t
u ertino
Citizens
ofCupertino
City
Council
l
J Citizen Adivisol
Commispons and
Committees
CITY OF
CUPEIQ INO
City Attorney
ChllIles Kilian
City Manaller
David Knapp
City Treasurer
Carol Atwood
Public Information Officer
Rick Kitson
Director of
Administrative Services
Carol Atwood
Director of
Community Development
Steve Piasecki
Director of
Parks and Recreation
Therese Smith
Director of
Public WDlks
Relph Qualls
IT Manager City Clerk Buildinll Official Recreation Supervisor Recreation Supervisor City Architect Assistant Director
Mariyah Serrato Kimberly Smith Greg Casteel Sports Center SeruDl Center Terry Greene of Public Works Enll
Don McCarthy Julia Lamy Glenn Goepfert
Finance Director Human Resources CIty Planner Recreation Supervisor Recreation Supervisor Public Works Environmental
Oavid Woo Director Ciddy WDldell Blackberry Farm Youth PMProargonralj1eglf1ceSrt Programs Manaller SandyAbc
MikeO Dowd Christine Hanel Carmen Lynaugb Lavenia Millar CodeOutreach
Economic Development Recreation Supervisor Assistant Director Senior Civil Enllineer Enforcement Programs
RDA Manager Quinlan Center ofPublic Works Maint David Stillman Vacant Tom
Walters Bob Rizzo Parks Supervisor
John
Bisely
Facilities Supervisor
Jim
OBvis
Streets Supervisor
Diane
Mahan
Public Works
Supervisor Ron
Silva
CITY OF CUPERTINO CALIFORNIA
Fiscal Year
200607
CITY COUNCIL
Richard
Lowenthal
Mayor
l f
1
Ij
IKris
Wang ViceMayor
PatrickKwok
COllllcilll1ell1ber Orrin
MahoneyCOllllcilmell1ber
Dolly Sandoval
COllllcilmell1ber DIRECTORY
OFCITY OFFICIALS David
WKnapp City Manager Charles
TKilian City Attorney Carol
Atwood Director ofAdministrative Services Steve
Piasecki Director ofCommunity Development Ralph
Qualls Director ofPublic Works Therese
Smith Director ofParksand Recreation III
CITY OF CUPERTINO CALIFORNIA
Fiscal Year
200607 COMMISSIONS
AND COMMITTEES AUDIT COMMITTEE PARKS
RECREATION COMMISSION
Myoung Kang
Dolly Sandoval
Garrett Wade
Kris Wang
Jim Weber
Jeanne Bradford
Derek Chen
Margaret Goodrich
David Greenstein
RogerPeng HOUSING COMMISSION
SENIOR COMMISSIONFINE
ARTS COMMISSION
Estelle lncociati Christine
Kennedy Pierce
Mavis Smith
Linda Walker
FrankYap
LIBRARY COMMISSION
Richard Abdalah Sarah
Hathaway Feit
Kim Mosleh
Frances Seward
Chihua Wei
Nancy Canter
Michael Harkin
Robert Harrison
Janet Mohr
Ann Woo
Ronald Miller
Sheila Mohan
Janet Riddell
Katherine Stakey
Susanna TsaiPUBLIC SAFETY COMMISSION
PLANNING COMMISSION
Fari Aberg
Charles Caldwell
Jay Cena
Nina Daruwalla
Hugh Riddell
TEEN COMMISSION
Cary Chien
Lisa Giefer
Marty Miller
Taghi Saadati
GilbertWong
ECONOMIC DEVELOPMENT
Yukti Gangwani
Vrinda Gupta
Cordelia Jiang
Diane Keng
Hannah Lee
BenjaminUn
Abishek Menon
Tiffany Ou
Varun Pande
Alex Pommier
Rulanani Sahay
Shivani Sharma
Ana Yglesias
Carol Atwood
Cary Chien
Mike Foulkes
Christine Giusiana
David Knapp
Orrin Mahoney
Mark McKenna
Steve Piasecki
Ralph Qualls
Scott Stauffer
KrisWangBICYCLE PEDESTRIAN COMMISSION
TECHNOLOGY INFORMATION
COMMUNICATIONS COMMISSION
Scott Fable
MayKoski
Geoffrey Paulsen
Joseph WaltonJ
ames Wiant
Charlie Ahern
William Allen
Eric Klein
Andrew Radle
StevenTingtv
California Society of
7VLunicipal 3inance Officers Certificate of Award
For
Excellence in Operating Budgeting
Fiscal Year
2005 2006TheCalifomia SocietyofMUllicipal Finance OfficersCSMFO pprreosuednltystlis
certificate to TheCity
ofCupertino For llIutillgthecriteria established toachievetileEXCELLENCE AWARDilltlteOPERATING
BUDGET
CATEGORY February 23 2006
L 4ukhai tJ
Budgeting
FinBndAI MAn gement PresidentThe California Society of Municipal Finance Officers issues
annual awards foroutstanding achievementand contributions to the profession The City of
Cupertino received the award shown above for its 2005 06 annual operating budget
Inbestowing thishonor the Societyacknowledges theCity foritsoutstanding
presentation of financial and budgetary data Our 2006 07budget documentisintended to meet
theSocietyshigh standardsand willbe submitted again
thisyeartodetermineeligibilityforanotherawardv
RESOLUTION NO
06118ARESOLUTION OFTHE CITY COUNCILOFTHECITY
OFCUPERTINO ADOPTINGANOPERATINGANDCAPITAL IMPROVEMENT
BUDGET FOR FISCALYEAR200607BYRATIFYING ESTIMATES
OFREVENUESTOBERECEIVEDINEACHFUNDAND
APPROPRIATING MONIES THEREFROMFORSPECIFIED ACTIVITIES AND
ACCOUNTS ANDSETTINGFORTH CONDITIONS
OFADMINISTERING SAID BUDGET WHEREAStheorderly administrationofmunicipal government
isdependent on the establislunentofasound fiscal policyofmaintainingaproper
rationofexpenditures within anticipated revenues
and available monies and WHEREAS the extentofany projectorprogram andthe
degree of its accomplishmentaswellastheefficiency of performing assigned dutiesand
responsibilities is likewise dependentonthe monies made available
for that purposeandWHEREAS theCity Manager has submittedhisestimates
of anticipated revenues andfundbalances and has recommended the allocationofmonies
for specified program activitiesNOWTHEREFORE BE IT RESOLVED that the City Council
doeshereby adopt the following sections asapart
of its fiscal policy Section1Theestimatesofavailable fund balances
andanticipated resources tobe receivedineach ofthe several fundsduring fiscal year
2006 07 as submittedbythe City Manager inhisproposed budget andashave been
amended during
the budget study sessions are hereby ratified Section2There is appropriated from each of
theseveral funds thesumof moneyasdetermined during the budget sessions for
the
purposes as expressedandestimated foreach department Section3 The
CityManagerishereby authorized to administer andtransfer appropriations between Budget Accounts
withintheOperating Budgetwhenin
his opinion such transfersbecome necessary for administrative purposes Section 4 The
DirectorofAdministrative Services shall prepareandsubmit
to City Council quarterlyarevised estimate ofOperating Revenues Section
5TheDirectorofAdministrative Services
is hereby authorized tocontinue unexpended appropriations for Capital Improvement projects
Section 6TheDirector of Administrative Services ishereby authorized to continue appropriations
for operating
expendituresthatareencumberedorscheduledtobeencumberedatyearendVI
PASSED AND ADOPTED at a regular meeting of the City Council of the City of
Cupertino this 20th day of June 2006 bythefollowing
vote VoteMembers of the City
Council
AYES
NOES
ABSENT
ABSTAIN Lowenthal WangK wok Mahoney
Sandoval
None
None
None ATTEST
APPROVEDIsKimberly SmithIsRichard
Lowenthal City Clerk Mayor Cityof
CupertinoVll
TABLE OF CONTENTS
FISCAL YEAR
2006
07PAGE
TITLEPAGE
ORGANIZATION CHART DIRECTORYOF
CITYOFFICIALS
COMMISSIONS COMMITTEES EXCELLENCEIN
OPERATIONAL BUDGETING2005
06ADOPTED
BUDGET RESOLUTION
BUDGET MESSAGE
BUDGET STRATEGIES Mission
Statement Financial Values Statements
City Council Work
Program Fiscal Strategic
Plan Services
vs
Resources
Performance
Measures
I11
111IVVVI1
56711 2526
BUDGET GUIDE Elementsof
the Budget Document Structure
ofthe
City sFinances
TheAnnual Budget
Process GlossaryofBudget
Terminology29
303233COMMUNITY
PROFILE History
ofCupertino
Community Economic Profile37
38FINANCIAL
ANDPERSONNEL SUMMARIES
Budget Summary Revenue
and Expenditure
Charts Revenue Summary Personnel
SummaryFive
Year Budget Forecast
Appropriations Limit45
46506371
96 DEPARTMENTAL OPERATING BUDGETS
COUNCILAND
COMMISSIONSCity
Council Technology
Information
CommunicationsCommissionLibraryCommissionFineArtsCommissionPublicSafetyCommissionBicycleandPedestrianCommissionParksandRecreati nCommissionTeenCommissionSeniorCommissionPlanningCommissionHousingCommission102104106108110112114116118120122
PAGE
ADMINISTRAnON
City Manager
Community Outreach
City Manager Discretionary Fund
Legal Services
128130
132134
LAW ENFORCEMENT
LawEnforcement
140PUBLIC
INFORMATION Community
Relations Cupertino
SceneGovernment
Channel
City Website
146
148150
152 ADMINISTRATIVE
SERVICES Administration Outreach Programs
Accounting
Business Licensing
City Clerk
Duplicating and Mail
Service Elections
Emergency Preparedness
HumanResources
Retiree Medical LiabilityCode
Enforcement
Insurance Administration Information Technology160162
164 166 16708 172174176 178 180
182 184 PARKSAND
RECREAnONAdministration Cultural
Programs Quinlan Center Community
HallYouth
and
Teen
Monta Vista
Recreation
Center Teen
Center
Sportsand
Physical Recreation
Senior Programs
Senior
Center
Blackberry
Farm
Nature Programs
192194
196198200202COMMUNITYDEVELOPMENTAdministrationPlanningHousingServicesBuilding208210212214PUBLICWORKSAdministrationEnvironmental rogramsEngineeringServicesServiceCenterGroundsStreetsFacilitiesTransportationGeneralServicesFixedAssetsAcquisition2222242262282 0232234236238240
PAGE
NON DEPARTMENTAL OPERATING BUDGETS
Interfund Transfers
Debt Service
246248 CAPIT
AL IMPROVEMENTS Five Year
CapitalImprovementsProgram251
j fi
u J
I F
CUPEIUINO
May
25 2006Tothe Citizens ofCupertino Honorable
Mayor and Members of the
City Council Enclosed please find the City of Cupertinos Fiscal Year 2006
07operating and capital improvement program budgets In addition projections have been
included for anadditional four fiscal years to aidasalong
range financial planning tool For the first time inthe past four yearsofbudget submittals ourfinancial
position has started to look brighter Last year at this time the Cityhad 17positions
11ofour workforce frozen and had deferred needed maintenance of facilities streets trees
and equipment for the previous four years Increases inbusinessto business sales tax license
and permits charges for services and one time revenues have all helped to ease the financial position
ofthe City andpositions are now being filled Althoughweare still struggling
with an operating deficit revenue increases coupled with a conservative approach on expenditures have
put usin astronger financial positionIn addition the Council adoptedthe Fiscal
Strategic Plan which identifies revenue and expenditure strategies to improve theCitysability
to
provide services under changing
economic conditions Fiscal Year0405 and 0506Results TheCitysaudit report for the year
ended June 30 2005 showed the General Fund in a strong
net income position after accounting for operating expenditures debt service and transfer obligations
This56million bottom linehowever isinflated by onetimerevenuesof 3
8million from the sale of surplus property state paybacks and park dedication
feepaybacks As for expenditures vacancies were upwardsof11saving both
salary and benefit costs deferred maintenance was close to1million and another 850 000inappropriations were
carried over Reflecting the
above activity our end result would have beenanetloss to the General Fund
of11million for theyear During fiscal year0506 revenue trends began to turn
around specifically in the area ofsales tax charges for services and licenses and permits Sales
taxincreased asa direct result of ourtwo large high tech firms
Charges for service and licenses and permits were directly related to development activity Because
ofthe increases in our revenues frozen positions were released for recruitment and various
items for deferred maintenance were funded at mid year In addition we added a parttime
emergency preparedness position broughtthe part time facility attendant for the Community Hall to full timedue
toworkload and
upgradedatraffictechniciantothatofseniorengineerWeexpecttoendthefiscalyearinapositivefinancialposition1PrintedonRecycledPaper
Fiscal Year 06
07 Concerns This proposed budget provides forfull staffing levelsandnew positionsto
accommodate growth in permits and development information technology newfacility maintenance
and specific customer service levelstandards Maintenance is budgeted at moderate levels and
mostcapital improvement projects that had been deferred for several years are now funded Our
five year projections however are still underwater comparing annual operating revenues
toannual expenditures and funding has not yet been setocucroerdretthis imbalance There
are good reasonstobe concerned about pending legislation for franchise revenues court
decisionsonbuilding development fees and cell phone utility tax maintenance for annexed older areas
to the Cityand increasing fuel and
asphalt costs To address these concerns Council formedaFiscal Strategic Plan Committee
this spring consisting oftwo council members and five key managers with the goal of
addressing our current financial picture future obligations and revenue and expenditure structures
The City Council approved the Fiscal Strategic Plan inMay which is incorporated asan integral
partof this budget Basedonthose recommendations the City willbetaking measures to
repositionits revenue composition streamline operations and
control costs But therearepromising possibilities as wellAsSilicon Valley rebuilds its economy
sales tax and transient occupancy tax revenue will improve In addition there isabill before
theState Legislature to adjust the City s share of property tax brining us in line with the rest of
the citiesin the California If passed our percentage of property tax could increase
from 4to7representingagross property tax increase ofjust over 2million
dollars per year Finally local ownersofour regional mallareproceeding with much needed
redevelopment of the propertyAnew AMC theater is scheduled to open in November 2006
and isestimated to bring in approximately1 5 million shoppers tothe
mall each year The developers are also proposing new housing and retail components as wellas
anew hotelIfsuccessfulintheir redevelopment efforts theCity would benefit greatly
from increases inboth propertyand
sales tax Fiscal Year 0607Funded andUnfunded RequestsIn additionto
contractual salary adjustments and covering our future retiree medical obligations the following programs
have beenre instated or added tihne proposed 06 07
budget Three new positions including an Economic Development RDA Manager a
Counter Specialistand
aMedia Coordinator One Recreation Coordinator position has been eliminated
through streamlining Consultant budgets for review of the Community Development Department
Service Delivery 75000a
Green Building Study 75 000 anda North
Vallco Area Study100 000
Referendum election costs amounting to 215 000 Pavement Management funding at the
fiscalyear2001102 levels 250 000 Traffic
Calming including speed bumps 25 000 EServices funding forupgrades
toour
FinanceHumanResourcesPermitTrackingCodeEnforcementandBusinessLicensesystems100000andExpandedoutreachprogramsintheareasofDisaste PreparednessNeighborhoodWatchandLeadershipCupertino2
With the above additions this budget includes most of our needs for this upcoming fiscal year
However the following requested items have not been incorporated due to lack of funding
North Area Vallco Study 100 000
funded250000unfunded
Joint Venture Consortium Membership Service
Club Memberships including Rotary Santa Clara County request for
2nd homeless count study 250 0005 00025002279 In addition
to the
operating itemsabovethe
following capital
improvement projects have
not been included Rancho Rinconada ParkConstruction
20091
0Stocklmeir Property UpgradetorentUpgrade for
public usenot including parking
Quinlan
Fountain 200708City Hall Remodel with Seismic ADAFire Code 200809Bubb McClellan Storm Sewer
Upgrade 2009 111000 000 250 000200000 150 0003000 0002750
000 Conclusion Iam pleased to submit to youabalanced budget for the
