PREPARED BY: MATT RODRIGUEZ DATE OF MEETING: 06/20/16
SUBJECT:
TITLE
CITY COUNCIL AUTHORIZATION TO RECEIVE AND ACCEPT THE INDEPENDENT CITIZENS’ OVERSIGHT COMMITTEE REPORTS FOR PERIOD ENDING JUNE 30, 2015 FOR MEASURE Q AND MEASURE K TRANSACTION & USE SALES TAX
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CITY MANAGER RECOMMENDATION
Recommendation
Receive and File Report by Minute Action
Body
Compliance statements
Budget Spending Controls (All) and Increase Financial Transparency (Finance) are adopted policy items under the FY 2015-17 Council Priority Workplan, effective July 1, 2015.
CEQA Compliance Statement
This is not a project as defined by CEQA as a budget or financing mechanism pursuant to 14 Cal. Code of Regulations section 15378(b).
BACKGROUND
Pursuant to Ordinance 2012-005 adopted by San Pablo voters for the Measure Q Sales Tax Measure on June 5, 2012 and Ordinance 2014-007 adopted by San Pablo voters for the Measure K Sales Tax Measure on June 3, 2014, the City Council appointed representatives of San Pablo businesses and residents to serve on a Citizens’ Oversight Committee (Committee) to monitor and review each measure respectively. The five-member Committee includes the appointed citizens, as follows:
• Leonard McNeil, Chair
• Dave Alvarado, Vice-Chair
• Prospero “Pete” Dito
• 2 vacant seats
As required by each ordinance, the Committee scheduled an annual public meeting on June 8, 2016 to select a Chair and Vice Chair for the Committee, and then reviewed the necessary reports. The reports are as follows:
Measure Q and Measure K
• Independent Accountant’s Report: The City engaged its independent auditor, Maze & Associates, to review and report on the collection, management and expenditure of revenues collected by each measure for the fiscal year ended June 30, 2015. In February 2016, the firm finalized each measure’s separate report, which describes their findings as it relates to the agreed upon procedures for each respective sales tax measure (see Attachments A and B: Audit Reports from Maze and Associates). FY 2014/15 overall revenues and expenditures were reported as follows:
Measure Q Measure K
Budgeted Revenues and Expenditures: $1,050,000 $0
Actual Revenues: $1,535,635 $483,469
Actual Expenditures: $ 993,323 $347,702
• Program Evaluation Reports: The Committee reviewed annual program evaluation reports for each measure, which were produced by Public Profit, the City’s program evaluator. Using Maze & Associate’s audited figures, the reports reflect revenues collected and funds spent in support of programs and services made possible by Measures Q and K. The reports also presented statistical data that represents the positive impact that each measure had on designated target areas for FY 2014-15 (see Attachments C and D: Measure Q and Measure K 2014-15 Annual Reports).
• PowerPoint Executive Summary Report: City staff also presented to the Committee an executive summary PowerPoint presentation (see Attachments E and F: Citizens’ Oversight Committee Executive PowerPoint Summary) which highlighted all FY 2014/15 programs and services that were made possible to San Pablo residents through Measure Q and Measure K funding for the period ended June 30, 2015. Several testimonials were also presented for Measure Q by City and SPEDC staff to the Committee which made a powerful statement on the impact of the programs in the lives of individuals. With only two months of operations in FY 2014/15, the Measure K program was just getting underway.
Compliance and Review Statement
Once the attending Committee members completed their review of all program data and audited financial reports, they took official action to certify that all Measure Q and Measure K Transaction and Use Tax-related program revenues and expenditures for the FY 2014/15 period were utilized in accordance with official ballot language as adopted by the local electorate. These certification statements have been executed and signed by Committee members certifying that all Measure Q and Measure K sales tax revenues were expended in accordance with the San Pablo electorate and adopted Sales Tax Ordinances by the San Pablo City Council (i.e. #2012-005, #2014-007). (See Attachments G and H: 2015 Compliance and Review Statements and Attachment I: Meeting Minutes of June 8, 2016).
Additional Committee Findings
As reported to the Committee members, the City conservatively projected Measure Q revenue amounts before the beginning of the two-year budget cycle back in spring 2013. When actual Measure Q revenues were collected above the budgeted amounts, additional funding became available during FY 2014/15 that was not clearly identified as having been spent on Measure Q-related activities. Vice Chair Alvarado was disappointed that a detailed expenditure report was provided for some but not all three program areas (i.e. SPEDC Measure Q-funded activities). He, therefore, asked to go on record that he suggested that unspent funds be allocated to more public safety programs and that the City consider conducting a full audit instead of a simple compliance review by the City’s auditor. Moreover, at the recommendation of Chair McNeil, the Committee will conduct a follow-up meeting to determine what additional City expenses could be recommended to enhance Measure Q spending in accordance with the adopted sales tax ordinance, without exceeding the current annual revenue funding threshold. Although no consensus was reached by the Committee to authorize this formal direction, City staff did accept the Committee’s comments and suggestions.
FISCAL IMPACT
There is no fiscal impact associated with this report.
Attachments:
Attachment A: 2015 Independent Accountant’s Report on Measure Q by Maze and Associates
Attachment B: 2015 Independent Accountant’s Report on Measure K by Maze and Associates
Attachment C: 2015 Measure Q Program Evaluation Report by Public Profit
Attachment D: 2015 Measure K Program Evaluation Report by Public Profit
Attachment E: Citizens’ Oversight Committee Executive PowerPoint Summary, Measure Q
Attachment F: Citizens’ Oversight Committee Executive PowerPoint Summary, Measure K
Attachment G: Measure Q 2015 Compliance and Review Statement
Attachment H: Measure K 2015 Compliance and Review Statement
Attachment I: Citizens’ Oversight Committee Meeting Minutes from June 6, 2016