The Mid-Year budget update provides an opportunity for the City Council to take a broader look at the City’s financial picture at the mid-point of the fiscal year. The report largely focuses on general fund revenue trends since adoption of the budget, recommendations on revisions of revenue projections (if necessary) and identification of any budget adjustments that require City Council action. Staff from the City Manager's Office and the Finance Department will provide the City Council with a Fiscal Year 2019-20 mid-year budget update.

General Fiscal Overview

The FY 2019-20 mid-year budget update shows that the City remains financially sound, based on actual fiscal performance during the first six months. Major general fund revenue sources (property tax and sales tax) are trending on track to meet original budget projections. Department expenditures are generally in line with original budget projections. Development activity and most local economic indicators continue to show stability.  No immediate, significant operating budget adjustments are necessary at this time. As always, staff continues to monitor both revenue and expenditures and will make recommendations for future adjustments, if necessary.

Additionally, the FY 2019-20 budget included $61.8 million in Public Safety and Vital Services Measure (PSVS) allocations. The PSVS budget was based on revenue projections at that time, which included consultation with the City’s sales tax advisor and comprehensive review of economic conditions, both locally and globally.

Since that time, the City has received two full quarter distributions of PSVS revenues. At the end of November, the City received the third quarter (July-September 2019) sales tax reports from the State.  PSVS revenues continue to come in higher than originally anticipated.  Integrating the third quarter PSVS receipts into the long term projections show the annual revenue from this source at over $9 million above the original budget for the current fiscal year.  This is a continuation of higher than expected PSVS revenues after the first full quarter came in 11 percent more than budgeted in the prior fiscal year. 

This is positive news, which allows staff to recommend the acceleration or supplementing of many PSVS-funded programs as part of this mid-year budget update. However, as you will see below, staff is recommending adjustments that are less than the anticipated increase in PSVS revenues. Staff continues to take a fiscally conservative approach with PSVS appropriations as the Measure has only been in place for 2.5 fiscal quarters. The next quarterly sales tax data will be available in March 2020.

Mid-Year Appropriations

The following is a summary of recommended PSVS Measure and General Fund mid-year appropriations totaling $5.4 million. The items funded by the PSVS Measure were submitted to the Citizens Oversight Committee for review and consideration in December 2019. All of the items were recommended by the Committee.

Additional detail on each of these proposed adjustments is as follows:

PUBLIC SAFETY AND VITAL SERVICES MEASURE

Balance of Body Worn Camera Project

Measure Spending Priority #1: Increasing police staffing to improve police response times, reduce crime, and increase neighborhood police patrols.

Measure Spending Priority #2:  Improving rapid response to assaults and robberies.

Measure Spending Priority #3:  Maintaining/improving rapid response to gang violence.

Measure Spending Priority #4:  Investigating and proactively preventing property crimes, burglaries and vehicle thefts.

Measure Spending Priority #5: Keeping public areas safe and clean

Measure Spending Priority #6:  Strengthening the capacity of the Special Enforcement Unit.

Measure Spending Priority #7:  Expanding the School Resource Officer Program.

Allocation Amount: $800,000

Following a year-long field-testing project, the Bakersfield Police Department entered into an agreement with Axon Enterprise, Inc. in September 2019 to begin the multi-year phase in of body worn cameras for all sworn officers and all uniformed police civilian personnel assigned to field duties.

Objectives of the body-worn camera project include:

• Strengthening community trust through an increase in accountability and transparency

• Reducing citizen complaints

• Increasing accuracy of citizen complaint resolutions

• Reducing department liability

• Improving quality of evidence in criminal cases

The FY 2019-20 Adopted Budget included PSVS funding for the first phase of this project, with future phases to be funded through future allocations of PSVS revenues. The first phase included 210 units to be deployed over 60 to 90 days.  This first phase equipped  uniformed personnel comprised of the Department’s Patrol shifts, Traffic Detail, K-9 Unit, Impact Unit, School Resource Officer Unit, and the Special Enforcement Unit of the Operations Division. These cameras are fully deployed.

Based on the improved fiscal circumstances and the significant benefits derived from the body-worn cameras, staff is recommending allocating an additional $800,000 to complete the full implementation within the current fiscal year. If approved, an additional 215 cameras will be deployed by spring 2020, which will full outfit the department. This allocation includes both the costs of the additional camera equipment and the addition of two Police Property and Equipment Specialist positions.

