HomeMy WebLinkAbout05. Adopt a resolution to establish Appropriations Limits for FY 2021-22 Page 1 of 4
Item 5.
CENTRAL SAN BOARD OF DIRECTORS
POSITION PAPER
MEETING DATE: SEPTEMBER 2, 2021
SUBJECT: ADOPT RESOLUTION NO. 2021-044 ESTABLISHING THE
APPROPRIATIONS LIMIT IN THE AMOUNT OF $127,013,222 FOR FISCAL
YEAR 2021-22, IN ACCORDANCE WITH ARTICLE XIII B OF THE
CALIFORNIA CONSTITUTION, USING THE CHANGE IN THE CALIFORNIA
PER CAPITA PERSONAL INCOME PERCENTAGE AND CHANGE IN
POPULATION TO CALCULATE THE APPROPRIATIONS LIMIT
SUBMITTED BY: INITIATING DEPARTMENT:
KEVIN MIZUNO, FINANCE MANAGER ADMINISTRATION-FINANCE
REVIEWED BY: PHIL LEIBER, DIRECTOR OF FINANCE AND ADMINISTRATION
ROGER S. BAILEY, GENERAL MANAGER
Roger S. Bailey
General Manager
ISSUE
Central San is required to establish its appropriations limit for tax proceeds that can be spent annually in
accordance with Article XI I I B, Government Spending Limitation, of the California Constitution.
BACKGROUND
As statutorily required, notice that the appropriations limit for Fiscal Year(FY) 2021-22 would be
considered at this meeting was provided at the August 5, 2021 regular Board meeting and, in accordance
with California Government Code Section 7910, documentation used in the determination of the
appropriations limit and other necessary determinations were made available to the public fifteen days prior
to this meeting.
California's State appropriations limit, also known as the "Gann Limit," was originally established by
Proposition 4 in 1979. The statute places an "upper limit" on the amount of tax proceeds that can be spent
on an annual basis. Since Central San receives the vast majority of revenues from service fees, not taxes,
September 2, 2021 Regular Board Meeting Agenda Packet- Page 31 of 199
Page 2 of 4
this limitation has had no material practical effect.
The annual limit is based on the amount of tax proceeds that were authorized to be spent in FY 1986-87,
adjusted annually by a factor comprised of the change in population combined with the change in California
per capita personal income. After 34 years of compounding under this formula, the annual limit far
exceeds the actual tax proceeds received by Central San. As a result, this Gann limit has had not practical
implications for Central San's finances, but nonetheless requires this administrative calculation and
notification each year.
As published by the California Department of Finance, the annual change in population for FY 2021-22 in
Contra Costa County is 0.35% and the percentage change in California per capita personal income is
5.73%. Using these percentages, Central San's current appropriations limit is calculated to be
$127,013,222, which far exceeds the total ad valorem tax revenue budgeted for FY 2021-22 of
$19,831,227 plus estimated interest earnings of approximately$33,000 on said tax proceeds.
ALTERNATIVES/CONSIDERATIONS
None.
FINANCIAL IMPACTS
None.
COMMITTEE RECOMMENDATION
No Committee review is necessary for this matter because establishment of the appropriations limit is
statutorily mandated under Article XI I I B of the California Constitution entitled Government Spending
Limitation.
RECOMMENDED BOARD ACTION
Adopt the proposed resolution establishing the appropriations limit in the amount of$127,013,222 for FY
2021-22, in accordance with Article XI I I B of the California Constitution, using the change in the California
per capita personal income percentage and change in Contra Costa County population to calculate the
appropriations limit.
Strategic Plan Tie-In
GOAL THREE: Fiscal Responsibility
Strategy 1—Maintain financial stability and sustainability, Strategy 2—Ensure integrity and transparency in financial
management
ATTACHMENTS:
1. Proposed Resolution
September 2, 2021 Regular Board Meeting Agenda Packet- Page 32 of 199
Page 3 of 4
RESOLUTION NO. 2021-044
A RESOLUTION OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT
ESTABLISHING THE APPROPRIATIONS LIMIT FOR FISCAL YEAR 2021-22
WHEREAS, Central Contra Costa Sanitary District (Central San) is required under
Article XIII B of the State of California Constitution to establish and adopt an
Appropriations Limit for each fiscal year; and
WHEREAS, Central San has determined the Appropriations Limit for taxes and
proceeds of taxes for Fiscal Year 2021-22 to be $127,013,222; and
WHEREAS, the selection of an alternative growth factor between the per capita
personal income or the change in the local assessment roll due to local non-residential
construction must be made by recorded vote; and
WHEREAS, the data for calculation of the local non-residential construction factor is no
longer readily available.
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Central Contra
Costa Sanitary District (Central San) as follows:
THAT the Board of Directors of Central San hereby adopts the Appropriations Limit for
Central San in the amount of $127,013,222 for the fiscal year ending June 30, 2022,
based upon the percentage change in California per capital personal income and the
percentage change in Contra Costa County population as published by the California
Department of Finance.
PASSED AND ADOPTED this 2nd of September 2021, by the Board of Directors of
Central San by the following vote:
AYES: Members:
NOES: Members:
ABSENT: Members:
Tad J. Pilecki
President of the Board of Directors
Central Contra Costa Sanitary District
County of Contra Costa, State of California
September 2, 2021 Regular Board Meeting Agenda Packet- Page 33 of 199
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Central Contra Costa Sanitary District
Resolution No. 2021-044
Page 2 of 2
COUNTERSIGNED:
Katie Young
Secretary of the District
Central Contra Costa Sanitary District
County of Contra Costa, State of California
Approved as to form:
Kenton L. Alm, Esq.
Counsel for the District
September 2, 2021 Regular Board Meeting Agenda Packet- Page 34 of 199