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Home My WebLink AboutAGENDA REPORT 2025 0808 CC SPC ITEM 05A POWERPOINTFinancial Workshop CITY OF MOORPARK AUGUST 8, 2025 Agenda •Structural Deficit •Financial Structure •Revenue Sources •Major Expenditures (General Fund) •Revenue Enhancement Options •Financing Options •Other Options Structural Deficit EST.PROPOSED PROPOSED PROJECTED PROJECTED PROJECTED PROJECTED PROJECTED PROJECTED PROJECTED PROJECTED Fiscal Year 2024-25 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32 2032-33 2033-34 2034-35 Revenues 25,980,183 25,825,301 25,931,451 26,385,600 26,847,600 27,319,600 27,802,600 28,296,600 28,801,600 29,315,600 29,840,600 Expenses 25,822,165 25,505,349 24,714,785 25,538,999 26,454,068 27,334,482 28,314,385 29,259,956 30,309,418 31,325,052 32,449,170 Surplus/ (deficit)158,017 319,952 1,216,666 846,601 393,532 (14,882)(511,785)(963,356)(1,507,818)(2,009,452)(2,608,570) $22 $24 $26 $28 $30 $32 $34 2024-25 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32 2032-33 2033-34 2034-35 MI L L I O N S 2025 10-Year Financial Plan GF Revenues GF Expenses Projected Deficit (FY 29/30) Major Budget Considerations •Park and Recreation Maintenance •$1.3 million average annual General Fund subsidy •Public Safety Costs •$1.1 million needed for additional 24/7 police beat ($400k already allocated for 40-hour downtown deputy) •Pavement Management Plan •$34.8 million needed to fix all streets over five-year period to a Pavement Condition Index (PCI) rating of 90 Fund Accounting To organize money into separate funds based on legal or policy restrictions to manage and track appropriately. Unrestricted General Fund Restricted Special Revenue Funds Capital Projects Funds General Fund Balance Savings Fiscal Year GF Balance Prior to Transfer Transfer to Special Projects Fund GF Balance After Transfer FY 2019-20 2,740,076.50$ 1,552,824.49$ 1,187,252.01$ FY 2020-21 4,972,267.06$ 3,966,847.06$ 1,005,420.00$ FY 2021-22 6,321,491.28$ 4,597,038.80$ 1,724,452.48$ FY 2022-23 5,062,137.77$ 3,562,744.67$ 1,499,393.10$ FY 2023-24*5,917,213.70$ 1,800,000.00$ 4,117,213.70$ Average Transfer: 3,095,891.00$ * FY 2023-24 - apporoximately $3 million was kept to pay down CalPERS Unfunded Liability. General Fund Revenues - Unrestricted •Property Tax •Sales Tax •Transient Occupancy Tax •Franchise Fees •Property Tax in Lieu of Vehicle License Fees •Investment Earnings •User & Regulatory Fees •Fines, Forfeitures, & Penalty General Fund Revenues - Unrestricted •Property Taxes include VLF •Grants and Donation may have restrictions Property Tax •Proposition 13 (1978) •Basic Property Tax is capped at 1% of Assessed Value or Purchase Price •Adjusted up to 2% annually •Moorpark receives total $0.09077 per property tax dollar •General Fund 78% Library Fund 22% Property Tax in Lieu of Vehicle License Fee •Prior to 2004, the rate was 2.0% of vehicle value •0.65% vehicle license fees •1.35% backfilled by the State General Fund •In 2004, the State reduced the rate down to 0.65% and discontinued backfill portion •Subsequently, replaced with a like amount of property taxes called Property Tax in Lieu of Vehicle License Fee (VLF) •Grows annually with growth in jurisdictions gross assessed valuation of taxable property Sales Tax Sales Tax is assessed on the total retail price of any tangible personal property. •Current Sales Tax – 7.25% •Basic State Sales Tax – 6% •Local City Operation – 1% •County Transportation – 0.25% •Cities above base rate of 7.25% •Ventura – 7.75% •Port Hueneme – 8.75% •Oxnard – 9.25% •Santa Paula – 9.25% Purpose Jurisdiction Rate State General Fund State 3.6875% State General Fund State 0.2500% Local Public Safety Fund State 0.5000% Local Revenue Fund (Health/Social)State 0.5000% Local Revenue Fund State 1.0625% Local City Operation Local 1.0000% County Transportation Funds Local 0.2500% Total Tax 7.2500% City Name Statewide Add-on General Purpose Add-on Infrastructure Total Tax Oxnard 7.25%1.50%0.50%8.75% Port Hueneme 7.25%1.50%8.75% Santa Paula 7.25%2.00%9.25% Ventura 7.25%0.50%7.75% Transient Occupancy Tax (TOT) •TOT is imposed to hotel guests staying for 30 days or less •Moorpark - 10% Franchise Fees •Fees are paid by utility companies for the right to