upcoming fiscal year 2006 07Inorder to continue the high
level of service the communityisreceiving we will
needto
implement the
Fiscal Strategic Plan
to
ensureastableanddiverserevenuestreamThismeanssupportingeconomicdevelopmentembarkingonnewrevenuesourcesandcontinuallyaskingourse veshowwecandeliverhighcustomerservicemoreefficientlyRespectfullysubmittedJcJ1DavidWKnappCityManager3
City of Cupertino
MISSION STATEMENT
The environment within our City is interdependent upon a partnership of City Employees
Elected Officials and the Community To further this partnership the City of Cupertino has
agreed upon certain basic values within the framework of the City s policies to better serve the
Community
Provide prompt courteous and equitable service that responds to individual needs
Treat each customer and employee with respect dignity and sensitivity
Support and encourage individual professional growth and innovation to enhance customer
service and employee satisfaction
Create a positive professional environment based upon teamwork
As a team it is our objective to provide the highest level ofsatisfaction in all programs and
servIces
We are proud to be part of the City of Cupertino team and will strive to provide the best service
possible5
BUDGET STRATEGIES
FINANCIAL VALUES STATEMENTS
The City of Cupertino adheres to the following guidelines and principles in preparing its budget
and conducting its day to day and long term fiscal affairs
1Revenue
Levels To the extent possible maximize investment yield while maintainingahigh level
ofliquidity for the Citysanticipated capital
costs Identifyandrecommend sourcesofrevenue necessarytomaintain the services desired
bythecommunity andtomaintain theCitysquality of
life Perform ongoing evaluations of existing sources ofrevenue to maximize the City
srevenue
base Recover costsofspecial services through user
fees Allocate all internal service chargestoappropriate user
departments Ensure that Enterprise activities remainselfsupporting in the long
term2
Expenditure Control Maintain operating activities at levels which are offset
byrevenues Evaluate expendituresatthe department and project levelsto
ensure control Reduce costsandimprove productivity through theuseof
efficiency measures Structure debt refinancing to provide the necessary capital while minimizing
future debt
service costs3Long
Term Financial Stability Ensure ongoing productivity through employee training
and retention programs Pursue consolidation of resources and activities with other
agencies and
jurisdictions where beneficial Ensure financial planning flexibility bymaintaining adequate fund
balances and reserves Provide for major maintenance and repair of City buildings and facilities
on
atimely basis Provide forinfrastructure asset preservation that maximizes the
performance of these assets atminimum
life cycle costs Continually evaluate and implement long term financial
planning including technology automation multiple year capital improvement programs
revenueandexpenditureforecasting6
BUDGET STRATEGIES
CITY COUNCIL WORKPROGRAM
Maior Developments
Process applications for and work with the development community
to present the best projects for our community for
Vallco
Toll Brothers
Taylor Woodrow
McDonaldIDorsa Quarry Site
fgpital Improvements
Design and implement the following capital improvement projects
Mary Avenue Pedestrian Footbridge
Phase I underway grading fencing and utility relocation
Stevens Creek Corridor Park
Includes improvements to Blackberry Farm picnic grounds creek
realignment and restoration trail construction and Phase I of
the environmental classroom construction
Rancho Rinconada park
Commence work on a park for Rancho Rinconada and explore
potential sites with water district and county parks staff Pursue
acquisition ofthe two parcels at Sterling and Barnhart
Pursue neighborhood park in the Homestead area
Work with potential developers ofthe Villa Serra project to
provide a neighborhood park
Vallco HP park
Pursue a neighborhood park in conjunction with the Vallco and
HP Toll Brothers developments
Sports Center pool
Develop a strategy for upgrading the pool and bath house
Construct Reach a Trail
Monitor the construction of the parcel trail in Reach a Trail in
2007
7BudgetReference2107677252274
BUDGET STRATEGIES
CITY COUNCIL WORK PROGRAM Budget Reference
Qy1italImprovements continued 77
252253 MaryAvenue Pedestrian Crossing Oaks
Senior Center Construct project during May
and
June 2006
OrganhationalImprovemen 184 185 E Services Bring City Halltothe
customer and improve efficiency of service delivery
Master Planinprocess
including On linebuilding
permits On line business
licensesOnline job applications Records retrieval
forthePublic Works Department
Economic Development
landusesite
Recreation registration Fiscal Strategic Plan 1124Developalong term
solution toreposition the City to ensure services can be
fullysupported
byrevenues
collected Items for
consideration include Entertainment
tax TOTtaxincrease
UUTordinance modification Business licence ordinance modification
Synchronize Council policy and development review criteria Coordinate
the intentof
Council policy
Planning Commission
and staff implementation210
PublicSafEJ140162174LawEnforcementContinueemphasisonNeighborhoodWatch8
BUDGET STRATEGIES
CITY COUNCIL WORK PROGRAM
Public JSlcoanft1inUueJd
Emergency Preparedness Continue
expandingtheCERTprogram Develop
high school emergency response training Ensure
emergency response trainingforcity staff Continue
Kaleidoscope programfor grades6
12Develop city evacuation
plan Ensure emergency response training for
schools Develop and conduct Code Red training for school
districtsin
Cupertino Expand volunteer
programlContinue partnership with Cupertino Union and Fremont
Union High School Districts tofundasecond School Resource
OfficerlContinue annual offeringof Every15
Minutes ProgramlContinue partnership with Cupertino Unionfora
juvenile
prevention programl
Traffic Safety Implement the walkable city concept in
conjunction withnew
development projects Review traffic safety issues including safe routes
to school program traffic signal at McClellan and DeAnza and
theStreet
Smarts Program Consider redlight education via the Public
Safety
Commission HousinllReviewthe teacher housing assistance program
for effectiveness lConductaNexus studyforhousing
mitigation feeslPursue theCleoAvenue affordable
housing
project9BudgetReference140162174212
BUDGET STRATEGIES
CITY COUNCIL WORK PROGRAM
Economic Development
Encourage retain and support healthy environment for retail growth
Consider retail in review of new development for potential revenue
generation possibilities
Hire an Economic DevelopmentRDA Manager
Planning
Begin implementation education and synchronization ofthe
General Plan update
Update the Heart of the City Plan and adopt implementation
measures including the Crossroads Streets cape Plan and the Green
Buildings Program
Perform a Green Building Study
Perform a North Area Vallco Study
Building Communiti
Continue to offer opportunities and programs to promote cultural
understanding and address the needs ofour diverse community
Communi Orllanizations
Support the Cupertino Historical Society in its effort to create
a Center for Living History
Pursue partnership opportunities with the three school districts
including pool gym traffic parking and teacher housing
10
BudgetReference210208130162174
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
Define the Problem Analyze the Current Funding Gap
The 2000 2005 recession coupled with significant increases in retirement and
medical costs energy costs new infrastructure service needs and the State of California take
always severely undermined the ability of the City of Cupertinotocontinue delivering high
quality municipal services TheCity weathered the economic storm bycutting service levels freezing
upto17staff positions refinancing debt service turning toafull cost recovery fee
structure forcertain services realizing one time revenues through sale of surplus property
andreducing employee compensation through direct salary cutbacks and work furloughs Service
levels clearly sufferedandsacrifices were necessary
across the board The city learned that our fiscal structure left us vulnerable tothewhims
of economic fluctuations and the ability of the Statetoraid our revenue sources Two major revenue
sources sales tax and property tax were principal weak points in the above scenario
Cupertino is heavily dependenton business to business sales taxes and its retail sales tax
issignificantly under performing dueto the conditionofolder strip shopping centers in the community
and the recent lossofseveral significant revenue producers such as Anderson Chevrolet
and Drexel Heritage Furniture Also Cupertino isone offourno low property tax cities frozen
bypreproposition 13 to
abnormally low tax rates The City must evaluate its revenue structure to ensure more
reliable less volatile revenue sources andevaluate its cost structuretoensure we are operatingin a
cost effective manner The following fiscal strategic plan defines strategies to reposition the revenue
and cost structure ofthe city to ensureitisnot asseverely impactedbyfuture changing
economic conditions and thatweare abletocontinue fundingofexisting
and new service levels The city s latest audit report for the year ended June 30 2005
shows the General Fund inastrong net income position after operating
expenditures debt service and transfer obligations Based on this andthe factthat the federal government is
estimating inflation next year in the 3 6 plus levels one might say that the
goal to achieve financial viabilityisalready won However the 200405 financials
arenot representative of our true levelofservice Vacancies were upwards to 11
of our authorized workforce maintenance of infrastructure was cut to anall time low and because
of the shortages in staffing many budgeted projects were carried over to the current fiscal year In
addition
onetimerevenuessuchassaleofpropertyinflatedthisbottomline11
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
To analyze our current funding gap and present for you a more accurate financial picture we
looked at the actual inflows and outflows to the General Fund and identified one time non
reoccurring revenue In addition we looked at the latest audit report for fiscal year 04
05 and added back the salary and benefits deferred maintenance anddeferred projects approved
but not spent Finally for 04 05wededucted the non reoccurring State
payback park dedication fee payback and sale of property This provides youasnapshot ofwhat
our financial results would have been atfully approved levels of operation andwithout
one time revenue sources The following chart shows total revenue operating and transfers
inversus total expenditures operating and transfers out for the fiscal years 9900to
0405 One time revenuesareshowninyellowtovisually denote the
1FitvoGmnhe2fufeaelrtnonsgfldwueonsrwistauslde
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
Although Fiscal Year 04 05 ended witha5 6million dollar profit
once one time revenues are removed and expenditures are reflected at approved levels the result is
anet loss of11million dollars This net lossfigure does notreflect
future concerns in the following areas Pending legislation willput
389000 ofcable franchise fees in jeopardy Pending court cases mayput
350 000 in cell phone utility user tax in jeopardy The City is
currently spending153million per year on active and retiree
medical premiums and future liability costs There are 150 active and 81 retired employees
receiving benefitsThecostofproviding this benefit has fluctuated
and it is conceivable that health premiums could increase in excess of
8per year Fuel costs have risen 30
since preparation ofthe 0506budget The City has approximately 130 rolling stock and
vehicles in the fleet Asphaltisa petroleum based product and the cost
of street work has risen dramaticaly this yearAconsultant isupdating
the pavement management plan and hasindicated that street jobsarecoming
in25 to46higher thanayear agoTheannexation of
Monta Vista Garden Gate and Rancho Rinconada neighborhoods has lowered the overall pavement
standard for Cupertino and a disproportionate amount offunding has gone into
these areastobring streets closer to city standardOurcurrent annual
750 000 commitment is
minimal forkeepingthestreets in good order Keeping pavement
ingood condition is the most economical maintenance strategyoverthe
long tern Library aquarium maintenance reimbursement willbereduced by507500 per
year starting in 2009 and willbe the Citysfull responsibility in 2014Besides balancing atthe
basic level of operating revenues and operating expenses debt service obligations with theabove issues
inmind we will needtofund our reservesat appropriate and
ormandated levels A healthy net income will be
required to embark on operationalorcapital improvement areas that are already
being discussed Some
ofthese projects include Additional parksonthe east sideofthe city
Reserves to accommodate major
renovation requirementsof
ourfacilities such
astheQuinlan
Community Center Funding
for environmental components
such as artificial turf and solar energy options for fields parks and facilities Extended library hours
Improved street standards Alternative energysources E Services and Risk reduction efforts
Basedontheunderfundedcurrentandnonfundedfutureneedsstaffrecommendsthatthecityrepositionitsrevenueandexpenditurebasetofundanaddi ional25millionperyear13
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
Automate and Streamline Service Delivery
We currently have 157 75 fulltime equivalent positionsin our budget Although lean for
a city of our size the committee lookedatthe structureofour organization and areas to
automate or streamline This task was critical since approximately 70 of the
general fund operating expenditures are associated with salary and benefit costs In addition long term
trends for what we call hidden costs medical insurance premiums workers compensation
and retiree medical costs are directly associated with the number ofour employees The morewe
canstreamlineorcontract out services the more wecan control these current and
long term costs Our hiring freeze this year demonstrated thatwecouldntreduce our workforce
and maintain all existing programs for any lengthoftime Our organization is too lean and
too flat to accommodate thisoption without experiencing declines in customer
satisfaction and service levelIfwe are successfulinaworkforce reduction programs impacted
by staffing reductions need to be identified and either contracted out modified or eliminated
In addition previously frozen maintenance positions will need to befilledtosupport infrastructure
added during the last five yearsandtoaddress mounting workload demands associated
with deferred maintenance We also need to be cognizantof our future personnel needs This year we added
afulltimeInformation Technology Assistanttoaccommodate the workload associated
withour increasing technology baseA Facility Attendant was also approved tostaff the new
Community Hall Atsome point possiblyasearly as fiscal year 200607wewill
be facing increased law enforcement needsasaresultofour annexations and the development
