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HomeMy WebLinkAboutRES NO 173-2022RESOLUTION NO. 173-2 02 2 A RESOLUTION ADOPTING A PUBLIC SAFETY & VITAL SERVICES MEASURE "N" FINANCIAL MANAGEMENT POLICY FOR THE CITY OF BAKERSFIELD WHEREAS, the City of Bakersfield receives locally controlled one -cent transactions and use tax revenue as a result of Measure N and Council -approved Ordinance No. 4958 ("Bakersfield Public Safety/Vital Services Measure Transactions and Use Tax Ordinance") which became effective on April 1, 2019, and has no sunset date; and WHEREAS, the City desires to establish a formal written policy to properly maintain fiscal stability and document the methods the City will use to demonstrate prudent financial management over Measure N tax revenue; and WHEREAS, the City Measure N tax revenues committed to personnel expenses shall not exceed sixty percent (60%), and ongoing cost allocations shall not exceed seventy percent (70%) of the proposed annual Measure N budget; and WHEREAS, the City Measure N ongoing costs are defined as those costs that represent a long-term commitment of 20 years, and that would have significant impacts on core services if those services were reduced, and as a result, would be the last costs to be removed from the City's budget; and WHEREAS, the City Measure N tax revenue above the amount needed to fund the Measure N Reserve, personnel expenses, and ongoing costs, will be allocated to one-time investments focused on maintaining and enhancing vital City services in direct alignment with City Council Goals; and WHEREAS, the City Budget and Finance Committee reviewed the City Public Safety & Vital Services Measure "N" Financial Management policy at its September 19, 2022, meeting and recommends Council adoption of the policy. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Bakersfield as follows: 1. The foregoing recitals are true and correct and incorporated in their entirety herein by reference. 2. The City of Bakersfield's "Public Safety & Vital Services Measure "N" Financial Management Policy" attached hereto as Exhibit "A" and incorporated herein by reference, is hereby adopted. o�eA` ,F,, -- Page 1 of 2 Pages 'ORIGINO ---------- 000--------- HEREBY CERTIFY that the foregoing Resolution was passed and adopted by the Council of the City of Bakersfield at a regular meeting thereof held on OCT 1 9 2022 , by the following vote: ✓ � ✓ ✓ ✓ OYES: COUNCIL MEMBER ARIAS, GONZALES, WEIR, &M44=i- FREEMAN, GRAY, P-ARH NOES: COUNCIL MEMBER ABSTAIN: COUNCIL MEMBER ABSENT: COUNCIL MEMBERS S YY\ 4A Qe-ti' 6t-(I APPROVED OCT 1 a 9f17.2 By O KAREN GOH Mayor APPROVED AS TO FORM: VIRGINIA GENNARO City Attorney B -)' J SHUA H. RUDNICK 4Deputy City Attorney JHR/ag Attachments: Exhibit A vv� &r�kzk;� J LIE DRIMAKIS, MMC CITY CLERK and Ex Officio Clerk of the Council of the City of Bakersfield -- Page 2 of 2 Pages -- �aAKE1n 0 a- m � r OORIGINAO EXHIBIT A 103 BAKERSFIELD Public Safety & Vital City Services Measure "N" Financial Management Policy POLICY STATEMENT AND PURPOSE 1. PURPOSE The City's Measure N Financial Management Policy documents the methods the City will use to demonstrate prudent financial management over Measure N tax revenue in conjunction with Council -approved Ordinance 4958 ("Bakersfield Public Safety/Vital Services Measure Transactions and Use Tax Ordinance") and Resolution 009-19 ("Established the Citizens Oversight Committee for the Bakersfield Public Safety/Vital Services Measure N"). This additional policy: • Establishes a Measure N Reserve Fund to address unforeseen revenue fluctuations, unanticipated expenditures, and similar circumstances; • Establishes a limit for ongoing cost expenditures; • Reiterates the spending priorities established by ordinance and establishes that future budget allocations will be prioritized based on City Council Goals; • Requires annual financial and compliance audits by the City's external independent auditors in addition to the City's. 2. BACKGROUND Voter approval of the City of Bakersfield's Public Safety and Vital City Services Measure (Measure N) in November 2018 authorized the implementation of locally controlled one -cent transactions and use tax which became effective April 1, 2019, and has no sunset date. The objectives of Measure N are "to maintain and enhance vital city services." Measure N contains thirteen (13) specific community spending priorities including: 1. Increasing police staffing to improve police response times, reduce crime, and increase neighborhood police patrols. 