CC - Item 5B - FY 2021-22 Mid-Year Budget Review, Adoption of Resolution No. 2022-13, Amending the FY 21-22 Budget & Related Actions, & Adoption of Resolution No. 2022-15, Authorizing the City Manager to Execute Certain Agreements Related to LRSP ProjectROSEMEAD CITY COUNCIL
STAFF REPORT
TO: THE HONORABLE MAYOR AND CITY COUNCIL
FROM: GLORIA MOLLEDA, CITY MANAGER J. 0
DATE: FEBRUARY 22, 2022
SUBJECT: FISCAL YEAR 2021-22 MID -YEAR BUDGET REVIEW, ADOPTION OF
RESOLUTION NO. 2022-13 AMENDING THE FY 2021-22 BUDGET AND
RELATED ACTIONS, AND ADOPTION OF RESOLUTION NO. 2022-15
AUTHORIZING THE CITY MANAGER TO EXECUTE CERTAIN
AGREEMENTS PERTAINING TO THE LOCAL ROADWAY SAFETY
PLAN PROJECT
BACKGROUND
On June 14, 2021, the City Council adopted the 2021-22 Operating and Capital Improvement
Program Budgets. On November 9, 2021, the City Council was presented with a Pt Quarter
Budget Report including recommended budget amendments for the Capital Improvement Program
project funding carryovers. This report summarizes the City's General Fund overall financial
position for the current fiscal year through December 2021 including a discussion on revenue
sources and expenditure trends. The estimates stated within are just that, estimates, and are subject
to change as the current fiscal year continues. This report will also cover recommended mid -year
budget adjustments.
SUMMARY
The adopted General Fund operating budget includes appropriations of $26.3 million against
revenue estimates of $25.6 million, including a $1.5 million transfer from the American Rescue
Plan Act (ARPA) fund, resulting in a projected use of fund balance in the amount of $752
thousand. At the time of adoption, the budget was balanced, however, with the adoption of
Resolution No. 2021-22 approving $766 thousand in carryover funding for previously funded
capital improvement program projects, the General Fund current year budget was placed in a
deficit position. As shown in the following chart (Table 1), FY 2021-22 operating revenue
(excluding the transfer in) was estimated at $2 million greater than the prior year (FY 2020-21)
budgeted estimate and $798 thousand more than the prior year actuals at year-end. Appropriations,
excluding capital improvements, are $922 thousand more than the prior year budget and $3.76
million more than the FY 2021-22 actual expenditures. Based on year-end estimates, staff
anticipates revenue will exceed original estimates by nearly $2.1 million while operating
expenditures will fall $1.2 million below budgeted levels.
AGENDA ITEM 5.11
City Council Meeting - FY 2021-22 Mid -Year Budget Review
February 22, 2022
Page 2 of 12
Table 1
DISCUSSION
REVENUE
As adopted, the City's FY 2021-22 revenue budget reflects $24.1 million in anticipated operating
revenue and $1.5 million from a transfer -in from the ABPA fund. Year-end estimates reflect
$26.05 million in operating revenue, which is nearly $2.1 million more than the budgeted revenue
amount. The estimates are based on current receipts through December 31St, comparison to the
same period in the prior year, revenue received after the mid -point, and anticipated revenue based
on actual to mid -year receipts for the prior year and known events. The following narrative and
projections, while accurate to the best of staff's present understanding, must be viewed as subject
to reconsideration as second half receipts become known and pandemic conditions continue.
As shown in Table 2, General Fund revenue received as of December 2021 is only 29% of the
estimated revenue for FY 2021-22 at 50% of the year. This is typical due to revenue sources that
are received in July and August that are accrued back to the prior fiscal year and other large revenue
sources that are received on a quarterly, bi-annual, or annual basis. As reflected in Table 2, overall
General Fund revenues are trending ahead of the same reporting period (December) in FY 2020-
21 for most categories with actual receipts $1.7 million more than the same period in the prior
year.
Table 2
Revenue by
FY 2020-21
FY 2020-21
% Rec'd
FY 2021-22
% Redd
SUMMARY
Total Final
YTD Activity
Thru
FY 2020-21
FY 2021-22
YTD Activity
Thru
Year End
Category
Budget
Through Dec
DEC
Actuals
Total Budget
Through Dec
DEC
Estimate
Revenue
22,040,400
5,318,100
24%
23,289,100
24,087,500
7,046,500
29%
26,147,750
Transfer In
-
-
0%
-
1,500,000
-
0%
250,650
Approp/Exp
24,618,550
9,264,900
38%
21,749,700
25,514,200
10,752,300
42%
24,297,000
CapitalImpr
29,500
35,300
120%
160,100
825,760
1,500
0%
413,000
Use of Money and Property
(2,607,650)
(3,982,100)
36%
1,379,300
(752,460)
(3,707,300)
42%
1,437,750
DISCUSSION
REVENUE
As adopted, the City's FY 2021-22 revenue budget reflects $24.1 million in anticipated operating
revenue and $1.5 million from a transfer -in from the ABPA fund. Year-end estimates reflect
$26.05 million in operating revenue, which is nearly $2.1 million more than the budgeted revenue
amount. The estimates are based on current receipts through December 31St, comparison to the
same period in the prior year, revenue received after the mid -point, and anticipated revenue based
on actual to mid -year receipts for the prior year and known events. The following narrative and
projections, while accurate to the best of staff's present understanding, must be viewed as subject
to reconsideration as second half receipts become known and pandemic conditions continue.
