I am pleased to present the Adopted Operating and Capital Improvement Program Budgets for Fiscal Year 2022-23. This budget provides an overview and detailed information on each of the City's departments and describes the activities and programs included in the budget. It also incorporates the City's Capital Improvement Program for the incoming budget year and the budget for the Rosemead Housing Development Corporation. As in prior years, the budget presents information pertaining to the Successor Agency as "information only."
As shown in the following chart, the City of Rosemead’s Adopted FY 2022‐23 Operating Budget, including transfers, is $38,157,500 with an additional $13,169,000 within the Adopted Capital Improvement Program (CIP).
GENERAL FUND – The General Fund is balanced with an adopted budget (City operating and CIP) of $27,712,200 balanced against $27,717,000 in estimated revenues. Overall, General Fund revenues are expected to exceed FY 2022‐23 appropriations by $4,800. However, the estimated revenue does include a $1.4 million transfer from the American Rescue Plan (ARP) State and Local Fiscal Recovery Fund (SLFRF). On April 26, 2022, the City Council accepted the $10 million standard revenue loss allowance provided within the Final Rule of the American Rescue Plan Act which was then transferred from the ARP fund, which received the funds, to the SLFRF fund which was established to track the expenditure of the $10 million.
• GENERAL FUND REVENUE – Fiscal year 2022‐23 General Fund revenue is adopted at $27,717,000, representing an increase of 8.3% over the FY 2021‐22 budgeted amount. Excluding the transfer from the SLFRF fund, operating revenue totals $26,317,000, representing an increase of 9.3% over the FY 2021‐22 budgeted amount. The largest increases from the prior year are taxes and use of property with reductions reflected in licenses, permits, and fees.
• TAXES – Taxes, which represent over 78% of the City’s General Fund revenues, are expected to increase 10.1% over last year’s budgeted amount. Property tax and property tax in‐lieu of vehicle license fees represent 52% of tax revenue and 41% of total General Fund revenue. These two sources are based on assessed property value and its growth was not impacted by the Pandemic. Sales tax represents 24% of total General Fund revenue and although the revenue source was impacted by the Pandemic, not to level first anticipated. Budgeted at $6.5 million, sales tax has reached its highest level. Transient occupancy tax was most impacted by the Pandemic but has partially recovered with the budgeted amount of $2.2 million just $100,000 less than received in FY 2018‐19, its highest year.
• USE OF PROPERTY – The increase in this category is primarily related to a one‐time catch up of prior lease increases due from the Housing Development Corporation and the on‐going increased rate for the lease.
GENERAL FUND EXPENDITURES – The appropriations for FY 2022‐23 are $27,712,200 which are comprised of a $27,652,200 operating budget and a $60,000 portion of the Capital Improvement Program and is 8.4% greater than the adopted FY 2021‐22 budget. The budget amount includes the incorporation of all negotiated salary and benefit increases, various contract and utility increases, $147,100 in new expenses, $521,800 in new programs, and $624,000 in one‐time services and equipment purchases.
OTHER FUNDS – The City has 21 Special Revenue funds that are restricted in their use based on the purpose for which the revenue is collected. Collectively, the funds are adopted at $10,377,800 in operating appropriations and $13,109,000 in capital improvement program appropriations, offset by $13,862,300 in restricted revenue estimated for FY 2022‐23 and the use of available fund balance. Most revenue estimates for these funds are provided by outside sources as discussed in the Revenue Detail section of this document. The foundation for increasing this year’s recommended Capital Improvement Program was a review of the fund balances of all special revenue funds, FY 2021‐22 year‐end estimates, FY 2022‐ 23 revenue projections, and current CIP obligations as detailed in the ‘Special Revenue Funds’ section of this document. The City also has two Internal Service funds which together, were estimated at $52,000 in revenue (transfer from the General Fund and interest earnings) and $127,500 in adopted expenditures for capital equipment and improvements.
CAPITAL EQUIPMENT & SUPPLEMENTAL BUDGET REQUESTS – New for this year’s budget document is a listing of capital equipment and supplemental budget requests from departments to provide a quick view of additions to current programs, new programs and costs, and one‐time expenditures.
