CITY of BURBANK
General Fund FY 2023-24
First Quarter Financial Status
12.5.23 FINANCIAL
SERVICES
First Quarter Report Overview
FY 2022-23 Year End Results (unaudited)
FY 2023-24 Q1 Results
Revenues: Highlights & Trends
Expenditures: Spending to Date
FY 2023-24 Year End Forecast
Revised Recurring Budget Balance
Projected General Fund Spendable Balance
CalPERS Update
General Fund 5 Year Financial Forecast
2 FY 2022-23 Year End Results
Spendable General Fund balance as of June 30, 2023 is $44.3 million
$14.8 million higher than the balance projected during the FY 2023-24 budget process
• Year-end budget savings as projected after carryovers • Revenues 8.5% over revised projections
• Receipt of some one-time revenues
After fully funding reserves, July 1, 2023 starting balance is $39.9 million
Independent Financial Audit in process
Will return to the City Council with the Annual Comprehensive Financial Report (ACFR) in January
3 Q1 Actual Revenue to Revised Forecast
numbers shown in $1,000’s
4 Sales Tax 61,698$ 60,003$ 60,003$ 4,681$ 7.8% Property Tax 69,425 65,818 69,818 4,000 433 0.6% Utility User's Tax 18,646 17,997 17,997 4,290 23.8% Service Charges 22,729 22,741 22,741 4,854 21.3% Transient Occupancy Tax 12,208 10,759 12,259 1,500 1,246 10.2% Transient Parking Tax 4,303 3,773 4,273 500 2 0.0% Interest/Use of Money 4,004 3,249 4,249 1,000 47 All Other Revenue 34,466 37,504 37,504 8,463 22.6% TOTALS 227,479$ 221,844$ 228,844$ 7,000$ 24,016$ 10.5% Change
from
Adopted
2023-24
Actual
Received
RECURRING REVENUE
CATEGORY 2022-23
Actual
2023-24
Adopted
2023-24
Revised
% Of
Revenue
Received
Q1 General Fund Revenue Adjustments
Citywide Assessed Value increased by $2.8 billion, 9.7% from the prior year Transfers of ownership
Reassessments from new development
Unsecured property which includes aircraft at Hollywood Burbank Airport Median single-family home sale price in Burbank for 3rd quarter, 2023 (July through September) was $1.3 million
5 Property Tax (+$4 million)
$800,000
$900,000
$1,000,000
$1,100,000
$1,200,000
$1,300,000
$1,400,000
2021
Q1
2021
Q2
2021
Q3
2021
Q4
2022
Q1
2022
Q2
2022
Q3
2022
Q4
2023
Q1
2023
Q2
2023
Q3
Sales Price
Year/Quarter
City of Burbank Singly Family Home Sale Prices
Average Price
Median Price
Q1 General Fund Revenue Adjustments
Interest earnings on cash held by Treasurer surpassed revised forecast in FY 2022-23
Federal Reserve continued to raise interest rates
Larger-than-anticipated General Fund balance
Economists widely believe interest rate hikes are done, with possible reductions in 2024
6 Interest/Use of Money (+$1 million)
Transient Occupancy Tax (TOT) (+1,500,000)
Steady rise in occupancy rate of 1.2% year over year
Average Daily Rate (ADR) up 31.9% year over year
7 Burbank Hotel Occupancy Rates
Q1 General Fund Revenue Adjustments
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN
FY 20-21 FY 21-22 FY 22-23 FY 23-24
Transient Parking Tax (TPT) (+500,000)
TPT revenue increasing with rise in tourism and business travel at Hollywood Burbank Airport
Hollywood Burbank Airport Passenger Counts
8 Q1 General Fund Revenue Adjustments
-
100,000
200,000
300,000
400,000
500,000
600,000
JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN
FY 20-21 FY 21-22 FY 22-23 FY 23-24
Q1 General Fund Revenue Adjustments
FY 2022-23 year-end results were 5% above revised projections No adjustment to Sales Tax revenue projections proposed at this time Q2 2023 (April-June) revenues impacted by Writers Guild of America strike Q3 2023 (July-September) results likely to be significantly impacted by combined Writers and SAG-AFTRA strike
National Retail Federation indicated holiday sales in 2023 are expected to rise at the slowest pace in five years, as Americans grapple with inflation. Staff will return with updated projections at Mid-Year 9 Sales Tax
Q1 General Fund Expenditure Results
10 * Appropriations include all carryovers as well as any additional General Fund budget amendments approved by the City Council since the adoption of the FY 2023-24 Budget. The original General Fund adopted budget totals $232,531,072.
