The fiscal year of the City and all of its agencies shall begin on the first day of January and end on the last day of December of each year.

Prior to the beginning of each fiscal year, the City Manager shall prepare and submit to the Council a recommended budget for the next fiscal year and an accompanying message.

The City Manager's message shall explain the budget both in fiscal terms and in terms of the work program. It should contain the proposed financial policies of the City for the next fiscal year, describe the important features of the budget, indicate any major changes from the current year in financial policies, expenditures and revenues, together with the reasons for such changes, summarize the City's debt position, give the balance between the total estimated expenditures and total anticipated revenue from all sources, taking into account the estimated surpluses or deficits in the various funds, and include such other material as the Manager deems necessary or which the Council may require.

The budget shall provide a complete financial plan of all municipal funds and activities for the next fiscal year and, except as required by law or this Charter, shall be in such form as the City Manager deems desirable or the Council may require. In organizing the budget, the City Manager shall utilize the most feasible combination of expenditure classification by fund, organization unit, program, purpose or activity, and object. It shall begin with a clear general summary of its contents and shall be so arranged as to show comparative figures for actual and estimated income and expenditures of the preceding fiscal year. It shall include the following in separate sections unless otherwise provided by ordinance:

(a) Anticipated revenues classified as cash surplus, miscellaneous revenues, and amounts to be received from property tax; cash surplus being defined for purposes of this article as the amount by which cash is expected to exceed current liabilities and encumbrances at the beginning of the next fiscal year;

(b) Proposed expenditures for current operations during the next fiscal year, detail by offices, departments and agencies in terms of their respective work programs, and the method of financing such expenditures;

(c) A reasonable provision for contingencies;

(d) A capital depreciation account;

(e) Required expenditures for debt service, judgments, cash deficient recovery and statutory expenditures;

(f) Proposed capital expenditures during the next fiscal year, detailed by offices, departments and agencies when practicable, and the proposed method of financing each such capital expenditure;

(g) Anticipated net surplus or deficit for the next fiscal year for each utility owned or operated by the City and the proposed method of its disposition; subsidiary budgets for each such utility giving detailed income and expenditure information shall be attached as appendices to the budget.

(h) The bonded and other indebtedness of the City, showing the debt redemption and interest requirements, the debt authorized and unissued, and the condition of sinking funds, if any;

(i) Such other information as the Council may request.

(a) The Manager, with such assistance as the Council may direct, shall prepare and submit to the Council a long-range capital program, simultaneously with his recommended budget.

(b) The capital program shall include the following, unless otherwise provided by ordinance:

(1) A clear general summary of its contents;

(2) A list of all capital improvements which are proposed to be undertaken during the following fiscal years, with appropriate supporting information as to the necessity for the improvement;

(3) Cost estimates, method of financing and recommended schedules for each such improvement;

(4) The estimated annual cost of operating and maintaining the facilities to be constructed or acquired;

(5) Such other information as the Council may request.

This information may be revised or extended each year with regard to capital improvements still pending or in process of construction or acquisition.

A public hearing on the proposed budget and proposed capital program shall be held before its final adoption at such time and place as the Council may direct. Notice of such public hearing and notice that the proposed budget is on file for public inspection in the municipal building shall be published one time at least seven days prior to the hearing.

(a) Amendments. After the public hearing, the Council may adopt the budget with or without amendment. In amending the budget, it may add or increase programs or amounts and may delete or decrease any programs or amounts, except expenditures required by law or for debt service or for estimated cash deficit.

(b) Adoption. The Council shall adopt the budget by resolution on or before the final day established by law for the certification of the next year's tax levy to the county. If it fails to adopt the budget by this date, the amounts appropriated for the operation of the current fiscal year shall be deemed adopted for the next fiscal year on a month-to-month basis, with all items in it pro-rated accordingly, until such time as the Council adopts the budget for the next fiscal year.

(c) Balanced Budget. The total of the proposed expenditures and provisions for contingencies shall not exceed the total of estimated revenue.

(d) Tax Levy. Adoption of the budget by Council shall constitute appropriations of the amounts specified therein as expenditures from the funds indicated and shall constitute a levy of the property tax therein proposed. Council shall cause the same to be certified to the appropriate authorities as required by law.

The budget may include an item for contingencies. Except in those cases where there is no logical account to which an expenditure can be charged, expenditures shall not be charged directly to contingencies; but instead, the necessary part of the appropriation for contingencies shall be transferred to the logical account, and the expenditure charged to such account. No such transfer shall be made without the express approval of the Council, and then only for expenditures which could not readily be foreseen at the time the budget was adopted.

Copies of the budget and capital program as adopted shall be public records and shall be made available to the public in the municipal building.

(a) Supplemental appropriations. If during the fiscal year the Manager certifies that there are available for appropriation revenues in excess of those estimated in the budget, the Council by resolution may make supplemental appropriations for the year up to the amount of such excess.

(b) Emergency Appropriations. To meet a public emergency affecting life, health, property or the public peace, the Council may make emergency appropriations. Such appropriations may be made by emergency ordinance in accordance with provisions of this Charter. To the extent that there are no available unappropriated revenues to meet such appropriations, the Council may by emergency ordinance authorize the issuance of emergency notes, which may be renewed from time to time, but the emergency notes and renewals of any fiscal year shall be paid not later than the last day of the fiscal year next succeeding that in which the emergency appropriation was made.

(c) Reduction of Appropriations. If at any time during the fiscal year it appears probable to the Manager that the revenues available will be insufficient to meet the amount appropriated, he shall report to the Council without delay, indicating the estimated amount of deficit, any remedial action taken by him and his recommendation as to any other steps to be taken. The Council shall then take action to prevent or minimize any deficit and for that purpose it may by resolution reduce one or more appropriations.

(d) Transfer of Appropriations. Any time during the fiscal year, the Manager may transfer part or all of any unencumbered appropriation balance among programs within a department, office or agency and, upon written request by the Manager, the Council may by resolution transfer part or all of any unencumbered appropriation balance from one department, office, agency, or object to another.

(e) Limitation--Effective Date. No appropriation for debt service may be reduced below any amount required by law to be appropriated or by more than the amount of the unencumbered balance thereof. The supplemental and

emergency appropriation and reduction or transfer of appropriations authorized by this section may be made effective immediately upon adoption.

An independent audit shall be made of all City accounts at least annually and more frequently if deemed necessary by the Council. Such audit shall be made by certified or registered public accountants, experienced in municipal accounting, selected by the Council. Copies of such audit shall be made available for public inspection at the municipal building.

Every appropriation, except an appropriation for a Capital Expenditure Fund or Special Fund, shall lapse at the close of the fiscal year to the extent that it has not been expended or encumbered. An appropriation for a Capital Expenditure Fund or Special Fund shall continue in effect until the purpose for which it has been made has been accomplished or abandoned or it is transferred as permitted in Section 12.10.