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HomeMy WebLinkAboutItem 4.11 Financial Review 2nd Qtr or 19 82 STAFF REPORT CITY CLERK ` CITY COUNCIL File #330-50 DATE: March 3, 2015 TO: Honorable Mayor and City Councilmembers FROM: Christopher L. Foss, City Manager " SUBJECT: Fiscal Year 2014-15 2nd Quarter Financial Review Prepared by Prepared by Colleen Tribby, Administrative Services Director EXECUTIVE SUMMARY: The City Council will receive a financial report on the second quarter for Fiscal Year 2014-15 and consider mid-year amendments to the Fiscal Year 2014-15 Budget. FINANCIAL IMPACT: Approval of the FY 2014-15 budget change will result in a net increase of $1,952,835 to the General Fund revenue budget and a decrease of $25,779 to the General Fund expenditure budget. Total General Fund reserves are projected at $70,471,828 as of June 30, 2015, with $15,287,140 in the unassigned (available) reserve. This report also contains a number of budget changes in other funds requiring City Council approval. RECOMMENDATION: Staff recommends that the City Council receive the report on the mid-year FY 2014-15 financial results and approve the budget change. Reviewed By Assistant City Manager DESCRIPTION: This focus of this report is the projected FY 2014-15 fund balance in the General Fund, updated with information collected through the second quarter, ending December 31, 2014. The numbers include budget amendments already approved by the City Council since July 1, carry-over budgets from FY 2013-14, new amendments needing approval, and updated revenue and expenditure projections. Page 1 of 4 ITEM NO. 4.11 FY 2014-15 Projections General Fund revenues are projected to come in $1,952,835 higher than the amended budget, due primarily to an increase in building permit revenue. Expenditures are in line with the budget except for the elimination of a large carryover budget for Police dispatch services that will not be used this fiscal year, and increased contract service costs related to development services. Revenue projections also include the second payment of $750,000 from Discovery Builders for the Cemetery Expansion project, which has been added to the Committed Reserve for that purpose. In addition, Staff recommends $1,500,000 of the anticipated surplus in the Assigned Reserve for contribution to Internal Service Funds in order to address necessary technology upgrades identified in the Information Technology Master Plan, which is currently underway. Examples of upgrades include the relocation and update to the City's Data Center, a provision for a computer training space, and the eventual replacement of the City's financial software package, which will be needed in the next six years. The draft Master Plan, as well as final reserve designations for the fiscal year, will be brought for City Council approval before June 30, 2015. The following is a summary of changes to revenues and expenditures. Revenues: $1,952,835 higher than budget Other Taxes: $90,000 higher than budget The increase is due to a higher level of Property Transfer Tax than anticipated, due to both an increase in assessed value of selling properties, and an increase to the number of sales expected to occur in FY 2014-15. Building Permits: $1,294,688 higher than budget Other Taxes (CalGreen Building Permit Surcharge): $65,887 higher than budget Charges for Services (Fire Inspection Services): $152,260 higher than budget Community Benefit Payment: $350,000 higher than budget The increase in these development-related revenues is related to the acceleration of development activity that occurred in the latter half of FY 2013-14 and has continued into FY 2014-15. The large increase in Building Permit revenue will change the flow of these funds throughout the five-year