As shown in Table 2, General Fund revenue received as of December 2021 is only 29% of the
estimated revenue for FY 2021-22 at 50% of the year. This is typical due to revenue sources that
are received in July and August that are accrued back to the prior fiscal year and other large revenue
sources that are received on a quarterly, bi-annual, or annual basis. As reflected in Table 2, overall
General Fund revenues are trending ahead of the same reporting period (December) in FY 2020-
21 for most categories with actual receipts $1.7 million more than the same period in the prior
year.
Table 2
Revenue by
FY 2020-21
FY 2021-22
Category
FY 2020-21
YTD Activity
% Rec'd
FY 2020-21
FY 2021-22
YTD Activity
% Rec'd
Year End
Category
Total Budget
Through Dec
Thru Dec
Actuals
Total Budget
Through Dec
Thru Dec
Estimate
Taxes
17,842,700
3,627,800
20%
19,047,400
19,732,300
4,289,600
22%
20,692,400
Intergovernmental
353,700
92,000
26%
456,600
155,000
136,200
88%
250,650
Licenses And Permits
1,835,500
947,500
52%
2,364,800
2,246,000
1,703,200
76%
3,292,300
Fines and Forfeitures
645,300
332,300
51%
620,800
624,300
249,600
40%
560,300
Use of Money and Property
421,000
151,300
36%
268,000
385,700
162,900
42%
414,200
Charges for Svcs
806,900
102,200
13%
427,500
338,700
261,700
77%
406,100
Other Revenue
135,300
65,000
48%
104,000
605,500
243,300
40%
531,800
Total -Gen'l Fund Operating Rev
22,040,400
5,318,100
24%
23,289,100
24,087,500
7,046,500
29%
26,147,750
Transfers In
-
-
0%
-
1,500,000
-
0%
-
TOTAL -General Fund Sources
22,040,400
5,318,100
24%
23,289,100
25,587,500
7,046,500
28%
26,147,750
City Council Meeting — FY 2021-22 Mid -Year Budget Review
February 22, 2022
Page 3 of 12
Tax revenue, as budgeted, represent 82% of all General Fund operating revenue followed by 9%
in the Licenses and Permits category. Based on year-end projections, significant increases in the
Licenses and Permits category fee-based programs resulted in the tax category decreasing to 79%
of total year-end estimates and the Licenses and Permit category increasing to 13%. Since taxes
are the most significant component of the City's revenue structure, this report focuses mostly on
that category as presented below with summary information for all other categories. Overall, taxes
are budgeted at $19.7 million, and (based on preliminary information) are projected to end the
fiscal year at $20.7 million, an increase of nearly $1.0 million.
Table 3
Taxes
Tax Description
FY 2020-21
FY 2020-21 YTD Activity
Total Budget Through Dec
%Rec'd
Thru Dec
FY 2020-21
Actuals
FY 2021-22
FY 2021-22 YTD Activity
Total Budget Tluough Dec
%Reed
Thru Dec
Year End
Estimate
Property Taxes
3,060,000
1,288,100
42%
3,463,900
3,473,000
1,290,300
37%
3,518,000
Property Tax In LieuNLF
7,097,000
-
0%
7,200,300
7,344,300
-
0%
7,374,600
Sales and Use Tax
4,603,200
1,749,800
38%
5,534,200
5,759,800
2,138,400
37%
6,204,800
Transient Occ Tax
1,800,000
348,900
19%
1,405,400
1,600,000
553,100
35%
2,000,000
Business Licenses
102,000
50,500
50%
128,200
205,200
108,000
53%
210,000
Franchise Fees
1,180,500
190,500
16%
1,315,400
1,350,000
199,800
15%
1,385,000
17,842,700
3,627,800
20%
19,047,400
19,732,300
4,289,600
22%
20,692,400
Property Taxes — Based on projections by the City's property tax consultant, HdL Companies, and
a review of other components such as prior year payments, late fees, transfer taxes, and residual
RPTTF (Redevelopment Property Tax Trust Fund — Successor Agency) revenue, staff estimates
property taxes will complete the year at $3.5 million, a $45 thousand increase over the budget.
The secured and unsecured estimate is provided by HdL, however, estimates for the other
components are prepared by staff based on trends. Accordingly, prior year and transfer tax
revenue, is trending ahead of prior year receipts, while the RPTTF revenue appears that it will
complete the year within the budgeted estimate but below last year's actual. The RPTTF is
calculated by the County based on property taxes collected within the Successor Agency areas less
required payments for continuing obligations — ROPS and passthrough agreements. The amount
remaining after these paying obligations is then distributed to taxing agencies including a portion
to the City of Rosemead. Payments are received outside of the mid -year reporting period (January
and June), however, the January payment has been received and is less than the payment received
one year ago.
