PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #9.E
SUBJECT/TITLE:
FISCAL YEAR 2022 FOURTH QUARTER FINANCIAL STATUS REPORT
RECOMMENDATION:
Receive as information only. No actions are requested or recommended.
EXECUTIVE SUMMARY:
This report updates the City Council on the City’s financial status for the fiscal year ending on June 30, 2022, based on preliminary actual revenues and expenditures during Fiscal Year (FY) 2022.
Overall, the City of Pismo Beach’s funds are projected to be financially stable, with sufficient fund balances. The FY 2022 ending General Fund unassigned fund balance is projected to be $6.21 million, which is $9.46 million less than the FY 2021 ending unassigned fund balance. This decrease is attributable to appropriating the fund balance to support one-time and capital project expenditures, including the 2022 Paving Project.
For the majority of the City’s other funds, revenues and expenditures in the City’s other funds are projected to be on budget and the ending fund balances are in line with the FY 2022 Adopted Budget ending fund balances. In all the funds, there are sufficient fund balances and projected revenues to cover projected expenditures.
The following sections provide details of the General Fund financial picture, followed by a summary and highlights of the City’s other funds.
I. General Fund Budget Summary
In summary, based on preliminary and projected actual revenues and expenditures during FY 2022, the General Fund is projected to end FY 2022 with a $6.21 million unassigned fund balance. The FY 2022 projected $6.21 million unassigned fund balance is $3.66 million greater than the FY 2022 revised budget ending unassigned fund balance. This projected $3.66 million increase is largely due to a projected $2.23 million of operating savings and a projected $1.79 million of additional operating revenues compared to the budget. The unassigned fund balance is used to pay for future one-time investments included in the FY 2023 budget and in the 10-year Capital Improvement Plan. In addition to the General Fund unassigned fund balance, the General Fund includes the Budget Stabilization Reserve set-aside of $2.00 million. The following table is a summary of the FY 2020 actuals and the FY 2021 General Fund revised budget, projected actuals, and a variance comparing the budget to projected actuals.
9.E-1Council Agenda 9-6-2022
Table 1. FY 2022 General Fund Budget Summary
The FY 2022 projected ending unassigned fund balance of $6.21 million does not yet include anticipated Council project expenditures that may be appropriated in FY 2023 with potential additional operating surplus. These additional anticipated costs total $5.00 million, which would leave $1.20 thousand remaining in the unassigned fund balance.
The following table illustrates these anticipated costs and the impact on the ending unassigned fund balance. Another project that is not yet included in the table as the scope of the project is not yet defined, but would likely draw down from the fund balance, is the repair of the Pier Avenue stairs. This table is for illustrative purposes only to demonstrate that the unassigned ending fund balance is likely committed to support these costs in FY 2023 with additional net operating surpluses.
Table 2: Anticipated Costs Using Unassigned Fund Balance
AB CD = C - B
($ thousands)
FY 2021
Actuals
FY 2022
Revised
Budget
FY 2022 Year-
End Projected
Actuals
Variance
(Actuals-
Budget)
Unassigned Fund Balance 6,642$ 14,225$ 14,225$ -$ Committed Fund Balance 7,569 3,976 3,976 - a Beginning Fund Balance 14,210 18,200 18,200 - b Operating Revenues 28,851 31,152 32,940 1,788 c Operating Expenditures 19,766 24,517 22,291 (2,225) d = b - c Net Operating Surplus/(Deficit) 9,085 6,635 10,649 4,013 e One-time Revenues 1,247 489 273 (216) f One-time/Capital Expenditures 2,800 20,784 3,659 (17,125) g =
a+d+e-f Ending Fund Balance 21,743$ 4,541$ 25,463$ 20,922$ Unassigned Fund Balance 15,667$ 2,541$ 6,205$ 3,663$ Committed Fund Balance 3,976 - 17,259 17,259 Contribution to Reserves 100 - - - Budget Stabilitation Set-Aside 2,000 2,000 2,000 - FY 2022 Projected Ending Unassigned Fund Balance 6,204,655$ Anticipated Projects in FY 2023
Public Safety Facility - PAYG/Cash portion only 1,000,000 James Way Beautification 1,600,000
Chumash/Palisades Park improvements 1,000,000
Tennis Court Relocation 1,400,000
Total Anticipated Projects 5,000,000
Ending Unassigned Fund Balance 1,204,655$
9.E-2Council Agenda 9-6-2022
II. General Fund Beginning Fund Balance
The General Fund beginning fund balance is comprised of two different components:
the unassigned fund balance, which are funds that are not committed for any specific purpose and could be used for various one-time projects, and the committed or carryforward fund balance, which are funds that are committed for a specific budgeted use.
