PPD 541 Public Finance Spring 2011 Erika Brooks Juan Cabral Eddie Martinez Milton McKinnon Frank Wasko PPD 541 Public Finance Spring 2011

Background Incorporated in 1917 • 5 Square Miles • 40,000 Residents • 1 Mile from Beach • 5 Member City Council • Light Rail • Culver City Unified School District • 5 Elementary Schools • 1 Middle School • 2 High Schools • West LA College • Antioch University • Pepperdine University

Median Household Income Major Employers # Employer # of Employees 1 Sony Pictures Entertainment 2,020 2 Westfield Culver City 1,500 3 Brotman Medical Center 900 4 Symantec 800 Median Household Income 5.5% of Families and 8.6% of the Population are below the Poverty Line.

Population by Race Population by Age 38,816 People • 16,611 Households • 9,518 Families • Median age is 39 • For every 100 females there are 87.5 males

Median Home Value Education Average Temperature: 70° • Warmest month is August • Coolest month is December • February is the wettest month

City Government Total City Workers: 649 Retirement System: PERS 2.5% @ 55 Years – Misc. Employee 3% @ 55 Years – Fire Department 3% @ 50 Years – Police Department Charter City: 1947

Revenue Current Revenue Streams Breakdown Local Taxes $49.8M Charges for Services $55.6M Fines & Forfeits $4M License & Permits $2.6M Intergovernmental $28M Other $14M 28M 2.6M 49.8M 4M 55M

Expenditures Breakdown Deficit – 8 Milliion Strategic Plan to Reduce Expenditures 11.6M Salaries & Benefits $88.6M Ops & Maintenance $56.4M Capital Outlay $11.6M Debt Service $2M 55.4M 88.6M

Fund Balances Review the “General Fund Changes In Fund Balance Statement.” Review whether the budget is balanced. Review whether revenues exceed expenditures. Determine how reserves will be impacted. Determine the unrestricted balances. Determine the total reserves.

Challenges CalPERS retirement system increases: Losses must be recouped Safety employees Miscellaneous employees Making these cuts will increase the General Fund to an estimated figure of $3.9 million 3.9 Million to be recouped in FY 2014-2015

Challenges Cont. Recognize the severity of the structural deficit Recognize the other long term financial issues that must be addressed in the future Propose a budget that will bring current operating cost in line with current resources

Proposed Solutions Implement a two year action plan to reduce expenditures First year: Workforce reduction of 60 positions Second year: Address remaining deficit through negotiations or further workforce reduction, or combination of both

Proposed Solutions Miscellaneous: FY: 2010-11 (12.9%) • FY: 2011-12 (13.60%) • FY 2013-14 (15.84%) • FY 2013-14 (18.22%) • FY 2014-15 (18.49%) Safety: FY: 2010-11 (26.52%) • FY: 2011-12 (29.60%) • FY: 2012-13 (34.43%) • FY: 2013-14 (40.45%) • FY: 2014-15 (41.14%) Questions