Property Tax In -lieu — Based on growth in assessed value, this revenue is remitted to the City in
two equal payments in the third and fourth quarter of the year. Although no revenue was received
within the reporting period of this report, the first payment was received in January and indicates
the year-end receipt will be $7.37 million, $30 thousand over the budgeted estimate and $174
thousand more than the amount received in FY 2020-21.
City Council Meeting — FY 2021-22 Mid -Year Budget Review
February 22, 2022
Page 4 of 12
Sales Tax — Based on projections by the City's sales tax consultant, HdL Companies, the year-end
estimate is $6.2 million which is an increase of $445 thousand over the budgeted estimate and
$671 thousand greater than the amount received in FY 2020-21. Current receipts are also nearly
$400 thousand greater than the same period one year ago.
Transient Occupancy Tax (TOT) — Receipts from TOT have been significantly impacted by the
pandemic. Revenue received in both FY 2017-18 and FY 2018-19 topped $2.3 million and was
budgeted to receive $2.4 million in FY 2019-20. Due to the pandemic, receipts for FY 2019-20
fell to $1.78 million and final receipts for FY 2020-21 fell further, to just $1.4 million — $400
thousand below budget. The FY 2021-22 budget estimate anticipated an increase over the FY
2020-21 receipts but were still estimated at a reduced amount of $1.6 million. While the pandemic
lingers, revenue in this source has started to rebound and is now estimated to complete the year at
$2.0 million.
Business License Fees — Due to the pandemic, the City Council authorized the 50% reduction of
business license fees for FY 2020-21, which in turn, reduced the City's annual revenue for this
source by 50%. With the return of the full fee structure and based on current receipts collected
through December 31, staff is anticipating a minimal increase of less than $5 thousand over the
budgeted amount of $205 thousand.
Franchise Fees — The largest contributors to this category (SCE and So Cal Gas) are received in
the second half of the fiscal year and are not typically impacted by pandemic conditions. The year-
end estimate of $1.385 million is based on the FY 2020-21 year-end actuals and current receipts.
The Licenses and Permits category includes Building Permits, Plan Checking, Industrial Waste
Permits, Public Works Permits, and Animal Licenses. The largest source in this category is
Building Permits/Plan Checking, which is budgeted at $1.7 million, an increase of $440 thousand
over the prior year budget but $215 thousand less than the prior year-end actual. Based on current
receipts of nearly $1.5 million, staff estimates revenue for Building Permit/Plan Checking could
reach $2.8 million by year-end. It is important to note, however, that 47% of this revenue is paid
to the contract service provider therefore, this $1.1 million increase actually results in only a $583
thousand net increase to the General Fund. The category as a whole, is estimated to complete the
year $1.05 million over the budgeted estimate.
Fines and Forfeitures are estimated to complete the year at $560 thousand, slightly less than the
budgeted $624 thousand based on current actuals.
Use of Money and Property which consists of Interest Earnings, Rents and Royalties, and Facilities
Rentals is estimated at $414 thousand, up from the budgeted $386 thousand based on an increase
to actual and anticipated Parks and Recreation facilities rentals.
Charges for Services is the category that remains most impacted by the pandemic but is seeing
some recovery. Parks and Recreation revenue is budgeted at $152 thousand and at mid -year point
has exceeded that amount by $12 thousand. Staff estimates that by year-end, revenue will reach
City Council Meeting — FY 2021-22 Mid -Year Budget Review
February 22, 2022
Page 5 of 12
nearly $240 thousand. While an improvement over the past two years, it is still significantly less
than the $675 thousand received in FY 2018-19, prior to the pandemic. Overall, the category of
`Charges of Services' which includes City Clerk, Community Development, Public Works, and
Parks and Recreation, is budgeted at $33 8 thousand and estimated to end the year at $406 thousand,
an improvement of $67 thousand over the budgeted number.
Other Revenue is a catch-all category for miscellaneous type revenue with a budget estimate of
$605 thousand. The largest sources within this category, is the reimbursement for the School
Resource Officer budgeted at $137 thousand, the crossing guard reimbursement budgeted at $104
thousand, and the reimbursement from other agencies (HCD and SA) at $339 thousand. The
contract for the School Resource Officer was not renewed as anticipated and therefore the revenue
estimate for year-end is zero. The crossing guard reimbursement is for 50% of the -City's cost of
the crossing guard contract service and there is no adjustment recommended to the budgeted
estimate at this time. The reimbursement from other agencies is an internal accounting process for
the payment of services provided to the CDC and SA each year. Overall, the category is estimated
to complete the year $74 thousand below the budgeted estimate.
APPROPRIATIONS / EXPENDITURES
At the halfway point of the Fiscal Year (December 31, 2021), overall General Fund appropriations
are only 41% expended as shown in Tables 4 and 5. As shown in Table 4, all actual expenditures
as of December 31St by category are within an acceptable range of year-to-date expenditures in
relation to the total appropriation for the year.