As illustrated in the following table, the FY 2022 Adopted Budget General Fund beginning fund balance was projected to be $14.15 million. Based on changes during FY 2021 and carrying forward fund balance to cover previously budgeted but not-yet-spent expenditures, the beginning fund balance is revised to $18.20 million. This includes $14.23 million of unassigned fund balance and $3.98 million of carryforward fund balances.
Table 3: FY 2022 General Fund, Beginning Fund Balance
III. General Fund Reserve
The City maintains various General Fund reserves totaling $7.33 million for emergency operations, building depreciation, and risk management. These reserves are crucial to avoid disrupting the City’s operations in following unanticipated events. The reserves are shown in the table below, followed by a summary of each reserve.
Table 4. General Fund Reserves
Reserve Amount ($ thousands)
General Fund 25% Reserve $6,578
City Building Reserve 500
Risk Management Reserve 250
Total $7,328
General Fund 25% Reserve
The City has adopted a fiscal policy to fund a General Fund Reserve of 25% of General Fund budgeted annual operating expenditures for FY 2022. The General Fund reserve should be equal to $6.13 million, which is 25% of the total FY 2022 budgeted annual operating expenditures of $24.52 million. Currently, the General Fund Reserve is $6.58 ($ thousands)
Adopted
Budget
Budget
Revisions Actuals
Unassigned Fund Balance 14,149$ 76$ 14,225$
Capital Funds Carryforward 3,516 3,516
Purchase Orders Carryforward 414 414
Prepayment Carryforward 45 45
Total Fund Balance 14,149$ 4,051$ 18,200$
$3,976
Carryforward
9.E-3Council Agenda 9-6-2022
million, which is invested in various securities. This reserve allows the City to maintain its operations for a couple of months in the event that an emergency or disaster impacts the City’s finances.
City Building Reserve
The Council created a City Building Reserve of $500 thousand, for the maintenance and upkeep of City facilities and buildings, particularly if funds are not available. This amount is equal to five years of annual depreciation on City-owned buildings.
Risk Management Reserve
The City Council established a Risk Management Reserve, contributing $50 thousand each year to budget for unanticipated risk management costs. This reserve has a balance of $250 thousand, which is the maximum contribution level.
IV. General Fund Revenues
The FY 2022 Revised Budget revenues total $31.64 million. FY 2022 projected actual revenues are $33.21 million, or $1.57 thousand greater than budget. Compared to the previous year, FY 2022 projected actual revenues are $3.11 million, or 10.3% greater than FY 2021. This increase over the prior year is largely due to additional projected transient occupancy tax (TOT) revenues in FY 2022 in comparison to TOT revenues in FY 2021. This projected TOT revenue increase is largely due to reflecting a full year of the additional 1.0% TOT revenue compared to only half a year of the additional 1% TOT in FY 2021. The table below summarizes the General Fund revenue budget and projected actual revenues for FY 2022, which is followed by a brief discussion of the top three FY 2022 projected actual sources of revenues.