STAFFING – The fiscal year 2022‐23 budget includes an adopted citywide staffing level of 68 full‐time positions. Upon adoption, the FY 2021‐22 budget authorized a staffing level of 56 full‐time employees, however, during the year three positions have been added and one 3/4‐time position was converted to full‐time bringing the current staffing level to 60 full‐time positions. There are seven new full‐time positions adopted within Community Development based on the May 31, 2022 City Council agenda item regarding Building and Safety operations and the direction to bring those services in‐house. The salary and benefit costs have been budgeted within the contract service line‐item and as the transition is made between the contract service and in‐house staff, budgeted amounts will be moved to the appropriate object numbers within the division. Additionally, one Maintenance Worker position has been added within Public Works for the implementation of an in‐house graffiti removal program. The positions and salary ranges for Building and Safety staff shown below were determined by a recent position and salary survey while the Maintenance Worker position is an existing classification. All salary ranges shown are effective as of July 1, 2022.
CAPITAL IMPROVEMENT PROGRAM – The Capital Improvement Program (CIP) section has been enhanced again this year to include project worksheets for each new and continuing project in addition to the summary charts for new projects and/or additional funding for FY 2022‐23, a listing of continuing projects, a listing of completed/deleted projects, and a comprehensive listing of all projects in the 5‐Year CIP.
CIP projects include building, upgrading, or replacing City infrastructure such as residential and arterial streets, traffic signals, parks, and public facilities. The FY 2022‐23 Adopted CIP adds $13,169,000 to the current program for a total Capital Improvement Program Plan consisting of 45 projects in the amount of $53,310,600. The General Fund contributes $60,000 to the Program as partial funding for the annual Preventative Pavement Maintenance program and serves as part of the Maintenance of Effort (MOE) requirements for certain special funds. In addition to this year’s contribution, the General Fund is also obligated for projects previously approved but have not yet been completed in the amount of $481,260.
These improvements are funded primarily by transportation related special revenue funds including American Rescue Plan funds, the street light district, and grants. As reflected in the following chart, the primary funding sources for the FY 2022‐23 added projects is the American Rescue Plan SLFRF funds, RMRA, Prop C and Gas Tax. Use of the street light fund for new and continuing projects is allowable due to the approval of Senate Bill No. 1307 which allows Rosemead to use its Street Lighting Act of 1919 revenue in accordance with Landscaping and Lighting Act of 1972 regulations. The City’s light district is part of the 1% property ad valorem tax and not an additional assessment to our residents.
ROSEMEAD HOUSING DEVELOPMENT CORPORATION – The City, through the Rosemead Housing Development Corporation (RHDC) owns and operates two Senior Housing facilities. The funding source of the RHDC is a combination of the rents collected from tenants and contributions from the Successor Agency to former Community Development Commission to cover any operating shortfalls and lease obligations to the City. Changes for FY 2022‐23 include a reorganization of the accounting structure to become more transparent in the reporting of operating costs of the facilities, the increase in the annual lease amount due to the General Fund in accordance with the lease agreement including a catch‐up for past years, and the inclusion of $400,000 for repair/replacement of the elevator at the Angelus Apartments. The cost of the elevator repairs will be included in future ROPS submissions for reimbursement as maintenance is listed as an allowable cost within the accepted recognized obligations listing.
FINANCIAL POLICIES – As part of the annual budget process, the Financial Policies contained within the Budget Guide section of this document are reviewed and updated as needed. There are two additions to the Budget Policies section this year. The first is a policy to budget for the City’s OPEB liability at the level recommended within the required actuarial report. The second is a policy that allows the Finance Director/City Treasurer to determine the method of payment for the City’s annual unfunded pension liability annual contribution based on cash flow needs. The payment may be made annually or monthly with a discount given if paid annually.
CONCLUSION – The Adopted Budget document has been produced with the cooperation of all City Departments and coordinated by the Finance Department. An enormous amount of data is compiled to accomplish the accurate layering of revenue estimates, anticipated expenses, cost allocations, and salary calculations for a City with multiple programs and funds. In the end, the FY 2022‐23 Adopted Budget is staff’s best estimate of a spending plan for the coming year. As always, staff will continue to monitor the City’s fiscal health throughout the year and report upon any changing conditions.
I would like to conclude by recognizing the contributions of the Department Directors and their staff members who worked on the developing this year’s budget and for those providing services to Rosemead residents on a daily basis. I would like to give special thanks to Finance and Public Works department staff for their work in creating this document. Lastly, I would like to express my gratitude to the Mayor and City Council for their leadership, prudent fiscal policy decisions, and support crucial to achieving the City’s goals.
View 2022-23 Fiscal Year Budget