STAFF REPORT
City of Lancaster
NB 4
3/26/2024
JC
Date:March 26, 2024
To: Mayor Parris and City Council Members
From: George N. Harris II, Finance Director
Subject:Amendment to the Adopted Budget and Capital Improvement Program for Fiscal Year 2023-2024.
Recommendation:
Adopt Resolution No. 24-__, authorizing an amendment to the adopted Budget and Capital Improvement Program for Fiscal Year 2023-2024.
Fiscal Impact:
Approval of the amendment to the adopted Budget and Capital Improvement Program for Fiscal Year 2023-2024, totaling a net increase in expenditures of $4,722,673.
Background:
The mid-year budget review provides an assessment of the City of Lancaster’s budget condition in the current fiscal year during the first six months of the fiscal year. It allows staff to review the projected expenditures and revenues appropriated in June of the previous year and account for adjustments not anticipated or fully defined when the projections were proposed. It provides an opportunity to review the fund balances, make adjustments, and help shape the development for the next budget cycle. Based on data gathered and analyzed, the proposed FY 2023-2024 revised budget includes an increase in revenues of $349,730 and an increase in expenditures of $5,072,403.
Revenues
Revenues have been slightly adjusted to include a $278,000 increase in Property Tax, $70,698 in Sale of Surplus Property, and $1,032 in Public Works Reimbursements.
Expenditures
Projections to various electricity accounts have been increased, totaling $3,863,688. There has been a significant delay in billings from the City’s electricity provider, resulting in payments made to prior fiscal year invoices. The budget has been increased to account for the additional payments plus rate and usage increases.
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A total of $809,000 is included in the Lancaster Choice Energy fund for continued Hydrogen projects and efforts. Hydrogen technologies are still in the early stages of development, and the additional funding will help the City invest in hydrogen programs that will foster innovation and support the growth of the industry.
The remaining increases are to support City operations through the fiscal year. The proposed increase aims to ensure adequate funding to address shortfalls without compromising essential services or planned projects.
The recommended adjustments result in an overall increase in appropriated operating expenditures totaling $4,722,673.
The proposed adjustments in Attachment A are detailed by fund, division, and object. Attachment B includes account information and proposed increase/(decrease).
General Fund
Overall, the General fund Budget will result in an almost exact ending projected fund balance as was originally proposed with the adoption in June. Savings were realized in the prior year and were applied to priority projects as identified by the Council. The soccer conversion project was initiated with $1.7M for design work, and an additional $3M was approved for the Public Safety Police Headquarters project that kicked off recently. An additional $2.86M was approved for various projects in October as part of the annual Construction In Progress (CIP) process.
Attachment:
Resolution No. 24-XX, Amendment to the Adopted Budget and Capital Improvement Program for Fiscal Year 2023-2024
Attachment A - Mid-Year Analysis, Detail Fund Division
Attachment B - Mid-Year Analysis, Detail Account
General Fund Original Fiscal Year 2023/24 Budget June Budget Adoption After MidyearBeginning Balance 53,338,864.00$ 90,596,335.00$ Revenues 109,651,484.00$ 110,079,089.00$ Operating Expenditures (109,540,102.00)$ (118,172,517.00)$ Capital Improvement Program/One-time Items (8,659,513.00)$ (32,856,092.00)$ Net Transfers (323,286.00)$ (1,549,392.00)$ Projected Fund Balance 44,467,447.00$ 44,020,442.00$ Reserve Requirement 43,860,593.00$ 43,920,436.00$ Surplus of Reserves 606,854.00$ 100,006.00$