operate in the public right-of-way. •Electric and Gas •Cable TV •Refuse Other Revenue •User and Regulatory Fees •Fines, Forfeitures, and Penalties •Investment Earnings •Contributions – Use of revenue may depend on nature and stipulation of gifts •Grants – Use of Grants typically restrict for specific purpose Special Revenue Funds - Restricted •Assessment Levy – Lighting & Landscape Maintenance District and Parks and Recreation Maintenance & Improvement District •Assessment Levies are annually calculated based on the maintenance and improvement cost; and restricted for specific area of benefits. •Grants (Federal and State): use is specified in each grant agreement •Gas Tax – city share of gas tax imposed under Street and Highway Code, 2103, 2105, 2106, 2107, and 2107.5 •Local Transportation Development Act (TDA) – ¼ cent of sales tax collected and allocated to the City •Solid Waste – funded by AB939 fees Special Revenue Funds - Restricted Development Impact Fees: one-time fees applied to new development projects for new construction •Park Facilities and Recreation •Library Facility – for Future expansion •City Hall •Police Facility •Transportation General Fund Major Expenses FY 2025-26 44% Contractual Services Public Safety Consulting Services 26% Salary and Benefits Salary: Full-Time Equivalent –78.5 Benefits: Retirement Plan, Health Insurance 18% Intergovernmental General Fund Subsidy Overhead Allocation 12% Other Expense Utilities Supplies, Maintenance Capital Projects, Capital Acquisition Cost-Saving Measures •Hiring freezes •Temporary furloughs •Overtime reduction (average annual overtime - $24,000) •Program and service level reductions •Travel and training reductions (citywide annual cost - $135,000) •Maintenance and capital reductions or deferments •Regional partnerships •Outsourcing non-core services •Technology improvements •Energy and utility efficiency Revenue Enhancement Options Property Tax on New Development City's Property Tax Revenue per $1 $0.09077 Desired Property Tax Increase $1,000,000 Total Assessed Value Needed $1,101,685,579 Assessed Value per house $800,000 Number of new houses needed 1377 •City receives small portion of property tax dollars ($0.09077). •It will take 1,377 new houses to increase $1 million in property tax if new houses are assessed at $800,000 each. Sales Tax Measure •The City may adopt additional increments of local sales tax. •A majority vote is required for general purpose add-on sales tax. •A two-third vote is required if the tax is designated for specific purpose(s). •An additional ¼ percent will generate approximately $1.1 million. Rate Total PASS FAIL Pass Rate 0.50%6 4 2 67% 0.75%3 2 1 67% 1.00%30 24 6 80% 1.50%1 1 100% Total 40 31 9 78% November 2024 Election Result shows 78% success on new add-on sales tax measures: Sales Tax Measure Sales Tax per capita Sales Tax per capita is the total amount of sales tax collected in a given year divided by the number of population. It shows, on average, how much sales tax revenue is collected for each resident. An additional ¼% increase will increase by $29.62 to $148.13. City Sales Tax Estimated Population Per Capita Add 1/4% Port Hueneme 1,782,421 20,838 85.54 Santa Paula 2,740,260 31,658 86.56 Moorpark 4,118,558 34,754 118.51 148.13 Simi Valley 20,486,378 124,815 164.13 Fillmore 3,187,876 17,035 187.14 Ventura 25,916,129 108,985 237.80 Thousand Oaks 31,034,158 122,468 253.41 Camarillo 17,485,253 68,927 253.68 Ojai 1,938,492 7,559 256.45 Oxnard 52,016,282 198,733 261.74 Sales Tax Measure - Steps 1.The City Council must pass an ordinance placing the tax measure on the ballot with a two-third vote (4 out of 5) of its members. 