City of Morgan Hill Fiscal Years 2020- 2022 Recommended Operating and CIP Budgets

In addition to the City Council’s ongoing priorities, five specific strategic priorities were recognized by the City Council that will require significant resources: ◦ Fiscal Sustainability

◦ Affordable Housing and Homelessness ◦ Community Engagement and Messaging ◦ Economic Development ◦ Transportation

We continue to educate and engage the community regarding City services, funding and priorities. In June 2019, the City kicked off the Engage Morgan Hill process, which included the formation of a Community Advisory Group (CAG), with the intent to engage, build trust, and educate the group on services the City provides and how those services are provided and funded. Over the past 10 months, the group has engaged on various topics including budget, economic development, housing, infrastructure, pensions, and public safety.

In light of the COVID-19 pandemic and the unknown fiscal impacts to the City, the proposed budget strives to attain the Council’s and Community’s priorities in a cost-effective manner while maintaining the City’s goal of fiscal sustainability.

The total Recommended Budget is $162.3 million in FY 2020-21 and $144.3 million in FY 2021- 22. FY 2020-21 budget includes $46.2 million for General Fund expenditures, $48.9 million for CIP, and $67.2 million for non-General Fund expenditures. For FY 2021-22, the recommended budget includes $47.7 million for General Fund expenditures, $28.6 million for CIP, and $68.0 million for non-General Fund expenditures. Details of each Division’s budget, project description and funding requirements can be found in the accompanying operating departments and Capital Improvement Program sections of this document.

Operations $113.4 million

Operations $115.7 million

FY 2020-2021 $162.3 million

FY 2021-2022 $144.3 million

Capital Improvement Program $48.9 million

Capital Improvement Program $28.6 million

12 RECOMMENDED BUDGET MESSAGE