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11-12-2008 CC Rpt A18COUNCIL. AGENDA STAFF REPORT Meeting Date: )P Public Hearing: Discussion item Consent Item: NOVEMBER 5, 2008 November 12. 2008 I;] I� CITY CLERK USE ONLY �(tj J TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS FROM: CITY MANAGER SUBJECT: RESOLUTION AMENDING THE 2008-09 FISCAL YEAR APPROPRIATION LIMIT RECOMMENDATION: It is recommended that the City Council adopt a Resolution entitled as follows: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHINO HILLS, AMENDING THE 2008-09 APPROPRIATION LIMIT FOR THE CITY OF CHINO HILLS." BACKGROUND/ANALYSIS: Cities are required to establish an appropriation limit for a new fiscal year by June 30 of the current fiscal year in accordance with Article XIIIB of the California Constitution - Gann Initiative. Each year the appropriation limit is modified by two factors. One factor is a population -based factor; the second factor is an economic -based factor. The population factor that may be selected is the greater of the percentage increase in the City's population or the County's population. The economic factor that may be selected is the greater of the percentage increase (or decrease) in the State's per capita personal income or the City's assessed valuation caused by new non-residential construction. The County does not release the factor for the increase in the assessed valuation caused by new non-residential construction until later in the fiscal year. Therefore, this factor is unknown at the time the City is required to adopt its appropriation limit. The City may revise the prior year's calculation if it turns out that the percentage increase factor for the new non-residential construction assessed valuation exceeds the percentage increase in the personal income per capita factor. This is the case for the 2008-09 factor. For 2008-09, the State per capita income factor of 4.29 percent was used; however, the County's non-residential new construction factor increased by 22.94 percent. Therefore, this factor is being substituted for the per capita income factor for the calculation for the 2008-09 fiscal year. The City's appropriation limit, based on the above -mentioned growth factors for the 2008-09 fiscal year resulted in an increase of $4,336,421 from $24,249,077 to $28,585,498 (see Exhibit A). ,q)9 AGENDA DATE: NOVEMBER 25, 2008 SUBJECT: RESOLUTION AMENDING THE 2008-09 FISCAL YEAR APPROPRIATION LIMIT PAGE TWO FISCAL IMPACT: There is no financial impact on the City since the City's FY 2008-09 appropriations subject to the limit are less than the 2008-09 Appropriation Limit. Respectfully submitted, Recommended by: ,-k, - �� �,, w &,"r, DougQ3,slN. LaBelle, City Manager JVR. I mffas'ter, Finance Director Attachments: Exhibit A — Appropriation Limit Calculations Resolution amending the 2008-09 Appropriation Limit DLB:JRL:AH:ddk CITY OF CHINO HILLS APPROPRIATION LIMIT FOR THE FISCAL YEAR 2008-09 (AMENDED) Aoorooriation Limit Calculations: Adopted Amended 2007-08 Appropriation Limit 22,919,255 22,919,255 Appropriation limit adjustments selected for the 2008-09 fiscal year: Increase in California per capita personal income (4.29%) 983,236 (1) Increase in new non-residential construction assessed valuations (22.94%) 5,257,677 (1) Subtotal 23,902,491 28,176,932 Increase in County's population (1.45%) 346,586 408,566 2008-09 Appropriation Limit 24,249,077 28,585,498 (1) Economic factor that may be selected is the greater of the percentage increase in the State's per capita personal income or the City's assessed valuation caused by new non-residential contruction. At the time of adoption, the percentage increased in the assessed valuation caused by new non-residential construction was not available. RESOLUTION NO. 08R- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHINO HILLS, AMENDING THE 2008-09 APPROPRIATION LIMIT FOR THE CITY OF CHINO HILLS. WHEREAS, Article XIII B of the Constitution of the State of California as proposed by the Initiative Measure approved by the people at the special statewide election held on November 6, 1979, provides that the total annual appropriations limit of such entity for the prior year adjusted for changes in prescribed economic and population factors; and, WHEREAS, the State Legislature added Division 9 (commencing with Section 7900) to Title 1 of the Government Code of the State of California to implement Article XIII B of the California Constitution; and, WHEREAS, Section 7910 of the Government Code provides that each year the governing body of each local jurisdiction shall, by Resolution, establish its appropriations limit for the following fiscal year pursuant to Article XIII B at a regularly scheduled meeting or a noticed special meeting and prior to such meeting, documentation used in the determination of the appropriation limit shall be available to the public; and, WHEREAS, Proposition 111 as approved by the voters of the State of California, requires a recorded voice vote of the City Council regarding which of the annual adjustment economic and population factors have been selected each year; and, WHEREAS, for the 2008-09 fiscal year, any challenge to the appropriation limit must be brought within 45 days of the effective date of the Resolution. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CHINO HILLS DOES RESOLVE, DETERMINE, AND ORDER AS FOLLOWS: SECTION 1. The adjustment factors selected for calculating the 2008-09 fiscal year appropriation limit are the increase in State of California per capita personal income and the increase in the County of San Bernardino's population. This amended appropriation limit substitutes the State of California per capita personal income factor for the 2008-09 fiscal year with the County's non-residential new construction factor which increased by 22.94 percent. SECTION 2. The City of Chino Hills amended appropriation limit for the 2008-09 fiscal year is $28,585,498. Page 1 of 3 SECTION 3. The City Clerk shall certify as to the adoption of this Resolution. PASSED, APPROVED, and ADOPTED this 12th day of November 2008. CURT HAGMAN, MAYOR ATTEST: MARY M. MCDUFFEE, CITY CLERK MARK D. HENSLEY, CITY ATTORNEY Page 2 of 3