Council to Consider Operating Reserves on Monday’s Consent Calendar

As part of the consent calendar on Monday’s City Council agenda, the council will consider using the balance of the general fund for the General Fund Emergency Contingency and the General Fund Operating Reserve for fiscal year 2021.

“This action formally commits the full 15 percent FY 2021 General Fund emergency contingency committed fund balance for $40,441,600 and a reduced General Fund operating reserve of an amount less than 5 percent and yet to be determined,” according to a city staff report.

The reduction below 5% is based on current projections of available fund balance, reflecting the pandemic and the City Council’s action to utilize general fund resources to fund the Rose Bowl Operating Co. (RBOC) debt service. 

“It is projected that the available ending unassigned fund balance will not be sufficient to fund the full 5 percent operating reserve reduced by the above item. As it is not possible to accurately project a specific amount for the commitment of Operating Reserve at this time it is acceptable under GASB [the Governmental Accounting Standards Board] 54 to approve the methodology to determine the fixed amount at a later date.

“This action is to determine the Operating Reserve by utilizing all unassigned General Fund fund balance up to the 5 percent amount to a maximum of $13,480,600.”

Projections for fiscal year 2021 operating reserve are approximately $2.1 million and take into account general fund funding of Rose Bowl debt service. As part of the fiscal year 2022 operating budget, the City Council is expected to approve the appropriation of $10 million from the general fund to make payments for RBOC debt service and fund Amerifest. Since these funds will not be utilized until FY 2022, they will remain part of the emergency contingency and operating reserve at the end of FY 2021 and do not impact FY 2021 reserves. 

Other items on Monday’s City Council consent calendar include:

• Adoption of Gann appropriations limit for fiscal year 2022.

An annual appropriations limit of tax proceeds of the general fund, established by the City Council through a resolution, is required as a result of the 1979 Proposition 4, Gann Initiative. The appropriations limit is applied only to expenditures funded through tax proceeds. The limit is further reduced by expenditures for debt service or capital.

• A sweep motion could also authorize the city manager to enter into a contract with Los Angeles Homeless Services Authority (LAHSA) in the amount of $502,115 for the receipt of Measure H funding for fiscal year 2021 to provide homelessness prevention, rapid rehousing, coordinated entry, and emergency shelter programs in the city of Pasadena. The city manager would also be authorized to amend a contract with LAHSA to extend the term through June 30, and add Measure H funds in the amount of $634,645 to bring the new contract total to $4,200,728.
• A budget amendment appropriating $1,540,000 from the inclusionary housing fund unappropriated fund balance to the Housing Department’s fiscal year 2021 operating budget for the HHP Housing Acquisition Project. Approval of certain key business terms of the proposed affordable housing loan agreement with Heritage Housing Partners, and authorize the city manager to execute any and all documents necessary to effectuate the staff recommendation. 
• Authorize the city manager to enter into a five-year contract with the Pasadena Humane Society and SPCA to continue providing animal services for a grand total amount not to exceed $8,524,938 over the five-year term of the contract.