forecast, where the accelerated development may mean slowed activity sooner than previously anticipated. Expenditures: $25,779 lower than budget Contracted Services: $401,150 higher than budget The increase is due primarily to building, safety, and engineering contract service costs, and is offset by additional development-related revenues. There is also an increase to the City's contract for Animal Control Shelter Services. Carryovers from Prior Year: $426,929 lower than budget The remaining budget for Police Dispatch services in the prior year had been carried over into FY 2014-15 to cover possible true-up costs that are sometimes incurred after the year is finished. The first billings in FY 2014-15 did not contain a true-up, therefore this budget amount will not be used. Fiscal Impact, Projected FY 2014-15 Page 2 of 4 The projected net impact of revenues, expenditures, and transfers out results in a draw on reserves of $9,101,059 (see Table 1) in FY 2014-15. The cash flow reserve is projected at $15,287,140 representing 2.9 months of the FY 2015-16 operating budget. Attachment 2 presents the details of all projected changes to reserves during FY 2014-15. Table 1: General Fund Reserves 13.14 4- Reserve Balances ActUal Projected ""3 e s a,W a. Y"4.S Ads gned 5 9 5' Unassigned Cash tow 1 3 **9 1 140 1L RESERVES 79,572,887 70,471,929 Long Term Projections Though the gains in the major revenue categories discussed above are anticipated to result in a surplus budget in this fiscal year, it is important to note that the long term projections show deficit spending within five to six years. Property Tax and Sales Tax revenues, which provide the primary funding for ongoing City operations, are not projected to keep pace with increases in ongoing expenditures. Building Permit revenues and other development-related revenues are expected to decline as projects are completed and the City nears build out. Staff will provide the City Council with a detailed long-term budget analysis, as well as the ten- year forecast model, at the City Council meeting of March 7, 2015. Items Needing City Council Approval (BUDGET CHANGE ATTACHED): 1. Budget adjustments, General Fund a. Property Transfer Tax: increase $90,000 b. Building Permits: increase $1,294,688 c. CalGreen Building Permit Surcharge: increase $65,887 d. Fire —Alarm Revenue: increase $13,000 e. Fire — Sprinkler/Underground Revenue: increase $128,000 f. Fire — Fixed Systems Revenue: increase $2,340 g. Fire — Plan Check Revenue: increase $14,500 h. Fire — Miscellaneous Revenue — decrease $5,580 i. Community Benefit Payment Revenue: $350,000 higher than budget j. Contract Services: increase $401,150 k. Police dispatch carryover: decrease $426,929 2. Budget adjustments, Non-General Fund: Page 3 of 4 a. Appropriate $30,000 in the ACTC Sales Tax Bike & Pedestrian Fund for a shared-use path condition assessment. b. Appropriate $27,320 in the Measure D Fund for a storm drain base map update, software and connection fees related to the Chargepoint maintenance program, and water bottle re-fill station for special events. c. Include revenues of $616,500 in the Public Art Fund, $1,200,000 in the Affordable Housing Fund, and $1,735,419 in the Impact Fees Funds resulting from developer contributions. d. Appropriate $5,000 in the Fire Impact Fee Fund for the interest payment on the General Fund loan. e. Appropriate $145,000 in the Eastern Dublin Traffic Impact Fee Fund for reimbursement of the Tassajara Interchange construction costs, based on a share of the fees collected. f. Appropriate $46,270 in the ISF Police Vehicle Fund for the replacement of a fully depreciated vehicle. g. Appropriate $100,000 in the ISF Building Fund for replacement of HVAC unit#8 at the Civic Center. 