Table 5. FY 2022 General Fund Revenue Budget and Projected Actuals
A B C D = C - B E = C - A F = C/A-1
($ thousands)
Revenue Category
FY 2021
Actuals
FY 2022
Revised
Budget
FY 2022
Projected
Actuals
Variance
(Projected
Actuals -
Revised
Bdgt)
Variance
(FY22
Proj Act -
FY21
Actuals)
% Variance
(FY22 Proj
Act v FY21
Actuals)
Proj
Actual %
of Total
Transient Occupancy Tax 14,210$ 16,986$ 16,986$ -$ 2,777$ 19.5% 51.1% Property Related Taxes 6,221 6,326 6,391 65 170 2.7% 19.4% Sales and Use Tax 3,661 3,445 4,114 669 453 12.4% 12.5% Other revenues 1,902 1,872 2,241 369 339 17.8% 6.8% Permits 1,137 862 1,343 481 206 18.1% 4.1% Franchise Taxes 657 631 599 (32) (58) -8.9% 1.8% Departmental Revenues 354 425 571 146 216 61.0% 1.7% Business Tax 218 211 238 27 20 9.1% 0.7% Other Taxes 244 78 193 116 (51) -20.8% 0.6% Transfers In 140 140 140 - - 0.0% 0.4% Intergovernmental Revenue 55 43 75 32 21 37.3% 0.2% Other Finan Sources - 96 47 (48) 47 0.0% 0.1% Grants 52 37 - (37) (52) -100.0% 0.0% Total Operating Revenues 28,851$ 31,152$ 32,940$ 1,788$ 4,088$ 14.2% 99.2% One-time Revenues 1,247 489 273 (216) (974) -78.1% 0.8% Total Revenues 30,099$ 31,641$ 33,213$ 1,572$ 3,114$ 10.3% 100.0%
9.E-4Council Agenda 9-6-2022
Transient Occupancy Tax (TOT) revenues are $2.78 million, or 19.5%, greater than the previous year’s TOT revenues. TOT revenues are equal to 11% of the rent charged by all lodging businesses for a person exercising occupancy for 30 consecutive calendar days or less. This increase in TOT revenues compared to the prior year is largely due to reflecting a full year of the additional 1.0% TOT revenue (Measure B-20 that was approved by the voters on November 3, 2020 increasing TOT from 10% to 11% of gross lodging revenues and effective January 2021), compared to only half a year of the additional 1% TOT in FY 2021. In addition, FY 2022 projected TOT revenues reflect fewer closures and travel restrictions from COVID-19 compared to FY 2021 and higher room rates. The following table illustrates the actual TOT revenues received by month in FY 2022 and FY 2021, showing an increase of 33.9% compared to the previous year. The following chart further illustrates FY 2022 TOT revenues collected in comparison to FY 2021.
Chart 1. TOT Revenues FY 2022 compared to FY 2021
Based on data obtained from Smith Travel Research Inc., a provider of competitive benchmarking, information services, and research to the hotel industry, excluding the additional 1% TOT on gross lodging revenues, a portion of the increase in TOT revenues is primarily due to an increase in room revenue. The average daily rate increased by 19.8% on average during FY 2022 compared to FY 2021. In addition, occupancy rates increased by 13.5% on average during FY 2022 compared to FY 2021. Looking at occupancy rates in FY 2022 compared to FY 2019 (pre-pandemic), occupancy rates are 0.4% less than FY 2019. Comparing average daily rate in FY 2022 to FY 2019 (pre-pandemic), rates are up by 40.4%, or $68.95. This reflects an average daily room rate of $239.09 in FY 2022 compared to $170.14 in FY 2019.
Property related tax revenues are projected to be $170 thousand, or 2.7%, greater than previous year’s property tax related revenues. There are two sources of property related tax revenues:
-
500,000
1,000,000
1,500,000
2,000,000
2,500,000
TO
T
A
m
o
u
n
t
FY 2021
FY 2022
9.E-5Council Agenda 9-6-2022
o Property Tax Assessed Value revenues: equivalent to 1% of assessed values o Property Tax In Lieu of Vehicle License Fees: 1% tax on the market value of a registered vehicle.
Assessed value cannot increase by more than 2.0% per year per Section 2 of Article XIIIA of the California Constitution. However, assessed values increased by 2.7%.
