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Home My WebLink AboutID# 14-426 FY 2014-15 Mid year Operating Budget Status Report General FundsCITY or LADE LLSINOKE UILEAM EjC"Hi CME REPORT TO CITY COUNCIL TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: GRANT YATES CITY MANAGER DATE: JANUARY 27, 2015 SUBJECT: FISCAL YEAR 2014 -15 MID -YEAR OPERATING BUDGET STATUS REPORT — GENERAL FUND RECOMMENDATIONS Staff recommends that the City Council approve the Fiscal Year 2014 -15 Mid -Year Operating Budget, as reflected and adjusted in the attached Exhibits. BACKGROUND The City is presenting its FY2014 -15 Mid -Year Budget review of the General Fund. On Tuesday, January 20, 2015, the City's Budget Committee reviewed the FY2014 -15 Mid - Year Revised budget for the General Fund. Please note that a review and status report update for Special Revenue Funds, Capital Project Funds, and other funds will be presented as part of the process for the FY2015 -16 Operating Budget and Capital Improvement Plan Budget, which includes a comprehensive workshop in May 2015. The downturn in the economy continues to challenge many cities throughout the state and Lake Elsinore is no exception. While the economy is showing signs of improving and the development activity momentum is building within the City, it is critical that we continue to operate in a fiscally prudent manner, maintain current public safety service levels, and continue providing key services that our citizens have come to expect. As such, the FY2014 -15 Mid -Year Operating Budget Status Report proposes to maintain current services through June 30, 2015, maintains the Uncertainty Reserve at 17.5 %, and establishes a path towards development of the FY2015 -16 Operating Budget and the Five (5) Year General Fund Financial Plan. Included as attachments to this report are several schedules illustrate (in a tabular format) the current status of the FY2014 -15 Mid -Year Budget for the General Fund, as follows: FISCAL YEAR 2014 -15 MID -YEAR OPERATING BUDGET STATUS REPORT — GENERAL FUND January 27, 2015 Page 2 of 4 • Exhibit A — Selected Analysis — Reconciliation of General Fund Fund Balance • Exhibit B - Summary of Revenues, Expenditures, and Change in Fund Balances — General Fund - FY2014 -15 Mid -Year Annual Operating Budget • Exhibit C —Budget Calendar for FY2015 -16 DISCUSSION Revenues: At mid -year, the City is anticipating a net decrease in recurring operating revenues of $355,000, from $35,872,965 to $35,517,965. The estimated revenue adjustments are as follows: Estimated Revenue Adjustments: Sales taxes Building permitfee Fees (Engineering, Departments) Fines and forfeitures Other miscellaneous revenue Special assessments $ 80,000 50,000 (545,000) (40,000) 75,000 25,000 $ (355,000) The largest revenue decrease of $545,000 is largely offset by a similar decrease in appropriations related to Engineering plan check costs. All of the remaining revenue adjustments are as a result of changes in user fee estimated revenues based upon activity year -to -date and projections to year end. Expenditures: Appropriations: The total decrease for mid -year appropriations is $873,301. Departments were requested to reduce or maintain costs within their existing appropriations, except for minor changes within individual line items. FISCAL YEAR 2014 -15 MID -YEAR OPERATING BUDGET STATUS REPORT — GENERAL FUND January 27, 2015 Page 3 of 4 Estimated Appropriation Adjustments. City Council/ PSAC /Citizen Carp City Attorney City Cleric City Manager Finance Risk Management & Human Resources information Systems PC /Planning /Econonic Development