of new residential and commercial buildings We also foreseenewstaffing needsfor
economicdevelopmentandaredevelopmentagency14
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
The Committee identified several areas for potential short term andlor long term savings for your
consideration
A Streamline and reposition our workforce as opportunities arise
As future vacancies occur through attrition we will need to streamline and reposition our
workforce whenever feasible All vacant positions should be reviewed to identify
opportunities for automation level of effort shifts or other cost saving ideas We will
also need to reposition our workforce to meet evolving workload demands Greater
emphasis will be placed on employee cross training and career development opportunities
and on filling vacancies through internal transfers and promotions Repositioning will
provide staffing where it s needed most while reducing our long term need for additional
positions
B Implement E Services with the goal of bringing city hall to the customer and
reducing our cost of service delivery
The City s E Service budget was eliminated the past two fiscal years in an effort to save
expenditures This year an E Services master plan is being drafted which addresses
automation opportunities of government services Examples of products currently being
assessed include but are not limited to
Permit tracking in the Building Department
Records managementretrieval in the Planning Department
On line job applications in the Human Resources Department and
On line business licenses in the Finance Department
C Pursue artificial turf in our athletic fields to reduce maintenance and risks
associated with injury
Utilization of artificial turf is a growing trend to curb the rising costs of maintenance and
general liability claims The committee recommends that we use all future youth sports
league fees for refurbishment of the fields and that we pursue utilization of artificial turf
and solar energy whenever feasible and cost effective
D Pursue alternate energy sources for the City s infrastructure and vehicle
replacement needs
The committee recommends the City investigate use of alternative energy for application
in City facilities and vehicles where it is a proven cost
benefit15
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
Stabilize and Reposition Revenue Sources
Cupertino has historically been heavily dependent on sales tax as a major general fund revenue
source however trends over the past ten years have changed not only the percentage of revenue
received from this source 36 to 26 but also the makeupof where the revenue
is coming from Ten years ago over 50 of our sales tax base carne from the retail
sector where today 49is from the business to business or the high tech sector Our
largest sales tax producer Apple Computer comprises 26 and given the volatility of the high
tech industry this fact alone has put this revenue source in an at risk situation To add to
thisconcern the State is continuing itsefforts to change the way Internet sales are reported
andifthey are successful will dramatically affect theamountofsales tax
revenue currently received
from Apple CITYOFCUPERTINO
SALES TAXBY ECONOMIC CATEGORY
li 1 II IC
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1 11OI I w r lj I 11
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I i i l
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rifj
v IJ Y s y tuY y111n co BENCHMARK YEAR ENDING
QUARTER In the past four years of budget cutswehave mainly focused our
effortsonreduction of expendituresNonew revenue sources persehave been implemented with the
only major change resulting fromanindependent analysis ofexisting fees to ensure thatwe
are
coveringourcostsofserviceTheCommitteebelievesthatitwouldbeprudenttoconsiderthefollowingrevenuestrategies16
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
A Pursue Tax Equity Allocation TEA relief with Santa Clara County
When Proposition 13passed in 1978itfroze property taxesattheir current
levels This action created significant problems for cities that at the time had low property
tax rates because they couldntraise those rates to meet their community needs
Four cities including Cupertino are significantly below the average We are actively
pursuing an amendment to bring ustopar with the TEA rate of7
with the County BReassess Park Dedication Fees on an ongoing basis to capture
rising real estate costs associated
with park acquisition Each timeanew development application comes to the City real estate
costs shouldberesearched to ensure that the park dedication fees arecurrent and
reflect appropriate costs for property acquisition This will ensure that our purchasing power
is notdiminishedCNegotiate with Hansen regarding future landuserightsin
exchange forannexation Hansen currently resides in the County but utilizes Cupertino streets for access
to its site The cement trucks that frequent Foothill Boulevard and Stevens Creek
inflict much more street and landscape maintenance needs than the average user
Cupertino has been absorbing thetraffic and pavement issues associated with this business
but receives no revenue benefit Itisestimated the utility users tax from this site alone
will bring over 1 million per year to the city The committee recommends
pursuit of annexation in exchange for
future land userightsDSupport Redevelopment Economic Development for
Vallco
and other major projects Analysis
shows us that ourregional
mall is producing well below the
average sales tax per square foot
that is required to have
a strong operation
We currently receive approxi
mately 12 million per year
from Vallco in sales tax
ascomparedtothe
Oakridge Mall which
is remitting around 5 4 million
peryear1lFJc1ftIl1ii17
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
In addition build out projections on infrastructure will provide about 2million per
year in new tax increment for the project area starting in07 08
and approximately 23 million for low and very low housing
over
the next
30
years
Vallco Valley Fair Stanford Oakridge
92 Vallco estimates 450after build out653 600 385 To decrease our
dependence on the businesstobusiness sector we recommend strong support for the
mall redevelopment In addition as new developments come before the Planning Commission
andCity Councilwe
recommend aquality retail component be incorporated intothe projectEConsider an Entertainment
Taxandamodification to ourexisting Utility
User Tax Ordinance in conjunction with the election this November If the City is
required to hold anelection for the Referendums the Committee recommends that we consider
placing on the ballot both an entertainment tax and re wording of our UUT
Ordinancetoreflect recent trendsintechnology
and retain existing UUT revenue suchas cell phone remittances
FPhase out one time revenue to the General Fund Limit park dedication
fee payback tothe General Fundto 500 OOO year for
0607decreasing by 100 000 increments each year with additional revenues
vesting to the Park Dedication Fund The Committee believes that the payback of park acquisition
costs inflatesthe General Fund revenue and gives the impression that thisison going
revenue from operationsAsthis funding will eventually
dry upitis prudent to replace it with true operational and annual revenue streams
GConsider assessingasales taxin lieu fee for discontinuanceofretail
land useThis concept would assess any developer who proposes taking land use
currently zoned for
retailcommercialuseandreplacingtheinfrastructurewithnonsalestaxproducingproductsuchashousing18
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
H Re visit the adoption of a County Communication fee if our sales tax composition
exceeds 50from thebusiness tobusiness
sector Two years ago a911fee for County Communications was deliberated
on by the City Council Estimates showed1per line
per month would provide approximately 650 000 towardsa750 000
cost of service Given our high percentage amount of business to business sales tax the committee proposes
torevisit this feeifour sales tax composition exceedsa50
benchmark Our current mixofsales tax providers results inahigh risk of fluctuation
inour largest general fund revenue category anda911
fee would identifyanew andstable
revenue source to offset this riskIConsideraRefuse Vehicle Impact Fee Several
cities in California have successfully levied astreet impact fee on their refuse providers to
offset the wear and tear on city streets from these oversized vehicles Such anassessment would
passthecostofstreet repairs duetoheavy usage through to the
garbage company and provide needed funds for maintenance but ultimately result in fee increases
to the customer The Committee was not inagreement on pursuit of this
revenue
Note Council did not want
to pursue this option at their5206study session Decrease Expenditures and Risk
Exposure The Committee lookedat our major programsin relation to operating
costs and risk exposure associated with general liability claims and workers compensation claims Currently claim
costs are paid directly by the Risk Management Division which resultsinan understatement of the true
cost ofservice of someofour programs For high exposure or
highlyloaded hidden cost programs additional trend analysis was performedto
establish what other municipalities are implementing inan effort to decrease expenses and areas of
risk Several
suggestions forpotential short term and orlong term savings have been
identified for your considerationARequire developers to maintain new open space associated with
their projects With new parksandopen space come the costs associated with maintaining those green
spaces throughout our city The Committee believes that it is in our best interests to
use the permit processto
requirethedevelopertopayfororprovideformechanismsthatfundthemaintenanceoftheseparks19
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
Suggestions include the incorporation of a landscape district or homeowners association
within the new development Or as in the case of Cali Mill Plaza the property and it s
maintenance would stay with the developer
It is estimated that it costs the Public Works Department approximately 40 000
per year for every new acre of parkland that goes onlineThis recommendation would
hold the line onourpark maintenance and help control future costs in
this areaBRequire safety enhancementsin
new developments The City has experienced an increase inresidential burglaries this past
year which increases our sheriff costs Many of these crimes involved taking jewelry
from the homes We suggest thatnewhousing developments be required to have built in
safes to secure val uablesandreduceaccessibility of jewelry inan effortto
reduceldeter crimeCContract
School Maintenance In the 1990sthe City issued approximately 5 million in
bonds to refurbish9school sports fields The agreement with CUSD provided that
we refurbish and maintain the fields in exchange for their use during non school
hours This provided an excellent partnership by providing CUSD with high quality fields
and the City with expanded parkland Thishasresulted howeverinaduplication
ofboth maintenance equipment
tbo2awhwre0noegotdrwakneirezsnations
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
Currently our Ground Maintenance Division mows 3317 acres and
edges 24 305 linear feet ofturf atthese school sites Transitioning the mowing
operation only to CUSD would reduce our long term hidden costs andour
vehicle and equipment replacement needs The current cost to provide mowing service to the
schools is137 594 out
of 555 000intotal expense per yearDAddCapital Improvement Projects
only ifongoing maintenance funding can
be identified LLD homeowners association development maintained owned The City is currently using
the permit process to incorporate private maintenanceofsidewalks mediansand other
improvements for new developments For City projects all associated budget costs shouldbeconsidered
with the adoptionof
the original budget for the Capital Improvement ProgramEIncrease the number
of
Block Leaders Neighborhood Watch programs and CERT graduates Increases in these programs
will capitalize on community policingandreduce maintain sheriff costs We also
encourage commissionerstobecome involvedin
these programsFChange accounting forEnterprise Funds The Committee proposes that all
Enterprise Fund activity be reflectedinthe individual fund whereby all costs including building
costs arerecognized in one place In addition all revenues associated with the complex
should berecognized in thefund The reader could easily ascertain the subsidy from
theGeneral Fund and
f2epfcsqCuoeou1aeuonrlpurcafudchlpndneotcnifriytlaingges
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
G Continue to investigate cost saving options for medical and retiree medical
msurance
The City should analyze the benefits of setting up a trust for the retiree medical reserves
to increase investment return and decrease funding obligations In addition staff should
continue to look for ways to reduce medical benefit costs including benefits for City
Council
H Adopt a Sidewalk Liability Ordinance requiring the landowner to be responsible for
sidewalk maintenance and claims to third parties from failure to maintain
The City has approximately 250 milesofsidewalk tomonitor and maintain The
annual sidewalk curb and gutter contract is 500 000 plusan
additional 150 000 in inspection and contract monitoring costs It requires 125 full
time staff per year Since it is impossible for one worker to cover the
miles of sidewalk that we are ultimately responsible for we areat riskfor
claims associated with needed repairs The landowner however already hasaduty to inspect and maintain
the areaandis considered the most able to
recognize artd respondto a potential hazard Sidewalk falls are ABAGssecond most
frequent claim with45million paid during the past 15 years in settlement
and attorney fees The City has paid over 100 00 in costs associated with these claims
in the past five years and two new claims this year
could equal 100 000 The Committee recommends that we continue to inspect and mark needed
repairs but that the liability for repair and associated claims vest to the
property
owner Note Council didnotwanttopursue thisoption at their5
206study
sessionIAdoptaTree Maintenance Ordinance requiring the landowner to
beresponsible for their street trees The Street Tree Maintenance program provides
for maintenance for over 13 000 trees including safety trimming
and clearing for vehicle and pedestrian height clearanceItcosts approximately
525 000 per year which covers42 positions equipment costs ofalmost 200 000 As per
the above suggestion the Committee considers the landowner the most able to recognize
andrespondtoapotential hazard caused bythe treesWe recommend
that we continue toinspect and notice needed maintenance but that
theliabilityformaintenanceandassociatedclaimsshouldvesttothepropertyownerNoteCouncildidnotwanttopursuethisoptionattheir5206stud session22
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
plementation Timeline
Stabilize and Renosition Revenue Sources 206 07 I 207
08I2008 09
I 2009 10I2010
11Tax Equity
AllocationIRe
assess Park
Dedication Fees Hansen NegotiationsISupport Redevelopment Projects
Entertainment Tax Phase Out One