Table 4
Budget& Expenditures
by Category
FY2020-21
Total Budget
FY2020-21
YTD Thru Dec
%Fxp'd
Thru Dec
FY 2020-21
Total Activity
FY2021-22
Total Budget
FY 2021-22
YTD Thru Dec
%Exp'd
Thru Dec
Salary and Benefits
7,728,300
3,266,700
420/-
6,271,600
8,433,300
3,579,400
420/-
2%Operations
Operations
5,739,650
1,676,100
29%
4,606,200
5,158,050
1,685,300
33%
Contract Police Svcs
8,915,300
2,713,500
30%
8,737,500
9,296,700
3,846,300
41%
UtiU Ins / Allocations
2,010,300
1,599,200
80%
2,101,600
2,360,600
1,639,700
69%
Capital Assets/Projects
254,500
44,700
18%
192,900
1,091,310
3,100
0%
24,648,050
9,300,200
38%
21,909,800
26,339,960
10,753,800
41%
• Salary and Benefits — These costs are 42% expended at 50% of the year due to vacancies and
budgeted step increases due later in the fiscal year. It is anticipated that expenditures in this
category will exceed the budgeted amount by year end due to the implementation of negotiated
salary and benefit increases but will be offset by savings within other categories.
• Operations — Expenditures in the `Operations' category are also below the 50% level but
marginally higher, percentage wise, than the same time period last year, however, the dollar
values of expenditures are nearly equal between the two years.
City Council Meeting - FY 2021-22 Mid -Year Budget Review
February 22, 2022
Page 6 of 12
• Contract Police Services - The year-to-date total for Contract Police Services represents only
five months of billings at the mid -year point and on target to meet the budgeted amount.
• Utilities / Insurance / and Allocation - This category is 69% expended due to the required full
payment of annual insurance premiums in July each year.
• Capital Assets / Capital Improvement Program - This category was initially budgeted at $326
thousand but was amended to include $766 thousand in carryover funding for CIP projects
funded by the General Fund. As of December 31St, only a minimal amount has been spent,
however, City Council just awarded the $200 thousand contract for a mobile stage and Public
Works is working towards expanding its efforts on the CIP.
Table 5 shows that most Departments are also below 50% expended at Mid -Year. It is anticipated
that most departments will complete the year within or under budget and that overall, general fund
final expenditures will be well below the budgeted amount for the fund. Since most departments
are within or below the 50% range, only those that significantly deviate from the 50% mark will
be discussed herein.
Table 5
• City Attorney - The budget for City Attorney operations were increased for FY 2021-22 from
$254 thousand budgeted in 2020-21 to $305 thousand for FY 2021-22 to better reflect past
actuals. This increase, however, is insufficient for the current fiscal year due to the added cost
of labor negotiations. It is estimated that departmental expenditures may exceed the budgeted
amount by year-end which will be covered by savings in other areas of the General Fund.
• Ci , Clerk -The City Clerk's Office is currently 83% expended as of December 31St, due to
the payment of insurance premiums discussed above. As reflected in the Chart, the Department
FY 2020-21
FY 2021-22
Budget & Expenditures
FY 2020-21
YTD Thru
%Exp'd
FY 2020-21
FY 2021-22
YTD Thru
%Exp'd
by Department
Budget
Dec
Thru Dec
Actuals
Total Budget
Dec
Thru Dec
City Council/Commissions
424,600
168,900
40%
345,700
427,300
180,600
42%
City Attorney
254,400
79,400
31%
333,300
304,600
215,500
71%
City Clerk
952,900
729,700
77%
914,000
1,212,300
1,004,700
83%
Administration
1,334,400
642,500
48%
1,262,300
1,464,600
602,200
41%
Finance
570,700
209,500
37%
421,600
738,400
359,400
49%
General Services
1,164,000
311,500
27%
764,100
989,800
471,600
48%
Public Safety
10,541,000
3,571,500
34%
10,265,600
11,097,100
4,615,400
42%
Public Works
4,077,800
1,988,700
49%
3,976,000
4,034,050
1,618,100
40%
Parks & Rec
3,387,350
827,500
24%
1,698,900
3,517,550
1,015,200
29%
Community Development
1,911,400
735,700
38%
1,768,200
1,728,500
669,600
39%
TOTAL - GF Operating
24,618,550
9,264,900
38%
21,749,700
25,514,200
10,752,300
42%
Capital Projects
29,500
35,300
120%
160,100
825,760
1,500
0%
TOTAL - General Fund
24,648,050
9,300,200
38%
21,909,800
26,339,960
10,753,800
41%
• City Attorney - The budget for City Attorney operations were increased for FY 2021-22 from
$254 thousand budgeted in 2020-21 to $305 thousand for FY 2021-22 to better reflect past
actuals. This increase, however, is insufficient for the current fiscal year due to the added cost
of labor negotiations. It is estimated that departmental expenditures may exceed the budgeted
amount by year-end which will be covered by savings in other areas of the General Fund.
• Ci , Clerk -The City Clerk's Office is currently 83% expended as of December 31St, due to
the payment of insurance premiums discussed above. As reflected in the Chart, the Department
City Council Meeting — FY 2021-22 Mid -Year Budget Review
February 22, 2022
Page 7 of 12
was also 77% expended at this same point in the previous fiscal year and for the same reason.
• Public Works — Department expenditures for Public Works are currently at 40% expended due
primarily to a delay in billing for engineering services. It is anticipated that the department
will complete the year near the budgeted amount.
