Finance Committee Agenda and Packet 2020 04 24

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City Council Finance Committee Meeting Minutes 04/24/20 Page 2 of 4 DEVELOPMENT OF 2020 REVENUE PROJECTIONS Finance Committee Chairperson Maloney presented an outline of goals for the meeting to better understand the impact of the COVID-19 Pandemic on the City's financial status. The Finance Committee reviewed the financial model provided by Finance Committee Member Lipton. The model included revenue and expenditure assumptions, and projections for the potential impact to the General Fund for 2020 and 2021. Director Watson stated he is able to load any projections agreed to by the Committee into the Long Term Financial Model so the Finance Committee could see how proposed changes would affect the various fund balances. These assumptions and related fund impacts would then guide the degree of expenditure reductions needed for the upcoming budget process. Director Watson stated he hopes to come away from this meeting with the Committee's input on the assumptions to be used. Member Lipton reviewed his projection model with Committee Members and staff. Members started discussions with sales tax and how several industry categories may collapse in the months to come. With such uncertainty ahead, Finance Committee Members agreed that any projections developed will be based on a combination of data and intuition. Finance Committee Members and staff agreed that it is difficult to anticipate how deep the revenue reductions will be, and when and how fast a full recovery may take place. Finance Committee Members and staff agreed that there may be as much as a 20% reduction in overall revenue and related City expenditures as a safe and conservative approach. The Finance Committee expressed that whatever budgeting criteria is established for 2021 be carried forward for 2022, and that there may be no new programs, staffing, or expenditures through 2022. The Committee also discussed that all General Fund transfers will need careful attention, especially for the Golf Course and Recreation Center. Finance Committee Members agreed unanimously that all budget cuts must be shared across all funds, and all areas must reduce expenditures. Finance Committee Members agreed they do not want to spend down fund balances too far. The Finance Committee requested City Manager Balser obtain projections for the decline in the Highway User's Tax.