3. Budget adjustments, Capital Improvement Program: a. Appropriate $89,401 in Downtown Traffic Impact Fee mitigation funds to the St. Patrick Way Project (#st0494). b. Eliminate $1,089,771 in budget from the St Patrick Way Project (#st0494), to remove the appropriation for the portion of the project that was completed by the developer. c. Reduce $4,507 in funding from Eastern Dublin Traffic Impact Fee mitigation funds, replace with $4,507 in funding from the Traffic Impact Fee Category 2 Fund for the Dublin Blvd Improvements Project (#st1012). NOTICING REQUIREMENTS/PUBLIC OUTREACH: None. ATTACHMENTS: 1. General Fund Summary and Reserves 2. Budget Change Page 4 of 4 GENERAL FUND RESERVES: FY 2014-15 2nd QUARTER FINANCIAL REVIEW Projected total change Projected 2013-14 INCREASE DECREASE during year 2014-15 Reserve Balances Non-Spendable', $7,270,072 $0'� ($847,854) '($6r47,85,4), , $1,622,168 Prepaid Expenses 27,080 27,080 Cemetery Endowment 60,000 - 60,000 Advance to Fire Impact Fee 901,907 (250,000) (250,000) 651,907 Advance to PERS Side Fund 1,281,035 (397,854) (397,854) 883,181 Restricted +$504,000 $0 $0 $0 $540,000 Heritage Park Maintenance 500,000 - 500,000 CoMmitted $34,124,272 '$7,38z,166 1$15,78$,570) x$9 354,844) $24,773,468 Economic Stability 6,000,000 - 6,000,000 Downtown Public Impr 1,000,000 (450,042) (450,042) 549,958 Open Space Funding 45,975 (45,975) (45,975) 0 Affordable Housing 1,000,000 - 1,000,000 Emerald Glen Aquatic Complex 3,000,000 (102,350) (102,350) 2,897,650 Emergency Communications 741,000 - 741,000 Fire Svcs OPEB 8,196,000 397,854 (8,196,000) (7,798,146) 397,854 Innovations&New Opport 1,372,785 - 1,372,785 Maintenance Facility 1,133,601 (1,133,601) (1,133,601) - Cemetery Expansion 2,391,538 2,887,600 (816,960) 2,070,640 4,462,178 Fallon Sports Park - 2,000,000 2,000,000 2,000,000 Civic Ctr Expansion 259,076 (155,457) (155,457) 103,619 Public Safety Complex - 97,312 (97,312) - - Jt City/School Projects 235,873 (235,873) (235,873) 0 Non-Streets CIP Commitments 3,132,016 - - 3,132,016 Shannon Center Parking Lot 775,000 - 775,000 Advance to Public Facility Fee 3,500,000 2,000,000 (5,500,000) (3,500,000) - One-Time Initiative 1,341,408 - 1,341,408 Assigned. $29,259,338 $1,547,000 ($2,577,051) ­($1,070,051) $28,189,287 Accrued Leave 979,248 979,248 Operating Carryovers 1,486,299 7,000 (1,493,299) (1,486,299) - CIP Carryovers 1,083,752 (1,083,752) (1,083,752) - Civic Ctr Renovation-Police 2,000,000 - 2,000,000 Contribution to ISF 500,000 1,500,000 1,500,000 2,000,000 Catastophic Loss 10,608,186 - 10,608,186 Service Continuity 2,410,000 - 2,410,000 Pension&OPEB 9,866,853 - 9,866,853 Fiscally Responsible Adj 325,000 - 325,000 Unassigned $1!,419,25S $19,9,58,475 {$17,990,825) $1,967,650 $15,386,906 Unassigned-Unrealized Gains 99,765 99,765 Uin ssigned jAva l Nej 13,319,490 2.9 months 15,287,140 TOTAL RESERVES 79,572,887 ($9,101,059) 70,471,828 GENERAL FUND SUMMARY ATTACHMENT 1 FY 2014-15 2nd QUARTER FINANCIAL REVIEW 13-14 14-15 14-15 14-15 Change from Actual Adopted Amended Projected Amended Budget Revenues Property Taxes 25,286,308 25,898,281 29,290,511 29,290,511 Sales Tax 17,833,314 17,686,696 18,667,216 18,667,216 - Other Taxes 5,427,627 4,813,800 4,657,800 4,747,800 90,000 Building Permits 5,046,928 3,171,473 3,171,473 4,466,161 1,294,688 Other Licenses&Permits 927,056 717,559 717,559 783,446 65,887 Fines&Penalties 111,714 138,260 138,260 138,260 - Interest 787,515 368,581 368,581 368,581 Rentals&Leases 708,090 1,016,037 1,016,037 1,016,037 Intergovernmental 191,574 193,620 193,620 193,620 - Charges for Services 9,197,812 7,115,752 6,890,752 7,043,012 152,260 Other Revenue 286,683 388,654 392,654 392,654 - Community Benefit Payment 2,108,858 2,426,174 2,426,174 2,776,174 350,000 Subtotal Revenues 67,913,478 63,934,887 67,930,636 69,883,471 