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HomeMy WebLinkAboutFin Measure S and Measure ECITY OF/" ♦ • • No: 5. b] J ee • / i ' Department: Finance Prepared by: Marls Moses Finance Director City Manager • • • SUBJECT: 1 RESOLUTION ACCEPTING THE MEASURE OVERSIGHT FINAL REPORT AND , OVERSIGHT COMMITTEE I BACKGROUND: On August 5, 2013, the San Rafael City Council passed Ordinance 1913, establishing a new Transactions and Use Tax (TUT) subject to voter approval. On November 5, 2013, San Rafael .` i approved Measure E. This new, twenty-year San cent TUT became effective April 1, 2014, and supplanted the former Measure S one-half cent TUT, which had been in effect since Aprili and was originally scheduled to terminate on March 31, 2016. Similar to the •(Measureenabling • ordinance fi . ` E calls the creation of an independent oversight committee to review the collection and expenditure of this tax revenue. OversightThe purpose of this report is to (1) present and recommend acceptance of the final Measure S #! formally .Committee; members(3) recognize the .establish TUT Oversight Committee; direct staffo proceed with the application process i solicit community members for the Measure E TUT Oversight Committee. 0 SAN RAFAEL CITY COUNCIL AGENDA REPORT / Paye: 2 A) Measure S Oversight Committee The Measure S Oversight Committee met on January 9, 2014, to review the actual General Fund expenditures for fiscal year 2012-2013. The Committee's written report is attached to the first resolution that accompanies this staff report. The Committee focused on the activities of Police, Fire and Public Works and noted that "for the first time since the 2008/2009 fiscal year, the expenditures and budget for all three of the 'essential services' departments are essentially keeping up with the inflation adjusted 2005-2006 baseline year total expenditures for these departments" and, concluded that "Measure S funds are being property allocated." The Committee also observed that, due to the decline in total General Fund revenues and some operating costs that have exceeded inflation, some essential service levels have been reduced relative to the inflation-adjusted service levels of the 2005-2006 base year, despite increased efficiencies. Pursuant to the termination of the Measure S TUT, effective March 31, 2014, the Measure S Oversight Committee will be dissolved with the passage of this resolution. Resolution No. 11894, which established the Measure S Oversight Committee, requires its dissolution not more than six months after the termination of the Measure S TUT. Because the final,, audited financial reporting for fiscal year 2013-2014 is expected to occur more than six months after the termination of Measure S1 the responsibility for reviewing the partial year (nine months) of Measure S activity can be assigned to the Measure E TUT Oversight Committee who will be reviewing the first three months (April 1, 2014 — June 30, 2014) of Measure E activity at that time. B) Measure E Transactions and Use Tax (TUT) Oversight Committee Section 3.19.144 of the San Rafael Municipal Code requires the establishment of an Independent Oversight Committee: "A City Transactions and Else tax Committee, to be established by the City Council by Resolution, shall review the collection and expenditure of tax revenues collected under the authority of this Chapter. The committee shall consist ofat least 5 members, who shall be residents of the City. The terms of the Committee members and their specific duties shall be established by resolution of the City Council. 11 _C* The responsibilities and duties of the Committee are limited to the review of expenditures ot Measure E revenues to ensure the monies have been expended in accordance with the authorized purposes of Measure E. To complete this review, the Committee is expected to.* Understand allowable expenses of Measure E general tax funds (as ident*fied i ified i Section 3.19.080 of the Municipal Ordinance). I ii) Review documentation from City Council and from City Council -appointed advisory committees that pertain to the prioritization of use of Measure E Eeneral tax funds. iii) Review annual reports prepared by the City's Finance Department that track and document the spending of Measure E general tax funds. iv) Prepare and submit to the City Council and the community an annual public report on the expenditures of Measure E tax revenues for the previous fiscal year. (Committee Meetings will typically be held in the fall, for the fiscal year ending on the preceding June 3 0.) The Committee will also fulfill the remaining responsibilities of the Measure S Oversight Committee under Ordinance 1837: This activity includes the review of and reporting on the final expenditures of Measure S during fiscal year 2013-2014, through its termination on March 3 1, 20141 to ensure that monies have been expended consistent with the authorized purposes of Measure S. The Measure E TUT Oversight Committee shall have at least