• Parks and Recreation — As the pandemic continues, the Parks and Recreation Department
continues to be the most impacted in both lost revenue and reduced expenditures. As shown,
department expenditures are at 29% at December 31, which is a slight improvement from the
prior year but still significantly under budget at the mid -year point. Expenditures for FY 2020-
21 completed the year at 50% of the budgeted amount. Staff estimates that the department will
complete FY 2021-22 expending approximately 60% of its budget, approximately $2.1 million
which is $1.4 million below the budgeted amount.
• Community Development — Expenses for Community Development reflect 39% expended at
the mid -point, however, this is not indicative of how the year is anticipated to finish. The
lower percentage spent is due to the continued vacancy of the department director and a delay
in billing from the contract building and safety services provider. Ultimately, as indicated
within the revenue section, due to an anticipated increase in building revenue, the calculated
fee could increase by over $500 thousand, and the department could exceed its budget by $275
thousand.
In summary, General Fund revenues are coming in well and are anticipated to exceed budgeted
expectations, while expenditures are within budgeted range and anticipated to complete the year
under budget. If projections are met, the General Fund will complete the year in a positive position
without the approved transfer from the ARPA fund. It should be noted, however, that the City has
been able to balance its budget by restricting necessary budget growth, stagnate employment
growth which further restricts the development of new or improved services, and underfunding
needed infrastructure maintenance and capital improvements within the community.
OTHER FUNDS
Although the focus of this report is the General Fund, a review of all other funds has also been
reviewed and there are no concerns to report at this time. In fact, revenue sources are coming in
strong, and expenditures are low for the majority of the special revenue funds. There are, however,
a few miscellaneous items requiring budget amendments that are reflected later in this report under
"Recommended Budget Amendments" including transactions for the grant described below and
capital improvement program changes as discussed in the CIP section of this report.
Grant Award — In 2021, Caltrans released a Local Roadway Safety Plan (LRSP) Grant for the
development of a framework to identify road safety needs and recommend improvements. An
LRSP will be preferred or required of all agencies to be eligible to apply for federal HSIP funds.
The city applied for the LRSP grant and was awarded $48,000. There is a local match requirement
of $5,334 which will be funded within the departments current budget. The LRSP grant only funds
City Council Meeting — FY 2021-22 Mid -Year Budget Review
February 22, 2022
Page 8 of 12
a study and there is no right-of-way or construction involved. Caltrans requires that the City
execute a Program Supplemental Agreement for Project LRSPL-5358(021) and a State Master
Agreement. A certified resolution clearly identifying the representatives authorized to sign grant
documents on the City's behalf is also required to be submitted prior to an approved Finance Letter
from the state. Staff is recommending that the City Council authorize the City Manager to execute
the applicable agreements and adopt a certified resolution.
AMERICAN RESCUE PLAN ACT (ARPA)
On March 11, 2021, the $1.9 trillion American Rescue Plan Act (ARPA) was signed into law and
established the Coronavirus State Fiscal Recovery Fund and Coronavirus Local Fiscal Recovery
Fund, which together make up the Coronavirus State and Local Recovery Funds (SLFRF)
program. The SLFRF program provides $350,000 billion in emergency funding and is intended
to provide support to State, territorial, local, and Tribal governments in responding to the economic
and public health impact of COVID-19 and their efforts to alleviate impacts on their communities,
residents, and businesses. Under the SLFRF program, the City of Rosemead was allocated
$17,878,653 in one-time funding to cover eligible costs incurred between March 3, 2021 and
December 31, 2024. The funds must be fully expended by December 31, 2026.
On January 6, 2022, the U.S. Department of the Treasury issued the Final Rule on the use of
Coronavirus State and Local Fiscal Recovery Funds (SLFRF) and on January 25, 2022, the City
Council received a presentation by staff outlining details of the allowable uses which include (1)
to replace lost revenue; (2) to respond to the public health and economic impacts of COVID-19;
(3) to provide premium pay to eligible workers, and (4) to invest in water, sewer, and broadband
infrastructure.
The least restrictive of the categories is the `Public Sector Revenue' category which allows cities
to replace revenue lost due to the pandemic and then use the funds for any governmental purpose.
The Final Rule provided clarification on the lost revenue calculation and provided the option of
selecting either a flat $10 million (up to the grant amount) or the actual revenue loss based on
SLFRF calculation factors. The preliminary analysis indicated the City of Rosemead would
benefit from using the actual loss calculator; however, based on the growth of revenue reflected in
this report and its impact on future growth, staff is in the process of analyzing the impact this
growth has on the SLFRF calculation. At the conclusion of the Council Meeting agenda item,
staff was requested to return to the City Council at a future meeting to discuss options further.
Staff had originally planned to return with an updated report in February; however, due to
continuing analysis of the required SLFRF calculation, the crafting of accounting procedures for
the use of funds, and the development of an expenditure/project plan within categories for Council
to consider the item, with the exception of personnel requests defined below, further discussion
has been delayed into March 2022.
PFRq"NNF.i .
