A. Definitions. As applied in this section, the following words and terms are defined as follows:
1. “Infrastructure” means long-lived capital assets that are generally stationary in nature and can be preserved for a significant number of years. They include, but are not limited to, alleys, arterials, streets, highways, curbs and gutters, sidewalks, bridges, street trees, landscaped medians, traffic signals, streetlights, retaining walls along streets and arterials, public facilities and improvements within the public right-of-ways or on public property.
2. “General Fund Revenue Baseline” (Baseline) means the externally audited sales tax and secured property tax revenue as reported in the Comprehensive Annual Financial Report (CAFR) for fiscal year ending June 30, 2019. The Baseline may be adjusted by majority action of the City Council due to change in disbursement of taxes resulting from state or court action and, beginning with the fiscal year ended June 30, 2029 CAFR, and every ten years thereafter.
a. The sales tax baseline shall be adjusted by the annual Consumer Price Index for All Urban Consumers, Los Angeles-Long Beach-Anaheim, CA Metropolitan Statistical Area (CPI), for the preceding fiscal year.
b. The secured property tax baseline shall be adjusted by 2.5% annually.
B. Establishment of the Fund. There is hereby established an “Infrastructure Fund,” which shall be a fund within the City’s General Fund. The Infrastructure Fund shall be used to fund maintenance, repair and replacement of public infrastructure, as defined, which is not eligible for funding from enterprise or utility funds, with an emphasis on funding of local streets, arterials, alleys and sidewalks.
C. Automatic Transfers into and from the Infrastructure Revenue Fund.
1. No less than fifty percent (50%) of annual secured property tax revenue above the annual secured property tax baseline shall be transferred into the Infrastructure Fund commencing with fiscal year beginning July 1, 2021.
No less than fifty percent (50%) of annual sales tax revenue above the annual sales tax baseline shall be transferred into the Infrastructure Fund commencing with fiscal year beginning July 1, 2021.
2. Where any of the designated annual tax revenues required to be transferred to the Infrastructure Fund are below the General Fund Revenue Baseline, no transfer will be made to the Infrastructure Fund. Conversely, no transfer out of the Infrastructure Fund to the General Fund will be made.
3. Nothing in this section shall prohibit the City Council, as part of the budgeting process, from contributing additional revenues to the Infrastructure Fund.
4. Transfers from the Infrastructure Fund shall only be used for the maintenance, rehabilitation, replacement, and construction of infrastructure as defined.
D. Suspension of Automatic Transfer. The automatic transfer described in Subsection C. shall be temporarily suspended by City Council resolution on a four-fifths (4/5th) vote of the membership when revenue projections underlying the adopted budget reflect a decline in actual revenues, as compared to the revenue forecasts underlying the adopted budget for the fiscal year immediately prior. Automatic transfers shall remain suspended until positive revenue growth is reflected in the revenue forecasts underlying the adopted budget.
E. True-up of Revenue Transfer. At the end of each fiscal year, the secured property tax and the sales tax revenue amounts shall be reconciled to make true the correct amount(s) transferred into the Infrastructure Fund. Corrected amounts shall be made prior to the close of the fiscal year or as practicable.
F. Annual Report. An annual report of transfers and expenditures shall be provided to the Infrastructure and Natural Resources Advisory Committee within ninety (90) days of the issuance of the CAFR for the applicable fiscal year. (Ord. 3284 § 2, 2020).