Consent Item 4d
STAFF REPORT
City Council Consent Item
DATE: October 20, 2025
TO: Honorable Mayor and Council Members
FROM: Aaron Felmlee, Finance Director
THROUGH: Amy Nilsen, City Manager
SUBJECT: Finance Department Monthly Report
STAFF RECOMMENDATION:
Receive report as an informational item.
EXECUTIVE SUMMARY:
Transit Fare Ratio:
The City of Fortuna operates a specialized transit service in which it receives funding through the Transportation Development Act (TDA). In order to be in compliance with the TDA and continue to receive funding the City’s transit system must maintain a ratio of fare revenues to operating costs of at least 10 percent per Section 6633.5 of the TDA code.
The last three years the City has not met the 10 percent threshold with 2024’s ratio ending at only 7%. However, the compliance requirements for those years were waived under the provisions of AB-90 due to COVID. It is important for the City to continue to monitor the City’s Fare Box ratio in order to get back to the required 10% ratio. As of the end of June 2025, the fare box ratio was 11%. However, this included a bulk purchase of punch cards for over $5,000 in revenue. If we take that out the ratio would have been under 9%. Additionally, since the punch cards were purchased in FY 24-25 and will be used in FY 25-26 staff anticipate anticipates even lower revenue in FY 25-26 due to the use of the bulk punch card use. Staff are continuing to work on alternative ways to increase revenue to meet the fare box requirement without having to increase the ridership fee any further.
Fiscal Year 2024-25 Transportation Development Act (TDA) Audit:
The Finance Department received a letter notifying staff that the firm of Davis Farr LLP has been engaged by the Humboldt County Association of Governments (HCAOG) for fiscal year ended June 30, 2025 to audit Fortuna’s Transportation Development Act (TDA) activities. The TDA requires annual audit examinations of all entities claiming Local Transportation Funds (LTF) which the City claims annually to fund the Senior Bus program.
This is the first year HCAOG has contracted with Davis Farr. They have requested staff prepare various schedules and other reconciliations that they require as part of the audit. Additionally, staff provided documents for Davis Farr to review as part of the interim audit work. A draft audit report will be provided to the City upon the auditor’s completed review of the requested schedules, reconciliations, and other documents.
Consent Item 4d
Measure E Update:
The Measure E committee held a regularly scheduled meeting on September 16, 2025 at 5:30pm.
The primary purpose of this meeting was for Staff to review with the Committee the list of Measure E funded projects that were included in the Council Adopted Budget for fiscal year 2025-26 and review preliminary revenues and expenditure results for FY 2023-24.
List of Measure E items funded this month:
• (2) Police Detective Positions
• Police Community Services Officer Position
• Police Records Clerk Position
• Parks and Recreation Director Position
• Recreation Program Supervisor Position
• Transit Trips to Eureka for Seniors
• PT Code Compliance Officer Position
• K-9 Program
• Encampment Outreach and Cleanup Services
• Storm Drain Maintenance Projects
• Street Maintenance Projects
An activity log displaying important Finance data is attached for informational purposes.
RECOMMENDED COUNCIL ACTION:
Receive Finance Department Monthly Report. Consent Agenda vote.
ATTACHMENTS:
• Finance Staff Activity Log for September 2025
• New Business List for Quarter 3 2025