FROM:
Finance
SUBJECT:
Title
Fiscal Year 2023-24 Third Quarter Budget Status Report
End
RECOMMENDATION:
Recommendation
Approve the recommended Fiscal Year 2023-24 Third Quarter Budget adjustments.
End
COUNCIL GOALS:
• Operate in a businesslike manner by ensuring that the public debate is based on accurate information.
• Operate in a businesslike manner by correcting problems immediately.
• Practice sound fiscal management by producing timely and accurate financial information.
• Practice sound fiscal management by living within our means while investing in the future.
• Practice sound fiscal management by fully funding liabilities and reserves.
• Practice sound fiscal management by developing long-term funding and debt management plans.
• Invest in the City’s infrastructure (streets, sewers, parks, etc.) by maintaining and improving the city's existing infrastructure.
• Invest in the City’s infrastructure (streets, sewers, parks, etc.) by providing for the development of new infrastructure.
• Invest in the City’s infrastructure (streets, sewers, parks, etc.) by utilizing Measure-I Funds wisely.
DISCUSSION:
The City’s budget is an important policy document, serving as the annual financial plan that identifies the spending priorities for the organization. Quarterly budget status reports are developed and presented to the City Council to provide the most current information on the financial activities of the City upon which to base decisions. Additionally, quarterly reports assist City departments in communicating their financial operations throughout the fiscal year including any program changes and significant impacts to their annual budgets, as well as gauging the City’s budget plan as compared to actual revenue and expenditures. This report includes requested departmental budget adjustments and preliminary year-to-date actuals through Third Quarter of Fiscal Year 2023-24, covering the period through March 31, 2024.
The current citywide Fiscal Year 2023-24 budget is comprised of a total of 200 funds including the General Fund, Other General Funds (10 funds), Special Revenue Funds (135 funds), Enterprise Funds (5 funds), Capital Project Funds (36 funds), a Debt Service Fund, an Internal Service Fund, and Other Agency Funds (11 funds). The current total citywide Fiscal Year 2023-24 budget (excluding other agency funds) includes total uses (expenditures and transfers out) for all City funds of $656.2 million and total sources (revenues and transfers in) of $468.7 million. The Recommended Budget includes an increase in total sources of $12.2 million for a total of $480.9 million and an increase in total uses of $18.7 million for a total of $674.9 million.
2023-24 Budget
All City Fund
GENERAL FUND
The current Fiscal Year 2023-24 General Fund Operating Budget includes total uses of $180.3 million and total sources of $160.4 million. The Recommended Budget includes an increase in total sources of $847,290 for a total of $161.3 million and an increase in total uses of $3.8 million for a total of $184.1 million.
2023-24 Budget
General Fund (Fund 101)
Notable Changes
• Revenue Adjustments - a increase in revenues of $840,909 from Business Related, Recreation, Reimbursables, and Miscellaneous revenues received.
• Personnel Requests (One-Time) - a increase in appropriations of $383,596 for new part-time positions, and new positions approved thru the American Rescue Plan Act
• One-time Requests - Increase appropriations of $3,289,460 for one-time expenditures and operating transfers out. Notable requests include:
o Transfer out to Fund #106 of $2.5 million for Settlement Reserve
o Transfer out to Fund #601 of $623,600 for property purchase
o Transfer out to Fund #103 of $140,860 for Lewis Library concrete steps
o Increase appropriations of $25,000 for plan check outsourcing
Fund Balance Analysis
The recommended 2023-24 ending fund balance of $48.0 million reflects an decrease of $3.0 million. Included in the fund balance of are total operating reserves of $33.1 (which reflects 25% of budgeted recurring annual expenditures.
The recommended ending fund balance reserves and designations are revised as follows:
• Settlements - Decrease in the Settlements of $2.5 million for a total of $0. Amount moved to Self-Issuance Fund #106 for the settlement reserve.
• Unappropriated - Decrease in the unappropriated fund balance of $466,648 for a total of $0 due to the requested one-time use of fund balance as described above.
2023-24 Budget
General Fund Balance
OTHER GENERAL FUNDS
Other General Funds includes a total of 10 funds which are funded by the General Fund for services that support the City’s general operations. The most notable funds include City Technology, Facility Maintenance, Self-Insurance, Retiree Medical Benefits, and General Fund Operating Projects.
The current 2023-24 Other General Funds Operating Budget includes total uses of $37.9 million and total sources of $51.7 million. The Recommended Budget includes an increase in total sources of $3.3 for a total of $41.2 million and an increase in total uses of $2.4 million for a total of $54.1 million.
2023-24 Budget
Other General Funds
Notable Changes
• Facility Maintenance - Increase appropriations of $140,860 for the Lewis Library concrete steps.
• Office of Emergency Svcs - Increase appropriations for Federal grant funds received.
• Self-Insurance - Increase appropriations of $1.7 million for settlement claims, legal services, and pending settlements.
OTHER CITY FUNDS
Other City Funds includes a total of 178 funds which Special Revenue Funds, Debt Service Funds, Capital Project Funds, Enterprise Funds, and Internal Service Funds.
The current 2023-24 Other City Funds Operating Budget includes total uses of $424.2 million and total sources of $270.4 million. The Recommended Budget includes an increase in total sources of $8.1 million for a total of $278.4 million and an increase in total uses of $12.5 million for a total of $436.7 million.
2023-24 Budget
Other City Funds
Notable Changes
• Special Revenue Funds - Increase in fund balance of $2.3 primarily due to:
o Federal Asset Seizure (Fund 223) - Increase revenues of $3.5 million for actuals received.
o Measure I 2010-2040 Local (Fund 246) - Decrease appropriations of $421,275 for various project closures.
• Capital Project Funds - Decrease in fund balance of $6.7 million primarily due to:
o Capital Reinvestment (Fund 601)
• Increase appropriations of $4.7 million for pavement rehab per the new fund balance policy.
o CFD #90 Summit @ Rosena Ph 1 (Fund 668)
• Transfer to Funds #620,632,634,636 of $1.2 million for developer reimbursement charges.
• Contribution to Housing Fund #698 of $675,106 for developer reimbursement charges.
o CFD #95 Summit at Rosena II (Fund 669)
• Transfer to Funds #620,632,634,636 of $577,756 for developer reimbursement charges.
o CFD #100 Victoria (Fund 673)
• Increase appropriations of $254,750 for bond cost of issuance.
ORGANIZATIONAL CHANGES
There are no organizational changes listed in the 2023-24 Third Quarter Budget Status Report.
FISCAL IMPACT:
The fiscal impact associated with this item is summarized below and details are provided in Third Quarter Budget Status Report.
The General Fund projected ending fund balance reflects a net decrease of $2.9 million for a total of $48.0 million because of prior year operations and the net impact of the recommended budget adjustments.
MOTION:
Approve staff recommendation.