HomeMy WebLinkAbout4.4 Fiscal Year 2022-23 2nd Quarter Financial Review Agenda Item 4.4
I STAFF REPORT
!t
DUBLIN CITY COUNCIL
CALIFORNIA
DATE: February 21, 2023
TO: Honorable Mayor and City Councilmembers
FROM: Linda Smith, City Manager
SU B.ECT: Fiscal Year 2022-23 2nd Quarter Financial Review
Prepared by: Lisa Hisatomi, Director of Administrative Services
EXECUTIVE SUMMARY:
The City Council will receive a financial report through the second quarter of Fiscal Year 2022-23
and consider amendments via a budget change.
STAFF RECOMMENDATION :
Receive the report and approve the budget change.
FINANCIAL IMPACT:
Approval of the budget change will result in a net increase to the General Fund revenue budget of
$3,668,068 and an increase in the General Fund expenditure budget of$1,725,000, including$1.1
million in transfers out to the Capital Improvement Program (CIP), resulting a net increase in
General Fund reserves of$1,943,068. The City is projected to be in an operating surplus position
of$14,990,476 in Fiscal Year 2022-23. Total General Fund reserves are projected at$211,478,758
by June 30, 2023.
This report also contains various budget changes in other funds requiring City Council approval.
DESCRIPTION :
The purpose of this report is to update the City Council on the status of the Fiscal Year 2022-23
General Fund Amended Budget and projected reserves.As a reminder,the Amended Budget
includes budget amendments already approved by the City Council since July 1, as well as
carryover budgets from the prior year. The Budget Change Form (Attachment 4) lists all new
amendments needing approval in the General Fund as well as in other funds.
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General Fund Summary (Attachment 1)
General Fund revenues are projected to come in $3,668,068 higher than the Amended Budget,
accounting for higher sales tax, property tax, charges for services, and facility rentals. On the
expenditure side,Staff is recommending an increase of$625,000 in operating expenditures and$1.1
million in transfers out to the CIP.
Table 1 summarizes the proposed changes to revenues and expenditures, followed by a discussion
of the changes.
Table 1: Revenue and Expenditure Changes
Category Amount
Revenues
Property Tax $1,300,000
Sales Tax 1,000,000
Interest 800,000
Charge for Services&Other 503,068
Transfers In 65,000
Total Revenues $3,668,068
Expenditures
Utilities 235,000
Contracted Services 260,000
Capital Outlay 130,000
Transfers Out 1,100,000
Total Expenditures $1,725,000
General Fund Impact $1,943,068
Revenues
Property Tax Revenue-increase of$1,300,000
The budget adjustment is due to growth in property sales and new construction in 2021,the year
used for growth in the assessment roll for 2022-23. In addition,the budget assumed a 2.5%
delinquency rate and the actual delinquency rate was significantly lower.
Sales Tax Revenue-increase of$1,000,000
The City continues to experience sales tax revenue growth in Fiscal Year 2022-23, primarily in the
Autos and Transportation, Building and Construction, and Business and Industry categories.Auto
inventory available for sale is finally increasing from historic lows after recent supply chain
disruptions and computer chip shortages ease, particularly for luxury and high-end vehicles. In the
Building and Construction category, merchants passed along inflation impacts to customers,
especially plumbing/electrical suppliers and contractors. The Business and Industry category
experienced strong growth due to significant surges in the Business-to-Business segment and
heavy industrial companies along with a onetime allocation for specialized equipment.
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Interest- increase of$800,000
The projected increase in interest earnings is due to the Federal Reserve's multiple increases to
interest rates.
Charges for Services and Other Revenues- net increase of$503,068
The net increase is due to the following:
• Charges for Services revenue is projected to increase $454,071, primarily for increased
program enrollments in Parks and Recreation programs.
• Development revenue is projected to decrease $175,000 in correspondence with year-to-
date information on City encroachment permits.
• Facility Rental revenue is projected higher than the budget by$176,097 due to additional
fields and courts being made available for rental, and an overall increase in demand.