These positions will specifically assist the Department in overseeing the day-to-day management of the cameras. Upon full implementation, there will be significant data review, management and tracking that will be required.

The two positions will be responsible for:

• Policy compliance – including verifying tagging of incidents by officers

• Preparing data for supervisor review, inspections, etc.

• Facilitating the identification, processing, and transfer of camera-related evidence to District Attorney’s Office and other law enforcement agencies

These positions were originally planned to be added next fiscal year based on the original implementation schedule of the cameras. However, due to the proposed acceleration of implementation, staff is recommending moving forward with these positions at this time.

Early Acquisition of Phase II Equipment – Bakersfield Fire Department

Measure Spending Priority #5: Keeping public areas safe and clean

Measure Spending Priority #8: Maintain a fully staffed and equipped Class 2 rated Fire Department

Allocation Amount: $320,000

In 2013, the Bakersfield Fire Department (BFD) responded to 16,206 emergency medical related incidents. In the five-year span ending in 2017, emergency medical calls for service increased by upwards of 63% totaling 25,357. The BFD foresees this trend continuing and will have a persistent negative impact on engine company response times due to the lack of availability when units are required to respond from neighboring districts to provide emergency medical services (EMS).

In an effort to be proactive due to the ascension of the overwhelming call volume related to emergency medical calls for service, the BFD will be proposing the to implement a new level of service to the citizens of Bakersfield in FY 2020-21. This will include six engineers and six firefighter positions in the form of rescue squads, which will serve as two-person, fast response EMS units that would also be utilized as a two-in-two out rescue component during a structure fire. These strategically placed rescue squads will respond to EMS calls which are normally handled by neighboring stations when the initial unit is already assigned to an incident or undergoing training. The rescue squad concept will provide a higher level of service in regards to more expedient response times and overall EMS efficiency by assuring engine/truck companies remain in their first-in district to provide much needed assistance at call time. This type of service enhancement directly corresponds to the ability to maintain the BFD’s Class II ISO rating.

The equipment necessary for these rescue squads requires lead time. Therefore, similar to what occurred in the previous budget cycle, staff is recommending the early acquisition of two fire rescue vehicles. Beginning the acquisition process in the near term will allow for these units to be ordered, built, transported and placed into service at the start of next fiscal year. This will coincide with the availability of the additional positions to staff this equipment. Delaying the acquisition will result in the implementation of the rescue squads being deferred until late 2020 or early 2021.

E-Permitting Software

Measure Spending Priority #11: Creating jobs through economic development, business retention/attraction and workforce development

Allocation Amount: $500,000

Staff initially presented the concept of acquiring and implementing an e-permitting and plan review software platform to the Planning and Development Committee. An e-permitting and plan review software platform is anticipated to accelerate the permitting process, providing individuals and developers an easier method to submit plans, review documents and drawings, process corrections and remit fees. This type of platform will also provide for internal City efficiencies, including the ability to quickly monitor and enhance the workflow process. The overall objectives of implementing this platform are to support economic development efforts and incubate job creation and expansion. 

Over the past several months, staff has completed a comprehensive review of e-­permitting and plan review software to determine the City's needs, to better understand cost parameters and the most advantageous pathway to implementation. To this end, staff issued a request for proposal in September 2019 and received two qualified responses from Avolve Software Corporation and Tyler Technologies.

A selection committee of City staff reviewed the proposals, which included onsite demonstration of the respective products from each company. Upon conclusion of the review process, staff recommended award of the agreement to Avolve Software Corporation based upon the product features and firm qualifications meeting or exceeding the needs of the City.

Therefore, staff is recommending the City Council approve the contract with Avolve and appropriate the necessary funding for the first year of implementation. The appropriation includes both payment to the vendor for the first phase, as well as funds to purchase additional computer equipment to support the use of the system by City staff. Upon approval, staff anticipates implementation will occur no later than fall 2020. Implementation will include hardware and software acquisition, outreach to the development community, internal staff training and the product launch. Additionally, staff is in the process of applying for a vehicle trip reduction grant from the San Joaquin Valley Air District, which may offset up to $150,000 of costs to implement this system.