This reflects supplemental assessments (new construction and change in ownership) and the recovery of Proposition 8 reductions which can increase assessed values over the 2.0% per year rate. About half of the Proposition 8 reductions remain to be recovered, which means property tax revenues should continue to increase above the
2.0% per year rate if property values continue to rise at their current pace.
Sales and Use Tax revenues are projected to be $453 thousand, or 12.4%, greater than the prior year. Sales and use tax revenues are made up of two sources:
o Bradley-Burns uniform sales and use tax, which is a 1.0% tax on taxable sales within the City.
o Public safety tax, which is a 0.5% tax on taxable sales for specified public safety purposes.
FY 2022 Bradley-Burns revenues are projected to be $439 thousand greater than the previous fiscal year. Based on actual revenues received to date and projections from the City’s sales tax consultant, City staff estimates that Bradley Burns sales and use tax revenues will be $4.00 million. The following table illustrates Bradley Burns sales and use tax revenues received in FY 2022 and FY 2020 by the month in which the sales tax was collected.
Chart 2. Bradley Burns Sales & Use Tax Revenues FY 2022 compared to FY 2021
FY 2021 public safety sales tax revenues are anticipated to be $114 thousand, or $14 thousand greater than FY 2021 actual revenues received.
$-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
Sa
l
e
s
T
a
x
A
m
o
u
n
t
FY 2021
FY 2022
9.E-6Council Agenda 9-6-2022
In total, sales and use tax revenues are projected to be $453 thousand greater than the prior year.
Other revenues are projected to be $339 thousand, or 17.8%, greater than the prior year. The largest component of this category that contributed to this increase is the receipt of $347 thousand for the LAFCO settlement agreement, which reimburses the City for legal fees.
V. General Fund Expenditures
The FY 2022 Revised Budget expenditures total $45.30 million and projected actual expenditures total $25.95 million. Operating expenditures are projected to be $2.22 million less than the Revised Budget. About $134 thousand of these expenditure savings will be carried forward to next year, leaving $2.10 million of savings that contribute to the ending unassigned fund balance. One-time capital costs are projected to be $17.13 million less than budget based on the timing of cash flow for these one-time projects.
These savings will be carried forward to the next year and do not contribute to an increase in fund balance.
Table 6. FY 2022 General Fund Expenditure Budget and Projected Actuals
ABCD = B - C
($ thousands)
Expenditure Category
FY 2021
Actuals
FY 2022
Revised
Budget
FY 2022
Projected
Actuals
Variance
(Revised Bdgt -
Projected
Actuals)
Proj
Actual
% of
Total
Salaries & Wages 6,998$ 8,136$ 7,599$ 538$ 29.3% Benefits 4,390 5,136 4,772 364 18.4% Professional Services 3,389 3,930 3,593 337 13.8% Contract Services 2,048 2,921 2,495 426 9.6% Operations & Maintenance 930 1,826 1,535 291 5.9% Other Expenses 722 956 784 172 3.0% Transfers Out 465 576 500 76 1.9% Retiree Medical Insurance 207 458 450 8 1.7% Debt Service 435 434 426 8 1.6% Other Financing Uses 135 120 125 (5) 0.5% Capital Projects 49 23 11 11 0.0% Total Operating Expenditures 19,766$ 24,517$ 22,291$ 2,225$ 85.9% One-time Capital Costs 2,800 20,784 3,659 17,125 14.1% Total Expenditures 22,566$ 45,300$ 25,950$ 19,351$ 100.0%
9.E-7Council Agenda 9-6-2022
VI. General Fund Contingency Budgets
General Contingency
The FY 2022 Adopted Budget included $1.00 million in the General Fund general contingency account that may be used for various one-time items that come up during the year. Of this amount, $471 thousand of this appropriation was allocated and $529 thousand was de-appropriated. Details of the allocation is provided in the following table.
Table 7: FY 2022 General Fund General Contingency Budget
Council Contingency
The FY 2022 Adopted Budget also includes a $5 thousand City Council contingency appropriation that may be used for various one-time items that come up during the year.
Of this amount, $3 thousand of this appropriation was allocated, leaving $2 thousand remaining. Details of the allocation is provided in the following table.