Time Revenue to General
Fund Sales TaxInLieuFee
County Communications FeeIModify UUT
to INnceluwde Technology ModifY Business License Ordinance
for Quarries Approach Foothill DeAnza to
Share Sheriff CostsIRevisit Refuse Vehicle
Impact
Fee rDecrease Ex enditures and Risk Ex osure
2006 07 2007108 200809 2009
10201011
h Re uire Develo ersto Maintain
0en S aceRe
uire Safe EnhancementslNew Develo ment Contract School Maintenance
CIP if OnGain MaintenanceFundin Available
Increase BL NW CERT Graduates Chan
eAccountin Jfor Ente riseFunds
Cost
Savin 0 tions
tASRMjlftJ127LTROMfOioni3rideraraefrdedovtbideiniirnisweltcieaitaetanlkacence
BUDGET STRATEGIES
FISCAL STRATEGIC PLAN
The Fiscal Strategic Plan Committee would like to thank you for your consideration of the above
recommendations We look forward to implementing a long term plan that will reposition our
revenues streamline operations and ensure a high quality of life and city service for our
residents
f
Omn Mahoney
Councilmember
Co Chair
It
KrisWig
Vice Mayor
Co Chair
a WwutJ
Carol A Atwood
Director of Administrative Services
v fd t
Sandy Abe
Human Resources Director
Therese Ambrosi Smith
Director of Parks and Recreation
Steve Piasec i
Director of Community Development
ehflrj V
Bob Rizzo
Asst Director of Public Works
Maint24
BUDGET STRATEGIES
SERVICES VS RESOURCES
The following chart shows how service levels have changed over the past five years The City s
population has grown from 50000 to approximately 54000 and program
demand has risen to106 while there has beenadeclineinthe number of employees
availableto
meet the increased service levels Additional impacts toservice levels from 2001
through 2005 includedaselective hiringfreeze three to three andahalfpercent salary
cutunpaid furlough days deferred maintenance increased retirement
and medical costs and new community issues Despite these chalenges the overall
customer satisfaction rate remainedat84to86 between 2002 and 2004
Should Cupertino s economic vitality decline and demand for services continuestoincrease it will not be possible
to maintain the current satisfaction levels Itiswith this inmind thatthe City embarked on
astrategic plan to ensure that community
needs were met while
maintaining
adequate staffing to
provide quality services
TRENDS
SERVICEVRESOURCESProgramDemand106StaffPopulation10554000100OptimalBaseFY2000500001501per1401301per40020002001200220032004200525
BUDGET STRATEGIES
PERFORMANCE MEASURES
lwartmentJDescription GoalObjective Actual
Public Information
Access Cupertino Response Time 3 Days
3Days
LawEnforcement Sheriff Response Time Priority
1 5 Minutes
Priority 1 4
94Priority
29Minutes Priority28 09Priority320 Minutes Priority316
74Administrative Services Investment Portfolio
RateofReturn ROR Greater
than LAIF ROR Below LA
IF ROR Accounts
Payable Processing5Days1 5 Days
Archival Research Requests
5Days1
5 Days Duplication Requests
Routine1Day1 Day Special
3Days1
3Days Recruitments
Qualification Liststo
Depts60Days
4560Days Parks
and Recreation Cultural Programs Revenue
200506
372000
451371
Youth Teen Programs
Revenue 2005
06715
000 746
064ProvideMiddleSchoolDances10Dances10DancesTeenCenterMembership441550SportsCenterRevenue20050624267001393575SportsCenterMember hip9161021SeniorCenterRevenue2005106465000559561SeniorCenterMembership2000Members1939SeniorCenterVolunteerService15290Hours1579 SeniorTrips3649CommunityDevelopmentPlanningApplications165216BuildingPermitApplications22522190BuildingInspections1924321022Rev nuesthrough62806January2006throughJune200626
BUDGET STRATEGIES
PERFORMANCE MEASURES
artmentJDescription
Public Works
Street Sweeping
Street Maintenance
Sidewalk Repair Maintenance
Graffiti Cleanup
Streetli ts Maintenance
Community Outreach
Block Leader Captains
Block Parties
Active Neighborhood Watch Groups
Trained Emer enc Res onse Team Members
GoalObjective
696 Curb Miles
MonthW lin 24 Hours
of Call
Emergencies 24 Hours
48 Hours of Call
5
Da
sof
Call160 2585 Groups
668 27
Actual 696 Curb
MileslMonth W in24
HoursofCallWithin24Hours48HoursofCall5DasofCall2012994Groups739
BUDGET GUIDE
The budget is the City s fundamental policy document It describes the City s goals and details
how resources are allocated to achieve these goals In addition the budget serves as the annual
financial plan an operations guide and a communications tool
The budget guide provides an overview of the elements of the budget document It describes the
structure of the City s finances and the annual budget process and includes a glossary of budget
terminology
ELEMENTS OF THE BUDGET DOCUMENT
The budget document includes the following key elements
1Budget Message The Budget Message is the City Managerstransmittal letter
submitting the budget to the City Council The Budget Message summarizes the Cityscurrent and
long term financial position highlightsnew programsandorganizational changes addressed in
the budget and outlines both short and long term goals of ourcity
government2Budget Strategies TheBudget Strategies section includes the Citysmission
statement theFinancial Values of the City and identified City Council goals for the fiscal
year The 2006 07 operating budget addresses the implementation of these
goalsandexplores various revenue enhancements
and cost reduction measures3Financial Summaries The Financial Summaries
section provides financial information on projected revenues expenditures fund balances and
reserves This section includes the Budget Summary ofFundsaswellasdetailed fund
descriptions andinformationonall
revenue sources and expenditure projections Inaddition to 2006 07 information this
section includesfundbalance trends and detailed revenues and
expenditures projections for the next five years This section includes an analysis of all
City revenues by category Our major revenue projections are basedontrends current
economic indicators and other agency input Sales tax projections are based oninput from our
sales tax consultants industry trends and major company forecasts Property tax revenues are projected
by the county and adjustedbystaff basedonknown trends Park dedication
fees are estimated based on current development projects andother taxes are reviewed monthly and
budgets are based on this trend analysis4Departmental
Operating Budgets The Departmental Operating Budgets section details historical and proposed expenditures
by operating department The City is organized into eight key
operating functions including the Administration Law Enforcement Public Information
Administrative Services ParksandRecreation Community Development andPublic Works Each
department budget includesasummary narrative financial information regarding the department
andeachofitsmajordivisionsandpersonnelinformation29
BUDGET GUIDE
Expenditures for employee compensation are based on negotiated contracts The materials
category of expenditures are based on trends Contract services and capital outlay are
justified each year by the departments
Departmental expenditures are divided into five categories which include the following charges
Illiwloyee Compensation represents permanent full time and part time salary costs overtime
PERS retirement health insurance costs and other benefits
Materials represents items purchased for repair and maintenance operational activities such
as books uniforms and recreation supplies and office supplies
Contract Services represents legal consulting and other professional services contract repair
and maintenance utility charges training and memberships equipment rentals insurance and
employment services
ital Outlay represents expenditures for tangible fixed assets including land buildings
furniture equipment and City vehicles
Debt Service Other represents principal and interest payments on outstanding debt and
interfund transfers
5NonDepartmental Operatmg Budgets TheNonDepartmental Operating Budgets
section details historical and proposed expenditures for the functionsofinterfund transfers and
debtsefV1ce
6Capital Improvements The Capital Improvements section details the proposed
capital projects for 200607through 20010 11 These projects
are organized into six categories Parks Buildings Medians and Overpasses Streets Traffic and
Storm The five year budget denotes funding sources and
adescriptionofeach project The City Council approves funding of theCapital
Improvements onayearly basis STRUCTURE
OF THE CITYSFINANCES TheCity s finances are structured in a variety offunds thatare
the basic accounting and reporting entities in governmental accounting The funds that
comprise the 200607budget are grouped intotwo major categories Governmental Funds and
Proprietary Funds The purpose of eachofthe various
fundswithinthesetwocategoriesisdescribedbelow30
BUDGET GUIDE
GOVERNMENTAL FUNDS
Governmental Funds include Tax Supported Funds Special Revenue Funds and Federal Grant
Funds They are accounted for under the modified accrual basis of accounting
Tax Supported Funds include the General and Capital Improvement Funds The General Fund is
the primary operating fund for governmental services funding traditional tax supported activities
such as law enforcement and community development The Capital Improvements Fund is
utilized for the acquisition or construction of major capital facilities
Special Revenue Funds include the Park Dedication Gas Tax Storm Drain Environmental
Management and Leadership Cupertino funds The use of Special Revenue Fund resources is
legally restricted for specific purposes
Federal Grant Funds include the Federal Housing and Community Development Block Grant
programs The Community Development Block Grant is a federally funded program for housing
assistance and public improvements
PROPRIETARY FUNDS
Proprietary Funds include Enterprise Funds and Internal Service Funds They are accounted for
under the full accrual basis of accounting
Enterprise Funds including the Resource Recovery Sports Center Blackberry Farm Recreation
and Senior Center funds are used to account for operations that are self supporting with user fees
covering expenditures
Internal Service Funds include the Workers Compensation Management Information Services
Equipment and Long Term Disability funds Internal Service Funds are similar to Enterprise
Funds except that fees are charged to user City departments to cover the costs of services
provided by the activity
COST ACCOUNTING
By using this financial technique the City is able to assess the true cost of providing a service
and benefits The Internal Service Funds and Enterprise Funds capture the full cost of a
program s activities Internal users of information management fleet and equipment and
insurance are assessed rental rates through their programs for the use and eventual replacement of
such services and equipment Employee benefits such as leave usage retirement and insurances
are also recovered as revenue of the funds by charging the programs that use personnel
services31
BUDGET GUIDE
THE ANNUAL BUDGET PROCESS
The City s annual budget is prepared on a July 1 to June 30 fiscal year basis The
budget process is an ongoing process that includes the phases of development proposal
adoption
and monitoring Thebudget development phase begins in February with the preparationof
budget instructions and goal setting sessions by the City Council and City Manager During
March departments prepare the budgets for which they are responsible These proposed department
budgets are reviewed bythe Finance Division and compared to current and prior year trends
The City Manager then reviews the proposals with theCity Treasurer and departmental staff
and makes final adjustments Theproposed budgetisthen submitted to theCity Council
inMay During the months of May and June the Council considers the budget proposals at a
series of City Council Study Sessions and meetings At this time the Council hears
from Boards Commissions and community groups regarding budget requests and recommendations
Prior to June30the City Council holds public hearingson the budget and then adopts
the final budgetbyresolution The adopted budget takes effect on July 1the first day of
the new fiscal year After the budget isadopted the Cityenters thebudget monitoring
phase Throughouttheyear expenditures aremonitored bythe Finance Division staff and department
managers to ensure that fun ds are used inan approved manner Adjustments to
expenditures within or between departmental budgets are accomplished onanasneeded
basis administratively throughout the year The City Manager and Department Heads can transfer funds
between their line items and or divisionsasneeded City Council approvalisrequired
for additional appropriations from fund balances
orfornewrevenuesources32
BUDGET GUIDE
GLOSSARY OF BUDGET TERMINOLOGY
The Citys budget contains specialized and technical terminology that is unique to public finance
and budgeting To help the reader understand the terms a glossary of budgetary terminology has
been included in the document
Adopted Budget Revenues and appropriations approved by the City Council in June for the
following fiscal year
AUocated Costs An expense charged by one departmentdivision to another for services
performed or expenditures of a general nature that are charged to one main account and allocated to
other departments divisions by a specified formula
Appropriation An authorization made by the City Council that permits the City to incur
obligations and to make expenditures of resources
Budget A financial plan for a specific period of time fiscal year that matches all planned
revenues and expenditures with various municipal services
Budget Amendment A legal procedure utilized by the City Manager to revise a budget
appropriation Adjustments to expenditures within or between departmental budgets may be
accomplished administratively City Council approval is required for additional appropriations
from fund balance or new revenue sources
Capital Improvement Program A plan for capital expenditures to provide for the acquisition
expansion or rehabilitation of an element of the Citys physical plant to be incurred over a fixed
period of several future years
Capital Outlay Expenditures relating to the purchase ofequipment land and other fixed assets
Cost Recovery The establishment of user fees that is equal to the full cost of providing services
Department A major administrative segment of the City that indicates overall management
responsibility for an operation or a group ofrelated operations within a functional area
Division A unit of organization that reports to a
department33
BUDGET GUIDE
Enterprise Fund A fund established to account for activities that are financed and operated in a
manner similar to private business enterprises in which costs of providing services are primarily
recovered through user fees
Estimated Budget The status of appropriations between July 1and June 30 Includes
the adopted budget budget amendments prior year encumbrances approved carryovers and
transfers between objects divisions
and deparhnents Expenditure Utilization of fund resources Expenditures include operating
expenses debt service and
capital outlays Expenditure Category Abasisfor distinguishingtypes of expendituresThe
major expenditure categories used bythe Cityare employee compensation materials contract services
capital outlay and
