PREPARED BY: MATT RODRIGUEZ DATE OF MEETING: 06/19/17
SUBJECT:
TITLE
CITY COUNCIL AUTHORIZATION TO RECEIVE AND ACCEPT THE INDEPENDENT CITIZENS’ OVERSIGHT COMMITTEE REPORTS FOR PERIOD ENDING JUNE 30, 2016 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 October 1, 2016.
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
San Pablo voters passed Ordinance 2012-005 by approving the Measure Q Sales Tax Measure on June 5, 2012 to provide additional funding to pay for the services including Public Safety (including gang prevention); job training for local residents especially youth and the disenfranchised; and youth services. In addition, the voters passed Ordinance 2014-007 approving the Measure K Sales Tax Measure on June 3, 2014 to provide funding for an Emergency Medical Services (EMS) squad in San Pablo. Pursuant to Measures Q and K, 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 representatives, as follows:
• Leonard McNeil, Chair
• David Alvarado, Vice-Chair
• Prospero “Pete” Dito
• Raynato Castro
• Lorena Medel
As required by each ordinance, the Committee scheduled an annual public meeting on May 31, 2017 to select a Chair and Vice Chair for the Committee, and then reviewed the necessary reports. All Committee members were present for the meeting except Committee member Pete Dito who was absent due to a scheduled vacation. 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, 2017. In December 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 2015/16 overall revenues and expenditures were reported as follows:
Measure Q Measure K
Budgeted Revenues and Expenditures: $ 1,050,000 $ 650,000
Actual Revenues: $ 1,512,936 $ 754,366
Actual Expenditures: $ 1,364,120 $ 1,200,000
Note: the Measure K actual expenditures include General Fund expenditures above the Measure K revenues to fully fund the EMS Squad.
• 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 2015/16 (see Attachments C and D: Measure Q and Measure K 2015/16 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 2015/16 programs and services made available to San Pablo residents through Measure Q and Measure K funding for the period ended June 30, 2016. Several testimonials were presented for Measure Q which made a powerful statement on the impact of the programs in the lives of individuals. The value of Measure K funding was equally impressive in the number of calls to which Squad 70 responded: 3,340 -- over nine per day!
Compliance and Review Statement
Once 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 2015/16 period were utilized in accordance with official ballot language as adopted by the local electorate and in compliance with adopted Sales Tax Ordinances of the San Pablo City Council (i.e. 2012-005 and 2014-007). Following their review, the Committee had no recommendations on the FY 2015/16 Measure Q and K budgetary expenditures by the City (see Attachments G and H: 2015 Compliance and Review Statements and Attachment I: Meeting Minutes of May 31, 2017).
Follow-up to Committee Findings from 2014/15
Last year regarding FY 2014/15 programming, Vice Chair Alvarado reported dissatisfaction regarding the level of Measure Q spending. The City had 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 further 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 Chair McNeil suggested a follow-up meeting to determine what additional City expenses could be recommended to enhance Measure Q spending 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.
In response, the City Manager authorized the Police and Community Services Departments to overspend their FY 2015/16 Measure Q budgeted appropriations. With a Measure Q budget of $1,050,000, identified expenditures reached $1,364,120. Additionally, SPEDC staff pointed out that only 1/3 of their staff time spent on Measure Q was actually charged to Measure Q in order to preserve funding for contracted programming. Furthermore, SPEDC staff provided the additional reporting detail requested. Committee members, including Vice Chair Alvarado, expressed satisfaction with the outcomes with the FY 2015/16 Measure Q budget appropriations during the Committee’s review on May 31, 2017 as a result of this directive.
FISCAL IMPACT
This report is for informational purposes only-no fiscal impact.
Attachments:
Attachment A: 2016 Independent Accountant’s Report on Measure Q by Maze and Associates
Attachment B: 2016 Independent Accountant’s Report on Measure K by Maze and Associates
Attachment C: 2016 Measure Q Program Evaluation Report by Public Profit
Attachment D: 2016 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 2016 Compliance and Review Statement
Attachment H: Measure K 2016 Compliance and Review Statement
Attachment I: Citizens’ Oversight Committee Meeting Minutes from May 31, 2017