• Fines and Penalties revenue is projected to decrease by$20,000 based on year-to-date
activity.
• Other Revenue is projected to increase by$67,900 due to higher-than-budgeted
concessions revenue at The Wave.
Transfers In -increase of$65,000
Transfers In will increase to account for a portion of the Environmental division Staff being
eligible for funding by Measure D.
Expenditures
Utilities-increase of$235,000
Utilities costs are projected to be higher than budget based on actual usage and higher gas prices.
Contract Services-increase of$260,000
Contract Services costs are increasing as the result of the following:
• The City's contract with Alameda County Fire Department requires an increase of$160,000
due to its cost-of-living adjustment provided to employees.
• In accordance with the contract with Amador Valley Industries (AVI) for waste
management,the City will be conducting a performance and financial review of AVI's
services. The contract is estimated at$100,000 which will be reimbursed by AVI; the
budget increase is to account for the timing difference in expenditures and the
reimbursement.
Capital Outlay-increase of$130,000
Capital Outlay requires an increase of$130,000 to fund the replacement of chairs and tables in
the Regional Meeting Room and the Library, and to purchase a new vehicle for the Public Works
Maintenance Division.
General Fund Reserves and Transfers Out
The budget adjustment includes $1.1 million in transfers out to the Resiliency and Disaster
Preparedness Improvements Project (GI0221), to provide funding for the planning, design,
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environmental permitting, and construction to make repairs at various sites impacted by the
recent storm.
After incorporating all adjustments as illustrated in Table 2 below, total reserves are projected to
decrease by$12,378,747 from the prior year, primarily attributed to budget carryovers for CIPs
and operating projects that were not complete in Fiscal Year 2021-22. Staff is projecting an
operating surplus of$15.0 million for Fiscal Year 2022-23.
The budget includes $21.0 million in transfers out to CIPs, $13.5 million of which is funded by
Committed/Assigned reserves. In addition, $6.5 million is budgeted as contributions to other
funds or for specific purposes, including ongoing contributions to Internal Service Funds and the
City's pension plan, and a one-time additional lump sum contribution to the City's allocated share
of unfunded pension liabilities for Dougherty Regional Fire Authority (DRFA), which is funded by
a Committed Reserve.
A list of changes to specific reserves is provided as Attachment 2 (General Fund Reserves
Summary).A detailed list of transfers out of the General Fund is provided as Attachment 3
(General Fund Transfers Out).
Table 2: General Fund Summary
FY 2021-22 FY 2022-23 New FY 2022-23
Actual Adopted* Amended
Total Reserves,Beginning of Year $209,764,495 $208,866,308 $223,857,505
Revenues 114,572,363 108,709,762 112,212,331
Expenditures (80,931,058) (94,018,847) (97,221,855)
Net Operating Budget Impact $33,641,305 $14,690,915 $14,990,476
Transfers In 312,874 77,900 142,900
Unrealized Gain/Loss (15,525,055)
Transfers Out/Contribution to Other (4,336,114) (11,067,815) (27,512,122)
Total Reserves,End of Year $223,857,505 $212,567,308 $211,478,758
Change from Prior Year ($12,378,747)
* FY2022-23 Adopted beginning reserve balance is based on FY 2021-22 projection.
Other Funds
Staff requests the City Council's approval to amend the budget for the following:
• Measure D Fund -Approve a transfer out of$65,000 to reimburse the General Fund for
Environmental Division personnel costs that are eligible for Measure D funding.
• Santa Rita 1997-1 Assessment District Fund -Appropriate $13,000 for higher-than-
budgeted recycled water costs.
• East Dublin 1999-1 Assessment District Fund -Appropriate $10,000 for higher-than-
budgeted electric costs.
• Measure BB Grant Fund - Reduce the CIP budget for Dublin Blvd Extension (ST0216) by
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$60,176 and make available the funding source to other CIPs as the portion of the project
eligible for the funding is complete.