debt service Fiscal YearAtwelve month time period signifying the beginning and ending period
for recording financial transactions The City has specified July 1through June 30
for its fiscal year FundAfiscal and accounting entity for whichtherecording of financial
transactionsismadefor the purposeofcarryingonspecific activitiesinaccordance with the
requirements placed uponthe
useof financial resources Fund BalanceThe net effect of assets less liabilities at any
given point in time General Fund Thefund usedtoaccount forthe major operating revenues
and expenditures of the City except for those financial resources that are required to beaccounted
for inanother fundcategory General Fundrevenuesarederived primarily from
property and other taxes Goal Broad mission statements that definethe
purpose of a department Infrastructure Long lived capital assets that normally are stationary in
nature and canbepreserved for asignificantly greater number of years than most
capital assets Examples include roadways
bridges and drainage systems Internal Service FundAfund used to account for the services provided
byonedepartment to other departments
onacostreimbursementbasis34
BUDGET GUIDE
Operating Budget A financial plan for the provision of direct service and support functions that
provide basic governmental services The operating budget contains appropriations for such
expenditures as employee compensation materials contract services capital outlay and debt
service It does not include Capital Improvement Project expenditures
Reserve An account used to designate a portion of the fund balance for a specific future use and
is therefore not available for general appropriation
Revenue Increases in fund resources Revenues include income from user fees taxes permits
and other sources
Section A unit or organization that reports to a division
Self Supporting Activity An enterprise activity where all service costs including principal and
interest debt payments are primarily covered solely from the earnings of the enterprise
Subsidy Supplemental resources provided to ensure adequate funding when anticipated
expenditures exceed revenues
User Fees Fees charged to users ofa particular service provided by the
City35
1ftstory
Cupertino owes its name and earliest mention in recorded history
to the 1776 expedition led by the Spaniard Don Juan Bautista
de Anza from Sonora Mexico to the Port of SanFrancisco to
foundthepresidio ofSt
Francis Leaving themajority of the partyof men women and children
inMonterey to rest from their travels deAnza his diarist
and cartographer Petrus Font and 18other men pressed
on through the Santa Clara Valley in late March to their
San
Francisco destination With the expedition encamped in whatisnow
Cupertino Font christened the creek nexttothe encampment the
Arroyo San Joseph Cupertino in honor of his patron San
Guiseppe San Joseph of Cupertino Italy The arroyoisnow known
as
Stevens Creek The village ofCupertino sprang upatthe crossroads
ofSaratoga Sunnyvale Road now DeAnza Boulevard and
Stevens Creek Boulevard It was first known as West Side but by
1898 the post officeat the Crossroads needed anewname to
distinguishitfrom other similarly named towns JohnTDoyleaSan Francisco lawyer and historian had given the name
Cupertino to hiswinery in recognitionofthe name bestowed on the nearby creek by Petrus Font In 1904 the name
wasapplied to the Crossroads and tothe post office whentheHome Union Store incorporated under the name
The Cupertino Stores Inc ManyofCupertinospioneer
European settlers planted their land ingrapes Vineyards
and wineries proliferated on Montebello Ridge on the lower foothills
and on
the flat lands below After 1906alot more than grape
growing was goingonin Cupertino Orchards were
thriving and new businesses were being started In the late 1940
s Cupertino was swept up in Santa
Clara Valleyspostwar population explosion Concerned
by unplanned development higher taxes and piecemeal
annexation to adjacent cities Cupertino s community leaders
beganadrivein1954 for incorporation
Cupertino rancher Norman Nathanson the Cupertino Monta
VistaImprovement Association and the Fact Finding
Committee played important roles in this movement Incorporation was approved inthe September 27
1955
election Cupertino officially
became Santa Clara Countys13th City on October 101955Amajor milestone in Cupertinosdevelopment was the
creation by some of the citys largest landowners of Vallco Business and Industrial Park inthe early 1960s
Of the 25 property owners17 decidedtopool their land to form Vallco Park six sold to Varian
Associates a thriving young electronics firm founded by Russell Varian and two opted for transplantingto farms
elsewhere The name Vallco was derived from the
namesoftheprincipaldevelopersVarianAssociatesandtheLeonardLesterCraftandOrlandofamilies37
Pr
Cupertino with a population just over 52 000 and city limits stretching across 11 square miles is considered to
be oneofthe San Francisco Bay Areasmost prestigious cities in which to
live and work Economic health is an essential component to maintaining a balanced environment which
provides high level opportunities and services that create and help sustainasense ofcommunity and quality of life
Public and private interests must be mutual inthat our success as a partnershipisa direct reflection of our success as
acommunity The cornerstone of this partnership is that ofacooperative and responsive government that provides
anenvironment for business and residential prosperity and fosters strong working relationships with all sectors
of the community Our economic development strategies are tailored to address the specific needs of the community As
the City of Cupertino isamature city with over90buildout our focus concentrates moreon
business retention and revitalization Business recruitment issite specific and targeted to industries that enhance rather than draw
from
our
existing
business
base
I
c
I
l ltit ji
t
li1llJ Jl4 I
iolJ As home to many well known high tech companies Cupertino offersadynamic and exciting
business climate Apple Computer is headquartered in the city along with Symantec and Portal SoftwareInaddition key
divisions of Hewlett Packard Sun Microsystems and Borland are also
located in Cupertino The Citysproactive economic development efforts have resulted inanumber of
innovative mutually beneficial partnerships with local companies The City strives to retain and attract local companies through
policies of balanced growth
satreanmlinded permitting Val1co Fashion Park includes Macy s Penneysand Sears as anchors andfeatures popular chain stores such as
VictoriasSecret Express and Natural Wonders Shoppers can alsoenjoy iceskating at the mallsice skating rink oranice
mealat Todai Restaurant The mallisundergoing major changes in the next two years with the addition ofa
16 screen movie theater which isexpected to open in the Fall of 2006 and many snheopws and restaurants Val1co Mall
isbecomingavibrant exciting place forresidents and
visitors to enjoyTheCity of Cupertino hasahistory of providing high level municipal services tocomplementthe
senseofcommunity and quality of lifeenjoyed by our constituents TheCity will continuetoenhance and promoteastrong
local economytoprovide municipal services that make Cupertinoaplace that people are
tc3hpoa8orolmlued
2006 pCritoy
i1 The CityofCupertino operates asageneral law city withacity council city manager formofgovernment Five
council members serve four yearoverlapping terms withelections held every two yearsThecouncil meets twiceamonth on
the first and third Tuesday at 6 45pmin
the Community Hall TheCity has158 authorized full time benefited employees City departments
include administrative services finance human resources IT city clerk emergency preparedness outreach
programs code enforcement community development planning building and economic development parks and
recreation public works engineering maintenance transportation and environmental and public information Police service isprovided
bytheSanta Clara County SheriffsDepartment andfireservice isprovided through the Santa
Clara County Fire District Assisting the city council areseveral citizen advisory commissions
committees which include housing telecommunications fine arts library planning audit parks and recreation bicycle and
pedestrian teen senior and public safety Members ofthevolunteer boards are appointed by the city council and vacancies
are announced so that interested residents may apply for the positions Residents are kept informed about city
services and programs through theCupertino Scene a monthly newsletter Cupertinosgovernment access cableTV channel The
City Channeland
the
city swebsite Housing Rentals for oneand two
bedroom apartments and duplexes range from 1 100 to
2100 per month Rent fora
two bedroom house ranges from 2 200 to 3
250 per month The average price
ofexisting single family homes
is950 000as
of June 2004 The average condo minimum townhouse
sale priceis597 742 Community
Health Care Facilities Cupertino is served by the Cupertino
Medical Clinic NovaCare Occupational Health Services Nearby hospitals include
EICamino HospitalinMountain ViewOConnor
Hospital in San Jose Community Hospital ofLos Gatos Kaiser Permanente
Medical
Center
inSanta Clara Stanford Hospital in Palo Alto
and
the Saratoga WalkinClinic in
Saratoga Utilities Natural gas
and electric
Pacific Gas and Electric
Company 800 743 5000 Telephone SBC
Forresidential
service call 800 8942355
for business service call800
750 2355 Cable Comcast 800 945
2288 Garbage Los Altos Garbage 408 725 0420 Water San
Jose Water Company 408 279 7900and California
Water 650 917 0152 Sewer Service Cupertino Sanitary District
408 253 7071 Tax Rates and Government Services Residential commercial and
industrial property is appraised at full market value as
it existed on March 1 1975 with increases limited
to a maximum of 2 annually Property created
or sold since March 11975 will bear
full cash value
as of the time created or sold
plus the2 annual increase The basic tax
rate is1 00 per
100full cash
valueplus anytax levied
to
cover
bonded
indebtedness forcounty city school or other taxing agencies
Assessed valuations andtax
rates arepublished annually after July1Retail Sales
Tax Santa Clara County125
City 1State General Fund5State Local
Public
Safety Fund0 50
StateLocalRevenueFund025CountyTransportationFund025Total825AssessedValuationSecuredandUnsecuredCupertino952684137963005County22 16652803163005TransportationRailSouthernPacificSanJosetoSanFranciscowithspurlineinCupertinoAirSevenmilesnorthofSanJoseInternati nalAirport32milessouthofSanFranciscoairportBusSantaClaraCountyTransitSystemsGreyhoundbuslinesHighwaysInterstateRoute280StateRou e8539
c y SLca FLaCc4tsf
and Figures Population
inCity Limits Median
Household Income Median
Age Sales
Tax Rate Registered
Voters Democrats
Republicans
Independent
Other
Did
Not State 52
600 1004
1138
82526
128 9685 8188
357533 7 365
Top40 Sales Tax Producers
Fourth Quarter 2005 In Alphabetical Order Alexanders
Steakhouse Jade Galore Apple Computer
JCPenney Benihana sJoy
Luck Place BJsBar and
Grill Longs Drug Store Chevron Service Station Macy
sCupertino Clean Scene Marina Foods
Cypress Hotel Helios Restaurant Mervyn
sDeAnza Cupertino US Gas Michaels
Arts Crafts DeAnza College Campus Center
Outback Steakhouse Dental
ArtsofCalifornia Ranch99Dynasty
Chinese Seafood Rite
AidDrugStore
Elephant Bar
Rotten
Robbie Service
Station
Hewlett Packard Sears
IBM Rational
Software Shane Diamond
Jewelers Shell Service
Station Sodexho
Marriott Management
Suburban House
Symantec
Tadpole
Technology
Target
TGIFriday
s
7FSVDUWI012457TABVHNMWAn604oJtaelsemeniaafdahishaoroilrimtwxaipeceoietviartdvzixknaeromlilnroneceosoiincgeisanaairsctanniopnhic
91and RecruJrl
ServCupertino Senior
Center The Senior Center providesawelcome and
friendly environment for adults over age 50 There is
afull calendar of opportunities for
learning volunteering and enjoying life There are exercise
classes a computer lab and classes
language instruction including English asasecond language
and cultural and special interest classes The
center also coordinates trips
and socials The Senior Center is located at
21251 Stevens Creek Boulevard andisopen Monday through
Friday 8 am
to5pm
Telephone 408 777 3150 Civic Centerand Library
The complex has a 6 000 square foot
Community Hall plaza with fountain trees and seating areas
City Council meetings are now held in the
Community Hall
as well as Planning Commission and Parks
and Recreation Commission The new 54000 square foot library despite
reduced hours due to budget cuts continues to be
oneofthe
busiestintheSanta
Clara County Library system For more information call 408
446 1677 TIre Quinlan Community Center The City of
CupertinosQuinlan Community Center is
a27 000 square foot facility that provides
a variety of recreational opportunities Most prominent
isthe Cupertino
Roomamulti
purpose room that can accommodate 300 people inabanquet format
For more information call 408 777 3120
Cupertino Sports Center The Sports Center isa
great place to meet friends The facility features
17 tennis courts complete locker room facilities andafully equipped
fitness center featuring free weights Cybex and cardia equipmentA
teen center isalso included
aswell
as achild watch center The centeris
located at the comer of Stevens Creek
Boulevard and Stelling Road Telephone 408 777 3160 Blackberry Farm
This 33 acre recreational facility offers twolarge swimming
pools softball field basketball courts volleyball courts horseshoe
pits
andanine hole golf course The picnic grounds
are located at 21975 San Fernando Avenue and the
golf course is locatedat22100 Stevens Creek Boulevard
Telephone 408 777 3 140 Blackberry Farm Retreat Center is
a2000
square foot house
that overlooks the picnic grounds and golf course The center
has one large conference room that will accommodate up to
25people The retreal ccntcr is located al 21979
San Fernando Avenue Telephone 408 777 3140 McClellan Ranc
ParkAhorse ranch during the 1930 and 40 s
this 18 acre park has the appearance of a working
ranch Preserved on the property are the original
ranch house milk barn livestock barn and two historic
buildings Baer sBlacksmith Shop originally located at
DeAnza and Stevens Creek and the old water
tower from the Parish Ranch now the site of
Memorial Park
4137TRil2aRMtsaopabiadelsafwMJcsaNr4CHRmsoniheavpmahuw127t2lfrnibnixneoahailocarfscueaeibeluehoitends072diodidlianpitclCanmtses tnabclbuecirile2uikdtcbeoletnpmheileirapbtreheinrueghsetdlaelnsmlosatrseinsnosen
E uJrl
Winner of numerous state and national awards for excellence our
city s schools are widely acknowledged to be models of quality
instruction
Cupertino Union School District serves 15700 students in
a26square mile area that includes Cupertino and portions of five
other cities The district has 20 elementary schools and
four middle schools including several choice programs Eighteen schools have
received state andornational
awardsforeducational excellence Student achievement isexceptionally
high Historically district test scores place Cupertino among the premier
public school districts in California The district isaleader in the
developmentofa standards based systemofeducation andis
nationaly recognized for leadershipinthe useoftechnology asan effective tool for learning Quality teaching and parent involvement are