Included in the FY 2021-22 Operating Budget is funding for 56 full-time positions, five 3/4 -time
City Council Meeting — FY 2021-22 Mid -Year Budget Review
February 22, 2022
Page 9 of 12
positions (3.75 FTE), and various part-time employees. No additional positions were added to
either the FY 2020-21 or FY 2021-22 budgets. As part of staff's continual evaluation of
department operations and efficiencies, staff began examining staffing levels in preparation of the
proposed FY 2022-23 budget. However, in light of the allowable use of SURF funds within a
category outside the `Public Sector Revenues', it is staff's recommendation to add 2.25 positions
to the authorized staffing list at this time. In accordance with the ARPA Final Rule (Economic
Impacts — Restore and Bolster Public Sector Capacity), the city may increase its workforce by
7.5% of its current full-time equivalency (FTE) positions and pay the positions through December
2026. Discounting the City's hourly FTE, Rosemead could increase full-time staffing level by 4.5
positions. The following positions are being requested at this time due to the beneficial impacts
of expedited hiring.
Finance — The Finance Department is requesting it's 3/4 -time Accountant position be
increased to full-time. The position plays an important part in maintaining segregation of
duties (internal controls) and assisting with the myriad of accounting responsibilities of the
department. Additionally, the 3/4 -time level for this type of position has been difficult to
recruit and retain. The urgency in requesting this increase at mid -year is due to the FY 2022-
23 budget preparation schedule, approaching interim audit (Spring), year-end closing, and
maintenance of internal controls, coupled with the recent vacancy of the 3/4 -time position
(February 18, 2022). Based on salary survey results, the range for this position is
recommended at $5,622 - $7,336 per month with an annualized fully burdened cost of $97,600
— $121,600. Because the position is already authorized at 3/4 -time, the cost to increase the
position ranges from $33,500 — $45,600 annually. For the remainder of FY 2021-22, the cost
is estimated at $8,400.
Public Works — Public Works — The Public Works Department is requesting the addition of a
City Engineer. The City Engineer plays a vital role for the Public Works Department and the
City. This position performs a broad range of engineering services, including infrastructure
design, parcel and tract map review, management of the CIP, coordination with regional
agencies, and serves as a lead engineering advisor for the City. The benefit of hiring an in-
house City Engineer is that an employee, rather than a contractor, would be fully committed
to the City and develop an intimate knowledge of the City's infrastructure, strategic plan, and
goals, as well as develop relationships with Staff, local contractors, and regional agencies —
essentially develop accountability and appreciation of the City. In addition, the City's
infrastructure and facilities are among its most valuable physical assets and employing an in-
house City Engineer will ensure that the City effectively maintains and improves its
infrastructure and facilities. Furthermore, the City's largest financial investment is the City's
CIP with a total budget of approximately $44 million, therefore, to maximize the value of the
City's CIP and return on investment, an in-house City Engineer is needed to effectively
manage and deliver CIP projects. An in-house City Engineer would also provide continuity
which is key in providing quality engineering services and the timely delivery of CIP projects.
The position would be a supplement, rather than replacement to the current contract service
and would serve as the primary lead position for all infrastructure/facilities, engineering
services, CIP projects, and City counter service. The urgency in requesting this position at
mid -year is to accelerate the spending of capital funds before the funds lapse and to expedite
City Council Meeting — FY 2021-22 Mid -Year Budget Review
February 22, 2022
Page 10 of 12
the development and oversight of CIP projects. Based on salary survey results, the range for
this position is recommended at $9,342 — $12,189 per month with an annualized fully
burdened cost of $156,700 — $197,600. The estimated cost for the remainder of FY 2021-22
is $39,000. It should also be noted that once the ARPA funding is exhausted, a large portion
of the costs associated with this position may be charged directly to CIP projects rather than
the General Fund.
Parks and Recreation — The Parks and Recreation Department is requesting to add a
Recreation Manager position to be second in command for the Department. The position
would play a key role in the return of summer activities and events, assist with creating,
planning, promoting, and developing Cultural Arts Programs and events, oversee and expand
the Rosemead Anti -Hate Campaign, assist with managing contracts, monitor the departments
operating budget, and facilitating current and identifying new capital improvement projects.
The position would also be responsible for assisting with the identification of resources and
grant opportunities for improving services to the community. The urgency in requesting this
position at mid -year is the return of many programs halted during the pandemic and
participation in the FY 2022-23 budget development process. Based on salary survey results,
the range for this position is recommended at $7,761 — $10,126 per month with an annualized
cost of $133,900 — $167,900 and a FY 2021-22 cost of $33,000.
AMENDING THE ADOPTED SALARY SCHEDULE
California Code of Regulations (CCR) Section 570.5 and amendments to 571(b) require a
consolidated Salary Schedule which shows all City classifications and salary ranges for purposes
of determining eligible salary compensation for retirement be publicly available. To meet this
requirement, a separate staff report has been prepared to include the three positions above and
another concurrent report on tonight's Agenda.