Table 8: FY 2022 City Council Contingency Budget
Beginning Balance July 1, 2021 1,000,000$
Appropriations
Janitorial Services (42,721)
General Plan LCP Amendment (207,922)
Public Art for Bello Bridge (56,694)
Public Safety Radio Communications Project (160,597)
St. Jude's Tunnel painted mural support (3,000)
Deappropriate Balance (529,066)
Total Appropriations (1,000,000)
Ending Balance as of June 30, 2022 0$
Beginning Balance July 1, 2021 5,000$
Appropriations
2022 Advisory Body Recruitment Mailer Postage (949)
2022 Advisory Body Recruitment Mailer Printing (1,822)
Total Appropriations (2,771)
Ending Balance as of June 30, 2022 2,229$
9.E-8Council Agenda 9-6-2022
VII. Next-Level Budget
The FY 2022 Adopted Budget included $400 thousand in the General Fund non- department contract services account that may be used for various “next-level” contract services. Of this amount, $130 thousand of this appropriation was allocated and the remaining $270 thousand was de-appropriated. Details of the allocation is provided in the following table.
Table 9: FY 2022 Next-Level Budget
Beginning Balance July 1, 2021 400,000$
Appropriations
Public Records Request Clerk (26,085)
Public Interactive Digital Budget Book and Budget In
Brief (16,170)
Price House additonal landscaping (18,000)
Pothole repairs (40,000)
St. Jude's tunnel fence work (30,000)
Deappropriate Balance (269,745)
Total Appropriations (400,000)
Ending Balance as of June 30, 2022 (0)$
9.E-9Council Agenda 9-6-2022
VIII. Other Funds
The following table reflects fund balance, projected revenue, and projected expenditure activity in the City’s other funds. For most funds, revenues and expenditures are projected to be on budget and the ending fund balances are in line with the FY 2022 Adopted Budget beginning fund balances.
Table 10. Other Funds
AB CD = B ‐ CE = A + DFG = E ‐ F
Fund
Type Fund Fund Title
Beginning
Fund Balance
Projected
Actual Revenue
Projected Actual
Expenditure Net Rev ‐ Exp
Projected
Ending Fund
Balance Carryforward
Unrestricted
Fund Balance
General Operating Funds
1001 General Fund 18,200,272 33,212,865 25,949,698 7,263,167 25,463,440 17,258,785 8,204,655 1002 Half‐Cent Sales Tax Fund 4,935,391 2,051,600 2,002,871 48,729 4,984,120 4,547,421 436,699 Special Revenue Funds
2001 Gas Tax Fund 98,552 322,557 259,769 62,788 161,341 161,231 109 2002 Local Transportation 403,644 311,954 356,191 (44,237) 359,407 218,950 140,458 2003 PEG Fund 138,494 29,727 7,335 22,392 160,885 27,397 133,489 2004 Grants‐NonCapital 193,111 145,421 84,259 61,162 254,273 252,087 2,186 2005 Housing In Lieu Fee 4,209,633 26,682 831,920 (805,239) 3,404,394 2,544,846 859,549 2006 LBID Operations 718,387 1,544,714 1,374,113 170,601 888,988 16,000 872,988 2006 LBID Improvements (2,067,697) 1,544,714 22,888 1,521,826 (545,871) 336,000 (881,871) 2007 Chapman Estate 42,921 439,522 469,418 (29,896) 13,025 ‐ 13,025 Capital Project Funds
3001 Capital Projects 613,814 11,543,520 11,543,520 ‐ 613,814 613,814 ‐ 3002 Public Facilities Fund 875 1 ‐ 1 876 ‐ 876 3003 Park Development Fund 594,249 191,558 483,376 (291,818) 302,431 206,735 95,696 3101 Circulation Fees 580,090 155,154 115,270 39,884 619,974 90,000 529,974 3102 Impact Fees 1,026,661 265,309 690,313 (425,004) 601,657 ‐ 601,657 3103 Developer Impact Fee 62,182 165 ‐ 165 62,347 ‐ 62,347 3201 Underground Utility Fnd 16,466 16 ‐ 16 16,482 ‐ 16,482 Debt Service Funds