the keysto
the districtssuccess The Fremont Union High School District serves over9000 students in a42
square milearea covering all of Cupertino most of Sunnyvale and portions of San Jose Los Altos Saratoga and Santa Clara
The five high schools of thedistrict have garnered many awards and recognition based on both the achievement
ofstudentsand the programs designed to support student achievement Student achievement is atanall time
high based on the statewide Academic Performance Index API All five high schoolsinthe district exceeded their
state established achievement targets for the2000 API District students are encouraged to volunteerand orprovide
service to organizations within the community During their senior year ifstudents complete80hours of service to a
nonprofit community organization they are recognized withaCommunity Service Award
medal that maybeworn during
their graduation ceremonies Cupertino
isserved by fourlocal
institutionsofhigher education
DeAnza College theUniversity of
SanFrancisco National University
and the UCSC Extension In
addition to these schools Cupertino
slocation offers easy accessto
Stanford
University Santa Clara University and San Jose State University
Buildingonits tradition of excellence and innovation DeAnza
College challenges students of every background to develop their
intellect character and abilitiestoachieve their educational goals and to
serve their community in a diverse and changing world DeAnza
College offersawide range of quality programs and services to
meet the work force development needs ofour region
The college prepares current and future employees of
Silicon Valley in traditional classroom settings and
through customized training arranged byemployers Several
DeAnza programs encourage economic development through college
credit coursesshortterm programs services
rs4mftraoeoee2rsnarctrsdehrvniunsinucititfaiecmaonsacnecltunerters
todo Se
Eupllrat Museum ofArt
The highly regarded Euphrat Museum of Art adjacent to the Flint Center on the DeAnza College campus traditionally
presents one of a kind exhibitions publications and events reflecting the rich diverse heritage of our area The Museum
prides itself on its changing exhibitions of national and international stature emphasizing Bay Area artists Museum
hours are 11 a m 4pmTuesday Wednesday Thursday68 p m Tuesday and 11a
m2p
mSaturday Telephone408 864 8836 Minolta DeAnza Planetarium Stargazers haveaCupertino facility cateringtotheir interests
the Minolta Planetarium ontheDeAnza College campus Ithostsavarietyof planetarium shows and events
including educational programs for school groups and family astronomy evenings on Saturdays at7 00 pmFor
more infonnation and current schedule of
events visit
the website at www planetarium deanza fllda orcall 408 864 8814 Flint Center The cultural life ofthe Peninsula
and South Bay isenhancedbyprograms presentedatthe Flint Center for Perfonning Arts locatedat21250
Stevens Creek Boulevard at DeAnza College campus Thecenter openedin1971andwas named in honor of CalvinC
Flint the first chancellor ofthe Foothill DeAnza Community College District The box office is open10 am
4p
mMondaythrough
Friday and one and one half hours prior to any performance Box office 408 864 8816 administrative office
408 864 8820 Cupertino Historical Society On May21966 the Cupertino Historical Society was foundedasa non
profit organizationbyagroupof177 longtime residents concerned abouttherapid growth in the
area and its impact on the quickly vanishing Cupertino heritageOnMarch301990 theSociety opened the Cupertino Historical
Museum dedicated tothepreservation and exhibition ofthe cityshistory Through its exhibits the museum attempts
to develop and expand the learning opportunities thatitoffers to the ethnically diverse communityofthe City ofCupertino
TheSociety continuestobuildpartnerships with thelocal school
districts to ensure that the history of Cupertino isoffered as part of the
educational curiculum The Societyislocated at the Quinlan Community Center 10185NStelling Road
Telephone 408
9738049 Residents
and visitors can visit the fanners market every Friday from9 00
amto I00pmThe market is located at
the Valko Fashion Park behind MacysFarmers Market California History Center The California History Center is located on
theDeAnza Colege campus Thecenterhas published 39 volumes on California history andhasa changing exhibit
program The center s Stocklmeir Library Archives boastsalarge colection of booksapamphlet file oral history tapes
videotapes and a couple thousand student research papers The libraryscollection is for reference only Heritage events focusing
4TtMt0134anpmJ38amitoSc48TimFtcbeqaohncsoCsnhohuaeu30no0p067yaufriarnhoeafsorefenlnonldoe148caetuoerpltlnruiouetrthn2refrutedmr tesergeayaradrdmahrlnlyatibiayoenr
BUDGET SUMMARY
2006 07
Fiscal Year
Estimated Estimated Balance at Operating Operating Non operating
Balance at Funds July 1 Revenues
Expenditures Transfers
June30General
Fund17
53800035
603000
29 981
000 8165
00014
995000
Special Revenue
Funds StormDrain
125 000
276 000308
00093
000 ParkDedication
Tax8
000500000500
0008000Environmental
Management 115
000366
000391
00090
000 Gas Tax
251000
1445
0002
284000800
000212
000 Housing
Community Development
1726000
763000662
000
1827000ValleoRedevelopment33600090000217000463000FundTotals1889000344000038620003000001767000DebtServiceCupertinoFacilitiesCorp ration230003535000353500023000TrafficImpact1140003800036000116000Valleo1974AssessmentDist120000120000FundTotals2570003800036910 03535000139000CapitalProjectsFundsCapitalImprovement11200022840002172000StevensCreekCorridorPark500000500000MaryAveBicycleFootb idge138000388000250000FundTotals25000031720002922000EnterpriseFundsResourceRecovery4963000246000027300005000004193000Blackberry arm13800010780001242000302000CupertinoSportsFacility7300015270001459000141000RecreationPrograms1000021450001987000148000SeniorC nter80005680005680008000FundTotals4896000777800079860005000004188000InternalServiceFundsInformationManagement934000903000102200 137000952000WorkersCompensation156000329000290000195000EquipmentReplacement13750008760008410001410000LongtermDisability13000520 04400021000RetireeMedicalInsurance348900065000018210004660000FundTotals5967000216000028470001958000723800045
Total City Revenue
Total City revenue for fiscal year 2006 07is expected to be 59
484 000 The chart below providesan overview of all City revenue General Fund revenue isshown
onthe
next pageofthis summary Sales Tax represents theCity s largest source of revenue
We receive1 ofthe825 collected in thecounty Charges for
Services includes program and engineering building fees from Blackberry Farm the Sports Center
theSenior Center Quinlan Center
andour Community Development and Public Works Departments Intergovernmental Revenue includes motor vehicle in
lieu feesand grant funds while Use of Money and Property represents rental fees
and interest income on the city investment portfolio Property Tax is small in comparison to our other revenues
as Cupertino is a no low property tax city receiving only 04on
every dollar paid Other Taxes include park
dedication fees business
licenses
taxes
and
property
transfer
taxes Total
City
Revenue
59484
000Property Taxes8
TOT
4License
Pennits
4
Charges
fur Services
13
Capilal
Projects
Equipment Funding DebtI
aybaeks
I3P4oTUMI14LFTSOFr14TU124Fnf7016aerairastlonlaohicxexelneienrpetcsgyescersoyhrtviyscenunental
Total City Expenditures
Total City expenditures for fiscal year 200607are expected tobe
62151000 This summary chart provides aquick overviewofall theCity
soperating and capital expenditures Manyof the Special Revenue fund activities such as theGas
Tax StormDrain Park DedicationandEnvironmental Management funds are administered by
the Public Works Department ThePublic Works Department also overseestheResource
Recovery operations with expenditures of over27for the City
wide garbage collection contractanddisposal costs All other Enterprise fund operationsare directed
bythe Parks and Recreation Department which spends over 78 million annually to provide programs
for all ages and to maintain the City senviable community facilities
at the Blackberry Farm andGolf
Course Quinlan Community Center Sports Center and Senior Center The majority of funding
for Capital Projects which provides forstreet projects sidewalks facilities and upgrades and major
equipment purchasesisdesignated to the StevensCreek
Corridor Park Project
and
the
Mary
Avenue Bicycle Footbridge
Total
City
Expenditures
62
151
000
Parks
Recreation
13
Council
Comm
iss
ions 1Operating
Transfers
13
IJ12467LAEPSCDWn147arcdenucaeoroworbfrbmvpmrvbjvrlelkiimitrmcnslcacoeitalcuspsmtntmiroiactneytninvolten
General Fund Revenue
Total General Fund revenue for fiscal year 200607is expected to be
36603000Thechart below provides
an overview of our revenue SalesTaxisused for general government expenditures and is
therefore accounted for entirelyinthe General Fund it represents approximately 28 4
of General Fund revenue Our sales tax comes from retail sales business to business largely
hightech sector sales and use tax Charges forServices within the General Fund
is comprised of
revenue from zoning planning and engineering fees Intergovernmental Revenue includes motor vehicle in
lieu fees and grant funds This revenue source represents125ofthe budget Use
of Money and Property is received from rental fees and interest income Property Tax
though small
incomparisonto
our other
revenues
has remained
consistent
General
Fund Revenue
36
603 000
Charges
forScrvices
4
Sales
Tax
28Fines
1
License
Penn
its
8Opcrating Transfers
I6Fr147FP46oTUMI136TROMn8f2eraOrtseloilaoihseexlevnTincperleseygeecersnoyhlrlutaviyseenemcomuesl1tal
General Fund Expenditures
Total General Fund expenditures for fiscal year 2006 07are expected
tobe39196 000 General Fund expenditures forthe general operation and
administration ofthe City
comprise over 631oftotal expendituresTheGeneral Fund budget allows for all expenditures necessary
to carry out the basic activitiesofthe City that arenot provided through other funds
It includes the necessary resources tocarry out police and
emergency preparedness community development through planning buildingand engineering activities public
works operations and maintenance recreational programs and park utilization and other general government
functions such
as legal personnel finance and administrative services The City s debt service costs are also bornebythe General
Fund as well as funding for capital projects Bothoperational andcapital budgets have been
tightened to minimize the
effect onthe
Citysreserve
levels General
Fund
Expenditures Including
Operating
Transfers
39196
000 Comunity Dcvelopment
9Administrative
Scrv
ices
10
Council Cummissions
1
Public
7LAlr1PCROI24LEPMWno4069adanuaetcrjobewomrfbcpdrokecrlkiitsmrectrcnsacsaialelsRlttmitioreoanetntinriuetne
REVENUE SUMMARY
Property Taxes
Property taxes represent approximately 133oftotal general fund operating
revenues Property tax revenue for the 200607fiscal year isestimated to
be4978000Property tax revenues fluctuate with market conditions from year to year
however they will generally increase in the long term
due toproperty sales and new
construction In 1978 voters
approved the passage ofProposition 13 which
froze property tax rates andlimited
the amount of their increase each year Cupertino
had oneof the lowest
property tax rates in Santa
Clara County receiving 02 for every
1
00paidThe County then provides
another 02 asatax equity allocation
In accordance with State law property is
assessed atactual full cash
valuewith the maximum levy
being I of the assessed valuation Increases
inassessed valuation are
limited to2annually if there
isnochangeinproperty ownership
major improve ments orrequests for
reassessment
Our revenue
has increased
slightly in this
area
with recent annexations
and housing
development0243
Cupertino Elementary
0
236 County
Bond0
164 Fremont
High
School Maintenance0
148 Santa Clara
County Fire District
0065
MidPeninsula Open
Space
Various Agencies
0
02TAPCR02345789LoFEPCMIBVRGFTCm05if0145678aorUrcrsaYeoEiouDAbeataop0238xtotyltmlpuNrniVTAuilfipneame456etrfeneEahDEiemoetsrcogc rerayilnGsrytNlaeuiltntenyelUOnadeoinERtnyctYe
REVENUE SUMMARY
Sales Tax
The City s sales and use tax revenues are generated from three principal economic categories
general retail 238 business tobusiness555includes
electronic equipmentand software manufacturers and distributors and other products 207
Cupertinossales tax has continued to experience declines asa result of the recessionary impacts inour
area and isjust
starting to
show
signsofrecovery
2000 rrr10 ACTUAL ESTl14 000 12 000 10 0008000
60004 00001998 1999 2000 2001 2002 2003 2004 2005 2006
2007 Sales and use taxes are the Citys largest single source of revenue and are budgeted
at 104million for the 2006 07 fiscal year representing 284
of the Citystotal general fund
operating revenues With sales tax so dependent onavital economy the Citymust focus its
efforts on finding other stable revenue sourcesorembark ona more aggressive economic development effort to
ensure health inthis
area Towards that
endtheCity
has approved
330000 square
02pAEPRfyir02aoBiftyboCwmilftryTfr012469noTSR0514BGFsnanihihevesever056709nufcufr025e010haUrcsYaYEiAEseaieofptloeceacsa0r0di02w ltlexaltNlnVejTVtjiuleapduorema4568iecslEasDElEororctrailGsuteNeNayiteotdmelUOUdneERsnYt
REVENUE SUMMARY
Other Taxes
The principal components of Other Taxes include utility franchise park and transient
occupancy taxes
The utility tax which was approved by voters in 1990 isassessed on gas electricity
andtelecommunication service provided within the Citysjurisdiction at arate of2
4of user charges This tax isageneral tax and can be used for any purpose The
following chart shows that the Citystax rateandareasofapplication are generally lower than thatof
other cities within Santa Clara CountyInMarch 2002voters approvedanextension ofthe utility
tax from a sunset date of 2015 to2030 This extension will correspond with the
extended debt maturity dates asaresult of refinancing for capital improvement projects
Utility taxes are budgeted to be2392 000 which is down compared to the
previous yearsprojections due to new court
rulings for applying this
taxto cell phone usage
Utility
TaxRate
Comparison Gas
Electric Cable
Water
Telephone Cupertino
2424Mountain View303 0Los Altos3
535 35 35Palo Alto 5 0 5050Gilroy
50 505 0San Jose 505
05 0 Franchise fees are received from cable television garbage water
gas
and electricity franchisees that operateinthe CityThefees range from2to 10 of the
franchiseesgross revenues depending on each particular agreement Franchise fee
revenues for fiscal year
200607estimated to be 2200 000are also flat due to the applicability for telecommunication
transmission Park tax is paid by developers onhousing development and canvary greatly
from year to year Estimated revenue for
fiscalyear200607is500000whichisgeneratedfromnewdevelopmentswithintheCityTransientoccupancytaxesareleviedonhotelfacilitieslocate intheCityattherateof10ofroomrevenuesThetaxesinthiscategoryamountto2226000andhavebeenincreasingsinceJanuary2005forallfourhotelsi thecity52
REVENUE SUMMARY
Other Taxes continued
