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HomeMy WebLinkAbout12.19.2016 SP Minutes @2:00 MINUTES SPECIAL MEETING coot Sow OF THE y BUDGET STANDING COMMITTEE OF THE CITY OF SOUTH SAN FRANCISCO P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, California 94083 Meeting held at: CITY HALL ANNEX CONFERENCE ROOM 316 MAPLE AVENUE SOUTH SAN FRANCISCO, CA MONDAY, DECEMBER 19, 2016 2:00 P.M. 1. Call to Order. TIME: 2:05 p.m. 2. Roll Call. PRESENT: Vice Mayor Normandy and Mayor Gupta. ABSENT: None. 3. Public Comments. None. 4. Motion to Approve the Minutes of the meeting of September 12, 2016. Motion—Vice Mayor Normandy/Second— Vice Mayor Gupta: to approve the Minutes of the meeting of September 12, 2016. Unanimously approved by roll call vote. 5. Report transmitting draft Comprehensive Annual Financial Report for Fiscal Year 2015-16 to the Budget Standing Committee of the City Council. (Richard Lee, Director of Finance) Finance Director Lee presented the staff report. He advised the Comprehensive Annual Financial Report (CAFR) is a required document that conveys the City of South San Francisco's financial condition. A CAFR is issued at the end of every fiscal year, which begins July 1st and ends June 30th. The staff report on the item included draft copies of the following sections of the CAFR: 1) Management Discussion and Analysis; 2) Basic Financial Statements; 3)Notes to Basic Financial Statements; 4) Supplementary Information; and 5) Statistical Section. The CAFR would be finalized and sent to the Government Finance Officers' Association by December 31, 2016 to be considered for its Certificate of Achievement for Excellence in Financial Reporting. The FY 2015-16 CAFR would be formally presented to the City Council in early 2017 for acceptance. Director Lee advised that overall, the health of the local economy was manifest through the City's additional primary revenues: 1) Property tax; 2) Transient occupancy tax; and 3) Permit revenues. The City recorded year-over-year increases in developer impact fee revenues resulting from a robust and accelerated development climate in South San Francisco. Director Lee stated that the only concern he had with respect to the City's financial position and compliance with the City's reserves policies related to PERS. Due to expected adjustments to PERS at the state level relating to the discount rate, the City is expecting an impact of roughly three (3) to four(4) million dollars a year. Based on these anticipated changes, staff planned to present Council with policy decisions regarding pension liability in the near future. Katherine Yuen of the City's Auditor Mays and Associates commented on the financial position's sensitivity to pension liability. Mayor Gupta and Vice Mayor Normandy asked various questions related to pension liability and specifically queried the frequency of CALPERS policy changes. Director Lee advised that the frequency with which CALPERS adjusts its strategy has been increasing over the past five (5) years. The current strategy had been in place for six (6)months and was going to be adjusted again. Ms. Yuen next addressed the Committee regarding the Auditor's Memorandum of Internal Controls (MIC). She advised the MIC reported no significant deficiencies. However, she cautioned the City would need to monitor OPEB reporting based on new GASB Statement 75, which would come into effect in 2018. Director Lee next advised the Committee that as part of the CAFR process, the City learned it was not PCI compliant in the sense that cameras were not installed at every credit transaction location. The City was working with staff to bring this deficiency into compliance. Director Lee closed by noting that Council would see the CAFR in January. Staff would continue to work on solutions to the financial issues highlighted during the discussion for Council's consideration in the near future. 6. Adjournment. Being no further business Mayor Gupta adjourned the meeting at 3:30 p.m. ubmitted .y: Ap roved by: R.,_ • a a r elli, C. y C1er , Budget Standing Committee City • S • San F cisco Member, City of South San Francisco BUDGET STANDING COMMITTEE MEETING DECEMBER 19,2016 MINUTES PAGE 2