2.Comply with Proposition 218 requirements. a.It must be submitted to voters b.A simple majority is required for General Purpose and two-third vote on special purposes c.The ballot must specify the duration, Specific Period or Permanent 3.The measure must be placed on a regular general election ballot for government body elections, unless an emergency exception applies. Transient Occupancy Tax (TOT) Measure •The TOT Rate across California ranging from 8 % to 14% with 12% being common. •The current rate for Moorpark is at 10%. •City currently receives an average of $468,000 in TOT annual revenues. •An increase of 2% will generate additional $90,000. •In November 2024 election, 28 cities proposed for general purposes and 23 measures passed (82% success rate) Utility Users Tax Measure (UUT) Utility Users Taxes are imposed on residential and commercial use of electricity, natural gas, cable television, water, cellular phone, landline telephone, and trash services. •A majority vote is required for general purposes. FY 2022-23 Revenue City of Port Hueneme $ 1,224,556 City of Ventura $ 9,470,311 City of Calabasas $ 3,679,997 According to State Controller Report, City of Port Hueneme and City of Ventura reported UUT revenues. In November 2024 Election, Long Beach passed on expanding UUT on Gas while Santa Cruz’s measure failed. Community Facility Districts (CFD) Under the Mello-Roos Act, local agencies can form Community Facility Districts (CFDs) to levy special taxes on properties for use of public improvements. A two-thirds vote is required. City already has CFD formation included in existing development agreements. Park and Recreation Maintenance and Improvement District In 1999, the Park and Recreation Maintenance and Improvement District was reinstated. Due to 3% increase cap, maintenance cost outpaced revenue from assessment levy. Engineer’s report determined: •75% benefits Moorpark residents •25% benefits public at large Park and Recreation Maintenance and Improvement District Although the General Fund is required to contribute for minimum 25%, historical transfer to Park Maintenance Fund is over 50% of total Expense. To maintain 25% GF transfer ratios, an additional assessment of $570,000 is needed Fiscal Year Assessment Levy Other Revenue Operating Expense Shortage GF Transfer In GF % FY 2016-17 782,342$ 8,837$ (2,126,845)$ (1,335,666)$ 1,335,666$ 63% FY 2017-18 818,161$ 22,207$ (2,525,989)$ (1,685,621)$ 1,685,621$ 67% FY 2018-19 820,207$ 31,277$ (2,347,122)$ (1,495,638)$ 1,495,638$ 64% FY 2019-20 861,477$ 26,959$ (2,228,866)$ (1,340,430)$ 1,340,430$ 60% FY 2020-21 873,677$ 11,310$ (2,039,608)$ (1,154,621)$ 1,154,621$ 57% FY 2021-22 945,486$ 21,490$ (2,163,002)$ (1,196,027)$ 1,196,027$ 55% FY 2022-23 955,993$ 62,134$ (2,078,694)$ (1,060,566)$ 1,060,566$ 51% FY 2023-24 993,069$ 19,032$ (2,096,472)$ (1,084,371)$ 1,084,371$ 52% Park and Recreation Maintenance and Improvement District Analysis in January 2025 recommended additional $396,000 for Equipment Replacement Fund (ERF) annually. Total additional assessment needed - $861,200 ($62 per Single Family Equivalent Units (SFE)) An Additional Assessment of $62 will save $465,200 for GF Fiscal Year Assessment Levy Other Revenue Operating Expense Shortage GF Transfer In GF % FY 2023-24 $ 993,069 $ 19,032 $ (2,096,472)$ (1,084,371)$ 1,084,371 52% Additional Levy $ 861,200 $ (396,000)$ 465,200 $ (465,200) Total $ 1,854,269 $ 19,032 $ (2,492,472)$ (619,171)$ 619,171 25% Financing Options Financing Options General Obligation (GO) Bonds •GO Bonds are used to finance infrastructure projects, including roads and bridges. •The proceeds can not be used for operation. •Repayment through property taxes. •Requires two-third voter approval. Financing Options Tax Increment Financing •A tool used to pay for improvement in a specific geographical area. •Historically used by redevelopment agencies •Enhanced Infrastructure Financing Districts (EIFDs) •Community Revitalization and Investment Authorities (CRIAs) Financing Options Public-Private Partnerships (P3) Public-Private Partnerships are arrangements where local governments collaborate with the private sector to finance, build, and operate certain public services or infrastructure projects. •Reduced upfront Capital Cost •Transfer of operational and financial risks •Faster project delivery Comprehensive analysis including financial impacts and risks is essential. Examples: Facility construction, recreational services, etc. Other Options Economic Development Economic development efforts already underway to help increase city revenues by attracting new businesses, supporting business expansion, and creating jobs, which in turn generate more sales tax, property tax, and other local revenues. •Hotel attraction •High sales tax generating businesses •High paying jobs Questions?