one meeting each year, and similar to the Measure S Oversight Committee,, will disband shortly after the enabling ordinance is *-1 repealed, ruled invalid or terminates under the provisions of the ordinance. All Committee members must be San Rafael residents and would serve staggered, four year terms. The full, proposed guidelines for the Measure E TUT Oversight Committee are attached to the second resolution included in this report. The resolution would formally establish this Committee and direct staff to initiate the application process. It is important to have the Committee in place ahead of the first audited reporting for the period that includes the initial collection of Measure E tax proceeds, which is not scheduled to occur prior to the fall. Working with the City Clerk's office, the application and appointment process can be conducted over the next 60 to 90 days. City Staff and City Council appreciate the hard work, dedication and support of the Measure S Oversight Committee, particularly during the difficult times in which Measure S revenues were falling and expectations were difficult to satisfy. In expression of gratitude for the seven members,, staff recommends the adoption of resolutions of appreciation for each current member. FISCAL IMPACT: There is no fiscal impact associated with the acceptance of the Measure 1, Oversight Committee report or the dissolution of the Committee. I Although there is some impact on staff time related to the development of the new, Measure E Transactions and Use Tax Oversight Committee, as well as ongoing involvement for preparing documents, research and meeting support. this will be accommodated using essentially the same resources as those used to support the Measure S Oversight Committee. 1) Approve the recommendations as reflected in this staff report. 2) Modif�r the Committee proposal and approve. 3) Request further information. 1 i 111, , J-g-i;l 3aigggim A) RESOLUTION ACCEPTING MEASURE OVERSIGHT REPORT i MEASURE OVERSIGHT i ! bum i i ,� A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAT"' 'I RAFAEL ACCEPTING THE MEASURE 'S' COMMITTEE FINAL REPJ RE OVERSIGHT ORI 0 AND DISSOLVING THE MEASUCOMMITTEE WHEREAS, on November 8, 2005, the voters of San Rafael approved a Transactions and Use Tax ("Measuremeasure amended the San Rafael Municipal Code to establish a 0.5% retail transaction and use tax within the City of San Rafael; and WHEREAS, the enabling ordinance required the appointment of an independent citizens' oversight committee whose purpose is to review the collection and expenditure of tax revenues collected under the authority of this ordinance; and WHEREAS, on January 9, 2014, the Committee met and reviewed the City's General Fund actual financial results for fiscal year 2012-2013, and issued a written report shortly thereafter; and WHEREAS, the Committee noted that, for the first time since the 2008/2009 fiscal year, actual expenditures for the three "essential services departments" (Police, Fire and Public Works) "are essentially keeping up with the inflation adjusted 2005-2006 baseline year total expenditures for these departments;" and WHEREAS, the Committee found that Measure 'S' revenues are being spent in a manner that is consistent with the Transactions and Use Tax Ordinance; and WHEREAS, the adoption of the Measure 'E' Transactions and Use Tax requires the early termination of the Measure 'S' Transactions and Use Tax, thus triggering the dissolution of the Measure S Oversight Committee. NOW, THEREFORE, BE IT RESOLVED, the San Rafael City Council accepts, as its fin I report, the January 9, 2014 report from the Measure 'S' Committee, a copy of which is hereb attached hereto as Exhibit A• by this reference made a part hereof. NOW, THEREFORE, BE IT FURTHER RESOLVED, the San Rafael City Council hereby dissolves the Committee and expresses gratitude to its members for their dedication and commitment. 1, ESTHER C, BEIRNE, Clerk of the City of San Rafael, hereby certify that the foregoing resolution was duly and regularly introduced and adopted at a regular meeting of the City Council of said City held on Monday the 7th day of April, 2014, by the following vote,, to wit: AYES: COUNCIL MEMBERS: Bushey, Colin, Connolly & Mayor Phillips NOES: COUNCIL MEMBERS: None ABSENT: COUNCIL MEMBERS McCullough ESTHER C. BEIRNE, City Clerk W:\Finance- Work Fi le\Councll Material\Resolutions\2014\Measure S comm 12-13 report- termination,doc EXHIBIT -- pg I City of San Rafael Measure S Oversight Committee Report Jan 9, 2014 Comparing the actual Genual fund expenditures for the fiscal year July 1, 212-2013 and the budgeted expenditures for the fiscal year July 2, 2013 - 2014 to the inflation adjusted 2005 - 2006 baseline year,,the Committee finds the following: Actual 12/13 vs base Budget 13/14 vs base Fire Department + I �/o +1.17% Police +1.02% Public Works 1-. 