March 21, 2024
Special City Council
Meeting
PowerPoint and Information
distributed at Council meeting
Budget Study Session
– General Fund
Fiscal Year 2024-2025
Presentation Overview
General Fund Revenues
Sales Tax
Property Tax
General Fund Expenditures
Projected Fund Balance
Internal Service Funds
Designated Reserves
2 General Fund
Operating
Revenues
Property Tax
39%
Sales Tax
35%
TOT
4%
Licenses and Permits
4%
Fees for Services
4%
Interfund Revenues
7%
Other Revenues
7%
FY 2024-25 BUDGET STUDY SESSION – GENERAL FUND 3
Total:
$144,006,541
General Fund
Operating
Revenues
FY 2024-25 BUDGET STUDY SESSION – GENERAL FUND 4
Total:
$144,006,541
0 10000000
20000000
30000000
40000000
50000000
60000000
Property
Tax
Sales Tax TOT License
and
Permits
Fees for
Service
Interfund
Revenues
Other
Revenues
FY 23 Actual FY 24 Estimate FY 25 Projection
General Fund Revenues-
Property Tax
5 Orange Unified
School District,
47.05%
Educational
Revenue
Augmentation Fund,
15.49%
City of
Orange,
13.58%
Rancho Santiago
Community College
District, 7.76%
Orange County
General Fund,
6.26%
O.C. Sanitation #2,
3.20%
O.C. Flood Control,
2.01%
Other O.C.
Agencies, 4.65%
City of Orange - Distribution of 1% Ad Valorem
Ad Valorem Tax = taxed based on
value
Limited to 1% of Assessed Value
Proposition 13 (1978)
Annual adjustments in Assessed
Value limited to lesser of CPI or 2%
Sale or new construction triggers
new valuation
General Fund Revenues-
Sales Tax (7.75%)
6 State General Fund,
3.9375%
City General
Fund, 1%Countywide
Transportation Fund,
0.25%
County Mental
Health/Welfare/Public
Safety Services,
1.5625%
Public Safety
Augmentation Fund
(Prop 172), 0.5%
Measure M, 0.5%
City of Orange - Distribution of 7.75% Sales Tax Administered by the California Department of Taxes and Fees
Administration (CDTFA)
Generated only on purchase
or lease of tangible personal
property
Charged only when sold to
end user
Cities are allocated 1% of
taxable transaction
unless an additional voter-
approved adopted sales
tax measure is passed
General Fund Revenues-
Sales Tax by Major Category
% diffFY 25 Forecast% diffFY 24 ForecastFY 23FY 22Category
2.1$8,232,572-1.2$8,060,772$8,157,923$8,237,732Autos & Transportation
2.9$5,872,822-1.4$5,705,722$5,788,843$5,960,680Building & Construction
3.2$5,932,007-6.6$5,749,907$6,156,062$5,229,375Business & Industry
2.0$1,656,280-2.2$1,623,780$1,660,281$1,619,277Food & Drugs -10.4$14,493,02716.2$16,171,127$13,917,240$15,261,457Fuel & Service Stations
1.4$7,614,9160.1$7,506,416$7,498,077$7,223,288General Consumer Goods
3.7$6,507,1233.0$6,275,323$6,092,100$5,658,311Restaurants & Hotels
3.0$9,429,91512.7$9,429,915$9,227,206$9,356,190State & County Pools
0.0$57,740-3.1$57,740$51,238$76,271Other/Misc/Adjustments ($514,641)($500,664)($429,717)($430,992)Less: Admin Fees ($8,299,200)($9,582,537)($7,999,081)($8,314,149)Less: Sales Tax Sharing
1.9%$50,980,562-0.2%$50,010,602$50,120,172$49,877,441Total Sales Tax 7Stats provided by HDL 3Q23 Reports
Indirect Cost
Allocation
FY 2024-25 BUDGET STUDY SESSION – GENERAL FUND 8
-
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
16,000,000
FY 24 FY 25
Interfund Revenues Transfer to ISF
Variance in Net
Impact:
($255,097)
Net Impact:
($4,493,003)
Net Impact:
($4,748,100)
General Fund
Operating
Expenditures
Salaries and Benefits
70%
Contractual Services
10%
Debt Service
9.90%
Internal Service
Allocations
9%
Supplies & Other
Expenditure
0.43%
FY 2024-25 BUDGET STUDY SESSION – GENERAL FUND 9
Total:
$161,236,003
General Fund
Operating
Expenditures
FY 2024-25 BUDGET STUDY SESSION – GENERAL FUND 10
Total:
$161,236,003
-
20,000,000
40,000,000
60,000,000
80,000,000
100,000,000
120,000,000
Salaries and
Benefits
Contractual
Services
Materials Debt Service Internal
Service Fund
Allocations
Other
Expenditure
FY 23 Actual FY 24 Estimate FY 25 Projection
General Fund Expenditures
Summary of Changes from FY 24 to FY 25
% Increase/DecreaseAmount
$142,810,866FY 24 Year End Estimated Expenditures
5.3%$7,587,794Salary/Benefits Base Increase
3.1%$4,405,096Elimination of V acancy Rate
-1.6%($2,280,408)Overtime Decrease
0.5%$650,372Part-Time/Seasonal Employee Cost Increase
0.1%$154,415Departmental Personnel Requests
1.2%$1,737,643Departmental Maintenance & Operating (M&O) Requests -$5,659Debt Service
4.3%$6,164,566Increase ISF Contributions
12.9%$18,425,137Subtotal
$161,236,003FY 25 Proposed Expenditures
11 General Fund Expenditures
Internal Service Fund Contributions
VarianceFY 25 ContributionFY 24 ContributionInternal Service Fund $696,870$3,029,100$2,332,230Equipment Maintenance (710) $2,917,800$2,917,800-Equipment Replacement (720)
