1 STAFF REPORT
DATE: August 22, 2023
TO: Justin Hess, City Manager
FROM: Jennifer Becker, Financial Services Director
VIA: Leana Mkrtchyan, Deputy Financial Services Director By: Joy Escalante, Budget Manager
Susan Langford, Revenue Manager
SUBJECT: Adoption of Resolutions Continuing Appropriations from Fiscal Year 2022- 23 to Fiscal Year 2023-24
RECOMMENDATION:
1. Adopt A RESOLUTION OF THE COUNCIL OF THE CITY OF BURBANK AMENDING THE FISCAL YEAR 202 3-2024 BUDGET FOR THE PURPOSE OF CONTINUING APPROPRIATIONS FROM THE FISCAL YEAR 2022-2023.
2. Adopt A RESOLUTION OF THE HOUSING AUTHORITY OF THE CITY OF BURBANK AMENDING THE FISCAL YEAR 202 3-2024 BUDGET FOR THE PURPOSE OF CONTINUING APPROPRIATIONS FROM THE FISCAL YEAR 2022- 2023.
3. Adopt A RESOLUTION OF THE PARKING AUTHORITY OF THE CITY OF BURBANK AMENDING THE FISCAL YEAR 202 3-2024 BUDGET FOR THE PURPOSE OF CONTINUING APPROPRIATIONS FROM THE FISCAL YEAR 2022- 2023.
BACKGROUND
At the end of each Fiscal Year (FY), departments review their budget line items to identify appropriations that have not been expended or encumbered and need to be continued into the next fiscal year. There are various reasons for departments to request continuing appropriations, also known as carryovers. The most common reasons are for ongoing or multi-year projects, delayed program implementation, or program operations that cross fiscal years such as housing assistance, summer recreation programs, and contractual
FINANCIAL
SERVICES
2 services. Grants, federal and state program funding, donations, and Council-directed set- asides or holding accounts are restricted for a specific purpose and may cross fiscal years as well.
DISCUSSION
The Summary of Continuing Appropriations by Fund ( Attachment 4) provides the total amount of requested carryovers for each fund. Continuing Appropriations by Account Number (Attachment 5) provides details for each request by fund type, including account number and name, amount requested, and a justification. It is important to note that the continuing appropriations amounts are only an estimate at this time, as financial activities in these accounts may continue until the fiscal year is officially closed. T hese continuing appropriations have no impact on the FY 2023-24 adopted budget or financial forecast because they are not new appropriations.
This year, citywide carryover requests total $48.3 million, roughly $13.6 million higher than last year’s total requests . The General Fund (Fund 001), the Burbank Water and Power (BWP) Electric Fund (Fund 496), and the Water Fund (Fund 497) account for the largest variances from prior year requests. This is largely due to the carryover of several large grants or appropriations related to continuing programs and services as well as supply chain issues that have delayed the purchase of equipment , and the implementation of certain projects and programs . Similar to last year, all multi -year infrastructure projects within the City’s approved Capital Improvement Program (CIP) were carried over as part of the Budget adoption process that took place on June 13, 2023.
General Fund requested carryovers are $11.8 million, which equates to 5.3% of the total FY 202 2-23 Adopted General Fund budget. Of the total $11.8 million General Fund carryover requests, over $7.7 million is comprised of restricted funding that includes grants, donations, and various contractual obligations. The most significant General Fund carryover amounts relate to restricted items, such as the Permanent Local Housing Allocation (PLHA), homeless plan implementation, library donations, and Urban Area Security Initiative (UASI) grants for Fire and Police.
General Fund Year-End Financial Update
The 2023-24 fiscal year is well underway, and while FY 2022-23 has not been officially closed, staff estimate s year-end General Fund budget savings of approximately $4.2 million, assuming the approval of the proposed carryover appropriations included in this report. This is roughly $1. 2 million more than what was projected in the General Fund Forecast at the time of budget adoption, which is largely attributable to staffing vacancies in various positions across City departments . These figures are subject to change until the fiscal year has officially been closed and the City’s annual external audit process is completed.
3 FY 2022-23 revenues are still being collected at this time, with final numbers anticipated to be available in September. Based on staff’s early analysis of June 2023 receipts, it is anticipated that the General Fund is on target to meet or exceed the revised revenue projections presented to the City Council during the FY 202 2-23 M id-Year Financial Report.
While economic conditions continue to remain stable , there is some anticipation of a looming recession in the future, due to high er interest rates, inflation, and reduced consumer spending. However, with the strong revenue returns and General Fund budget savings achieved during the previous fiscal year s, along with the implementation of the Council’s strategic initiatives, Burbank’s General Fund remains in a positive cash position well into the future years of our financial forecast. Staff will continue to monitor the state of the economy and return to the Council with the FY 2023-24 First Quarter Update in late fall.
FISCAL IMPACT
Should the Council adopt the resolutions and approve the continuing appropriations as proposed, the FY 2023-24 Budget will be amended for citywide continuing appropriations of approximately $48.3 million, which includes $11 .8 million for the General Fund, approximately $2.2 million for the Housing Authority, and approximately $85,396 for the Parking Authority. As previously mentioned, the totals for continuing appropriations are preliminary and the amounts may be adjusted slightly as financial activities continue until the f iscal year is officially closed. These continuing appropriations do not impact the recurring balance of the FY 2023-24 adopted budget or the financial forecast as they are not new appropriations. At year-end, any unencumbered appropriations, not requested or approved as a continuing appropriation, return to the available balance of the applicable fund and can be appropriated for other purposes by the Council.
CONCLUSION
By approving the requested continuing appropriations, the Council will be providing staff with the funding required to complete and/or continue with various Council-supported projects, grants, programs, and services. S taff recommends that Council adopt the proposed resolutions approving the requested continuing appropriations from FY 2022- 23 to FY 2023-24 for the City, the Housing Authority, and the Parking Authority.
ATTACHMENTS
Attachment 1: Resolution
Attachment 2: Housing Resolution
Attachment 3: Parking Resolution
Attachment 4: Summary of Continuing Appropriations by Fund Attachment 5: Continuing Appropriations by Account Number