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Agenda Item
ASR
Control 24-000372 |
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MEETING
DATE: |
06/25/24 |
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legal entity taking action: |
Board
of Supervisors and Orange County Flood Control District |
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board of supervisors district(s): |
All
Districts |
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SUBMITTING Agency/Department: |
Auditor-Controller (Approved) |
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Department contact person(s): |
Andrew
N. Hamilton (714) 834-2457 |
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Salvador
Lopez (714) 834-2470 |
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Subject: Establishment
of FY 2024-25 Gann Appropriations Limit
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ceo CONCUR |
County Counsel Review |
Clerk of the
Board |
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Concur |
Approved Resolution to Form |
Consent Calendar |
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3 Votes Board Majority |
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Budgeted: N/A |
Current
Year Cost: N/A |
Annual
Cost: N/A |
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Staffing
Impact:
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No |
#
of Positions: |
Sole
Source: N/A |
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Current Fiscal Year Revenue: N/A
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Prior Board Action: 5/21/2024 #3, 6/27/2023 #4 |
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RECOMMENDED
ACTION(S):
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1. |
Acting in the
capacity of the Orange County Board of Supervisors, adopt the attached
resolution establishing the appropriations limit, cost of living factor and
population factor for FY 2024-25 for County Funds. |
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2. |
Acting in the
capacity of the Orange County Flood Control District Board, adopt the
attached resolution establishing the appropriations limit, cost of living
factor and population factor for FY 2024-25 for the Orange County Flood
Control District. |
SUMMARY:
Establishment of
the annual appropriations limit for FY 2024-25 for County Funds and the Orange
County Flood Control District is required by Article 13B of the California
Constitution.
BACKGROUND
INFORMATION:
Proposition
4, approved by voters in November 1979, added Article 13B to the California
Constitution. Article 13B places a limit on appropriations of revenue
identified as proceeds of taxes. This limit is commonly referred to as the Gann
Limit. The Gann Limit, as originally approved by voters, set the 1978-79
expenditure level as the base spending limit. This limit is adjusted annually
for population growth and inflation (using the lower of the percentage growth
of the U.S. Consumer Price Index or California's per capita personal income).
Proposition 111,
passed by voters on June 5, 1990, amended Article 13B to allow local agencies
to choose between two different cost of living increase factors to calculate
the appropriations limit: (1) the percentage change in California per capita
personal income from the preceding year; or (2) the percentage change in the
local assessment roll from the preceding year resulting from the addition of
local nonresidential new construction.
Government Code
Section 7901, which implements Proposition 111, provides three different
population increase factors for counties to use in computing the appropriations
limit: (1) the change in countywide population; (2) the countywide change in
population combined with the change in population within all counties having
borders contiguous to the county; and (3) the change in population within the
incorporated portion of the county. Special districts such as the Orange County
Flood Control District continue to use only the countywide population increase.
Government Code
Section 7903 requires county governments to include specified state subventions
within their appropriations limit, starting from FY 2021-22. The California
Department of Finance provides the total amount of these subventions to be
included in the appropriations limit for each fiscal year.
Government Code
Section 7910 requires the Board of Supervisors (Board) to establish, by
resolution, the appropriations limit for the following fiscal year for entities
under its authority. Attachments A and B display the computation of the
appropriations limit for FY 2024-25 for the two entities for which the Board
must establish limits, the County Funds and the Orange County Flood Control
District. The County Funds includes the County General Fund, Library Fund,
Orange County Fire Authority, OC Parks Fund and the County Service Areas.
The
Auditor-Controller has received from the California Department of Finance the
population and cost of living factors allowed by Proposition 111 and has also
received from the County Assessor the nonresidential new construction assessed
valuation data for Roll Year 2023-24 to compute the FY 2024-25 appropriations
limit. The detailed calculations for the County Funds and the Orange County
Flood Control District appropriations limit for FY 2024-25, as provided under
Proposition 111 and its enabling legislation, are shown on Attachments A
(County Funds) and B (Flood Control District).
The appropriations
of tax proceeds in the FY 2024-25 Recommended Budget for both the County Funds
and Orange County Flood Control District entities are less than their
appropriations limits for FY 2024-25.
Following is an estimate of appropriations
subject to the Gann Limits for FY 2024-25.
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COUNTY
FUNDS |
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FY 2024-25 Gann Appropriations Limit |
$16,310,924,726 |
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FY 2024-25 Estimated Appropriations
Subject to Limitation* |
$
1,924,461,868 |
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Estimated Amount below Limit |
$14,386,462,858 |
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FLOOD
CONTROL DISTRICT |
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FY 2024-25 Gann Appropriations Limit |
$1,903,049,414 |
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FY 2024-25 Estimated Appropriations
Subject to Limitation* |
$ 156,562,111 |
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Estimated Amount below Limit |
$1,746,487,303 |
* Only appropriations financed by tax
proceeds as defined by Article 13B of the Constitution, and state subventions
specified per Government Code Section 7903.
Prior
Board Actions:
On May 21, 2024, the Board set the Gann
Annual Appropriations Limit Hearing. The purpose of the hearing was to direct
the Auditor-Controller to provide notice that the FY 2024-25 appropriations
limits would be considered at the Board meeting of June 25, 2024, and the
documentation used in the determination of the appropriations limit would be
available for review commencing June 5, 2024.
On June 27, 2023, the Board approved the
FY 2023-24 appropriations limit for the County Funds and the Orange County
Flood Control District entities.
FINANCIAL IMPACT:
This is a non-financial Agenda
Staff Report.
STAFFING IMPACT:
N/A
ATTACHMENT(S):
Attachment A - County Funds'
Computation of Appropriations Limit FY 2024-25
Attachment B - Flood Control District's Computation of Appropriations Limit FY
2024-25
Attachment C - Resolution - County Funds
Attachment D - Resolution - Orange County Flood Control District
Attachment E - California Constitution Article 13B Government Spending
Limitation
Attachment F - California Government Code Sections 7901, 7903 and 7910
Expenditure Limitation