AMENDING THE CAPITAL IMPROVEMENT PROGRAM
NEw PROJECT — Walnut Grove Avenue Street Light Installation — As part of the City's Fiscal Year
2017-2018 Capital Improvement Program, the City Council approved the Walnut Grove
Underground project from Marshall Avenue to Valley Boulevard. The project included removal
of all overhead utility facilities including power poles and streetlight fixtures mounted on power
poles on Walnut Grove Avenue from Marshall Avenue to Valley Boulevard. As this project is
nearing completion, staff is proposing a new project "Walnut Grove Avenue Street Light
Installation" to install new streetlight poles and fixtures on Walnut Grove Avenue from Marshall
Avenue to Valley Boulevard. The Project includes installation of twenty-five (25) new concrete
streetlight poles (30 feet height) with solar LED fixtures on Walnut Grove Avenue from Marshall
Avenue to Valley Boulevard. Since the proposed lighting system is solar powered, the installation
will not require installation of conduits within the roadway on Walnut Grove, therefore the
proposed work will not conflict with the ongoing Walnut Grove Ave Resurfacing Project, Phase
I. Because the proposed work involves the rehabilitation of an existing public facility, the project
is Class 1 Categorically Exempt pursuant to the California Environmental Quality Act (CEQA).
The Project is proposed to be funded with available Measure R funds in the amount of $390,000.
City Council Meeting — FY 2021-22 Mid -Year Budget Review
February 22, 2022
Page 11 of 12
AMENDED PROJECT —Various Residential Streets Resurfacing (Project No. 21032) —As part of the
City's FY 2021-22 Capital Improvement Program, the City Council approved the "Various
Residential Street Resurfacing" project with a project budget funded by Gas Tax in the amount of
$645,000. Based on the City's Pavement Management Plan, additional residential streets are
identified with a "Very Poor" to "Poor" asphalt pavement condition rating with a Pavement
Condition Index (PCI) between 7 to 59. These additional residential streets are recommended for
asphalt pavement rehabilitation, including cold milling of existing asphalt pavement, construction
of rubberized asphalt overlay, adjusting utility manholes/vaults to grade and restoring traffic
striping and pavement markings. Staff is recommending that the City Council approve the
amendment to the project budget to increase the total budget by $355,000 for a new total budget
of $1,000,000 to perform the additional street rehabilitation. Furthermore, due to lapsing Measure
M and Measure R funds, staff is also recommending that the City Council approve the un -
appropriation of the $645,000 in Gas Tax funding and appropriate funding for the project in the
Measure M and Measure R funds in the amount of $600,000 and $400,000, respectively.
RECOMMENDED BUDGET AMENDMENTS
Staff is recommending the following amendments to the FY 2021-22 Operating and CIP Budgets:
Gas Tax, Measure R and Measure M Funds —
Decrease appropriations in the Gas Tax Fund
in the amount of $645,000 and increase
appropriations in Measure M and Measure R
funds in the amount of $600,000 and $400,000
respectively for the `Various Residential
Street Resurfacing" project amendment.
Increase appropriations to fund the proposed
Walnut Grove Avenue Street Light
Installation in the amount of $390,000 from
Measure R funds.
American Rescue Plan Act — Increase
appropriations for the cost of the additional of
2.25 positions for the remainder of FY 2021-
22.
Grant Fund — Increase revenue estimates and
appropriations by $24,400 for final
transactions of the S132 Planning Grant; and
increase revenue estimates and appropriations
by $48,000 for professional services related to
Local Roadway Safety Plan (LRSP) Grant.
Gas Tax F201
Revenue
Approp
Adopted Budget
1,325,000
2,572,500
Move Proj Budget to Other Funds
(645,000)
Amended Budget
1,325,000
1,927,500
Measure R (F225)
Revenue
Approp
Adopted Budget
698,000
1,960,751
Street Resurfacing Proj Amendment
400,000
New Street Light Project
390,000
Amended Budget
698,000
2,750,751
Measure M 17226)
Revenue
Approp
Adopted Budget
794,030
2,730,700
Street Resurfacing Pro' Amendment
600,000
Amended Budget
794,030
3,330,700
American Rescue Plan Act (ARPA) Revenue Approp
Adopted Budget 8,939,300 1,500,000
New Positions 80,400
Amended Budget 8,939,300 1,580,400
Grants (F232) Revenue Approp
Adopted Budget 328,200 2,426,408
SB2 Planning Grant (canyover) 24,600 24,600
LRSP Grant 48,000 48,000
Amended Budget 400,800 2,499,008
City Council Meeting — FY 2021-22 Mid -Year Budget Review
February 22, 2022
Page 12 of 12
Vehicle Replacement Fund — Increase
appropriations for the aftermarket COStS Of Equipment Replacement F501) Revenue A ro
Adopted Budget -
equipment added to leased vehicles. Cost of Aftermarket Equip Additions 32,000
Amended Budget - 32,000
FISCAL IMPACT
The adoption of the attached resolution will increase budgeted revenue estimates by $72,600 and
increase total operating and capital improvement appropriations by $930,000.
STAFF RECOMMENDATIONS
It is recommended that the City Council take the following actions:
1. Receive and file the Mid -Year Budget Review Report.
2. Approve Resolution No. 2022-13 approving budget amendments to the FY 2021-22
Operating budget, amending the Capital Improvement Program budget, and amending the
City's authorized staffing list.