Building & Fire Safety Code Enforcement Police Services Fire Services Emergency /Weed /Graffiti /E nvi roimental Engineering Public Works Park and Facility Maintenance Lake Operations Vehicle & Equipment Maintenance Non- Deparunental - Operating (813) (10,000) (21,209) (950) (3,000) (3,341) (1,720) (239,936) (8,570) (680) (221,455) 149,000 (13,878) (401,100) (13,977) (64,080) (14,142) (500) (2,950) (873,301) Regarding Police and Fire Services appropriation adjustments, the City is maintaining existing levels of service, nevertheless, the modifications noted are related directly to effectively managing the operating expenditures within budget line items including training, fees, supplies, and other line items. In addition, the City Manager will be working closely with the departments to further reduce expenditures before June 30, 2015. GENERAL FUND BALANCE RESERVES The General Fund Balance Reserves at June 30, 2015 would reflect the following as a result of the proposed Mid -Year adjustments, as follows: FISCAL YEAR 2014 -15 MID -YEAR OPERATING BUDGET STATUS REPORT — GENERAL FUND January 27, 2015 Page 4 of 4 Nonspendable Deposits and to epaid items $ 1,034,879 Due from Successor Agency - Loans Receivable 1,000,000 Designated: Uncertainty resewe 6,376,831 Undesignated: Unallocated resewe 1,251,665 Total Fund Balance (net) $ 9,663,375 FISCAL IMPACT While the City is beginning to benefit from the improving economy, the development of an accurate, balanced and achievable budget is critical to establishing a solid foundation to manage the anticipated growth and demand for services within and by the community. In developing and implementing a comprehensive operating budget plan, the factors impacting the City's operations and financial condition are numerous, and while the City's General Fund is still in a vulnerable condition, efforts will continue to monitor operating activities closely to ensure the General Fund's resources are programmed appropriately. The FY2014 -15 Mid -Year Budget Report is one of the first steps in beginning the FY2015 -16 budget preparation process. The City Manager will be proactively working with each department to develop and present a balanced budget to the Mayor and City Council that moves the City forward in achieving its financial goals as part of the FY2015 -16 Budget process. The overall fiscal impact of the FY2014 -15 Mid -Year Operating Budget for the General Fund is as follows: Revenue adjustments $ (355,000) Appropriation adjustments 873,301 Net reduction in transfers out 20,000 Net change /impact - FY2014 -15 MidYear $ 538,301 Prepared by: Jason Simpson Director of Administrative Services Approved by: Grant Yates City Manager Exhibit A Selected Analysis — Reconciliation of General Fund "Fund Balance" CITY OF LAKE ELSINORE, CALIFORNIA FY2014 -15 MID -YEAR BUDGET - OPERATING SELECTED ANALYSIS - RECONCILIATION OF GENERAL FUND - "FUND BALANCE" DATED: JANUARY 27, 2015 Ending Fund Balance, June 30, 2014 (audited) FY2014 -15 Current Budget - Deficit FY2013 -14 Roll -Over Encumbrances FY2014 -15 Midyear Budget Changes (2,187,568) (2,187,568) $ 11,312,642 Net Impact - Increase/ Favorable/ Adopted Midyear (Decrease) (Unfavorable) Estimated Revenues $ 35,872,965 $ 35,517,965 $ (355,000) $ (355,000) Appropriations 37,676,435 36,803,134 (873,301) 873,301 Transfers in - - - - Transfers out 384,098 364,098 (20,000) 20,000 Net FY2014- 15 Net Mid -Year Operating Budget Surplus /(Deficit) 538,301 $ (1,649,267) Ending Fund Balance (Projected), June 30, 2014 $ 9,663,375 Exhibit B Summary of Revenues, Expenditures, and Change in Fund Balances —General Fund 