$1,319,571$3,626,500$2,306,929Accrued Liability (740)
($75,175)$3,414,300$3,489,475Information Technology Operations (780) $1,305,500$1,305,500-Computer Replacement (790)
$6,164,566$14,293,200$8,128,634Total Cost to General Fund 12 Internal Service Funds
Funded by Allocation from Other FundsEQUIPMENT EXPENSE
V ehicle
Maintenance
Fuel Expense
Fleet Services
Salaries
EQUIPMENT REPLACEMENT
V ehicle
Replacement
New to Fleet
V ehicle
Purchases
SELF INSURANCE - LIABILITY
Liability Claims
Self-Insurance
Premiums
Property Damage
Risk Management
and City Attorney
Salaries
INFORMATION SYSTEMS
Citywide
Software
Contracts
Computer
Maintenance
IT
Department
Salaries
COMPUTER REPLACEMENT
IT Equipment
Replacement
New Software
Implementation
Costs
FY 2024-25 BUDGET STUDY SESSION – GENERAL FUND 13
710 720 740 780 790
FY 25 Internal Service Funds
Funded by Allocation from Other Funds
14 Estimated
Ending Fund
Balance
Estimated
FY 25 Revenues
(from Other Funds)
Estimated
FY 25
Expenditures
Estimated
Starting Fund
Balance
Internal Service Fund
($5,189,392)$3,034,100$3,896,871($4,326,621)710 Equipment Maintenance $20,086,774$2,922,600$3,000,000$20,164,174720 Equipment Replacement ($3,413,583)$3,632,400$6,045,481($1,000,502)740 Liability and Self Insurance ($926,616)$3,207,362$4,749,383$615,405780 Information Technology Operations $4,321,985$1,307,700$1,737,500$4,751,785790 Computer Replacement $14,879,168$14,104,162$19,429,235$20,204,241Total Fund Balance FY 2024-25 BUDGET STUDY SESSION – GENERAL FUND
Internal Service Funds
Funded by Payroll Allocations
WORKER’S COMPENSATION
Worker’s Compensation
Claims
Self Insurance – Worker’s
Compensation
Risk Management Salaries
DENTAL INSURANCE
Dental Insurance
EMPLOYEE ACCRUED LIABILITY
Unfunded Liability
Payments
Leave Payouts for Retirees
Health Insurance Benefits
for Retirees
Unemployment Claims
FY 2024-25 BUDGET STUDY SESSION – GENERAL FUND 15
730 752 760
FY 25 Internal Service Funds
Funded by Payroll Allocations
Ending Fund
Balance
FY 25 Revenues
(from Payroll)
FY 25
Expenditures
Starting Fund
BalanceInternal Service Fund
($9,587,280)$4,696,916$4,886,509($9,397,687)730 W orkers Compensation $562,483$448,728$455,700$569,455752 Dental Insurance
$2,283,377$1,782,415$6,066,700$6,567,662760 Employee Accrued Liability/Pension Stabilization
($6,741,420)$6,928,059$11,408,909($2,260,570)Total Fund Balance 16 FY 2024-25 BUDGET STUDY SESSION – GENERAL FUND
FY 25 Fund Balance
General Fund and Internal Services Funds
Internal Service Funds
FY 25 Projection
General Fund
FY 25 Projection
$17,943,671($1,920,869)Estimated Beginning Undesignated Fund Balance at 7/1/2024 $21,032,221$144,006,541Revenues
--Transfers In
$21,032,221$144,006,541Total Revenues
$30,837,144$161,236,003Expenditures
--Transfers Out
$30,837,144$161,236,003Total Expenditures
$8,137,748($19,150,331)Estimated Ending Fund Balance at 6/30/2025 N/A$2,327,327Catastrophic Reserve Designation
$8,137,748($21,477,658)Estimated Undesignated Fund Balance at 6/30/2025 17 TN0
Slide 17
TN0 You might want to make a note when presenting the fund balance that if there is any changes to FY24 year-end estimates, it will impact deficits for FY25.
Trang Nguyen, 2024-03-21T19:18:38.988
City Council Designated Reserves
FY 25 Projected Fund
BalanceMinimum Reserve LevelDefined MinimumFund
$26,033,931$26,033,93116.6% of GF ExpenditureGeneral Fund Catastrophic Reserve (100) ($21,477,658)-NoneUnreserved Fund Balance (100)
$1,207,754-NoneBuilding Records Management Fee Fund (110) ($2,609,747)*$2,980,000Based on 5-year CIPCapital Projects Fund (500) $20,086,774$3,081,775Avg. 3 year prior actualsEquipment Replacement (720) $2,283,377-NoneEmployee Accrued Liability/Pension Stabilization (760) $4,321,985$2,457,655Avg. 3-year prior actualsComputer Replacement (790) $29,846,416Total Fund Balance
18 $29,846,416$48,370,80030% of GF
ExpenditureMinimum Designated Reserve Policy
($18,524,384)Surplus/(Deficit)
* Includes $3.7 million in funding requests, to be presented at the next Budget Study session Council Direction
Decision Packages
Closing the Gap
Budget Ad-Hoc Committee
19 Timeline
Second Budget Study
Session - CIP
April 16th
Second Strategic Planning
Session
April 30th
Preliminary Budget
May 14th/28th
Budget Adoption
June 11th
FY 2024-25 BUDGET STUDY SESSION – GENERAL FUND 20
Questions?
Trang Nguyen, Finance Director
Michelle Kresan, Budget Manager
Hailey Zurcher, Financial Analyst
21FY 2024-25 Budget Study Session – General Fund