City of Diamond Bar Budget

Fiscal Year 22/23

REVENUE DESCRIPTIONS


All revenues which, by law, do not have to be placed in a separate fund are deposited in the General Fund. All general operations of the City are charged to this fund. All expenditures must be made pursuant to appropriations, which lapse annually and at the end of the fiscal year. Unexpended balances are transferred to the unappropriated reserve.


PROPERTY TAXES

Secured - Current Year

Tax levied on secured property pursuant to the revenue and taxation code.


Unsecured - Current Year

Tax levied on all personal property not secured by real property held in title by the same owner. Due to the transitory nature of unsecured property, a tax is levied immediately after assessed values are determined.


Supplemental Roll

Taxes levied when secured property is sold to a new owner. It is calculated as the difference between what the seller paid for property tax and what the new owner is expected to pay prorated from the time of closing escrow until the next property tax bill is prepared by the Assessor.


Prior Year Uncollected

Taxes paid in the current year, which were due in a prior year.


Interest and Penalties

Interest and penalties charged for the late payment of property taxes.


Consultant HdL & Companies provides annual estimates for Secured and Unsecured Property Taxes. Supplemental and Delinquent Property Taxes are based on the latest 3 year average trend.


OTHER TAXES

Sales and Use Tax

As a result of the Bradley-Burns Local Sales and Use Tax law, 1% of the Sales & Use Tax is to be distributed to the City.


Consultant HdL & Companies provides annual estimates.


Transient Occupancy Tax

These revenues are received on a monthly basis from the hotels in the City. The hotels are required to pay a 14% tax based on the amount of their room rental revenues.


Estimate based on historical trends.


Franchise Fees

Companies are granted special privileges for the continued use of public property, such as city streets. Such companies usually involve elements of monopoly and may require regulation. The Franchise Fees are the amounts required for the continued granting of these privileges. Franchises currently granted within the City are Electric, Gas, Cable TV, Bus Benches and Waste Hauler.


Estimate based on franchise agreements with each franchisee.



FINES AND FORFEITURES

Vehicle Code Fines

Amounts derived from traffic citations and fines for violations occurring within the city limits.


Court Fines and Forfeitures

Fines collected by the county courts for city code violations other than traffic, which are shared with Los Angeles County.


Impound Fees

Fines collected upon the release of vehicles, which have been impounded and stored by the Sheriff's Department.


Miscellaneous

Other fines and forfeitures not included above.


Estimate based on historical trends and changes to the City and/or County Fee Schedule.


LICENSES AND PERMITS

Building Fees

Building Fees are collected in accordance with the Uniform Building Code. The revenues from these fees are used to cover the cost of providing building inspections to insure compliance with building codes.


Estimate based on anticipated building activity and any changes to the City's Fee Schedule.


Encroachment Permit Fees

These fees are levied to cover costs of inspections for work within the public right-of-way for the construction of new or repair of existing utility facilities and other public improvements such as sidewalks, curb, gutter, asphalt roadway, etc.


Estimate based on anticipated building activity and any changes to the City's Fee Schedule.


Certified Access Specialist Program (CASP) Fees

SB 1186 requires that a $4 additional fee is to be paid by any applicant seeking a local business license when it is initially issued or renewed. From January 1, 2018 through December 31, 2023, the City will retain 90% of the fees collected. The purpose of the fee is to increase disability access and compliance with construction related accessibility.


Estimate based on historical business license volume and the State's Fee Schedule.


CURRENT SERVICE CHARGES

Planning and Engineering Fees

These fees are levied to cover costs of plan checks, inspections, etc. which maybe necessary in conjunction with new construction or improvements being made by contractors.


Estimate based on anticipated building activity and any changes to the City's Fee Schedule.


Recreation Fees

These fees are levied to cover the cost of providing recreation programs such as fee classes, Tiny Tot programs, excursions, summer day camp, youth and adult athletics, senior activities and community events.


Estimate based on trending program participation and any changes to the City's Fee Schedule.


Public, Educational and Governmental (PEG) Fees

Fees totaling 1% of gross revenues are remitted to the City by all video service providers with a valid state franchise. These funds may only be used for capital improvements related to the City's operations of its PEG channels.