2014 -15 Mid -Year Annual Operating Budget CITY OF LAKE ELSINORE, CALIFORNIA SUMMARY OF REVENUES, EXPENDITURES, AND CI- IANGE. IN FUND BALANCE GENERAL FUND 2014 -15 MIDYEAR OPERATING BUDGET Reveli SalesTa, Properly'rax Franchise Tax Building Permit Fee Property Transfer Tax Other Taxes Other Licenses& Permits Intergovernmental Fees Fines and Fnrfeitnres Fire S'mcc l'ax Credit Investment Eal'lll ngs Reim hursemen is 0'en, RDA RDA Lease Pymes (LERA) RDA SB211 Pass'Fhrzngh Other Miscellaneous Reve to Special Assessments -Law & The - 2003 -1 Special Assessments - Law & The - 2007 -1 Special Assessments - litn e - 200:3 -2 Special Assessments -Pan its, t1.S &Drainage Supplemmrtal Law Enforcement Services Fund 'Traffic Safety Fund I I aflic Offender Fund Law Enforcement Grants County Pays - Sl 97 ( FI'ncl( Captain Positions) Reimbot ni en is for Street Program Total Revenues Expenditures by Department: General Government. City Council/ PSAC /Citlzee Carp City'Il'easm'er City Attm'ney City Clerk City Manager Administrative Services Finance Risk Management & Human Resources In Rn'ma mn Systems Community Development: FC /Planning /Economic Development Building & Fire Safety Code Enforcement Public Safety: Police Services Fire Services Animal Services Public Services: lime,geocy /Weed /Graffiti /Envlrmumental Engineering Puhlic W., Its park and Facility Maintenance Lake Operations Vehicle & Equipment Maintenance Community Services: RcaI noon Connnumty Ccolm' Senior Center FY13 -14 UNA(JUrrl!D ACTUALS 8,031,486 5,495,091 2,275,619 1,956,923 274,518 462,169 897,992 89,360 2,752,076 486,958 1,917,662 168,608 321,180 761,282 94,465 960,959 1,790,620 52,983 FY 1415 CURRENT BUDGET 8,185,889 5,916,7117 2,359,500 1,700,000 245,D00 275,000 1,035,9(10 218,407 4,09B,97.5 479,800 2,018,889 105,000 321,180 1,129,050 98,000 1,6:34,977 2,091,200 52,13110 505,700 258,171 426,900 108,518 100,000 520,152 451,150 136,756 95,(100 79,539 - 529,362 529,362 1,000,1.30 1,798,500 FY 14 -15 YTD ACTUALS (11/30/2014) 2,296,01S 74 7,266 44(1,807 582,970 135,251 109,224 485,354 97,040 1,142,112 213,776 61,444 166,004 564,252 278,810 948 FY 1415 MIDYEAR BUDGET $INCREASE/ (DECREASE) %INCREASE/ (DECREASE) 8,265,089 80,000 0.9B% 5,916,787 - n/a 2,359,500 - n/a 1,75(1,000 50,000 2.94% 245,000 - 0.291yo 275,000 1,035,900 n/a 358,230 218,407 35,512 315,000 3,553,975 (545,)(1(1) - 13.30% 439,800 (40,000) -8.34% 2,1118,889 - o/e 105,000 - n/a 321,180 -0.20% 828,517 1,129,050 396,176 989,975 98,000 - n/a 1,709,977 75,000 4.59% 2,091,200 - n/a 52,800 - n/a 530,700 25,!)00 4.94% 426,900 - n/a 100,0011 - 14.60% o/a 451,150 308,806 1,020,597 95,000 - 0.83 %, 217,063 421,129 162,217 n/a 529,362 - n/a 1,798,500 1,550,161 o/a 31,372,578 3.5872,965 7,327,273 35,517,965 (355,000) -0.99% 252,465 275,824 125,389 275,011 (813) - 0.291yo - n/a 358,230 325,000 35,512 315,000 (111,000) -3.08% 300,190 439,409 131,417 418,200 (21,209) -4.83% 462,579 466,059 175,366 465,109 (950) -0.20% 828,517 992,975 396,176 989,975 (3,000) -0.30% 769,251 701,348 503,937 698,007 (3,341) - 0.48% 52:3,8£39 646,494 286,074 644,774 (1,72D) -0.27% 1,003,012 1,643,541 409,440 1,4113,605 (239,936) - 14.60% 812,508 1,029,167 308,806 1,020,597 (8,570) - 0.83 %, 217,063 421,129 162,217 420,449 (680) - 0.16% 10,363,123 11,213,394 1,550,161 10,991,939 (221,455) -1.970/h 6,671,775 7,242,235 1,033,351 7,:i91,235 149,000 2.06% 396,413 835,427 484,173 835,427 - n/a 596,695 652,634 238,962 638,756 (13,878) -2.13% 1,452,686 2,042,338 584,873 1,641,238 (401,100) - 19.641/11 784,738 789,607 289,868 775,710 (13,977) -1.77% 2,169,475 1,616,626 599,594 1,552,546 (64,080) - 