May 4, 2004
SUBJECT:City Council Policy Direction on Prioritizing City Services and Revising Service Levels
REPORT IN BRIEF
This report summarizes worksheets that City Council members completed individually as part of a process to prioritize City services and to revise service levels. It is anticipated that Council will use the results from the tabulated worksheets to provide policy direction on changes to services and/or service levels. Staff will identify the effects of this policy direction, and describe these effects in the recommended FY 2004/2005 annual budget and long-term financial plans. The recommended annual budget will be distributed on May 18, 2004. At the May 25, 2004 budget workshop, Council will discuss these effects and several financial strategies for addressing the structural problems in the City's budget and projected, annualized budget gaps. Public hearings will be held at the May 4th Council meeting as part of the consideration of this agenda item, and at the May 25th budget workshop, to provide opportunities for public participation. Finally, staff is suggesting that the final financial strategies adopted by Council to address structural problems in the City's budget and the projected FY 2004/2005 budget gap be implemented in the second half of next fiscal year. This will allow staff to determine the effects of an improving local economy, the State of California's budget for FY 2004/2005, and a state wide ballot initiate to protect city tax revenues on the City's financial condition.
BACKGROUND
The City Council approved in February 2004 a new process to prepare, to review, and to provide initial and final policy direction for the City's annual budget and long-term financial plans. As part of this process, Council held five special meetings during March and April 2004 to prioritize City services and to revise service levels. Multiple methods have been used to inform the public about these special meetings and to encourage their involvement and participation in the revised budget process.
At the April 17th special meeting, Council decided to prioritize services and revise service levels for the City services that it had previously assigned to the following ranking categories:
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Optional services: scalable
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Optional services: not scalable
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Expected/Traditional services: scalable
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Core internal services: scalable
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Core external services: scalable
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Legally mandated/required by contract services: scalable.
Council also decided to complete the Service Review Process Summary Worksheets (green worksheets) individually. In completing the worksheets, individual Council members were asked to assign a service level ranking to all services included in the above categories. Council members were also asked to write any comments regarding these services on the green worksheets. The ranking categories were:
1. No change to existing service level
2. Low increase to existing service level (5%)
3. Medium increase to existing service level (10%)
4. High increase to existing service level (15%)
5. Low decrease to existing service level (5%)
6. Medium decrease to existing service level (10%)
7. High decrease to existing service level (15%)
8. Eliminate service.
City staff would then collect, tabulate, and summarize Council's individual completed worksheets.
EXISTING POLICY
Fiscal Sub-Element of the General Plan
Goal 7.1B: Financial Practices: Maintain Sound Financial Practices Which Meet All Applicable Standards and Direct the City's Financial Resources Toward Meeting the City's Long-Term Goals.
Policy 7.1B.5: Performance Budget System: Maintain and refine the Performance Budget System to assure its use for multi-year planning, full cost accounting, and budget monitoring.
DISCUSSION
Council requested that an agenda item to report the tabulated service level rankings be scheduled as a public hearing item on the May 4, 2004 regular City Council meeting. By providing a public hearing, Council wanted to continue to encourage public involvement and participation in the process to prepare next year's annual budget and long-term financial plans. This public hearing will also provide another opportunity for the public to offer their suggestions, ideas, and opinions on setting service priorities and revising service levels.
All Council members submitted their individual worksheets during the week of April 19th. Attachment 1 records the service level rankings completed by each Council member, and all written comments regarding services. This information is listed in the columns titled Service Level Priority and Council Comments.
A massive amount of information has been generated by Council's assessment of City services. The attachment does not include those services that were assigned “no change to existing service level” ranking by all Council members. However, these services are listed later in this report. Services are indicated by their department numbers in ascending order to help Council find a specific service listed on the attachment. This attachment was prepared to give Council a more reasonable amount of information to use in providing policy direction to staff.
Staff has organized Council's service level rankings into six groups. These groups are designed to assist Council in reviewing the information that has been generated, and in providing policy direction. These groups are:
Group A Services that received the same service level ranking (no change to service level) by all Council members.
Group B Services that were ranked no change to existing service level (#1) by four or more Council members.
Group C Services that were ranked for an increase to existing service levels (#2, #3, or #4) by four or more Council members.
Group D Services that were ranked for a decrease to existing services levels by four or more Council members.
Group E Services that were ranked for elimination by at least four or more Council members.
Group F Services where no clear majority on a service level ranking emerged through this process.
The same six groups will be used to organize the service level rankings for all services assigned by Council to the Optional: scalable, Optional: not scalable, Expected/Traditional: scalable, Core Internal: scalable, Core External: scalable, and Legally Mandated/Required by Contract: scalable categories.
The services included in each group are identified by the same department number that has been used on the blue and green summary worksheets. These worksheets have been distributed to Council as part of the special budget meetings held in April. This department number can be used if Council wants to examine the service level rankings that were assigned to a specific service by each Council member. The department number can also be used to determine the program name, the service name, the fund, the cost recovery ratio, the service cost, the population served, and Council written comments for a specific service.
Attachment 1 is provided to Council only for information purposes. It is understood that Council will provide policy direction for setting priorities and revising service levels for City services at the May 4th Council meeting. The following summarizes the information contained in Attachment 1.
Optional: scalable
Group A Services that received the same service level ranking (no change to service level) by all Council members.
CDD |
005 |
006 |
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DPR |
031 |
032 |
043 |
044 |
045 |
046 |
049 |
050 |
051 |
057 |
058 |
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059 |
060 |
061 |
062 |
063 |
064 |
065 |
066 |
068 |
069 |
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DPS |
028 |
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DPW |
079 |
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OCM |
012 |
017 |
018 |
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Group B Services that were ranked no change to existing service level (#1) by four or more Council members.
CDD |
044 |
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DPR |
028 |
030 |
033 |
034 |
035 |
036 |
037 |
039 |
040 |
042 |
047 |
|
048 |
053 |
054 |
067 |
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DPS |
023 |
041 |
048 |
057 |
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DPW |
026 |
028 |
033 |
034 |
035 |
038 |
040 |
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FIN |
009 |
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OCM |
013 |
014 |
015 |
016 |
019 |
020 |
021 |
022 |
023 |
028 |
032 |
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033 |
034 |
040 |
041 |
042 |
043 |
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Group C Services that were ranked for an increase to existing service levels (#2, #3, or #4) by four or more Council members.
None
Group D Services that were ranked for a decrease to existing services levels (#5, #6, or #7) by four or more Council members.
· 5% service reduction