Estimate based on historical trends.



INTERGOVERNMENTAL REVENUE

Vehicle License Fee (VLF) - Property In-Lieu Tax

The Motor Vehicle In-Lieu fee is a tax on the ownership of a vehicle in place of taxing vehicles as personal property. The tax rate used to be 2%, and then the rate was cut by 67.5% which greatly affected the revenue allocated to the City by the State. VLF has now been totally eliminated. To fill the gap created by the cut the State instituted a property tax swap where the City receives additional property tax to offset the loss of VLF. These funds are included in the budget as VLF Property Tax in Lieu revenue.


Projection prepared by consultant HdL Companies, LLC.

AB2766 - Air Quality Improvement/Pollution Reduction Fees

These fees are derived from the imposition of an additional motor vehicle registration fee which shall be used to fund the implementation of air quality management compliance and provisions of the California Clean Air Act of 1988.


Estimate based on historical trends.


Gas Tax Section 2105

This Section of the Streets and Highways Code provides for the collection and distribution of special gas tax to fund improvements for regional transportation needs.


Gas Tax Section 2106

Section 2106(a) of the Streets and Highways Code provides that each city shall receive a fixed monthly apportionment of $400; Section 2106(c) provides for distribution on a per capita basis.


Gas Tax Section 2107

This section provides monthly allocations of 1.315 cents per gallon of gasoline, 1.8 cents per gallon of diesel and 2.59 cents per liquefied petroleum gas (LPG) based on population.


Gas Tax Section 2107.5

This account represents a fixed amount of revenue received from the state based on population.


Highway Users Tax Act (HUTA)

This revenue source replaces the Proposition 42 sales tax on gasoline with a franchise tax. It is intended to be revenue neutral to Cities and allow greater flexibility at the State level.


Road Maintenance & Rehabilitation Act of 2017 (SB-1)

This source of revenue was signed into law in April 2017 in order to address the significant multi-modal transportation funding shortfalls statewide. A fuel tax increase began on November 1, 2017. The value-based transportation fee began on January 1, 2018. The price-based excise tax will be reset on July 1, 2019 and the new zero emissions vehicle fee will begin on July 1, 2020.


Gas Tax, HUTA and SB-1 estimates are provided by California Local Government Finance Almanac which bases their estimates on State Department of Finance statewide revenue projections.


Measure W

The Safe Clean Water Act (ACW Program) also known as Measure W was approved by the voters in November 2018. The revenue generated from this measure is intended to maximize the ability of local governments to address local storm water and urban runoff challenges and is to be used for water quality improvements within the City. It is estimated that the City will receive $800,000 annually as part of this program.


Measure M

Approved by the voters on November 6, 2016, this half-cent sales tax increase will fund projects that will improve local streets, repair potholes and improve traffic flow/safety. The City received its first allocation of Measure M funds during FY 2017-18.


Prop A - Transit Tax

The City receives twenty-five percent of the 1/2% Prop A Sales tax (approved by voters in 1980). These funds are distributed by the L.A. County Metropolitan Transportation Authority (MTA), and are distributed to Los Angeles County cities on a proportional population basis. The funds are to be used for the development of transit programs within the guidelines established by the MTA.


Prop C - Transit Tax

The City receives twenty percent of the 1/2% Prop C sales tax (approved by voters in 1990). These funds are distributed by the L.A. County Metropolitan Transportation Authority (MTA), and are distributed to Los Angeles County cities on a proportional population basis. The funds are to be used the improving, expanding and maintaining public transit services. These expenditures must be consistent with the County's Congestion Management Program.


Measure R - Local Return Funds

Measure R is funded with 1/2 cent sales tax revenues that LA County voters approved in November 2008 to meet the transportation needs of the County. Fifteen percent of this tax is designated for the Local Return program to be used by cities. These funds are to be used for local transportation projects.


Measure M, Prop A, Prop C and Measure R estimates come from L.A. County Metropolitan Transportation Authority (MTA).


Prop A - Safe Parks Program

Funds transferred to the City as a result of the 1992 and 1996 L.A. County Safe Neighborhood Parks Act. These funds are to be used to improve, preserve and restore parks and to employ at-risk youth. Projects utilizing the California Conservation Corps are funded through the at-risk youth element of this program. This program ended in FY 2017-18.