Homeless Services/Shelter Operations

Measure Spending Priority #5: Keeping public areas safe and clean

Measure Spending Priority #9: Reducing homelessness through partnerships with service providers to increase outreach, sheltering and construction of affordable housing

Measure Spending Priority #13: Enhancing neighborhoods through additional code enforcement and improved park maintenance.

Allocation Amount: $822,000

In December 2019, City staff proposed $1.5 million in homeless services/shelter-related mid-year PSVS Measure allocations to the Citizens Oversight Committee. A portion of this allocation was identified to extend homeless-related services through the end of the fiscal year. Since that time, the City Council has approved three separate appropriations totaling $678,000 to fund three contracts for downtown human waste clean up, private security services and an agreement with the Bakersfield Homeless Center for general cleaning activities.

The balance of the recommended allocation for homeless-related items is $822,000. Subsequent to the mid-year review by the Citizens Oversight Committee, the City Council directed staff to provide a $500,000 contribution to support expenses related to the operation the County of Kern low Barrier shelter project at 2900 M St. Therefore, staff is recommending the appropriation of $500,000 to be directed toward funding this contribution.

Over the course of the past year, staff has been comprehensively studying the various components of low barrier shelters, including operational needs, space layouts, resource availability and partnership opportunities with other government agencies, non-profits and the private sector. This research included staff visiting other jurisdictions to observe operations of low-barrier shelters and reviewing costs incurred by other agencies to operate and maintain these types of facilities. The balance of the available allocation after the County contribution is $322,000. Based on additional research,  staff is proposing this remaining amount be appropriated to the City's Low Barrier Shelter Project at 1900 East Brundage Ln. These funds would be utilized to supplement the previous allocation to operate the facility as envisioned by the Citizens Oversight Committee, the City Council and the community.

Allocation to PSVS Reserve

Measure Spending Priority #10: Addressing the fiscal stability of the City of Bakersfield

Allocation Amount: $3,000,000

As part of the FY 2019-20 budget adoption process, the City Council approved a policy to enact a multi-year plan to reach a 60-day reserve by FY 2024-25. Reserve funds help mitigate the effects of unanticipated situations such as natural disasters and significant unforeseen events, as well allow the City to temporarily buffer against cuts to staffing levels, programs or services in response to economic downturns and State revenue takeaways. Upon completion, this plan meets or exceeds the general cash reserves of most comparably-sized cities within the state and meets recommended reserve funding levels as established by the Government Finance Officers Association. To this end, the City Council allocated $3.3 million to the PSVS Measure reserves as part of the budget process. The plan noted that to stay on track to reach the 60-day reserve by FY 2024-25, the City would need to allocate an additional $5.7 million in each of the next three years to reach the goal of $65.1 million when this plan is fully implemented. Based on fiscal circumstances, staff is recommending an additional $3 million be allocated to the reserve at this time. Although this does not meet the stated target of $5.7 million for the current year, staff anticipates an additional future allocation can occur should PSVS revenues continue to meet revised projections.

GENERAL FUND

City Hall North Security Upgrades

Beginning February 3, visitors to City Hall North (CHN) and City employees without a security code are required to check-in with a plain-clothed Bakersfield Police Officer before accessing the elevator and the upper floors. This is something many other municipal buildings across the state already provide. Visitors conducting business at the City Clerk’s Office, Treasury or Human Resources (all located on the first floor) do not need to check-in at this time. This system does not restrict public access to the departments in CHN and is intended to provide a safe environment for visitors and the employees who work in the building. This change also gives City staff a record of who is in the building at any given time so everyone can be accounted for in the event of an emergency and/or evacuation.

Currently, the officers stationed at City Hall North are on a transitional assignment, serving an administrative role in order to make the most effective use of BPD resources. Because of the current arrangement, multiple officers may be stationed at the desk over a given time period, which creates continuity issues. Additionally, this assignment is a transitional assignment and when officers return back to a regular assignment, availability of staff may be challenging at times.

Therefore, staff is proposing to hire a private security firm to staff the check-in desk. The private security staff member will perform the same duties as the BPD officer. This arrangement allows BPD to reassign the officer to other department related tasks. This proposed arrangement is similar to what is established at several other public agency facilities within the community. Additionally, several keypads throughout CHN need to be upgraded to fully implement this security upgrade plan. Therefore, staff is requesting an additional appropriation of $35,000 to address these two items.