Planning for Fiscal Sustainability in Difficult Times February 19, 2009

1. Planning for Fiscal Sustainability in Difficult TimesFebruary 19, 2009 Presented by Jesse Takahashi Finance Director City of Campbell

2. Background • Built-out city of 40,000, in suburban San Jose/Silicon Valley • 4 years of deficits consumed $5.7 million in reserves • $4 million in cuts made over 5 years resulted in balanced budget in FY 07 and FY 08 • Further decline in economy, continued State revenue take-away, and new fire contract rekindled structural deficit

3. Projected General FundRevenues & Expenditures

4. Timeline of Events • March2007--study session began focused discussion of voter required revenue enhancement options • July 2007--community satisfaction survey; included two possible revenue measures • October 2007--study session reviewed unmet operating and capital needs, survey results and revenue options; direction to pursue measure and hire consultant • January2008—Consultant begins planning process for possible measure • March2008—First directed polling to assess viability of measure; strong support but lack of knowledge over fiscal situation

5. Timeline of Events (cont) • April2008—launched community education & outreach program • July2008—conducted follow up community polling; narrowed scope of possible revenue measure • August2008—Council votes to place Transactions & Use Tax on ballot • Aug-Nov2008—Partisan campaign begins; City disseminates objective information • Nov2008—Voters pass measure with 71% approval; effective April 1, 2009

6. Outreach Efforts • Inventory of Community Organizations • Citizens Budget Task Force • Newsletter and Newspaper Articles • Citywide Mailing • Community Forums • Presentations to Community Groups • Information Tables at Public Events • Feedback Forms

7. Summary of Options • Raise revenue via a ballot measure to maintain current service levels • Reduce expenditures and/or raise fees by $2 million to eliminate deficit • Some combination of the above What level of service and quality of life do we want for our community ?

8. Recommendation • Maintain current services from a ¼ cent sales tax increase • Locally raised funds would stay local • 40+ cities have adopted such measures • A $50 pair of jeans or dress would cost an extra 13 cents; a $1,000 computer would cost an extra $2.50

9. Keys to Success • Self Assessment • Community Priorities • Unified Board or Council • Education and Outreach • It’s all About the Trust • Communicate, Communicate, Communicate • Assemble a Capable Team • Speak with One Voice

10. Obstacles to Success • Naysayers (Internal and External) • Limited Budget/Resources • Getting Your Ducks Lined up • Workers, Endorsements and partisan campaign volunteers • Poor Economy • Reasons for Distrust in Local Officials • Maintaining Momentum through Entire Process

11. Reasons for Optimism • Strike While Iron is Hot • New President has Created Renewed Hope and Optimism Among Public • Public is Fed up with State’s Inability to Balance Budget Without Impacting Local Governments • People Are More Aware and Involved in Their Local Communities More Than Ever • YOU CAN DO IT!!!

12. 6 Steps for Success • Initiate Planning Efforts • Implement Public Opinion Research • Assess Initial Baseline Feasibility • Implement Nonpartisan Outreach Program • Re-Assess Support and Prepare your Council or Board • Win the Partisan Campaign

13. Resources • Consultants • League of California Cities • Institute for Local Government • California Ballot Measure Academy • CA Local Gov’t Finance Almanac (aka, Michael Coleman website) • www.californiacityfinance.com • CSMFO members and email listserve