3.96 %, 1,708,312 1,485,020 958,060 1,470,878 (14,142) - 0.95'%, 529,802 S0i 163,436 500,389 (5(10) -0.10% 263,740 692,807 262,740 692,807 - o/o 533,485 604,814 190,715 604,814 - n/a 177,072 208,620 63,080 208,620 - n/a Nan- Departnenlai - Operaiiog 2,456,470 2,851,000 715,920 2,1348,050 (2,950) -0.10% Total Expenditures 33, 631, 520 37,676,435 9,669,268 36,801,134 (873,301) - 2.32'% Excess of Revenues Over (Under) Expmt(jitiu'es (2,2513,942) (1,803,470) (2,341,995) (1,285,1 .69) 518,3(11 - 28.74% CITY OF LAKE ELSINORE, CALIFORNIA SUMMARY OF REVENUES, EXPENDITURES, AND CHANGE IN FUND BALANCE GENERAL FUND 2014 -15 MIDYEAR OPERATING BUDGET Operating'[) an fees: 01,c,atl ng Transfers In Operating Transfers Out Excess of Revenues Over (Under) Expenditures and Operating Transfers In /(Out) Fund Balance, Elf, ofYcar AdjusUnent 'll'ansfeis to CIF /Reserves Fund Balance, Beg. e(Year (as resuc,d) FY13 -14 FY 1415 FY 14 -15 Y'fD FY 14.15 UNAUDITED CURRENT ACTUALS MIDYEAR $INCREASE/ % INCREASE/ AC, CUALS BUDGET (11/30/2014) BUDGET (DECREASE) ( DECREASE) 534,390 (189,149) (384,098) 345,241 1384 0981 (1,913,700) (2,187,568) 13,839,223 11,312,642 325,785 - (938,665) $ 11,312,642 $ 9,125,074 ,/a (364,098) 20,000 -5.21% (364098) 20,000 - 5.21 " /0 (2,341,995) (1,649,267) 11,312,642 11,312,642 $ 8,970,648 .$ 9,663,375 Detail of undd Ualance Nonspendable: Deposits and pre paid items $ 1,034,879 $ 1,034,879 $ 1,034,079 .$ 1,034,879 Due from Su¢essm'Agency - - Loans Receivable 1,000,000 1,000,000 1,000,000 1,000,000 DesUi uated; uncertainty rescren 5,670,450 6,526,159 1,692,122 6,376,831 Budgetstabijizatlon reserve - - _ _ Equipment rcplaccmont - - - CivicBeautifaation - DarwlnRogai T,ustllmds - - - Undestgnnted; unallocated rescrvc 3,607,314 564,036 5,243,647 1,251,665 Total Fund Balaace(net) $ 11312642 $ 9,125074 $ 8,970,648 $' 9,663,375 Exhibit C Budget Calendar for FY2015 -16 CITY OF LAKE ELSINORE, CALIFORNIA FY` 20i r " BUDGET CALENDAR MONTH DESCRIPTION TIMELINE JANUARY Mid -year budget analysis and revision January 1 Prepare agenda reports and proposed mid -year budget documents January 20 Council adoption of mid -year operating and CIP budgets January 27 FEBRUARY Development of budget par ameters /strategic goals February Distribution of Budget Preparation Guidelines February 4 Budget workshop with key City staff February 11 Development of program goals and objectives February SB Development of performance measures February 18 "New" Budget requests submitted to Finance fin review February 25 Proposed CIP ( "Capital Improvement Plan ") projects submitted to Finance February 25 MARCH Department operating budget submittals reviewed March 2 All non -fee based revenue estimates completed by Finance March 3 User Fee Study completed and for City review March 10 Budget analysis prepared for t'eview by City Manager March 11 User Fee adoption March 24 APRIL Preliminary operating and CIP budgets prepared April 1 Fee based revenue estimates completed by Finance April 3 Budget analysis prepared for review by City Manager April 13 CIP project timing and priorities modified based on available revenues April 20 Five -year financial projection completed April 27 MAY Public budget workshop with City Council allowing for public input TBD JUNE Prepare agenda reports and proposed budgetdocuments June 1 Council adoption of final operating and CIP budgets June 9 Council adoption of schedule of authorized positions and Gann Appropriations Limit June 9 ONGOING Monthly budget /actual reports reviewed & sent to Departments Monthly Quarterly financial statements prepared and presented to City Council Quarterly