EXPENDITURE APPROPRIATIONS EXPENDITURES PERCENT
CATEGORY FY 2023-24 as of 9-30-2023 EXPENDED
Police 69,858,198 16,394,641 23.5%
Fire 50,239,034 14,623,683 29.1%
Parks and Recreation 34,564,821 8,031,137 23.2%
Library Services 9,976,062 2,355,117 23.6%
Community Development 23,530,686 3,335,270 14.2%
Public Works 20,328,566 4,376,498 21.5%
Administrative Services 27,191,419 5,674,960 20.9%
Non-Departmental 25,728,242 12,809,559 49.8%
TOTALS 261,417,028 67,600,865 25.9%
2023 CalPERS Update
11 FY 2021-22 net investment loss of (6.1%)
Decreased the City’s overall funded status from 84.1% to 73.9% Citywide Unfunded Actuarial Liability (UAL) is at $433 million across the City’s three plans
Increase to City’s UAL payment of $3 million for FY 2024-25 FY 2022-23 net investment returns of 5.8%
Should have minimal impact on future UAL payments
New asset classes give hope to achieving a 6.8% expected rate of return in FY 2023-24
CalPERS Pension Costs
12 Classification
Actual
FY 2022 -23
Actual
FY 2023 -24*
Actual
FY 2024 -25
Projected
FY 2025 -26
Police 3% @ 50 Rate 22.05% 24.01% 23.20% 22.60%
Police Liability
Payment $8,152,664 $7,175,729 $7,997,927 $8,697,000
Fire 3% @ 55 Rate 17.71% 18.80% 18.42% 18.00%
Fire Liability Payment $5,028,014 $4,465,006 $5,066,096 $5,597,000 Misc 2.5% @ 55 Rate 10.00% 11.11% 10.96% 10.70%
Misc Liability Payment $21,224,820 $18,843,953 $20,417,782 $22,415,000 *Amounts shown are the total employer contribution amounts required for FY 2023-24. For FY 2023-24, the City Council approved the prepayment of the liability payments to CalPERS which will result in a net savings of $932,860 citywide.
CalPERS Investment Return History
10.80%
-7.10%
-6.00%
3.90%
16.70%
12.60%
12.30%
19.10%
-4.90%
-23.40%
11.60%
20.90%
0.10%
13.20%
18.40%
2.40% 0.60%
11.20%
8.60%
6.70%
4.70%
21.30%
-6.10%
12.50%
-25.00%
-20.00%
-15.00%
-10.00%
-5.00%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 13 5.8%
CalPERS Pension Funding Plan
The first year of a two-year pension funding plan payment of $4.5 million paid in July 2023 resulted in $735,492 in recurring savings (General Fund portion $499,920)
Classification
Original 2024 -25
Payment
NEW 2024 -25
Payment SAVINGS
Miscellaneous Plan $20,417,782 $19,946,638 $471,144
Police Plan $7,997,927 $7,839,330 $158,597
Fire Plan $5,066,096 $4,960,345 $105,751
Citywide Total $33,481,805 $32,746,313 $735,492
Estimated General Fund Savings: $499,920
14 Burbank UAL Savings FY 2024 -25
Projected FY 2023-24 General Fund Balance
Adopted FY 2023-24 Recurring Revenues $221,843,625
1st Quarter Revenue Adjustments 7,000,000
Less: Recurring Appropriations (217,705,238)
TOTAL RECURRING BALANCE $11,138,387
15 Projected FY 2023-24 General Fund Balance
Projected Spendable Fund Balance 6/30/23 $44,269,243
Less: Formal & Compensated Absence Reserve Adjustments (4,326,050) Projected Beginning Spendable Balance 7/1/23 $39,943,193 Other Non-Recurring Revenue/Use of Resources 4,079,401
Estimated Budget Savings FY 2023-24 4,354,105
Less: Adopted One-Time Budget Items (17,225,281)
Less: Adopted Contribution to CalPERS (2,914,200)
Less: Deposit to 115 Trust (5,800,000)
Less: Items Added Post Budget Adoption (5,313,647)
TOTAL NON-RECURRING BALANCE $17,123,570
16 Projected FY 2023-24 General Fund Balance
Total Recurring Balance $ 11,138,387
Total Non-Recurring Balance 17,123,570
PROJECTED GENERAL FUND
SPENDABLE BALANCE 6/30/24: $28,261,957
17 General Fund 5-Year Forecast (in millions)
Ending GF
Balance: $28.3 $40.0
18 $228.8
$238.4
$247.1
$255.9
$264.7
$217.7
$233.5
$244.7
$255.3
$264.9
$200
$210
$220
$230
$240
$250
$260
$270
2023-24 2024-25 2025-26 2026-27 2027-28
Revenue Expenses
Balance/
(Deficit): $11.1 $4.9 $2.4 $0.6 ($0.2)
Unrestricted General Fund
One-Time Resources
Projected General Fund Balance 6/30/24 $28,261,957
RESERVES:
15% Working Capital $32,655,786
5% Emergency Contingency 10,885,262
Up to 5% Budget Stabilization 10,885,262
Compensated Absences 2,404,234
RDA Loan Repayments 927,884
Performing Arts & Youth Endowment 194,810
Total Available One -Time Resources $86,215,195
19 Conclusion
Current (FY 2023-24) projected General Fund recurring budget balance of $11.1 million
Anticipated spendable balance of $28.3 million at the end of FY 2023-24
No General Fund deficit expected until year 5 of the forecast General Fund recurring deficit of $200,000 in year 5 (FY 2027-28)
Strong cash position allows Burbank flexibility when facing potential economic uncertainty
Staff will continue to monitor economic conditions and legislative actions and provide updates to City Council 20 January 23 – FY 2022-23 Annual Comprehensive Financial Report February 27 – Mid-Year Financial Report
May – Distribution and Presentation of Proposed FY 2024-25 Budget June 4 - Public Hearing and Adoption of FY 2024-25 Budget 21 Future Financial Reports
Recommendation
Note and File
Staff is available to answer questions
22 Contact
Jennifer Becker
Financial Services Director
[email protected]
(818) 238-5500
https:/ /www.burbankca.gov/web/financial-services
23