4001 PFA Debt Service ‐ 390,988 390,988 ‐ ‐ ‐ ‐ 4002 PF Agency Debt 5 709,572 709,572 ‐ 5 ‐ 5 4101 Reass 92‐1 Fwy Fthlls 762 1 ‐ 1 763 ‐ 763 4102 Spyglass 92‐4 12,683 13 ‐ 13 12,696 ‐ 12,696 Enterprise Funds
6101 Water Enterprise 6,882,780 5,543,666 6,415,758 (872,092) 6,010,687 6,010,687 ‐ 6102 Water Tax (Lopez/State) 210,888 1,704,933 1,739,645 (34,712) 176,176 176,176 ‐ 6103 Water Construction Fund 1,064,892 1,841,714 1,896,907 (55,193) 1,009,699 1,009,699 ‐ 6104 Water Expansion Fund 994,609 216,405 ‐ 216,405 1,211,014 1,211,014 ‐ Water Enterprise Funds 9,153,168 9,306,717 10,052,310 (745,593) 8,407,576 8,407,576 ‐ 6201 Wastewater Treatment 7,576,680 5,822,425 5,177,212 645,213 8,221,893 8,221,893 ‐ 6202 Wastewater Capital Proj 861,761 281,119 286,645 (5,526) 856,235 856,235 ‐ 6203 Wastewater Expansion 1,594,513 384,225 473 383,752 1,978,265 1,978,265 ‐ Wastewater Enterprise Fund 10,032,954 6,487,769 5,464,330 1,023,439 11,056,394 11,056,394 ‐ 6301 Local Trans Transit 29,902 29 858 (829) 29,073 29,073 ‐ 6401 Pier Enterprise 93,600 81,216 67,546 13,669 107,269 107,269 ‐ 6501 Parking Enterprise 3,409,461 2,755,025 639,448 2,115,577 5,525,038 3,514,425 2,010,613 Internal Service Funds
7101 Technology Service Fund 129,023 852,481 797,366 55,115 184,139 ‐ 184,139 7201 Motor Vehicle Fund 2,154,880 1,132,646 1,065,965 66,681 2,221,561 365,239 1,856,322
9.E-10Council Agenda 9-6-2022
Highlights of Other Funds
Half-Cent Sales Tax Fund (1002)
The Half-Cent Sales Tax Fund is part of the General Fund which includes a 0.50% transaction sales and use tax. This tax was approved by Pismo Beach voters in June 2008, effective October 1, 2008, and renewed in November 2014, which extends the tax to March 31, 2027. The tax proceeds are used exclusively for infrastructure projects. This fund started the year with a $4.94 million beginning fund balance (after including carryforward fund balances). Projected actual revenues are $2.05 million. Projected actual expenditures are $2.00 million. After accounting for a $4.55 million carryforward of project budgets, there is a projected $437 thousand projected ending fund balance in this fund. This amount has already been appropriated to support the 2022 Paving Project in FY 2023. The following table lists the budgeted projects in this fund for FY 2022.
Table 11: Half-Cent Sales Tax Fund FY 2022 Budgeted Projects and Projected Actuals
Gas Tax Fund (2001)
The Gas Tax Fund is a Special Revenue Fund whose revenues include State gas tax funds based on the State’s apportionment formula. These funds are used for City street light costs, City traffic signal maintenance costs, and street repairs and/or capital improvements. This fund started the year with a $99 thousand beginning fund balance (after including carryforward fund balances). Projected actual revenues are $323 thousand and projected actual expenditures are $260 thousand for the 2022 Paving Project. Based on the projected revenues and expenditures for the current year and projected carryforward of budget to the next fiscal year, there is a $109 projected ending fund balance in this fund.