STRATEGIC PLAN INITIATIVE:
None.
NOTICING REQUIREMENTS/PUBLIC OUTREACH :
The City Council Agenda was posted.
ATTACHMENTS:
1) General Fund Summary Q2 FY 2022-23
2) General Fund Reserves Summary Q2 FY 2022-23
3) General Fund Transfers Out Q2 FY 2022-23
4) Budget Change Q2 FY 2022-23
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Attachment I
GENERAL FUND SUMMARY-Q2 FY 2022-23
Actual Adopted Amended New Amended
2021-22 2022-23 2022-23 Q2 Adjustment 2022-23
Revenues
Property Tax $55,186,388 $55,163,000 $55,163,000 $1,300,000 $56,463,000
Sales Tax 26,456,903 26,400,000 26,400,000 1,000,000 27,400,000
Sales Tax Reimbursements (346,696) (405,555) (405,555) (405,555)
Development Revenue 9,803,444 7,702,334 7,562,355 (175,000) 7,387,355
Transient Occupancy Tax 1,255,575 1,400,000 1,400,000 1,400,000
Other Taxes 7,025,567 6,560,000 6,560,000 6,560,000
Licenses&Permits 354,643 351,373 351,373 351,373
Fines&Penalties 70,714 85,000 85,000 (20,000) 65,000
Interest Earnings 2,269,289 1,510,000 1,510,000 800,000 2,310,000
Rentals and Leases 1,647,882 1,477,330 1,477,330 176,097 1,653,427
Intergovernmental 324,519 290,000 290,000 290,000
Charges for Services 8,022,099 6,496,124 6,496,124 454,071 6,950,195
Other Revenue 2,502,034 1,680,156 1,719,636 67,900 1,787,536
Subtotal Revenues-Operating $114,572,363 $108,709,762 $108,609,263 $3,603,068 $112,212,331
Transfers In $312,874 $77,900 $77,900 $65,000 $142,900
Unrealized Gains/Losses (15,525,055) - - -
Total Revenues $99,360,182 $108,787,662 $108,687,163 $3,668,068 $112,355,231
Expenditures
Salaries&Wages $11,670,597 $13,249,383 $13,481,615 $13,481,615
Benefits 4,728,716 5,488,704 5,567,488 5,567,488
Services&Supplies 3,894,567 5,178,309 5,434,414 5,434,414
Internal Service Fund Charges 3,907,323 4,932,571 4,932,571 4,932,571
Utilities 2,511,166 3,485,435 3,485,435 235,000 3,720,435
Contracted Services 52,920,629 59,695,219 61,661,855 260,000 61,921,855
Capital Outlay 339,943 432,737 496,987 130,000 626,987
Debt Service Payment - 1,333,050 1,333,050 1,333,050
Contingency&Miscellaneous 958,117 223,440 203,440 203,440
Subtotal Expenditures-Operating $80,931,058 $94,018,847 $96,596,855 $625,000 $97,221,855
Operating Impact(REV-EXP) $33,641,305 $14,690,915 $12,012,408 $2,978,068 $14,990,476
Transfer Outs&Contributions to Other Funds
Transfers Out(CIPs)-Com./Assig.Resery $2,803,478 $2,291,645 $13,474,910 13,474,910
Transfers Out(CIPs)-Unassigned 532,636 2,316,170 6,453,834 $1,100,000 7,553,834
Contribution to OPEB/PERS 4,460,000 4,460,000 4,460,000
Transfers Out to ISF/Other 1,000,000 2,000,000 2,023,378 2,023,378
Subtotal-Transfers Out&ContributionE $4,336,114 $11,067,815 $26,412,122 $1,100,000 $27,512,122
Total Expenditures $85,267,172 $105,086,662 $123,008,977 $1,725,000 $124,733,977
GF Impact(Include CIP&Transfers) $14,093,010 $3,701,000 ($14,321,814) $1,943,068 ($12,378,747)
TOTAL GENERAL FUND BALANCE $223,857,505 $212,567,308 $209,535,691 $211,478,758
Actual Adopted Amended New Amended
Contracted Services Detail 2021-22 2022-23 2022-23 Q2 Adjustment 2022-23
Police Services(1) $21,437,403 $23,985,730 $24,085,730 $24,085,730
Fire Services(1) 14,699,226 15,311,310 15,311,310 160,000 15,471,310
Maintenance Services(MCE) 5,875,493 7,220,710 7,220,710 7,220,710
Development 3,858,842 4,312,851 4,649,007 4,649,007
Other Contracted Services 7,049,665 8,864,618 10,395,098 100,000 10,495,098
Total Contracted Services $52,920,629 $59,695,219 $61,661,855 $260,000 $61,921,855
(1)Police and Fire liability insurance amounts are not included above,they are included in Services&Supplies.
