1. February 17, 2009 City of Berkeley Budget Update

2. 2 Unknown State & Federal Impacts  State budget unknown -$17B FY 2009 -$25B FY 2010 -$42B Deficit (23% of budget!)  Federal stimulus package still in progress  Unknown how Berkeley will be impacted

3. 3 2-YR Budget…3-YR Problem PERS rate spike in FY 2012  $600K loss of parking meter revenue  Need GF reductions over 3 years of 6%  Year 3 reflects PERS rate spike  Assumes CIP funding reductions

4. 4 FY 2009 General Fund Budget  Less public safety & fixed costs = $60M

5. 5 GF Balancing Framework  3-year Deficit = $9.6M Reduce expenses =$6.00M New revenues* =$3.60M $9.6M *Raise parking fines $10 over two years

6. 6 Reducing GF Expenses  Administrative reductions  Reorganizations  Efficiencies Return on technology investments  Civilianization  Shifts in funding source  Service reductions $2.5M $3.5M

7. 7 Reducing GF capital funding

8. 8 Other Revenue Funds Face Deficits  Public and Mental Health Funds Expenditure reductions  Streetlight Assessment Fund Possible General Fund subsidy increase  Refuse Fund Rate increase in March 2009: 20-30%  Clean Storm Fund Ballot in FY 2010  Permit Service Center Fund Expenditure reductions

9. 9 Cutting costs now…  Hiring Freeze  Cuts to Health & Mental Health  Defer capital projects (pending State $)  Limit travel & non-essential expenses  No new programs  Limit OT (eliminate for non-emergency/non-essential)  Preparing for Federal Stimulus

10. 10 Principles of developing the budget  5-year budget model (3-year focus)  Long-term solutions  Engage/inform Council,employees, community  Harvest creative ideas City staff, labor unions, citizens  Streamline overhead  Address unfunded liabilities  Special revenue funds must balance on own Need 5% more (cuts/revenue) to deal with uncertainties

11. 11 Organizing to improve services Health & Human Services – Housing Dept  HHS to focus on public & mental health  Create Housing & Community Services Department Adding Aging Services & Youth Employment Department focus now…  Community Services  Homeless Services  Housing

12. 12 Goals & Values  Maintain City’s long-term fiscal health  Provide quality services to residents  Recognize the exceptional work our employees do

13. 13 Program Focused Discussions  Environment… Watershed Management Plan Climate Action Plan Zero Waste