1- 1% -.04%, expenditureThe Police Department actual 12/13 numberactually lower not all of the amount of the 12/13 budget adjustedwas spent. If the entire Police Department budget for 12/13 had been 3.5`1/o below the spenc-, their expenditures Tvvnuuld have been ionly.Oi baseline inflationn to find tfor the first tima since the year, the expenditures nbudgets l three of theifessential ice � departments are essentially keeping up with the inflation adjusted 2005-u .0 S71 00--6 baseline year t, tal expe-nditures -f r the c department- B., this. "' n t " �--/Ieas-i re S - t d s :-- being *r-� �,,,r�` �'loa-e'" U oned' eless, di e �o s e.-raning co5t increases beyond inflai---ion; and rtf-.w' f�, ✓` .�, ,. .. . 3,...e. .ffi ..., `.,.i _- `+ter ..� .�. + �, +r � .�. ;,r^�. .�. � �. �..v. ;.�'w. s '- r �. �. �'ra > EXHIBIT A- pg '23 Lisp r,Qoldstein Fait, Y 4i Vice -Chair x Jackie Schmidt, Commiqee member _ . a v Luckhamn, l 4 $ire der Gu €st N'lPmber ✓ e: >a ntnr.?17 Samantha Sargent, tommittee Member m s RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL ESTABLISHING THE MEASURE 'E' TRANSACTIONS AND USE TAX OVERSIGHT COMMITTEE AND DIRECTING STAFF TO COMMENCE WIT THE APPLICATION PROCESS I WHEREAS, at the General Municipal Election held on NovemberSan Rafael voters approved amendments to Chapter 3.19 of i Rafael Municipal Code, providing for a new, City-wide Transactions and Use Tax, by passing Measure E with a majority of the votes cast in said election; and, WHEREAS, pursuant to Section 3.19.144 of Chapter 3.19, the City Council must establish a "City Transactions and Use Tax Committee to review the collection and expenditure of tax revenues collected under the authority of this Chapter;" and WHEREAS, pursuant to Section 3.19.144, the City Council has the authority to establish the terms of the committee members and the specific duties of the Committee; and, WHEREAS, the City Council desires to establish the Measure E Committee and the specific duties of the Committee; NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of San Rafael hereb establishes the Measure E Transactions and Use Tax Oversight Committee and establishes the responsibilities and duties of the Committee members as specifically delineated in Exhibit attached hereto and 'incorporated herein. FURTHER BE IT RESOLVED, that the City Clerk is directed to initiate the appointment process, inviting interested residents of the City of San Rafael to apply for appointment to the Transactions and Use Tax Oversight Committee. FURTHER BE IT RESOLVED, that the Transactions and Use Tax Oversight Committee shal] automatically disband no later than six (6) months after the end of the fiscal year in which the enabling ordinance is repealed, ruled 'Invalid or terminates under the provisions of the ordinance. 1, ESTHER C, BEIRNE, Clerk of the City of San Rafael, hereby certify that the foregoing resolution was duly and regularly introduced and adopted at a regular meeting of the City Council of said City held on Monday the 7th day of April, 2014, by the following vote, to wit: AYES.- Councilmembers: Bushey, Colin, Connolly and Mayor Phillips ABSENT: Council memhers: McCullough `2- ESTHER C. BEIRNE, City Clerk Measure E Committee Formation Exhibit A Page I Measure 'E' Transactions and Use Tax (TUT) Oversight Committee Guidelines and Policy 0 To ensure that all revenues received from the voter approved Transactions and Use Tax (Measure E) are spent on uses outlined in San Rafael Ordinance 1913. 11. Governing Authority for Committee Formation Section 3.1 9.144 of the San Rafael Municipal Code requires the establishment of an Independent Oversight Committee: "A City Transactions and Use Tax Committee, to be established by the City Council by Resolution, shall review the collection and expenditure of tax revenues collected under the authority of this Chapter. The committee shall consist of least 5 members, who shall be residents of the City. The terms of the Committee members and their specific duties shall be established by resolution of the City Council. '1, 111. Roles, Responsibilities and Duties A) The responsibilities and duties of the Committee shall be limited to: 1) Review expenditures of Measure E general tax revenues to ensure the monies have been expended in accordance with the authorized municipal purposes of Measure E. To complete this review, the Committee shall: i) Understand allowable expenses of Measure E general tax funds (as identified in Section 3.19.080 of the Municipal Ordinance) which states: The proceeds of the transactions and use tax imposed by this Chapter shall be deposited into the General Fund of the City to be usedfor all general government purposes which may include, but are not limited to, fire andpolice protection, street and sidewalk repair and maintenance, library services, park repair and maintenance, recreational programs, building and code enforcement services, planning and zoning services, capital equipment requirements, repair and re lacement of City p facilities, capital improvement projects, operational expenses, fiduciary responsibilities, administration, indebtedness and general obligations of the City. The tax imposed by this Chapter is intended to be and is, a general tax, the proceeds oV'wnich are to be spent as the Ci�y Council shall in its discretion, ftom time to time, determine. 