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Attachment 2
GENERAL FUND RESERVES SUMMARY-Q2 FY 2022-23
Actual Increase Decrease Net Change Projected
RESERVE DESCRIPTION 2021-22 2022-23 2022-23 2022-23 2022-23
Non-Spendable -
$10,541 $10,541
Prepaid Expenses 10,541 10,541
Restricted $4,261,640 $4,261,640
Cemetery Endowment 60,000 60,000
Developer Contribution-Downtown 1,490,000 1,490,000
Developer Contr-Heritage Park 19,000 19,000
Developer Contr-Nature Park 60,000 60,000
Section 115 Trust-Pension 1,882,640 1,882,640
Heritage Park Maintenance 750,000 750,000
Committed $73,346,367 ($22,769,786) ($22,769,786) $50,576,582
Advance to Public Facility Fee 9,523,096 (9,523,096) (9,523,096)
Downtown Public Improvement 15,176,230 (426,221) (426,221) 14,750,009
Economic Stability 8,000,000 8,000,000
Emergency Communications 532,113 532,113
Fire Svcs Pension/OPEB 5,671,094 (3,460,000) (3,460,000) 2,211,094
Innovations&New Opportunity 1,026,591 (132,093) (132,093) 894,498
One-Time Initiative-Capital 6,419,657 (1,420,149) (1,420,149) 4,999,508
One-Time Initiative-Operating 503,860 503,860
Public Safety Reserve 2,600,000 2,600,000
Specific Committed Resets
Cemetery Expansion(CIP) 13,748 (13,748) (13,748)
Contribution to Public Facility Fee 6,000,000 6,000,000
Cultural Arts Center(CIP) 7,139,197 (6,964,197) (6,964,197) 175,000
Don Biddle Park(CIP) 675,193 (675,193) (675,193)
Fallon Sports Park III Contingency 510,500 (100,000) (100,000) 410,500
Lease Revenue Bond Payoff 6,000,000 6,000,000
Maintenance Facility(CIP) 55,089 (55,089) (55,089)
Utility Undergrounding(CIP) 3,500,000 3,500,000
Assigned $93,266,322 ($9,633,178) ($9,633,178) $83,633,144
Accrued Leave 1,308,044 1,308,044
Catastrophic Loss 17,710,320 17,710,320
CIP Carryovers 4,088,843 (4,088,843) (4,088,843)
Fiscally Responsible Adjustment 325,000 325,000
Municipal Regional Permit 2,209,778 (2,182,419) (2,182,419) 27,359
Non-Streets CIP Commitments 3,276,777 (4,277) (4,277) 3,272,500
Operating Carryovers 1,600,546 (1,600,546) (1,600,546)
Parks and Streets Contingency 201,270 201,270
Pension&OPEB 17,000,000 17,000,000
Relocate Parks Dept 500,000 500,000
Service Continuity 3,150,000 3,150,000
Dublin Blvd Extension-Placeholder 20,000,000 20,000,000
Specific Assigned Reserves
ARPA Revenue Replacement 665,878 665,878
Climate Action Plan 3,000,000 (62,000) (62,000) 2,938,000
Contribution to ISF 1,500,000 1,500,000
Facade Improvement Grants 364,256 364,256
HVAC Replace.&Civic Ctr Improv.(CIP) 3,278,409 (1,307,892) (1,307,892) 1,970,517
Pavement Management 2,000,000 2,000,000
Public Safety Complex(CIP) 87,200 (87,201) (87,201)
Village Pkwy Pavement Reconstruction 11,000,000 (300,000) (300,000) 10,700,000
Unassigned $52,972,635 $32,402,964 ($12,378,747) $20,024,217 $72,996,852
Unassigned-Unrealized Gains (11,008,294) (11,008,294)
Unassigned(Available) 63,980,929 70,996,852
TOTAL RESERVES $223,857,505 $32,402,964 ($44,781,710) ($12,378,747) $211,478,758
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Attachment 3
GENERAL FUND TRANSFERS OUT-Q2 FY 2022-23
Adopted Amended Q2 New Amended
