CC 2016-02-23_12b Mid Year Presentation 15-16MID-YEAR BUDGET REPORT
FISCAL YEAR 2015-2016
February 23, 2016
Good evening, Mr. Mayor, members of the City Council
I am Debbie Malicoat, your Director of Administrative Services
I’m here tonight to present the Mid-Year Budget Report
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Purpose
Review revenues and expenditures during the first six months of the fiscal year to determine appropriate adjustments
Highlight any major changes that have occurred since budget adoption
Update
the budget with audited results of prior fiscal year
Typically General Fund focused – not this year
The purpose of the Mid Year Budget report is to take a look at how revenues and expenditures are performing during the first half of the fiscal year and make any adjustments that might
be necessary.
It also provides an opportunity for staff to highlight any major changes that have occurred since the budget was adopted
While we look at every fund and operation of the
City, the Mid Year Budget Report is usually primarily focused on the General Fund, but this year there are challenges in other funds that need to be called to your attention as well.
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Key Points
Mixed results and financial challenges, particularly Gas Tax, Water, Sewer
General Fund balance is strong and is projected to be 35.5% of appropriations at year-end
A few budget adjustments
are recommended at this time
Long term challenges remain
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Water and Sewer Revenues
Consumption is much lower than originally anticipated. The Governor’s Emergency Order happened after the budget was developed, so modest reductions were projected, not the 28% mandate
– much less the way the community has exceeded the mandate.
There is an inverse relationship between price and consumption. Since most of the costs are fixed and must be covered by
users, not general taxes, when consumption goes down, price has to go up in order to generate the necessary revenue.
No recommendations for rate adjustments at this time, but it is
likely that when we come to the Council in April, we will have the data we need to make rate recommendations.
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Gas Tax Revenues
Complicated formula for allocation, but it is always looking back in time
Trends show a decline in consumption and price
Projections $75,000 short in FY 2015-16 and $190,000 short in
FY 2016-17
Possible offsets in Governor’s May Revise but wait and see
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Top 10 Revenue Performance
Taking a quick look at the General Fund’s top 10 revenues, we see that overall, with half the year behind us, we are only at 38% of our revenue target. This is consistent with previous
years and reflects the fact that not all revenues are received in equal increments and there are timing issue related to when we receive the revenue. For example, the Sales tax and
franchise fee numbers reflect only 4 months of collections. The TOT revenue reflects just 5 months. And the first half of our Triple Flip money isn’t received until January.
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Expenditures by Department
As far as expenditures are concerned, again, not everything is paid in equal increments throughout the year, but as you can see on the slide, for the most part, department budgets are
less than 50% expended. The Non-Departmental budget contains the City’s liability insurance premium- full annual amount.
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Mid-Year Expenditure Requests
There are a few adjustments to expenditures that are requested by the departments.
These are detailed in the Report on pages 8 through 10 and summarized on the screen.
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Revenue Adjustments
Offsetting the increases to appropriations are several increases to revenues.
Most significant are the increases to property tax and TOT. In addition, a number of other revenues are
performing better than original estimates , which results in increased revenue projections in the General Fund of just over $362,000.
The Local Sales tax fund is also anticipated to
bring in about 63,000 more and Gas Tax estimates released from the State show that this revenue source will do better than projected.
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Recommendation
Approve detailed budget adjustments listed in the Mid-Year Budget Report
Approve Schedule A
Approve requests for additional appropriations
Adopt a Resolution establishing or amending
job descriptions/classifications
Tonight, the recommendation before the Council is to:
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Questions
With that, I’m happy to answer any questions you might have.
Thank you.
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