11) Review documentation from City Council and from City Council -appointed advisory committees that pertain to the prioritization of use of Measure E general tax funds. ill) Review annual reports prepared by the City's Finance Department that track the receipt and spending of Measure E general tax funds. Measure E Committee Formation Exhibit A Pai4e 2 -I iv) Prepare and submit to the City Council and the community an annual public report on the expenditures of Measure E general tax revenues for the previous fiscal year. (Committee Meetings will typically be held in the fall, for the fiscal year ending on the preceding June 30.) 2) Fulfill the final responsibilities of the Measure S TUT Oversight Committee under Ordinance 1837: Review and report on the final expenditures of Measure S during fiscal year 2013-2014, through its termination on March 31, 2014, to ensure that monies have been expended consistent with the authorized purposes of Measure S. B) The Committee shall not have any budgetary decision authority, shall not allocate financial resourcesand shall not make budget or service recommendations to the City Council. C) The Committee shall not have authority to direct, nor shall it direct, City staff or officials. IV. Committee Structure: A) Appointments 1) The City Council shall make appointments to the Committee consistent with the established manner of appointing various City Commissions and related committee members. 2) The Committee shall be composed of five (5) members B) Qualification Standards Members of the Committee shall be at least 18 years of age and reside within the City limits. The Oversight Committee may not include any employee or official of the City,, or any vendor,, contractor or consultant doing business with the City. C) Term Committee members shall serve for a term of four years. Members' terms are to be staggered; The City Council will determine which three of the initial appointments will be for a two-year term. D) Chair and Vice -Chair The Mayor shall appoint the initial Chair. The Chair shall appoint the initial Vice -Chair. Thereafter., the Committee shall annually elect a chair and a Vice -Chair, who shall act as Chair only when the chair is absent. E) Compensation The Committee members shall serve without compensation. Measure E Committee Formation Exhibit A Page 3, F) Meetings 1) The Committee shall conduct at least one meeting each fiscal year. 2) Special meetings may be called by the Committee's chair. Special meetings may also b called by Committee members if three or more members petition the chair for a special meeting. I 3) All meetings shall be noticed and shall be open to the public in accordance with th Ralph M. Brown Act, Government Code Section 54950 et seq. Each member of th Committee will be given a current copy of the Ralph M. Brown Act. , I 4) A majority of the Committee members shall constitute a quorum for the transaction of any business. G) Vacancies and Removal 1) The City Council shall fill any vacancies on the Committee. 2) The City Council may remove any Committee member for any reason, including but not limited to, failure to attend two consecutive Committee meetings. Upon a member's removal, his or her seat shall be automatically deemed vacant. H) City Sup port_ The City shall provide the Committee with necessary technical and administrative assistance, including: 1) Preparation, provision and posting of public notices as required by the Brown Act and in the same manner as noticing City Council meetings. 2) Provision of a meeting room, including any available City audio/visual equipmenj 3) Provision of meeting materials, such as agendas, minutes and supporting reports. 4) Retention of Committee record.1- 5) Properly staff all Committee meetings. 6) Educate Committee members on municipal4� 1) Termination of Committee The Measure E TUT Oversight Committee shall automatically disband six (6) months after the end of the fiscal year in which the enabling ordinance is repealed,, ruled invalid or terminates under the provisions of the ordinance. The purpose of this time is to allow the Committee to complete its final report. W-Tinance- Work File"Accounting and Budgetina,\,Committees",Measure F Committee\1 committee set-up.doc CITY OF SAN RAFAEL a A a i® 0 A [ INSTRUCTIONS: USE THIS FORM WITH EACH SUBMITTAL OF A CONTRACT, AGREEMENT, ORDINANCE OR RESOLUTION BEFORE APPROVAL BY COUNCIL / AGENCY. SRRA / SRCC AGENDA ITEM NO. 5, b DATE OF MEETING: April 7, 2014 F !• M: Mark Moses DEPARTMENT: Finance DATE: March 2014 A) RESOLUTION ACCEPTING THE MEASURE S OVERSIGHT COMMITTEE)S FINAL REPORT AN DISSOLVING THE MEASURE S OVERSIGHT COMMITTE E I APPROVED AS COUNCIL / AGENCY AGENDA ITEM: Cit�o,ma-nager (signature) City Attorney (signature)