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HomeMy WebLinkAbout7242 RESOLUTION NO. 7242 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARCADIA, CALIFORNIA, MAKING CERTAIN FISCAL EMERGENCY FINDINGS WITH RESPECT TO THE GENERAL FUND MID-YEAR BUDGET REVIEW AND LONG RANGE FINANCIAL FORECAST PLAN WHEREAS, our residents choose to live in Arcadia because it offers a better quality of life and services than nearby communities; and WHEREAS, in keeping with Arcadia's strong tradition of careful spending and responsible stewardship of taxpayer dollars, since 1998, the City has reduced its operating costs by $3.4 million; and WHEREAS, the City of Arcadia has continued to be awarded with the Government Finance Officers Association ("GFOA") Certificate of Achievement for Excellence in Financial Reporting for the City's Comprehensive Annual Financial Report for the past 10 years; and WHEREAS, in 2011, the City of Arcadia implemented pension and benefit reforms, one of the first cities in the state to do so, saving millions of dollars for taxpayers; and WHEREAS, recent changes to state law have increased fiscal stress on cities like Arcadia, and have contributed to increased crime in our City; and WHEREAS, in December 2016, the PERS Board of Administration approved lowering the pension fund's discount rate assumption, reducing the expected long-term rate of return from 7.5% to 7.0%, significantly increasing employer contributions to the fund; and WHEREAS, the City of Arcadia has nearly $63.4 million in unfunded capital improvement project needs, and current and projected revenues are insufficient to maintain the City's infrastructure; and 1 WHEREAS, in Fiscal Year 2016-17, the City of Arcadia began projecting future deficits in the General Fund which could undermine the City's ability to maintain current 911 emergency response times, to maintain police and fire protection, and to reduce property crimes like home break-ins, thefts and burglaries; and WHEREAS, in Fiscal Year 2017-18, the City Council of the City of Arcadia created a Citizens Financial Advisory Committee, an ad-hoc advisory body of civic volunteers empaneled by the City Council to review the City's General Fund long-range financial forecast and provide recommendations to the City Council for cost containment and/or revenue enhancements strategies; and WHEREAS, in Fiscal Year 2018-19, for the first time in decades, the City Council of the City of Arcadia adopted a deficit budget of $3.1 million in the General Fund, with total sources (revenue) of $64.4 million and total uses (expenses) of$67.5 million; and WHEREAS, the Citizens Financial Advisory Committee found that the City's General Fund deficit is projected to increase to $8.0 million by Fiscal Year 2024-25; and WHEREAS, police and fire services comprise over 60% of the City's General Fund budget, and unless more revenue is generated to balance the budget, nearly two dozen police officer, firefighter, and paramedic positions could be cut and the fire station in North Arcadia could be closed, affecting neighborhood police patrols and 911 emergency response times; and WHEREAS, in 2017, Arcadia had the highest number of home break-ins and neighborhood property crime in recent history, at the same time that state law allowed early release of prisoners; and 2 WHEREAS, the City currently has five fewer police officers than it did in 2008; and WHEREAS, with property crime continuing to be a concern and the recent effects of wildfires seen throughout the state, the City can ill afford a reduction in neighborhood patrols, fire coverage, and lifesaving response times; and WHEREAS, the Citizens Financial Advisory Committee found that more locally- controlled revenue is necessary to address the City's budgetary shortfall in order to maintain 911 emergency response times, to maintain local fire and police protection and paramedic services, and to maintain the City's finances; and WHEREAS, the Citizens Financial Advisory Committee recommended that the City Council declare a fiscal emergency and submit a ballot measure to Arcadia voters seeking their approval of a 3/4% general sales tax increase; and WHEREAS, on January 15, 2019, the City Council of the City of Arcadia unanimously adopted the recommendations contained in the Citizens Financial Advisory Committee Final Report issued on December 13, 2018; and WHEREAS, Proposition 218 (California Constitution, Article XIIIC, Section 2(b)) permits the City Council to call a special election to impose, increase or extend a general tax, only if the City Council finds, by a unanimous vote, that there exists an emergency requiring a special election to be conducted earlier than the next regularly scheduled general election at which City Council members are to be elected (April, 2020); and WHEREAS, the Fiscal Year 2018-19 midyear budget projections show that the City of Arcadia is still in a budget deficit for this fiscal year and is still projecting budget deficits through the 10-year term of the City's General Fund Long-Range Financial Forecast; and 3 WHEREAS, should additional revenues not be available, as the City begins to plan for the Fiscal Year 2019-20 budget, the City Council wants to ensure that the public is aware of this fiscal emergency as the City explores necessary cuts to services that it will be forced to make, including public safety, which will have a negative impact upon the public peace, health, safety, and welfare of the Arcadia community. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ARCADIA, CALIFORNIA, HEREBY RESOLVES AS FOLLOWS: SECTION 1. The City Council finds that all of the preceding recitals are true and correct, are incorporated herein by this reference and are made an operative part hereof. SECTION 2. Pursuant to California Constitution, Article XIIIC, Section 2(b), the City Council hereby unanimously declares the existence of an emergency in that there are imminent financial risks and dangers, as described above, to the public welfare and the City's financial ability to provide municipal services at current levels and without disruption, so that a special election is necessary to address such risks and dangers. At a later meeting, the City Council may, by unanimous vote, call a special election seeking voter approval of a general sales tax increase in a manner consistent with the City Charter, California law and this Resolution. SECTION 3. The City Clerk shall certify to the adoption of this Resolution. [Signatures on the next page] 4 Passed, approved and adopted this 5th day of February , 2019. Mayor of the Cit of Arcadia ATTEST: / 4erk _..6,- _ APPROVED AS TO FORM: Stephen P. Deitsch City Attorney 5 STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) SS: CITY OF ARCADIA ) I, GENE GLASCO, City Clerk of the City of Arcadia, hereby certifies that the foregoing Resolution No. 7242 was passed and adopted by the City Council of the City of Arcadia, signed by the Mayor and attested to by the City Clerk at a regular meeting of said Council held on the 5th day of February, 2019 and that said Resolution was adopted by the following vote, to wit: AYES: Amundson, Beck, Chandler, Verlato, and Tay NOES: None ABSENT: None -�\ Ci Clerk of th'ty of Arcadia 6