CITY COUNCIL MEETING AGENDA PACKET

Page 13 of 17 Repair and Replacement Funds. In accordance with the City’s financial policies, the City maintains various Repair and Replacement Funds. The purpose of these funds is to provide ongoing replacement of City equipment, vehicles, traffic signals, streetlights, and to make major repairs/renovations to City facilities, parks, and medians to extend their useful lives. As described in Table 12 below, collectively, expenditures from the Repair and Replacement funds were $1.9 million less than budgeted in FY 2024/25. Any unspent funds will remain in the Repair and Replacement funds to be expended on future projects, equipment, or vehicle replacements. Actual net transfers ended up with a difference mainly due to an additional $500,000 transfer to the Golf Replacement Fund and a $62,000 transfer from the General Fund to the Library & Recreation Facilities and Equipment Fund. Proposed budget amendments are included in Table 15 below to reflect these transactions. It is worth noting that many of the City’s Repair and Replacement funds do not have an adequate fund balance to cover necessary project costs and/or replace aging equipment or vehicles in a timely manner. Once the Asset Management Plan has been completed, it will help staff to better estimate an appropriate level of funding needed to support each Repair and Replacement Fund. Table 12. Repair & Replacement Funds - Amended Budget vs. Actual Workers’ Compensation Funds. There are two Workers’ Compensation funds: one for the City of Pleasanton workers’ compensation expenses and liabilities, and the other for the Livermore-Pleasanton Fire Department’s (LPFD) workers’ compensation expenses and liabilities. While there is, and has been, sufficient cash in both funds to cover actual workers’ compensation expenses, the incurred but not expensed claims and future liability cause both funds to have negative fund balances. That said, as described in Tables 13 and 14 below, the City’s claims paid is approximately $270,000 lower, and future liability is lower than expected by $740,000. For LPFD, claims paid and future liability are approximately $340,000 and $360,000 higher, respectively. The City’s Workers’ Compensation Fund had a negative fund balance of $1.3 million, and LPFD had a negative fund balance of $4.1 million, with $2.0 million (50 percent) belonging to Pleasanton. To reduce the LPFD Workers’ Compensation Fund deficit, the cities of Pleasanton and Livermore each contributed an additional $322,314 into the fund at the end of June 30, 2025, utilizing the LPFD budget savings, without increasing the Fire Department's overall budget for each agency. Page 359 of 399