Title
a. Consider approving the attached proposed County Financial Policies revision to include a policy to fund the Road Fund through a County Transient Occupancy Tax contribution formula in a graduated process from 20% up to a flat rate contribution of 25% to maintain roads;
b. Consider approving the policy to include the implementation of a Road Fund Advisory Committee to provide direction on the use of the funds; and
c. Consider approving the Resource Management Agency as the designated County department to support the Road Fund Advisory Committee.
Report
RECOMMENDATION:
It is recommended that the Board of Supervisors:
a. Consider approving the attached proposed County Financial Policies revision to include a policy to fund the Road Fund through a County Transient Occupancy Tax contribution formula in a graduated process from 20% up to a flat rate contribution of 25% to maintain roads;
b. Consider approving the policy to include the implementation of a Road Fund Advisory Committee to provide direction on the use of the funds; and
c. Consider approving the Resource Management Agency as the designated County department to support the Road Fund Advisory Committee.
SUMMARY:
June 2013, the Board, in recognition of the contributing value that well maintained roads provide for the overall economic vitality of the County, approved including the Road Fund in the list of recipients from the County Transient Occupancy Tax Revenue contribution formula for FY 2012-13, which was established at 20% at that time. Additionally, the Board of Supervisors directed staff to return with a recommended County financial policy to: (1) utilize a Transient Occupancy Tax (TOT) contribution percentage formula on a per annum basis leading to a flat rate in the future of 25%; and (2) implementation of an Advisory Committee (Committee), whether an existing or creating a new Committee, to provide direction to the Monterey County Public Works Department in the use of the TOT funds. The policy establishes an alternative that, going forward, will replace the $2.0 million the County General Fund has contributed to the Road Fund in the past for maintaining roads (chip seal program).
Staff recommends the Transient Occupancy Tax Revenue section of the County Financial Policies (see Attachment 1) be revised so that the TOT contribution percentage to the Road Fund will increase by 1% until it reaches 25%; at that time, the contribution percentage shall remain capped at 25%. The recommended contribution percentage per annum shall be as follows: FY 2013-14 (20%); FY 2014-15 (21%); FY 2015-16 (22%); FY 2016-17 (23%); FY 2017-18 (24%); FY 2018-19 (25%); and thereafter remain at 25%.
To insure the intent of the contributions meet the Board's performance requirements, staff recommends a ten (10) member Road Fund Advisory Committee (Advisory Committee) is established to review per annum the recommendation from the Monterey County Public Works Department (MCPWD) on the use of the funds. When the MCPWD provides a plan for the use of the funding to the Board of Supervisors and their applicable committees, minutes from the Advisory Committee will be included for consideration (see Attachment 1). To insure the Advisory Committee meets the diverse needs of the County, staff recommends the Advisory Committee should have two (2) members appointed by each Supervisor for their respective Districts; these members shall be residents of that Supervisor's unincorporated area of the County. The implementation of the Advisory Committee does not replace the functions and responsibilities of both the Capital Improvement and Budget Committees.
OTHER AGENCY INVOLVEMENT:
The County Administrative Office, Resource Management Agency Administration and Monterey County Public Works Department worked on the recommended policy.
FINANCING:
The revised policy updates the Financial Policies to provide the framework for building and administering the Recommended Budget each fiscal year. The fiscal implications related to the recommended funding strategy for the Road Fund is to utilize the recommended Transient Occupancy Tax contribution formula of 21% based on the total Transient Occupancy Tax from the previously audited fiscal year for the FY 2014-15 Recommended Budget and subsequent percentages as recommended for future budgets. The recommendation will not have an impact on funds agreed upon by the Board as annual contributions to The Monterey County Convention and Visitors Bureau, Film Commission and Arts Council.
Prepared by: Approved by:
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Rod Walker Dewayne Woods
Principal Administrative Analyst Assistant County Administrative Officer
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Approved by: Approved by:
_______________________________ ________________________________
Robert K. Murdoch, P.E. Benny J. Young
Public Works Director RMA Director
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Attachment: Attachment 1: Monterey County FY 2014-15 General Financial Policies Revision