3. Approve Resolution No. 2022-15 authorizing the City Manager or designee to execute
agreements and related authorizations with Caltrans for the Local Roadway Safety Plan
Project LRSPL-5358(021).
PUBLIC NOTICE PROCESS — This item has been noticed through the regular agenda
notification process.
Prepared by:
Paula Chamberlain
Interim Finance Director
Attachments:
Resolution No. 2022-13 Amending the FY 2020-21 Budget and Authorized Staffing
Resolution No. 2022-15 Authorizing the City Manager to Execute an Agreements
Attachment A
Resolution No. 2022-13
RESOLUTION NO. 2022-13
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
ROSEMEAD, CALIFORNIA, AMENDING THE FY 2021-22 OPERATING
AND CAPITAL IMPROVEMENT PROGRAM BUDGETS AND
AUTHORIZED STAFFING LIST
WHEREAS, a fiscal review is a prudent method to ensure that the City maintains a healthy
financial structure; and
WHEREAS, the City routinely adjusts fiscal year revenue estimates and appropriations
throughout the fiscal year; and
WHEREAS, the City Council adopted the FY 2021-22 Operating Budget and CIP budgets
on June 14, 2021 and amended the budgets on November 9, 2021; and
WHEREAS, the City Council has reviewed the Mid -Year Budget Report.
NOW THEREFORE, BE IT RESOLVED, by the City Council of the City of Rosemead,
California, as follows:
SECTION 1. That the City Council authorizes the carry forward of appropriations for
projects approved in prior fiscal years but have remaining project funds as follows:
FLInd Category Adopted Bridget Amendment Revised Budget
lr--. Revenue 1,325,000 1,325,000
Measure M Revenue 794,030 - 794,030
Annronriation 2,730,700 600,000 3,330,700
Grants Revenue 328,200 72,600 400,800
Appropriation 2,426,408 72,600 2,499,008
Total Change to Revenue 72,600
FY 2021-22 Appropriation 930,000
SECTION 2. That the City Council amends the 2021-22 Authorized Staffing List
effective February 22, 2022 by restructuring the 3/4 -time Accountant position to full-time
(monthly salary range of $5,622 — $7,336, and adding the position of City Engineer (monthly
salary range of $9,342 — $12,189) and Recreation Manager (monthly salary range $7,761 —
$10,126).
SECTION 3. The City Clerk shall certify to the passage and adoption of this resolution,
and it shall thereupon be in full force and effect.
PASSED, APPROVED, AND ADOPTED this 22nd day of February, 2022.
Polly Low, Mayor
APPROVED AS TO FORM: ATTEST:
Rachel Richman, City Attorney Ericka Hernandez, City Clerk
COUNTY OF LOS ANGELES) §
CITY OF ROSEMEAD )
I, Ericka Hernandez, City Clerk of the City Council of the City of Rosemead, California, do hereby
certify that the foregoing City Council Resolution No. 2022-13, was duly adopted by the City
Council of the City of Rosemead, California, at a regular meeting thereof held on the 22nd day of
February 2022, by the following vote, to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
Ericka Hernandez, City Clerk
Attachment B
Resolution No. 2022-15
RESOLUTION NO. 2022-15
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
ROSEMEAD, CALIFORNIA, AUTHORIZING THE CITY MANAGER OR
HER DESIGNEE TO EXECUTE AGREEMENTS AND RELATED
AUTHORIZATIONS WITH THE CALIFORNIA DEPARTMENT OF
TRANSPORTATION FOR THE LOCAL ROADWAY SAFETY PLAN
PROJECT LRSPL-5358 (021)
WHEREAS, the City of Rosemead is eligible to receive Federal and/or State funding for
transportation projects, through the California Department of Transportation (Caltrans); and
WHEREAS, the City of Rosemead has applied for and received funding approval of
$48,000 from the Caltrans' Highway Safety Improvement Program (HSIP) for a safety analysis;
and
WHEREAS, Federal and/or State documents and agreements are required to be executed
in relation to each phase of funded work with Caltrans before such funds can be claimed through
the Caltrans' Highway Safety Improvement Program; and
WHEREAS, the City of Rosemead wishes to delegate authorization to the City Manager
or her Designee to execute these documents, agreements, and any amendments thereto
THE ROSEMEAD CITY COUNCIL HEREBY RESOLVES AS FOLLOWS:
SECTION 1. The City Council hereby authorizes the City Manager or her Designee to
execute all required documents and agreements for the completion of the grant scope under
Caltrans' Highway Safety Improvement Program
SECTION 2. The City Clerk shall certify to the adoption of this Resolution.
PASSED, APPROVED, AND ADOPTED this 22nd day of February, 2022.
Polly Low, Mayor
APPROVED AS TO FORM: ATTEST:
Rachel Richman, City Attorney Ericka Hernandez, City Clerk
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES) §
CITY OF ROSEMEAD )
I, Ericka Hernandez, City Clerk of the City Council of the City of Rosemead, California,
do hereby certify that the foregoing City Council Resolution No. 2022-15 was duly adopted by
the City Council of the City of Rosemead, California, at a regular meeting thereof held on
the 22nd day of February, 2022, by the following vote, to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
Ericka Hernandez, City Clerk