Project Description 2022-23 2022-23 Adjustment 2022-23
Committed/Assigned Reserves
City Entrance Monument Signs 200,000 200,000
Citywide Signal Communications Upgrade 1,420,149 1,420,149
Civic Center Rehabilitation 220,840 1,307,892 1,307,892
Cultural Arts Center 6,964,197 6,964,197
Don Biddle Community Park 675,193 675,193
Dublin Heritage Park Cemetery Improvements 13,748 13,748
Electric Vehicle(EV)Charging Stations 194,093 194,093
Fallon Sports Park Phase 3 100,000 100,000
Green Stormwater Infrastructure 1,770,805 2,153,074 2,153,074
IT Infrastructure Improvement 4,277 4,277
Maintenance Yard Facility Improvements 55,089 55,089
Public Safety Complex-Police Services Building 87,201 87,201
Village Parkway Reconstruction 300,000 300,000 300,000
Committed/Assigned Reserves 2,291,645 13,474,910 - 13,474,910
Unassigned Reserve
Alamo Creek Park&Assmt Dist Fence Replacement 446,767 446,767
Audio Visual System Upgrade 50,000 157,923 157,923
City Entrance Monument Signs 285,000 285,000
Citywide Bicycle&Pedestrian Improvements 105,000 365,992 365,992
Citywide Energy Improvements 1,280,000 1,436,559 1,436,559
Downtown Dublin Street Grid Network 8,990 196,893 196,893
Downtown Dublin Town Square Park 4,680 102,205 102,205
Dublin Blvd.Ext.-Fallon Rd to N.Canyon Pkwy 123,000 123,000
Dublin Standard Plans&Details Update 142,500 142,500 142,500
Financial System Replacement 1,176,799 1,176,799
Imagine Playground at Dublin Sports Grounds 48,820 48,820
Municipal Fiber 140,000 140,000 140,000
Resiliency&Disaster Preparedness Improve. 1,100,000 1,100,000
Restrooms Replacement 999,720 999,720
San Ramon Road Landscape Renovation 238,660 238,660
San Ramon Road Trail Lighting 7,996 7,996
Situational Awareness Camera Program 585,000 585,000 585,000
Unassigned Reserve* 2,316,170 6,453,834 1,100,000 7,553,834
Subtotal Transfers Out to CIPs $4,607,815 $19,928,744 $1,100,000 $21,028,744
Other Contributions/Transfers Out
Contribution to DRFA Pension Liabilities(One-time) 3,460,000 3,460,000 3,460,000
Contribution to Pension 1,000,000 1,000,000 1,000,000
Transfers Out to ISF/Other 2,000,000 2,023,378 2,023,378
Subtotal Transfers Out to Other $6,460,000 $6,483,378 $6,483,378
Total General Fund Transfers Out $11,067,815 $26,412,122 $1,100,000 $27,512,122
*CIPs identified to be funded by Undesignated reserve include$4.1 million budget carryovers from FY 21-22,the amount
is identified as Assigned Reserve-CIP Carryovers
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CITY OF DUBLIN Attachment 4
FISCAL YEAR 2022-23
BUDGET CHANGE FORM
Budget Change Reference#:
City Council's Approval Required
From Un-Appropriated Reserves X Budget Transfer Between Funds
From Designated Reserves Other
REVENUES
General Fund
10010000.42101 (Sales Tax) $1,000,000 Increase in taxes based on consultant's updated projections
10010000.41101 (Property Tax) $1,300,000 Delinquency is lower than budgeted 2.5%
10016120.44241 (Encroachment/Transportation) ($175,000) Based on year-to-date actual
10013000.45121 (Citations) ($20,000) Based on year-to-date actual