1,952,835 Carryover Prior Year Operating Revenues 1,493,299 1,493,299 - Total Revenues 67,913,478 63,934,887 69,423,935 71,376,770 1,952,835 Expenditures Salaries&Wages 9,443,209 9,708,952 9,724,952 9,724,952 - Benefits 4,530,270 4,892,712 4,892,712 4,892,712 Services&Supplies 2,133,125 2,453,706 2,462,206 2,462,206 Internal Service Fund Charges 1,721,525 1,778,101 1,778,101 1,778,101 Utilities 1,784,982 2,035,482 2,035,482 2,035,482 - Contracted Services 35,099,787 36,897,837 36,995,273 37,396,423 401,150 Capital Outlay 212,240 511,710 511,710 511,710 - Contigency&Contributions - 919,282 821,346 821,346 - Subtotal Expenditures 59,221,782 59,622,932 401,150 Carryover Prior Year Operating Expenditures 1,480,923 1,053,994 (426,929) Total Expenditures 54,925,137 59,197,782 60,702,705 60,676,927 (25,779) OPERATING BUDGET IMPACT SURPLUS/(DEFICIT) 12,988,341 4,737,105 8,721,230 10,699,844 1,978,614 CIP/One-Time Expenditures Maintenance Yard* (4,894,349) (1,133,601) (1,133,601) - Public Safety Complex* (3,186,592) (97,312) (97,312) Parkland Acquisition* (1,954,025) Emerald Glen Aquatics Complex* (5,602,350) (5,602,350) Civic Center Modifications* (132,498) (155,457) (155,457) Joint City/School Projects* (364,127) (235,873) (235,873) Cemetary Expansion* (816,960) (816,960) (816,960) Fire Services OPEB* (8,196,000) (8,196,000) Amador Plaza Rd Bicycle&Ped Impr* (450,042) (450,042) San Ramon Rd Landscape (239,065) (239,065) (239,065) Tree Planting (777) Sidewalk Safety (21,574) (86,972) (147,524) (147,524) Electronic Agenda (64,945) (244,005) (244,005) Energy Upgrade (102) (5,593) (5,593) Network Syst Upgrade (12,539) (313,793) (313,793) Tennis Court Resurfacing (10,000) (153,350) (153,350) GIS (19,000) (87,656) (87,656) ADA Transition (21,177) (43,577) (43,577) Storm Drain Condition (100,476) (160,042) (207,010) (207,010) Storm Drain Trash Capture (583) (178,436) (178,436) TOTAL CIP EXPENDITURES (10,732,587) (1,353,216) (18,307,604) (18,307,604) USE OF COMMITTED RESERVES (for projects noted by*) 10,415,745 816,960 16,687,595 16,687,595 AMOUNT AVAILABLE TO SHIFT AMONG RESERVES 12,671,500 1 4,200,849 7,101,222 9,079,835 NET IMPACT ON RESERVES 2,255,754 3,383,889 (11,079,673) (9,101,059) TOTAL RESERVES 79,572,887 70,471,828 CITY OF DUBLIN FISCAL YEAR 2014-15 BUDGET CHANGE FORM Budget Change Reference#: City council"S Appr©ual'Requ red From Un-Appropriated Reserves X Budget Transfer Between Funds From Designated Reserves Other INCREASE,BUDGET IT Budget Change Description Account Amount Animal Control Shelter Services due to allocated budget is EXP: General Fund -Animal Control -Contract Svcs Animal Shelter higher than estimated. 1001.2701.64014 $22,897 Building Permits and Fees-higher than projected REV: General Fund - Building Safety- Revenues development activities. 1001.8102.44231 (Building Permits) $172947688 1001.8102.44233 (Cal Green Permit Fees Surcharc $657887 EXP: General Fund - Building Safety- Building Permits-Contract Building &Safety contract service-higher than projected Services development activities. 1001.8102.64001 $2007000 Engineering private development inspection services- EXP: General Fund - Engineering - Inspection Private Development higher than anticipated plan checking services. 1001.8301.64093 $1787253 Property Transfer Tax-higher than anticipated property transfers and property value. REV: General Revenue- Property Transfer Tax 1001.0000.42201 $907000 Community Benefit Payment REV: General Revenue-Community Benefit Payment 1005.0000.49151 $3507000 REV: General Fund - Fire Prevention - Revenues Fire Prevention Revenues- higher than projected 1001.2402.48301 (Fire Alarm) $137000 development activities. 