2. Improving rapid response to assaults and robberies. 3. Maintaining / improving rapid response to gang violence. Page 1 rn 90RICINAL ' EXHIBIT A 4. Investigating and proactively preventing property crimes, burglaries, and vehicle thefts. 5. Keeping public areas safe and clean. 6. Strengthening the capacity of the Special Enforcement Unit. 7. Expanding the School Resource Officer Program. 8. Maintaining a fully staffed and equipped Class II Rated Fire Department. 9. Reducing homelessness through partnerships with service providers to increase outreach, sheltering, and construction of affordable housing. 10. Addressing the fiscal stability of the City of Bakersfield. 11. Creating jobs through economic development, business retention/attraction, and workforce development. 12. Enhancing amenities throughout the community to improve the quality of life and attract visitors. 13. Enhancing neighborhoods through additional code enforcement and improved park maintenance. These 13 priorities guide all investments for enhanced City services, programs, and projects funded by Measure N. 3. POLICY 3.1 Measure N Reserve The City shall maintain a Measure N Reserve dedicated to mitigating the financial risk that can occur from the effects of unforeseen revenue fluctuations, unanticipated expenditures, and similar circumstances. The amount of money held in this reserve will be a stated percentage of budgeted operating expenses which is viewed as a reliable indicator of its ongoing needs. This is so that the City of Bakersfield reserve stays consistent with the size of the budget over time. The Measure N Reserve Policy will be governed by the same guidelines established in the General Fund Reserve Policy. The City's long-range forecasting model will be used to track the estimated growth of the annual budget and the related contribution requirements to stay within the established range of reserves. If the minimum reserve balance is not met during the forecast period, the Finance Director and/or Budget Officer will develop a plan to bring the reserve balance to the desired amount. This plan will be offered to the City Council's Budget and Finance Committee for consideration. 3.2 Ongoing Costs The intent for limiting Measure N Ongoing Cost allocations is to 1.) ensure that the City can sustainably fund current obligations into the future and 2.) preserve Measure N resources to fund strategic, large-scale one-time projects. ,;bAKF� F- rn Page 2 v o ORIGINAL EXHIBIT A • Measure N revenues committed to personnel expenses shall not exceed sixty percent (60%) and ongoing costs shall not exceed seventy percent (70%) of the proposed annual Measure N budget. • Ongoing Costs are defined as those costs that represent a long-term commitment (20 years); costs that would have significant impacts on core services if those services were reduced; costs that would be the last budget cuts that would be recommended by staff. • Ongoing Cost examples include personnel costs (salaries and benefits); contracts for services necessary for personnel to carry out their duties; contract services in support of core operations (i.e., Brundage Lane Navigation Center). • Measure N revenue, above the amount needed to fund the Measure N Reserve, personnel expenses, and ongoing costs, will be allocated to one- time investments focused on maintaining and enhancing vital city services and in direct alignment with City Council Goals. 3.3 Governance and Transparency Measure N revenue and expenditures should be transparent to the City Council, Measure N Citizens Oversight Committee, and Bakersfield residents. To achieve this transparency, Measure N resources will be accounted for and reported separately to facilitate review by the Council and the Citizens Oversight Committee. In addition, the Finance Director and/or Budget Officer shall report to Council and the Citizens Oversight Committee annually during the budget development process or other open meetings: • The funded status of Measure N Reserve. The City's annual financial and compliance audit will include revenues and expenditures for the Measure N Fund. Major events that occurred that will likely impact the future funded status of ongoing Measure N programs. OAKF Page OORIGINPI'