10010000.46101 (Interest) $800,000 Increase due to Federal Reserve's multiple increases of
interest rate
Higher than anticipated rentals and additional fields and
10017xxx.46201 (PCS-Multiple Programs-Field &Court Rentals) $77,601 courts available for rent
10017xxx.46202(PCS-Multiple Programs-Facility Rentals) $98,496 Higher than anticipated rentals
10017xxx.48700(PCS-Multiple Programs-Charge for Svcs) $411,071 increase in enrollments of recreation programs
10013800.48301 (Fire Alarm) $14,000
10013800.48302(Sprinkler/Underground) $11,000 Based on year-to-date actual
10016240.48505(Stormwater Facility Inspection) $18,000
110017612.49102(Concessions) $67,900 Summer birthday parties
10016200.49999(Transfers In) $65,000 Reimburse Environmental division personnel cost from
Measure D Fund
OPERATING EXPENDITURES
General Fund
10016317.63201 (Gas) $150,000 Gas for the Wave, base on year-to-date usage and higher
gas price
10016317.63202(Electric) $85,000 Electric for the Wave, base on year-to-date usage
10016230.64001 (Contract Services) $100,000 AVI Performance and Financial review.These expenditures
will be reimbursed by AVI,timing difference in fiscal year of
expenditure and reimbursement
10013700.64021 (Contract Personnel) $160,000 Increase in fire contract service due to higher COLA than
budgeted effective 2023
10017514.71101 (Furniture) $60,000 Chairs and tables for the Regional Meeting Room and the
library
10016342.72107(Vehicles) $70,000 New fleet vehicle for Public Work
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FISCAL YEAR 2022-23 Attachment 4
BUDGET CHANGE FORM
Budget Change Reference#:
Special Revenue Funds
23026200.89101 (Transfers Out) $65,000 Reimburse Environmental division personnel cost to
General Fund
27046332.63302(Recycled Water) $13,000 Recycled water in Santa Rita 1997-1 Assessment District
27056336.63202(Electric) $10,000 Electric costs in East Dublin 1999-1 Assessment District
electric costs in East Dublin 1999-1 Assessment District
CIPs
Dublin Blvd Extension (ST0216)
ST0216.9200.9201 (Contract Services) ($60,176)
ST0216.2217(36009610.49999)-Measure BB Grant Funding ($60,176) Reduce the CIP budget and make available the funding
Source/Transfers In source to other CIPs as the portion of the project eligible for
the funding is complete
22179610.89101 -Measure BB Grant Transfers Out ($60,176)
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Resiliency and Disaster Resiliency and Disaster Preparedness Improvements(GI0221)
G10221 9100.9101 (salaries) $52,000
G10221.9200.9201 (Contract Services) $223,000
Provide funding for the planning,design, environmental
G10221.9400.9401 (Improv. Not Building) $825,000 permitting, if necessary,and construction to make the
G10221.1001 (33009310.49999)-General Fund Funding Source $1,100,000 repairs at various sites impacted by the recent storm
/Transfers In damages.
10019310.89101 -General Fund Transfers Out $1,100,000
As Presented at the City Council Meeting 2/21/2023
**********Finance Use Only**********
Posted By: Date:
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