proposed budget and staffjng model in line with the Board's goals of - PDF document

Rent Stabilization Board proposed budget and staffjng model in line with the Board's goals of maintaining fiscal $250 per unit. The Board fflt comfprtable going an additional year without adjusting the ffe because of Fund 440's larger than expected uncommitted reserve balance, caused by stafg turoover and unexpected vacancies in several previously-budgeted positions. These staffjng changes have resulted in some delays in delivery of services and/or deffrral of some new initiatives or projects. Stafg has worked hard to strike the proper balance of submitting a responsibility while still providing quality service to the community. While it remains to be seen discussed both the current year as well as next year's budget on April 30 th and May 21 st fvll how the current COVID-19 pandemic and accompanying Shelter in Place Orders will afgect our collection of Registration Fees, it is reasonable to expect that there will at least be some short term revenue gaps that we do not normally anticipate when preparing the budget and staffjng staffjng levels and services for the coming year. To this end, stafg believes it imperative that the Board incorporate a fprmal mid-year budget review as part of the process fpr adopting the budget 1 Board stafg sent Registration Fee bills to all landlords earlier than usual, so that we would give the community ample time to review the infprmation. The Registration Unit supervisor has reported that while landlords have been Board meetings. At the April 30 th meeting the Board voted to keep the annual registration ffe at is guided by the Budget and Personnel Committee. The Boasd received budget updates and DATE: maximum expenditure authorization fpr FY 2020/21. The process fpr adopting the annual budget TO: FROM: BY: SUBJECT: RENT STABILIZATION BOARD June 18, 2020 Honorable Members of the Rent Stabilization Board Budget & Personnel Committee Matt Brown, Acting Executive Direc� Lief Bursell, Senior Planner Adoption of FY 2020/21 Line-Item Budget, Staffjng Model & Expenditure Level Recommendation: That the Board adopt the attached resolution approving the FY 2020/21 line-item budget and staffjng model of 22.35 FTE career employees (23.35 FTE including temporary employees) and authorizing an overall spending level of just over $6,096,000, which includes $465,000 in expenditures fsom the Board's Capital Reserve. Background and Need fpr Rent Board Action Legally, the Board has through the end of June to adopt a staffing model and budget with a sending in payments, we have thus far received proportionally less than in years past. model. 1 For that reason, staff recommends a cautious approach when establishing the initial

FY 2020/21 Stafging Model and Budget Report $200,000.00 average of just over 75% of annual ffe collected, in the month of June. Payments in May and July average between 2-3% of the total amount collected. Occasionally, July 1 st will fbll on a weekend, the due date is moved to the next business day. This was the case in fjscal FY 2018/19 when the due date was moved to July 2 nd and a larger percentage of the ffe was received in July. The next chart compares weekly revenue received thus far this year with the average weekly revenues received between May and August during the previous five fiscal years $1,400,000.00 $1,200,000.00 $1,000,000.00 $800,000.00 $600,000.00 $400,000.00 $0.00 Nov Dec Weekly Revenue May - August 1.26M Avg. Revenue (Last week of June) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 - 5 Year Weekly Avg. As the chart demonstrates, the agency receives the majority of registration ffe payments, an Oct Rent Stabilization Board (June 18, 2020) $2,000,000 Page 2 fpr FY 2020/21. At that time, the Board will surely be able to make more informed choices regarding to what extent it is able to fjll several positions and/or fvnd program enhancements. Update on FY 2021 Registration Revenue The agency receives an average of over 96% of its yearly revenue from the annual registsation ffe. This fee is mostly collected on or befpre it is due on July 1 st of each year. The chart below compares revenue collections by month over the previous 5 fjscal years. $4,500,000 $4,000,000 $3,500,000 $3,000,000 $2,500,000 $1,500,000 Aug Sep $1,000,000 $500,000 $0 Registration Fees by Month (FY 2015/16 to FY 2019/20) Fiscal -15/16 -16/17 17/18 -18/19 -19/20 Jan Feb Mar Apr May Jun Jul FY 2021 Weekly

FY 2020/21 Staffjng Model and Budget Report As with most years, the Board and Program have much to be proud of years, $400,000 of this Capital Reserve is earmarked fpr upgrades and/or a more cost-efgective replacement of the Board's rent tracking database. We project that our revenues fpr the fjscal year will exceed our expenditures by at least $160,000. This represents signifjcant aod unplanned fpr savings given that the Board adopted a budget that included $410,000 in defjcit spending. This is mostly due to salary savings fsom several unexpected retirements/departures as well as ongoing vacant positions. Some of these savings were counterbalanced by revenue collections coming in lower than we expected. At this point, we project revenues to end the year $130,000 under budget. At this point we project that the Board will start FY 2020/21 with an uncommitted fvnd balance of just over $910,000. Programmatic Accomplishments and the Need to Maintain Current Staffjng Level over the past 12 to the year-end uncommitted operational fvnd balance of approximately that amount. There is an 18 months. Together, once again, we have experienced an extraordinarily productive period, both administratively and in promoting sound public policy, despite shortages and turoover of several key staff/ The overwhelming majority of stafgs time, energy and resources go to perfprming our core services. Our ongoing core efgorts are described, in detail, in Attachment 2. Our time and energy largely fpcus on providing the fpllowing fjve essential services: 1. Regularly communicating with Berkeley's 50,000 plus tenants and 2,800 landlords to ensure they are aware of the protections, requirements and services under the Rent additional Capital Reserve of $500,000. As has been discussed regularly over the past three (Attachment 3) befpre you this evening is the 3/4-year line-item budget update, which projects Rent Stabilization Board (June 18, 2020) just two days a week thus fbr during the Shelter in Page 3 Initially, registration payments were coming in at a faster pace than nornal. This is likely attributed to the early adoption of the fee on April 30 ti and mailing of the bill on May 15th. Revenues received during the last two weeks, which are weeks 6 and 7 of the registration season, are signifjcantly lower than normal. During this two-week period, revenues were 40% of normal and we are behind our normal collection rate by about 30% so far this year. Stafg believes this is explained by delays in processing mail-in payments and the inability to accept in-person payment due to the offjce closure. Processing of mail-in payments has been delayed because City of Berkeley mail pick-up has been limited to place Order. an uncommitted fvnd balance of a little over $900,000. Included in the attached documents On June 15 ti, the agency began accepting drop-ofg check or cash registration payments to provide an additional payment option to property owners. Even with this additional option, Registration Unit staff anticipate continued delays in payment and payment processing due to the current circumstances. Stafg and the Budget and Personnel Committee will continue to monitor the FY 2020/21 revenue closely and will provide an update to the Board afuer the July 1, 2020 deadline has passed. Update on FY 2020 Budget Status and Year-End Proiections On April 30 ti, the night the Board adopted the annual registration ffe, the Board received a 2/3- year budget update. At that time, stafg projected that we would end the current fjscal year with Stabilization and Eviction for Good Cause Ordinance.