Measure A Neighborhood Parks Act

Approved by the voters in November 2016, this new source of revenue in FY 2018-19 provides funds to improve the quality of life throughout Los Angeles County by preserving and protecting parks, safe places to play, community recreation facilities, beaches, rivers, open spaces and water conservation. Measure A funds provide local funding for parks, recreation, trails, cultural facilities, open space and Veteran and youth programs.


Annual estimates are received from the Los Angeles County Regional Park and Open Space District.

STATE GRANTS

State TDA

The Transportation Development Act provides this source of funding. Derived from statewide sales tax, and allocated by formula to the County Transportation Commission, allocations are deposited in each regional entity's State Transit Assistance Fund.


Estimate based on historical trends.


SB821 - Bike and Pedestrian Paths

SB821 allows the City to request specifically allocated monies for the purpose of constructing bike and pedestrian paths.


Estimate based on historical trends.


Habitat Conservation Fund (HFC)

Established by the California Wildlife Protection Act of 1990 (Proposition 117), the HCF provides funding to local agencies to protect threatened species, to address wildlife corridors, to create trails and to provide for nature interpretation programs which bring urban residents into park and wildlife areas.


Grant awards vary from year to year so this is based on individual grant criteria.


COUNTY GRANTS

County TDA

The Transportation Development Act provides this source of funding. Derived from state sales tax and allocated by formula to the County Local Transportation Fund, allocations are available to operators for the support of public transportation systems.


Based on estimates from Los Angeles County.


FEDERAL GRANTS

Community Development Block Grant (CDBG)

The federal government provides funds for metropolitan areas whose population exceeds 50,000. The funds are based upon a federal formula and are to be used only within low and moderate-income census tracts and/or to benefit low and moderate-income persons.


Based on estimates received from the Community Development Commission of the County of Los Angeles.


Moving Ahead For Progress In The 21st Century (MAP-21)

The Federal Government has created a Federal Surface Transportation Program that allocates funds for various improvements to the nation’s streets and roads. This two year legislation has annual allocations funded primarily by the Highway Account.


Estimate based on historical trends.


Land & Water Conservation Fund (LWCF)

LWCF is a Federal program that conserves irreplaceable lands and improves outdoor recreation opportunities. Funds are administered by the State of California and are allocated to local agencies through competitive grants.


Grant awards vary from year to year so this is based on individual grant criteria.


Recreational Trails Program (RTP)

RTP is a Federal program that provides financial assistance to local agencies for the development of recreational trails, trailheads and trailside facilities. Funds are administered by the State of California and are allocated to local agencies through competitive grants.


Grant awards vary from year to year so this is based on individual grant criteria.


Hazard Mitigation Grant Program

The City received a grant from FEMA, which is administered by the State, in order to update the City's Hazard Mitigation Plan. This plan establishes the City's strategy to implement improvements and programs to lessen community impacts in the event of natural hazard events.


Grant awards vary from year to year so this is based on individual grant criteria.


OTHER FINANCING SOURCES

Proceeds from Sale of General Fixed Assets

This includes proceeds from the sale of fixed assets (used by governmental funds only).


Damage to City Property

These funds include reimbursement to the City for repairing willful or accidental damage to city property. Generally these are associated with automobile accidents.


Cost Reimbursements

Reimbursements to the City for various expenditures incurred that are reimbursable i.e. legal expenses.


All three of these revenue source estimates are based on historical trends.


Street Beautification - Developer Paid

Funds received from development projects to be used toward the Diamond Bar Complete Streets improvements as well as other identified capital improvement streetscape or complete streets projects as conditioned by the development projects entitlements.


Estimate based on anticipated development projects and the associated fees.


OPERATING TRANSFERS IN

Operating Transfers In

Includes monies transferred from one fund to another. Transfers are income to recipient fund.


USE OF MONEY AND PROPERTY

Investments

Inactive City funds are pooled and invested on a continuing basis in certain types of investments that are state approved such as time certificate of deposits, money market accounts, Local Agency Investment Fund, and Federal Agency notes.


The City's investment software produces a projection based on the holdings in the portfolio.