Other taxes of 1640 000 reflect business license fees property transfer tax
constructiontaxand
housing mitigation fees
2004052005
062006
07Actual
Estimate Proposed REVENUE
BYCATEGORY Utility
Tax2
706 0002
675
0002392
000 Franchise
Fees221700022000002200000ParkDedicationFee1726000634000500000TransientOccupancyTax179100021000002226000OtherTaxes16260001850000 6400001006600094590008958000REVENUEBYFUNDGeneralHousingCommunityDevelopmentParkDedicationFund8208000250000500000895800053
REVENUE SUMMARY
License and Permits
Licenses and Permits represent approximately 83of total General Fund
operating revenues This category includes building plan check and electrical and plumbing permits
With the adoption of a new fee study for building planning and engineering fees to reflect
full cost recovery of services andalarge demand for construction the Citysawasubstantial
increase in fees for fiscal year 2004 05 and 200506Wedo not expect
this volume to
continue howeverin
2006 07 2004
05Actual 2005
06Estimate200607ProposedREVENUEBYCATEGORYLicenseandPermits289600033700003050000REVENUEBYFUNDGeneral305000054
REVENUE SUMMARY
Revenues From Use of Money and Property
This revenue category represents approximately 26of total City revenues andis
comprisedofinterest earnings on City funds facility rentsand concession payments onCity
owned property assessment bond interest and repayment of longterm affordable
housing loans Investment earnings areafunctionofthe amount of excess cash available for investment
and thecurrent
interest rate 2004
05200506
200607
Actual Estimate
Proposed REVENUE
BYCATEGORY Investment
Earnings
1025
000 796
000 973
000Property
Rentals
537 000510
000
503000LoanRepayment15200025000055000171400015560001531000REVENUEBYFUNDGeneralStormDrainSportsCenterResourceRecoveryBlackberryFa mTransportationHousingCommunityDevelopmentOtherFunds88000026000600001850008200080000115000103000153100055
REVENUE SUMMARY
Intergovernmental Revenues
Intergovernmental revenues comprise approximately 11 6 of the Citystotal
revenues and consist ofState motor vehicle license fees VLF State gas tax and various grants
from federal state or county agencies This revenue fluctuates widely depending on grant
awards
and alocations As a result ofState budget deficits the last two years have seen many State
borrowings shifts and take aways from the City In 2004 05 the State paid back the 885
00in VLF thatit had borrowedin200304As describedinthe
State Revenue Raid section of this Revenue Summary in 2004 05 and 2005 06 the
City lost12 millioninproperty taxes sales taxes and VLF to theState
in exchange for theGovernor ssupportof PropositionlAFinallyto colateralize the States
deficit recovery bonds and tobackfill the permanent reduction ofVLF aportion of sales
taxes andVLFformerly remitted to the City monthly have been replaced
bysemiwannual paymentsofproperty taxes which has affected cash flows and
interest income Cupertino becameanentitlement city for housing and community development block
grants which increased our grant allocation from 60 000toalmost 500 000 per year
Inadditionourtwo new major
capital projects the
Stevens Creek Corridor
Park and the Mary
Avenue
Bicycle Overcrossing areprimarily
funded bygrants 2004
05 Actual2005
06Estimate
200607 Proposed
REVENUE BY
CATEGORY
Motor Vehiclein
Lieu Transportation
StevensCreekCorridorCIPMaryAvenueCIPHousingCommunityDevelopmentOtherGrants49410004365000458500099100016910001315000520003225000 075320001380002020004350003980004190001530004370006335000135010006873000REVENUEBYFUNDGeneralFundTransportationHousingCommunityD velopmentCapitalImprovementProjects45850001315000398000575000687300056
REVENUE SUMMARY
Charges for Services
Due to the nature of the services provided most of the activity in this category is accounted for
separately as enterprise funds As such the City attempts to recover the cost of the services
provided through user charges
Charges for services representing approximately 143of total City revenues are
estimated to be 8503 000 for the 2006 07 fiscal year With the
opening of our new Sports Center and expansion of our youth programs andtheupdate
ofourbuilding planning and engineering fees this category hasbeen
one of our
largest growing revenue
sources 2004 052005106
200607
Actual Estimate ProposedREVENUEBY
CATEGORY Construction andOther
Permits 1207 0001
785 0001200 000
Resource Recovery2421
0002150
000
2150
000Blackberry
Farm Park Golf
Fees1
108
0001150000995000CupertinoSportsCenterFees132400014420001467000RecreationCulturalYouthandTeenPhysicalNatureandParkPrograms216800 21650002125000SeniorCenterClassesExcursions474000542000566000870200092340008503000REVENUEBYFUNDGeneralResourceRecoveryBlackberr FarmCupertinoSportsCenterRecreationProgramsSeniorCenter1200000215000099500014670002125000566000850300057
REVENUE SUMMARY
Fines and Forfeitures
Fines result from vehicle code parking code and other miscellaneous violations Our fines have
slightly declined due to an enhanced signage effort by our Code Enforcement and Public Works
Departments
2004 05 Actual
200506 Estimate
2006
07Proposed REVENUE
BYCATEGORYFines560000550000560000REVENUEBYFUNDGeneral56000058
REVENUE SUMMARY
Miscellaneous Revenues
Miscellaneous revenues consist of environmental management fees property sales and other
revenue items that the City receives on a non consistent basis from year to year Revenues for
fiscal 200607are budgetedat2336000 Non reoccurring revenues
include
the sale of
surplus property2004
05Actual
200506
Estimate 200607
Proposed
REVENUE BY CATEGORY
Developer Fees
Environmental Management
Saleof
PropertyMiscellaneous500003610001200000447000500003650002423000362000500003650001750000171000205800032000002336000REVENUEBYFUND eneralFundStormDrainEnvironmentalManagementOther18700005000036500051000233600059
REVENUE SUMMARY
Interdepartmental Revenues
Interdepartmental revenues consist of interdepartmental service charges and operating transfers
Interdepartmental service charges arise from the centralized administration of certain activities
the costs of which are allocated to the various City departments benefited The City uses internal
service funds to account for the provision of these services and the related charges Operating
transfers are in essence subsidies of one fund to another fund whereby monetary resources are
recorded as non operating revenues in the receiving fund and as non operating expenditures in
the transferring fund
Operating transfers of 1O 215000are primarily duetothe transfer of3
535 000 in debt service payments 3 722 000 to
fund capital
projects and 1
821000in
GASB 34 retiree
medical benefit obligations
200405
Actual2005
06 Estimate
200607 Proposed
REVENUE BY
CATEGORY Transfer of
Funds
Interdepartmental Service Charges
Insurance Premiums Equipment
ChargebacksIT
Chargebacks12
232 0009
458
00010215000194000338000356000891000855000841000717000717000883000140340001136800012295000REVENUEBYFUNDGeneralFundCapitalImprove entFundTransportationCupertinoFacilitiesCorporationInformationTechnologyITEquipmentReplacementWorkersCompensationLongtermDisabi ityRetireeMedical10000002922000800000353500010200008410003040005200018210001229500060
REVENUE SUMMARY
State Revenue Raid
This category denotes the 2004 05through 200607negotiated
League of California Cities agreement with the StateTheLeague andGovernor Schwarzenagger have
agreed that the State will take 619 000and 623 313
for fiscal years200405and2005 06respectively inreturn for the Governor
s endorsement of Proposition lA which was passed by the voters in 2004 This raid of local
revenue represents one third sales tax one third property tax and one third vehicle license fees
and is therefore segregated in this budget asaseparate line
item The Proposition instituted protections from future takeawaysofthese revenue sources
and strengthened the
State sfunding
requirements forprograms mandated
bythe State
2004 05
Actual 200506 Estimate 200607
ProposedREVENUEBYCATEGORYStateRevenueRaid619000623000oREVENUEBYFUNDGeneralQNotrestatedforprioryearrevenueraids61
Summary of Employees
By Department
80
0 70 00
t I 60
0 1
1L
i5000
j
JJI
k4000
iI3000
20000
0010
002000
02oCiI0126aoAPSDRWini070123456nadeguoeAfo0dorbemumcvddrkv6f12345relnknemfismecicnslcvJoaieiyieiuanalpstslnititsomosiroiiaptlnor yntmaninvtsteieonnt
Employee Summary
Trend Analysis
Council and Commissions
During the 200607budget preparations City Council requested inclusion of all
stafftime associated with commissions for consistencyin
recording
purposes Administration TheAdministration Department has had minimal increases over the past six
years TheCommunity Outreach Coordinator was decreased toahalftime position in 2001
02ahalf time clerk
receptionistwas
added in 2002 03 Administrative Services From fiscal year 200001
to2005 06 the Administrative Services Department has seen minimal changes in staffing The majority of the
increase was due to the expansionofthe IT Division with the additionofaGIS
Coordinator andanITAssistant The Finance Division increased an Account Clerk position fromapart time
toafull time position tohandle Business Licensing andahalf time clerk
receptionistwas
added to the City Clerksoffice in 200203Public Information The staffing
inthePublic Information Department has remained constant over the past eight years except fora
75position that was taken
tofull
timein200102and aMedia Coordinator position will be added in
200607Recreation Services Recreation Services has increased staffing due to new
programs from fiscal year 200001to2005 061A Maintenance Worker
for Blackberry Farm a Building Attendant for the Senior Center and two Recreation Coordinators were
added in fiscal year 2000 01 Changes for 2001 02 included the reclassification
of four positions from part time tofulltimedue to
increased workload at the Quinlan Center Senior Center Blackberry Golf CourseandSports Center During
2002 03greens maintenance was contracted out moving three Maintenance Workers to vacancies in the Public
Works Departmenttwopart time positions were consolidated into afull time
Assistant Golf Shop Attendantand aparttime position went to75
time at the Senior Center Continued consolidation ofcontract maintenance efforts alowed for
thereductionofone vacant
MaintenanceWorkerpositionatBlackberryFarmin200405In200506aFacilityAttendantwasaddedtoservicethenewCommunityHallandin200607aRecr ationCoordinatorwaseliminatedatBlackberryFarm64
Community Development
The Community Development Department has had variations in staffing over the past eight
years In 200102the department combined two part time intern positions intoa
full time position to increase efficiency In addition during 2002 03
the Senior Building Inspector position was vacated asaresult of an internal promotion For
fiscalyear 2006 07 anEconomic Development Manager 50 willbe
addedas
well asaCounter Specialist Public Works The Public Works Department has had minimal increases
over the past six yearsATraffic Engineerwaseliminated and replaced witha
City Architectin2001 02and an Assistant Director of Public Works was
added in 200203The Facilities position count wasincreased in2004 05
by one maintenance worker to support the additional
maintenance workload required for
the librarynewCommunity Hall and City Center Park Redevelopment A2enCY RDAl The Vallco
Redevelopment Project Area was approved and existing stafftimeis allocated
each
yearasappropriateDuringfiscalyear200607anEconomicDevelopmentManager50willbeadded65
PERSONNEL SUMMARY
Summary of employees by Division
Permanent Benefited Positions
2000012001
02 2002
03 200304
CITY COUNCIL COMMISSIONS City
Council0200
200
400
40Fine
Arts Commission
0100
100100
10Technology
InformationCommunications
Commission0
050
050
050
05Parks
andRecreation
Commission0
100
100
10
0
10Teen
Commission0
00000
015
015
Housing Commission
0
05005000000LibraryCommission000000000000SeniorCommission000000000000PublicSafetyCommission000000000000BicycleandPedestrianCommi sion000000000000PlanningCommission000000000000050050080080ADMINISTRATIONCityManager135135145145CommunityOutreach075050050050Cit Attorney275275275270485460470465PUBLICINFORMATIONCommunityRelations075075075075CupertinoScene040040040040GovernmentChannel30030 325325CityWebsite000000000000415415440440ADMINISTRATIVESERVICESAdministration200200190190Accounting375450440440BusinessLicensin 025050050050CityClerk390390390390DuplicatingandPrinting000000060060HumanResources250250270270InsuranceAdministration03503503003 CodeEnforcement315315300300InformationTechnology200300300300179019902030203066
2004052005062006070400100050100150000000000000000000801500502704700750402251004401954400503900602700303003002035040010005010015 0000000000000000008015005027047007504022510044019544005039006027003030030020350400100050100150050020020030030451401400502404300 5040340100555194439050390060270030330400216367
PERSONNEL SUMMARY
Summary of employees by Division
Permanent Benefited Positions
2000012001
02
200203
2003 04 PARKS AND
RECREATION Administration190
190
190
190
Cultural
Programs
625
8
006
50
700
Youthand
Teen Services
2
00
3
50
335
335
Sportsand Physical
Recreation400500550550SeniorPrograms600675750750BlackberryFarm85010007887882865351532633313COMMUNITYDEVELOPMENTAdministration14 149149149Planning596696696696HousingServices100100090090Building10501050114011401895199520752075PUBLICWORKSAdministration200200 00300EnvironmentalManagement235235257242EngineeringServices475575575575ServiceCenter220220220220Grounds1850185018401840Streets2 35223522552270Facilities740740730730Transportation535535435435GeneralServices4104104104106900700070227022REDEVELOPMENTAGENCY000 00000000000000000000TOTALPERMANENTBENEFITEDPOSITIONS1317513800144001538068
2004052005062006071907003355507506883213149704090114019341907003355507506883213149704090114019341897553355507695983196139776081 1902047300300298327327327575575568220220220184018401840224522452245760760760435435435420420420712271227113032032092032032092154 5154751587569
Five Year
Budget
Forecast71
FUND BALANCE TRENDS
Five Year Forecast in thousands
200506
2006072007 08
200809
2009102010
11 GENERALFUND Beginning Balance
atJuly1
1831417
53814
9951341110 752
9080 Operating Activity Estimated
Operating Revenues
33223 33
85335
30235949 37618
38 829Use
ofPublic Access Reserve50
50 5050
5050
Estimated Operating Expenditures
29988 29981
3085432
25833
468 35 037Net
Operating Activity 3
2853922
4 498
37414
2003
842DebtService
3548
35353538353435363532NetOperatingActivityafterdebt263387960207664310TransfersOuttoOtherFundsMISFund220137220220220220RetireeMedi alGASB34176318211882194620132082EquipmentFund0050505050NetIncomeforelPProjectslReserves224615711192200916192042OneTimeRevenuesE terpriseFundsSportsCenterlRecProg35300000SaleofProperty242317500000ParkDedication634500400300200100ResourceRecoverylRDAPayback5 050050005970IncomeforelPProjectslReserves1664117929217098221942ProposedelPProjectsCapitalProjects4302672500200075MaryAveBicycle ootbridge7552500000TransportationProjectsOperations1255800792750850860244037221292950850935EndingBalanceJune3017538149951341110 5290806203ReservePolicyCapitalImprovementProjects5000500012780000PERSReserve1000100010001000000EconomicUncertaintyI250040385217 911325215800EconomicUncertaintyII750075007500750075007500620316000175381499513411107529080620372
FUND BALANCE TRENDS
Five Year Forecast in thousands
2005062006
072007
