The purpose of this staff report is to adopt the Biennial Fiscal Year 2019/20 and 2020/21 Operating Budget and the Five Year Capital Improvement Plan for Fiscal Years 2019/20 through 2023/24, establish the Fiscal Year 2019/20 Gann Limit and approve the General Fund Public Service Grants for Fiscal Year 2019/20 and 2020/21.

Budget - Every two years the City is required to adopt a biennial budget by July 1 that establishes appropriations and estimated revenues for all funds for the coming two fiscal years.  The approved budget serves as authorization for the City to conduct operations within the confines of those fiscal approvals.   If, during the course of the coming fiscal year, the City finds a need to spend outside those approved fiscal limits, approval will first be sought from the City Council in the form of supplemental appropriations.  Before the beginning of the second year of the two year budget cycle, the FY 2020/21 budget will be brought back to the City Council, along with any updates and modifications, to be re-appropriated. The City Council held a budget workshop on April 23, 2019, held budget discussions with public input on May 14, 2019 and May 28, 2019 and held a public hearing regarding the budget on June 11, 2019.

Gann Limit – Annually pursuant to Article XIII-B of the Constitution of the State of California, the City Council is required to establish an appropriate (or Gann) limit for the Fiscal Year.  The Appropriations Limit has been determined in accordance with State law to be $174,333,612 on the basis of annual adjustment factors for Union City’s population growth (+1.16%) and change in California’s per capita income (+3.85%) for Fiscal Year 2019-20.  A resolution is attached for this purpose.

Non-Profit Public Service Grants - During the May 14, 2019 City Council meeting the City Council was presented with the proposed Non-Profit Public Service Grants recommendation.  For the General Fund portion, the City Council held off on final approval on the allocation of the grant funds until the adoption of the biennial budget.  A resolution is attached for this purpose.

The proposed biennial budget and five year capital improvement plan has been prepared with input from all City Departments.  The process has covered a period of 6 months and reflects the best estimates of expected revenues and expenditures for each fund and program.  The total City wide budget follows:

Attached to this staff report are the following items:

·         Attachment 1 - Budget Message

·         Attachment 2 - 2019/20 & 2020/21 Budget support documents

·         Attachment 3 - City wide revenue by fund

·         Attachment 4 - City wide expenditures by fund

·         Attachment 5 - 5 Year Capital Investment Plan

·         Attachment 6 - Authorized Position List and Salary Schedule

·         Attachment 7 - Resolution to adopt biennial budget

·         Attachment 8 - Resolution to adopt Gann limit

·         Attachment 9 - Gann support document

·         Attachment 10 – Resolution to allocate non-profit service grants

·         Attachment 11 – List of non-profit public service grants

The information contained in the attached documents are crucial for a proper understanding of the budget taken as a whole.

The fiscal impact of the budget is as presented in the attached documentation.

Staff recommends that the City Council conduct a public hearing on the budget and adopt the following resolutions:

·         Resolution to adopt biennial budget

·         Resolution to adopt Gann limit

·         Resolution to allocate non-profit service grants