City of Piedmont
COUNCIL AGENDA REPORT
DATE: September 16, 2024
TO: Mayor and Council
FROM: Rosanna Bayon Moore, City Administrator
SUBJECT: Review of FY 2023-24 Unaudited Financial Results
RECOMMENDATION
No action required. This report is provided for information only.
FINANCIAL REPORT
In FY 2023-24, favorable revenue trends, coupled with lower than budgeted expenses and capital transfers, resulted in General Fund Net Revenue approximately $3.4 million higher than budgeted.
GENERAL FUND
(in thousands)
Actual Budget Variance
Beginning Balance $ 7,423 $ 9,111 $ (1,688)
Revenues 37,722 35,849 1,873
Operating Transfers In 1,009 1,056 (47)
Total Revenue 38,731 36,905 1,826
Expenditures:
Operating 31,941 32,850 909
Non-Department 4,039 3,947 (92)
Operating Transfers Out - 150 150
Total Expenditures and Transfers Out 35,980 36,948 968
Operating Net Revenue 2,750 (43) 2,794
Capital Transfers Out 1,649 2,295 646
Net Revenue 1,101 (2,338) 3,439
Ending Balance $ 8,524 $ 6,773 $ 1,752
Available for Transfer - - -
Ending Balance - Adjusted $ 8,524 $ 6,773 $ 1,752
% of Operating Exp 23.7% 18.4%
FY 2023-24 (Unaudited)
The following major categories accounted for the increase in revenue as compared to the FY 2023-24 budget:
Revenue, excluding the recognition of ARPA revenue, exceeded annual budget by $1,873,000.
ARPA funds have been received but can not be included in revenue until spent. All remaining funds will be used for the Police Dispatch Renovation Project. Only $314,000 of the $2.1 million budgeted were spent in FY23-24. The remaining funds will be expended in FY 2024-25.
Major variances include:
• Transfer tax receipts totaled $4.1 million,
o $686,000 HIGHER than budget, but $378,000 LESS than last year. o Home sales were 4% HIGHER than last year (115 vs. 111). o The Average Sales Price decreased 11% to $2.8 million-the first decline since FY 2010-11.
o Median Sales Price decreased 4% to $2.5 million.
• Recreation revenue up $456,000, primarily due to strong recreation classes and camp receipts.
• Investment income exceeded budget by $429,000 as interest rates remained high throughout FY 23-24.
• Property taxes exceeded annual budget by $339,000 million, driven by strong unsecured property tax receipts and supplemental assessments which comprised $271,000 million of the increase.
GENERAL FUND
Revenues
(in thousands) Actual Budget Variance
Transfer Tax $ 4,086 $ 3,400 $ 686
Recreation 3,954 3,498 456
Investment Income 589 160 429
Property Tax 18,449 18,110 339
Miscellaneous 237 88 149
Sales Tax 196 250 (54)
Animal Control - 120 (120)
All Others 10,211 10,223 (12)
Sub-Total 37,722 35,849 1,873
ARPA funds 314 2,079 (1,765)
Total Revenue $ 38,036 $ 37,928 $ 108
FY 2023-24 (Unaudited)
Agenda Report Page 2
• Miscellaneous income was up $149,000, primarily due to receipt of insurance claim proceeds related to losses incurred in FY 23-24.
These revenue gains were offset by:
• The discontinuation of animal control services provided to the City of Emeryville ($120,000).
• Lower than expected sales tax, primarily due to the closing of the Shell Station on Grand Avenue.
General Fund Departmental expenses were $909,000 less than budget, while Non-Departmental expenses exceeded budget by $92,000.
Although Recreation Department expenditures were higher than budgeted by $319,000, it was completely offset by increased recreation revenue, resulting in net revenue of approximately $163,000 for all Recreation Department activities.
Non-Departmental expenses surpassed budget by $92,000 primarily due to:
• Workers Compensation claims were higher than expected due to injuries in the Police and Fire Departments. ($144,000).
• Unfavorable change in the actuarial calculation for future insurance claim reserves, Workers Compensation and General Liability, $86,000 and $35,000, respectively.
• Offset by lower General liability claim payments ($80,000) and lower retiree medical premiums paid ($76,000).
The Administration Department exceeded budget by $17,000. The major variances were:
• Legal Fees were higher than budget ($139,000).
• IT services were higher than budget, primarily due to delays in implementing the
GENERAL FUND
Expenditures
(in thousands) Actual Budget Variance
Recreation $ 3,902 $ 3,584 $ 319
Administration 3,921 3,904 17
Public Works 4,607 4,591 16
Fire 8,279 8,398 (119)
Communications 379 522 (142)
Police 7,961 8,189 (228)
Planning & Building 2,892 3,664 (772)
Sub-Total 31,941 32,850 (909)
Non-Departmental 4,039 3,947 92
Total Expenditures $ 35,980 $ 36,798 $ (818)
FY 2023-24 (Unaudited)
Agenda Report Page 3
Community Development (Track-it) software. ($55,000)
• Offset by lower personnel related and other professional service fees.
Public Works Department exceeded budget by $16,000. The major variances were:
• Increased City Engineer Service fees ($130,000).
• Offset by lower salary and benefit costs and other consulting fees.
Fire Department expenses were less than budget by $119,000 primarily due to:
• Lower Emergency Preparedness expenses as the project was delayed due to contract issues and has been pushed into FY 24-25.
• Other Medical Contract Expenses were lower due to timing and need for medical training.
Communications Department expenses were less than budget by $142,000, primarily due to lower salary and benefit costs.
Police Department expenses were less than budget by $228,000, primarily due to lower salary and benefit costs due to open positions, and less than anticipated use of part-time personnel.
Planning and Building Department expenses were less than budget by $772,000, primarily due to:
• Supplemental Planning Services, which include code revisions, general plan amendments, and objective design standards, activities being pushed into FY 24-25 ($525,000).
• Records management project delayed until FY 24-25 and responsibility moved to the Administration Department ($130,000).
• Lower than anticipated Housing Element costs ($110,000).
The unassigned balance of the General Fund on June 30, 2024 is estimated to be $8.5 million, which is 23.7% of expenditures. This is approximately $82,000 higher than the projection that was included in the FY 24-25 Approved Budget. This is well above our General Fund Reserve Target of 18% due to several one time and cyclical costs included in the FY 24-25 Approved Budget.
Since we attained the ending General Fund Reserve Balance needed per the Approved Budget, no capital transfers are recommended at this time.
By: Michael Szczech, Finance Director
Agenda Report Page 4