Thursday, July 24

City Hall

City Manager's Focus

It’s that time of the year for us - budget time. Each and every year Upland staff goes through the exercise of preparing a spending plan for the next fiscal year which runs from July 1st through to June 30th the following year. This spending plan covers every facet of City operations from providing police and fire services, to repairing the streets. Overall, the annual spending plan is approximately $100 million. Covered in the spending plan is $18.8 to deliver water, $15.7 for police services, $10.8 for fire services, $10.0 for sewer services, $7.3 million for housing, and $4.3 million for repairing the streets. These amounts cover roughly two-thirds of the spending plan. The remainder covers services like the library, animal services, park development, recreation programing, and other administrative areas within the City’s operations. The revenues that support the spending plan come from a variety of sources. Taxes and user fees make up the majority of the revenue Upland receives. Property taxes and sales taxes are the largest revenue sources the City receives. Approximately 17.5% of each dollar paid on property taxes comes back to Upland and approximately 12.5% of each dollar paid in sales taxes comes back. Other tax revenues include business license, transient occupancy (bed), franchise and rock taxes. User fees come in the form of charges for water, sewer and trash services. Other revenue sources include permits, money from other governmental agencies, charges for service, fines and rents. The budget process begins with departments preparing their individual spending plans for delivering the services they provide to the community. The spending plans will cover costs for personnel, materials, and equipment along with amounts for insurance, utilities, fuel, and maintenance of the equipment they use. Parallel with the departments preparing their individual spending plans, these same departments are working with Upland Finance staff to prepare estimates on revenues that will be used to fund the spending plans. These estimates are based upon economic data received from various sources including the State of California along with a gauge of activity in progress and/or planned within each department. Once the spending plans are compiled along with the revenue estimates, a comparison is made to see if the revenues exceed the amounts requested in the spending plan. In some cases, such as reconstructing a street, the amounts for a spending plan may be covered by amounts in a reserve which represents surpluses incurred in prior years; however, generally, spending plans are to never exceed the revenue. If this occurs, then the budget is considered to be “balanced”. Since the economic downturn in, roughly, 2008, it has been difficult to provide a balanced budget as the needs for services to the community have exceeded the revenues being generated. This causes multiple rounds of analyzing requested spending plans and paring down those plans to meet the amount of revenue available. Once the budget has been prepared, staff sends it to the City Council’s Finance Committee which consists of two City Council members and the City Treasurer for consideration. This Committee then makes a recommendation on either changing the budget or adopting the budget as presented to the entire City Council. The adoption of the budget usually occurs in June. The budget is reviewed monthly and adjusted as necessary. The Finance Committee and the City Council are presented with a formal “mid-year” review normally within the first couple of months of a new calendar year so staff can update the estimates and request the City Council to make adjustments accordingly. I will conclude by saying the City Council, along with myself and the entire City staff, pride themselves in delivering top notch services within the revenues received that support those services. The only limitation Upland staff has in addressing each and every need of the community is having enough money. That realization is no different than what takes place in our personal lives.