RESOLUTION No. 36197

Adopt the Five Year General Fund Financial Forecast upon which the FY 2004-05 Budget shall be based. (Resolution)

WHEREAS, planning and preparation for the FY 2004-05 budget process is underway; and

WHEREAS, the City of Portland, Office of Management and Finance, Financial Planning Division, has reviewed with Council and published the Five Year Financial Forecast for FY 2004-05 through FY 2008-09; and

WHEREAS, the Five Year Financial Forecast includes funding for Fire equipment within Fire’s target instead of the General Fund capital set-aside; and

WHEREAS, the business license refund set-aside is zeroed out in the Five Year Financial Forecast to be consistent with the new accounting method employed for business license revenues; and

WHEREAS, the Five Year Financial Forecast includes about $1.8 million in PERS savings taken out of bureau current appropriation levels; and

WHEREAS, risks to the forecast include an unresolved Police labor agreement, possible further adjustments to the PERS rates, possible long term effects of the Shilo-Inn Rule on property tax collections, further reduced forecast revenue due to the business license accounting changes, and the continuing recession; and

WHEREAS, the Five Year Financial Forecast, with these and other assumptions, shows a forecast to forecast decline of $9.996 million in ongoing resources such that forecast revenues are insufficient to fund current appropriation levels and set-asides within the General Fund; and

WHEREAS, the Five Year Financial Forecast includes $458,308 in one-time resources planned by Council for allocation in the FY 2004-05 budget; and

WHEREAS, Current Appropriation Level or CAL is a term used to define the starting point of a bureau’s budget development. CAL is the dollar amount calculated by Financial Planning on a bureau’s current year’s Revised Budget, with an increment incorporated for the assumed level of inflationary increase.

WHEREAS, the decline in resources requires a $2.818 million reduction in current appropriation levels and translates into approximately 1.1% reduction in ongoing requirements;

NOW THEREFORE BE IT RESOLVED BY THE Council of the City of Portland, Oregon, that:

1.  The FY 2004-05 budget shall be based on the resource estimate included in the Five Year Financial Forecast, attached as Exhibit A.

2.  The Office of Management and Finance is directed to modify the resource estimate based on updated information, as it becomes available, and to report any changes to Council.

3.  The Financial Planning Division of OMF will assign target budgets at 97.5% of Current Appropriation Level budgets to all General Fund bureaus in accordance with Council direction and including the special adjustments described in the Five Year Financial Forecast and the Target Schedule attached as Exhibit B.

Adopted by the Council, January 21,2004  Gary Blackmer

 Auditor of the City of Portland

 By: /S/ Susan Parsons

   Deputy

Mayor Vera Katz

TG:JS:bt

January 12, 2004

BACKING SHEET INFORMATION

AGENDA NO. 54-2004

ORDINANCE/RESOLUTION/COUNCIL DOCUMENT NO. 36197