1001.2402.48302 (Sprinkler/Underground) $1287000 1001.2402.48303 (Fixed System) $27340 1001.2402.48305 (Fire Plan Check) $147500 EXP: ACTC Sales Tax Bike& Ped Fund - Engineering -Contract Class I Shared-Use Path Condition Assessment Services General 2205.8301.64001 $307000 Storm Drain Base Map Update-to analyze and plan for the EXP: Measure D Fund - Envir. Services-Contract Services General implementation of long-term Dublin Trash Reduction Plan. 2302.5201.64001 $157000 Chargepoint 3 year hardware maintenance program & EXP: Measure D Fund - Envir. Services-Contract Services General Software maintenance and connection/reporting fees. 2302.5201.64001 $87320] C:\Users\agenda\Desktop\4.11 attch 2 4.11 attch 2 FISCAL YEAR 2014-15 BUDGET CHANGE FORM Budget Change Reference#: city ouneil's Approval.F eq,uired Water Bottle Re-fill Station for special events. EXP: Measure D Fund - Envir. Services-Operating Supplies 2302.5201.61104 $4,000 REV: Public Art Fund - Developer Contribution Public Art Contribution 2801.0000.49161 $5857000 2801.0000.49163 $317500 REV: Affordable Housing Fund - Developer Contribution Affordable Housing Fund 2901.0000.49161 $171457000 2901.0000.49163 $557000 REV: Impact Fees- Developer Contribution 4101.0000.49161 (PFF-Community Parkland) $4617232 4101.0000.49163 (PFF-Community Parkland) $547797 Impact Fees-higher than projected development activities. 4201.0000.49161 (Fire Impact Fee) $807000 4201.0000.49163 (Fire Impact Fee) $117390 4301.0000.49161 (T I F-Cat 1) $170007000 4302.0000.49161 (T I F-Cat 1) $1007000 4304.0000.49163 (Downtown TIF) $287000 Fire Impact Fee- Interest payment to General fund Loan. EXP: Fire Impact Fee- Non Dept- Interest Payment 4201.1901.85101 $57000 Traffic Impact Fee-Cat 1 -higher than projected TIF1 revenues. Reimbursement of Tassajara Interchange EXP: Traffic Impact Fee Cat 1 - No Dept- Impact Fee Obligation construction costs advanced by the County and the Lin Family. Pro-rata share of 8% of TIF1 fees collected. 4301.1901.86101 $1457000 Replacement of Police vehicle D8- purchased in 2009 & EXP: ISF Police Vehicle Fund - Non Dept- Equipment ISF fully depreciated. 6101.1901.72102 $467270 Replacement of HVAC#8. EXP: ISF Building Fund - Non Dept- Equipment ISF 6201.1901.72102 $1007000 DECREASE BUDGET AMOUNT,, Reduce Police dispatch carry over from FY 13-147 FY 13-14 dispatch true-up cost is lower than budget. General Fund - Police Dispatch -Contract Services Dispatch 1001.2106.64035 ($4267928) Reduce Fire Prevention misc. revenues. REV: General Fund - Fire Prevention - Misc Fire Services 1001.2402.48309 ($5,580) C:\Users\agenda\Desktop\4.11 attch 2 4.11 attch 2 FISCAL YEAR 2014-15 BUDGET CHANGE FORM Budget Change Reference#: City council"S Appr©ual'Requ red CIP BUDGET CHANGE Traffic Impact Fee Mitigation Fund -Street CIP -St. Patrick Way Increase Budget-Allocate remaining Mitigation Funds to st0494.9100.9101 (Salary/Benefit) $24,401 the St. Patrick Way CIP project(st0494). st0494.9200.9207 (Contract Svcs-General) $657000 3600.9601.49999 (Transfers In) $897401 4309.9601.89101 (Transfers Out) $897401 Traffic Impact Fee Downtown TIF -Street CIP-St. Patrick Way Decrease Budget- Improvement for St. Patrick Way CIP st0494.9400.9401 (Improvement- Not Bldg) 1,089,771 (st0494)to be constructed by developer, not the City. ( p g) ( ) 3600.9601.49999 (Transfers In) ($170897771) 4304.9601.89101 (Transfers Out) ($170897771) Traffic Impact Fee Category 2/Mitigation Fund -Street CIP- Dublin Change Funding Source- not net impact to project cost. Blvd Improvements-Sierra Ct to Dublin Ct Mitigation Fund balance for Dublin Blvd Improvements- Sierra Ct to Dublin Ct(st1012) is less than budgeted. 4309.9601.89101 (Transfers Out) ($4,507) 4302.9601.89101 (Transfers Out) $47507 REASON,FOR,BU[)GGET GHA IGGE As Presented at the City Council Meeting 3/3/2015 • Posted By: Date: C:\Users\agenda\Desktop\4.11 attch 2 4.11 attch 2