082008092009 10 2010
11SPECIAL REVENUE
FUNDS STORMDRAIN
BegiJll1ing Balance
atJulyI1
15612593
949698Estimated Operating Revenues
7527676
777778
Estimated Operating Expenditures
17610575 7575
75Capital Projects
930203 00
00
Ending Balance at June 30
1259394
9698101
PARK DEDICATION TAX BegiIll1ing
Balance
atJulyI182 8 8
108308 608
Estimated Operating Revenues 634
500500 500 500 500Estimated
Operating Expenditures0
000
00
NetOperating Activity
634500500500500500OperatingTransfersOutGeneralFund634500400300200100CapitalProjectsMcClellanlPortal17400000EndingBalanceatJune3 881083086081008ENVIRONMENTALMANAGEMENTBegiJmingBalanceatJulyI16311590868278EstimatedOperatingRevenues366366366366366366Estimate OperatingExpenditures414391370370370370EndingBalanceatJune301159086827874TRANSPORTATIONBeginningBalanceatJulyI2163251212ISO5435 stimatedOperatingRevenues127312951305130613191331GrantsOtherIncome468ISO327000OperatingTransfersInGeneralFundCIP125580079275085 860EstimatedOperatingExpenditures928834866902938976NetOperatingActivity206814111558115412311215CapitalProjects39801450162012501 501250EndingBalanceatJune302512121505435073
FUND BALANCE TRENDS
Five Year Forecast in thousands
2005062006
07 200708
2008092009 10
201011SPECIAL
REVENUE FUNDS HOUSING
COMMUNITY DEVELOPMENT Beginning Balance
atJuly1
25771 726
1827885
890866Estimated
Operating Revenues 785 763765
740740 740
EstimatedOperatingExpenditures636662707735764793EndingBalanceatJune30172618271885189018661813VALLCOREDEVELOPMENTBeginningBalanc atJuly222336463594115230EstimatedOperatingRevenues8890909419751000EstimatedOperatingExpenditures2022172223226336OperatingTransf rsOutGeneralFund00005970EndingBalanceatJune3033646359411523091474
FUND BALANCE TRENDS
Five Year Forecast in thousands
2005062006
07200708
2008092009 10
201011DEBT
SERVICE FUNDS CUPERTINO
FACILITIES CORPORATION Beginning Balance
atJuly1
2323 232323
23Operating Transfers
In3548
35353 538
3534 3536
3532Debt Service
Payments3548
35353
5383534
35363532EndingBalanceatJune30232323232323TRAFFICIMPACTBeginningBaanceatJuly1811411611211286EstimatedOperatingRevenues3638353790 ebtServicePayments403639373537EndingBalanceatJune301141161121128649VALLCO1974ASSESSMENTDISTRICTBeginningBalanceatJuly1120120000 EstimatedOperatingRevenues000000DebtServicePayments01200000EndingBalanceatJune301200000075
FUND BALANCE TRENDS
Five Year Forecast in thousands
2005062006
072007
082008 09 2009 10
201011CAPITAL
PROJECT FUNDS CAPITAL
IMPROVEMENT Beginning Balance
atJuly
I15830
000
0Operating Transfers In 390
2
1720200
075 Prior Year Grants53
00
000 Grants
Other Income45
112000
0Capital Projects
2071
22840
200075EndingBalanceatJune30000000CIVICCENTERLIBRARYBeginningBalanceatJulyI200000Donations10500000OperatingTransfersIn4000000Tra sfersOutFFELoanPayback5000000CapitalProjects9700000EndingBalanceatJune30000000CALIMILLPLAZABeginningBalanceatJuly1300000Operati gTransfersOut300000CapitalProjects000000EndingBalanceatJune3000000076
FUND BALANCE TRENDS
Five Year Forecast in thousands
2005062006
072007082008
092009 10 2010
11CAPITAL PROJECT
FUNDS STEVENS CREEK CORRIDOR
PARKBeginning Balance atJuly
1727
0000
0GrantsOther Income1
652000
00PriorYear
Grants Authorized157300
000 Operating Transfers
InGeneral
Fund0500
500000CapitalProjects3952500500000EndingBalanceatJune30000000MARYAVENUEBICYCLEFOOTBRIDGEBeginningBalanceatJuly144500000PriorYea GrantsAuthorized536700000FedemlandStateGrantsOtherIncome21651380000OperatingTransfersInGeneralFund7552500000CapitalProjects8732 880000EndingBalanceatJune3000000077
FUND BALANCE TRENDS
Five Year Forecast in thousands
200506
200607
2007082008 09 2009
10201011
ENTERPRISE FUNDS RESOURCE
RECOVERY Beginning Balance
atJuly
I57164963
41933 269
2777
2235 Estimated Operating
Revenues2325
24352
4152461
25292 600Estimated
Operating Expenditures 2 798
27302
83929533
0713194
NetOperating Activity
473295424
492542594 Loan Payback
220250
000OperatingTransfersOutGeneralFund500500500000EndingBalanceatJune30496341933269277722351641BLACKBERRYFARMBeginningBalanceatJul 11113830230219468EstimatedOperatingRevenues12371078722131213361360EstimatedOperatingExpenditures13861242722120412101215NetOpera ingActivity1491640108126145OperatingTransferInGeneralFund000000EndingBalanceatJune301383023021946877CUPERTINOSPORTSCENTERBeginn ngBalanceatJuly120373141169200224EstimatedOperatingRevenues6491527159516517081768EstimatedOperatingExpenditures1679145915671620 6841752NetOperatingActivity306828312416OperatingTransferOutGeneralFund10000000EndingBalanceatJune307314116920022424078
FUND BALANCE TRENDS
Five Year Forecast in thousands
200506
200607
2007082008 09 2009
10201011
ENTERPRISE FUNDS RECREATION
PROGRAMS Beginning Balance
atJulyI
9510148 291
416523
Estimated Operating Revenues 2 180
21452
2092274
23422
412Estimated Operating
Expenditures2085
1987206624922352325NetOperatingActivity9558432510787OperatingTransfersOut20000000EndingBalanceatJune3010148291416523610SENIORCE TERBeginningBaanceatJuly488888EstimatedOperatingRevenues545568585602620639EstimatedOperatingExpenditures54568585602620639NetOpe atingActivity400000OperatingTransferIn000000EndingBalanceatJune3088888879
FUND BALANCE TRENDS
Five Year Forecast in thousands
2005062006
072007
082008 09 2009
10201011
INTERNAL SERVICE FUNDS
MANAGEMENT INFORMATION Beginning
BalanceatJuly
11
010 934 9521
01910701
103 Estimated
Operating Revenues 735 903
921939957
976Estimated Operating
Expenditures 726821 854
888
924960Net Operating
Activity982
675133
16 Operating Transfers
In220137 220220
220220
Depreciation Reserve 80 99 80
808080 Capital
OutlayNew Replacement
385300300 300
300300Ending
BalanceatJune
30934 952
1019107011031119WORKERSCOMPENSATIONBeginningBalanceatJuly1156156195231264295EstimatedOperatingRevenues315329338347357367Estimat dOperatingExpenditures315290302314326339EndingBalanceatJune30156195231264295323EQUIPMENTBeginningBalanceatJuly11367137514101437 4561467EstimatedOperatingRevenues870876902929957986EstimatedOperatingExpenditures862841875910946984NetOperatingActivity83527191 2OperatingTransferInGeneralFund0050505050DepreciationReserve34298125125125125CapitalOutlayNewReplacement34298I75175175175Ending alanceatJune30137514101437145614671469LONGTERMDISABILITYBeginningBalanceatJuly1141321303949EstimatedOperatingRevenues4352555759 1EstimatedOperatingExpenditures444446484951EndingBalanceatJune3013213039495980
FUND BALANCE TRENDS
Five Year Forecast in thousands
200S
06200607
2007082008
092009 10 2010
11INTERNAL SERVICE
FUNDS RETIREE MEDICAL
INSURANCE Beginning Balance
atJuly1232134894660577468587916EstimatedOperatingRevenues176318211882194620132082EstimatedOperatingExpenditures5956507688629551 54EndingBalanceatJune3034894660577468587916894481
REVENUE ESTIMATE
Adopted Revised
Actual Budget Budget FIVE YEAR FORECAST in thousands
2004
05
2005 06
2005 06
2006072007
08 2008 09
2009 10
2010 11
GENERAL TAXES Property
Tax 42604157
4620
4850
5
0445246 5 456
5
674Sales
Tax9222
91509650
10400
186
228913
280
13811 Transient Occupancy Tax 7911
730
21002226
23372
1822269
2360Utility Users
Tax2706 2
6752
6752 392 2488
2587
2691
2771
FranchiseFees2217230022002200180018001836873OtherTaxes3713505501390432147551915642156721362227952345824917255782705128054LICENS SANDPERMITS28962800337030502959281128112811USEOFMONEYANDPROPERTYInvestmentEarnings595600500510520531541552PropertyRentals365475 653703773853934009601075865880898916934953INTERGOVERNMENTALMotorVehicleLicenseInLieu45273450404042204300445046104780Grants22812 22580808080180OtherIntergovernmenta18600100851858518518549413675436545854665481549755145CHARGESFORSERVICESZoningandPlanningFees 63510905004854614646EngineeringFees683675775600582553553553OtherServiceCharges3910000100041081127120712851785120011711122112611 1FINESANDFORFEITURES560625550560571583594606MISCELLANEOUS171100116120122125127130STATETAKEAWAYsalespropertyVLF61962362300000Sub otal3168330299332233385335302359493761838829TRANSFERSINOTHERREVENUESSaleofProperty120050024237500000ParkDedicationTax1723500634 00400300200100ResourceRecoverylRDALoanPayback50050050050050005970LoanPrepaymentKiian3300000000LeadershipProgram80000000LibraryC liMillOPsavings03005302000SportsCenter0000000000RecreationPrograms20820020000000TotalGeneralFund3565233399371333660336204362493 4153892982
REVENUE ESTIMATE
Adopted Revised
Actual Budget Budget FIVE YEAR FORECAST in thousands
2004052005
062005
062006
07 2007 08 2008 09
200910201011
SPECIAL REVENUE FUNDS
STORM DRAIN Investment
Earnings30
2525 26
26
272728
TaxSO 50 50
SOSO50 50SO
Water District cost share
000200
00
00
80 7575
27676 77
77
78 PARK
DEDICATION TAXPark
Dedication Tax 1726 500 634 500 500
500500500
1
726500634500500500500500ENVIRONMENTALMANAGEMENTInvestmentEarnings111IFees361374365365365365365365362375366366366366366366TRANSP RTATlONInvestmentEarnings7650508070SOSO50OperatingTransfersInGeneraFund750755255800792750850860TrafficCongestionReliefPropositi n4200223200210221223225FederalandStateGrants0330468100327000OtherRevenues000500000GasolineTax9900010000151025035104610561817213 299622452424205621682191HOUSINGCOMMUNITYDEVELOPMENTInvestmentEarningsRent1820208585858585Grants202435435398400400400400LoanRepa ments3230303030303030HousingMitigationFees255200300250250225225225TransferIntoSeparateBMRfromGenFd72100000012286857857637657407 0740VALLCOREDEVELOPMENTPropertyAssessment196088909094197510001960889090941975100083
REVENUE ESTIMATE
Adopted Revised
Actual Budget Budget FIVE YEAR FORECAST in thousands
2004052005
06200506
200607 207
082008 09
200910
201011 DEBT SERVICE
FUNDS
CUPERTINOFACILITIESCORPORATIONInvestmentEarningsI0000000OperatingTransferIn3547354835483535353835343536353235483548354835353538 53435363532TRAFFICIMPACTInvestmentEarnings0II00000PropertyAssessment393535383537903936363835379084
REVENUE ESTIMATE
Adopted Revised
Actual Budget Budget FIVE YEAR FORECAST in thousands
2004052005
062005
062006 07
2007 08 200809
2009 10 2010
11CAPITAL PROJECTS
FUNDS
CAPITAL
IMPROVEMENT Operating Transfers
In447340390
2172 0
200075 Prior
Year Grant Receipts
005300
000 Grants Other Income
46 4545112
000
059338548822840200075CIVICCENTERLIBRARYMiscellaneous400000000Donations236010500000OperatingTransfersn004000000276014500000STEVE SCREEKCORRIDORPARKOperatingTransfersn72100500500000PriorYearGrantsAuthorized0057300000GrantsOtherIncome521652165200000773165232 5500500000MARYAVENUEBICYCLEFOOTBRIDGEOperatingTransfersInfromGeneralFund02557552500000PriorYearGrantsAuthorized00536700000Feder landStateGrants0216521651380000024208287388000085
REVENUE ESTIMATE
Adopted Revised
Actual Budget Budget FIVE YEAR FORECAST In thousands
200405
200506
200506
2006 07 2007
08 2008 09 2009 10
2010
ENTERPRISE FUNDS
RESOURCE RECOVERY
Investment Earnings
173 2020
60 50
5050
150 Charges
for
Services2
42
2450
21502
502
2152
28 2 3492
420 Loan
Paybackfor
FFE
120 20 220
250000Grants32055255030303027172710254524602415246125292600BLACKBERRYFARMInvestmentEarnings62222222RentI808080802012020Chargesf rServices1085015099564090124238Miscellaneous055I0000122512371237107872213121336360SPORTSCENTERInvestmentEarnings9777891011Rent6 65655370727478TennisProgram040110042115085122012571294Membership28430030037333349367385OtherRevenue0013500000139414721649152715 5165117081768RECREAnONPROGRAMSInvestmentEarnings25552020202020CulturePrograms373385385375386398410422YouthandTeenPrograms757807 0775798822847872PhysicalPrograms10801000100097510041034106509721932180218021452209227423422412SENIORCENTERInvestmentEarnings222 2222ChargesforServices474500542566583600618637Miscellaneous010000047650354556858560262063986
REVENUE ESTIMATE
Adopted Revised
Actual Budget Budget FIVE YEAR FORECAST in thousands
2004052005
062005
062006
072007
082008 09
200910
201011
INTERNAL SERVICE FUNDS
MANAGEMENT
INFORMATION
Investment Earnings
2518
182020
202020
Service Charges 717 717 717
883
901919
937956 Operating TransfersIn
12022022013722022022022086295595510401141115911771196WORKERSCOMPENSATIONInvestmentEarnings2820202525252525OperatingTransfersIn3 00000000Premiums149295295304313322332342477315315329338347357367EQUIPMENTInvestmentEarnings3615153536373839ServiceCharge8918558 5841866892919947OperatingTransfersIn00005050505092787087087695297910071036LONGTERMDISABILITYInvestmentEarnings0200II1IPremiums4 504352545658604552435255575961RETIREEMEDICALOperatingTransfersInfromGeneralFund285759517631821188219462013208287
EXPENDITURE ESTIMATES
Adopted Revised
Actual Budget Budget FIVE YEAR FORECAST in thousands
2004
05200506
200506
200607
200708 208
09200910
201011GENERAL
COUNCIL CAOMMNISSIDONS 1000City
Council72
195195
220229
238247
2571031
Telecommunications
Commission9
1313
13141415
151040
Library Commission
0I
15 5
5 66
1042Fine
ArtsCommission
11 1313 17 17
18 199
1050 Public Safety
Commission0
0
04
000
0
1055Bicyc1e1Pedestrian
Safety Commission
000
50
00
01060
Recreation Commission8
1010
1011
11
12121065TeenCommission13161615161617181067SeniorCommission011311111070PlanningCommission13212196100104108112075HousingCommissio 00077888227269269395400416432449ADMINISTRATION1200CityManager3083303303503643793944101201CommunityOutreach50474757606264671300C tyManagerDiscretionaryFund4153220202020203623924094274444614784961500CITYATTORNEY5245135135245455675906132100LAWENFORCEMENT6145 969717772697632801484148835PUBLICINFORMATION3300CommunityRelationInfonnation154184184161681751821893350City50thAnniversary24575 23252627283400CupertinoScene100991291051091131181233500GovernmentChannel32431938346047949858539350GovtChannelSpeciaProjecl47484 4955355573502PublicAccessSupport5050505254565863600CityWebSite109127271374314854168088849789871028106911121157ADMINISTRATIVESER ICES4000Administration289316363293423553703844010LeadershipCupertino00022222222224040LibraryExtraHours02012012012025130135400Ac ounting6086876877387677988308634200BusinessLicenses39414142444647494300CityClerk4584754895095295505725954310DuplicalingandPosta e63218233212202282382474330Eections593003042150500504400DisasterPreparedness14403151879194981024510HumanResources42648649652454 5665896245HumanResourcesLitigation1306325262728294530CodeEnforcement5025895896436686957237524540InsuranceAdminislration44371095 5765996236486744600NeighborhoodWatch002834353738393132407444654074400843174333465588
EXPENDITURE ESTIMATES
Adopted Revised
Actual Budget Budget FIVE YEAR FORECAST in thousands
2004 05
200506
200506
200607200708
2008
09200910
201011
GENERAL contRECREATION
SERVICE 6100 Recreation Administration 236
263
263 284
295307
320 332
Quinlan Community Center Cultural
6200Supervision 444474
474
460479
498 518 538 6230
Community Hall
Operation419
27272829
3032
6248Cultural
Programs25
5252
100 104 108 112117
6265
Quinlan Community
Center 255 279
283 297 309
321 334
347Monta Vista
Recreation Center Youth
6300
Administration210262612782893003123256342YouthPrograms33404040414344466343TeenPrograms1013121313141456344TeenCenter556469697174 7806360MontaVistaRecrealionCenter61313131414515CupertinoSportsCenterPhysicallRecreation6400Supervision2172312312372472572672786 45CreeksidePark612299910106448FourthofJuy5468686871747780SeniorCenter6500SeniorAdultPrograms4644944955285505725946186529SeniorC nterCaseManager31484852545659616647NaturePrograms7178818690949710121212407242725612663277028802996COMMUNITYDEVELOPMENT7200Plann ngAdminislration206234234285297308321334730CurrentPlanning5587357377577888198528867302MidandLongRangePlanning231262275273283295 073197305Anneutions00512120007306EconomicDevelopmen