Local Transportation Fund (2002)
The Local Transportation Fund is a Special Revenue Fund whose funds are used for construction and maintenance of streets, bluff protection, and beach access. Revenues for this fund consist of State Transportation Development Act funds, which remain after funds are allocated for regional transit, local transit, and Ride-on services. Projected actual revenues are $312 thousand and $356 thousand of expenditures are budgeted for the 2022 Paving project. Based on the projected revenues and expenditures for the current year, there is $141 thousand projected ending fund balance for this fund.
Projects
FY 2022
Budget
FY 2022
Projected
Actuals
Ocean Blvd Improvement Project $1,516,810 $1,344,940
City Hall Parking Lot 25,000 -
Storm Drains Project 663,384 651,087
2022 Paving Project 4,010,098 -
Tennis Bball Court relocation 335,000 6,844 Total $6,550,292 $2,002,871
9.E-11Council Agenda 9-6-2022
Public Education Government Fund (2003)
The Public, Educational, and Governmental (PEG) Access Fee Fund includes revenues from a PEG Access Fee collected from cable television providers (i.e. Spectrum) with franchise operations within City limits. Expenditures include capital costs related to governmental cable broadcasting and equipment. Based on projected revenues of $30 thousand and projected expenditures of $7 thousand, the PEG Fund is expected to end the year with a $133 thousand fund balance.
Housing In Lieu Fund (2005)
The Housing In Lieu Fund is a Special Revenue Fund with revenues from a development impact fee paid to the City as an alternative to the production of affordable housing (housing in-lieu fee). These funds are used for the acquisition, construction, or rehabilitation of affordable housing. The fund is projected to have $860 thousand of funds available by the end of the year for this purpose.
Lodging Business Improvement District Fund (2006) Operations The Pismo Beach Lodging Business Improvement District (LBID) Fund for operations reflects a 1% assessment on transient rents at transient lodging providers as revenues and budgeted expenditures to promote Pismo Beach lodging businesses. The LBID Fund started the year with a $718 thousand beginning fund balance. City staff projects that LBID assessment revenues and interest earnings will be $1.54 million. Operating expenditures are projected $1.37 million. The fund is expected to end the year with an $873 thousand ending unrestricted fund balance.
LBID Fund (2006) Improvements
The LBID Fund for improvements includes a 1% assessment for physical improvements, in particular the Pier Plaza project. The LBID Fund started the year with a negative $2.07 million beginning fund balance after including a $2.32 million remaining balance on the interfund loan payable to the Motor Vehicle Replacement (MVR) Fund and pre-funding the Pier Plaza project in FY 2020 and FY 2021. City staff projects that LBID assessment revenues and interest earnings will be $1.54 million. The LBID Improvements expenditure budget includes $359 thousand for the Spyglass sidewalk under US-101, Beach Swing replacements at Addie and Main Streets, and interest costs to the MVR Fund. The second interfund loan payment is expected to be $1,245,321. The fund is expected to end the year with a negative $882 thousand ending unrestricted fund balance. The fund is expected to have a positive balance at the end of FY 2023 when the loan is paid in full.
Chapman Estate Fund (2007)
The Chapman Estate Fund reflects donations or other contributions for the Chapman Estate as revenues and ongoing maintenance and one-time infrastructure improvements to the Chapman Estate as expenditures. The fund started the year with $43 thousand and is expected to receive $440 thousand of revenues, largely due to the $382 thousand payment from the Chapman Estate trust and interest earnings. Proposed private event revenues are not anticipated at this time until the roofing project, window replacement project, and the accessible restrooms are built. Projected actual expenditures are $469 thousand, including $355 thousand that is transferred out of the Chapman Estate Fund
9.E-12Council Agenda 9-6-2022
into the Capital Projects Fund to support a portion of the Chapman Estate roofing project, $51 thousand for the Chapman Estate improvement project (window replacement and accessible restrooms), and $63 thousand for operating costs of the home and grounds and monthly maintenance costs for utilities and gardening. Although the projected revenues support the projected expenditures this fiscal year, the fund will either need General Fund support or a reduction of the transfer out of the trust funds in the future to continue to operate as the operating costs were originally anticipated to be covered by a portion of the trust fund revenues and those are now supporting the Chapman roof project.
The remaining projected ending balance of this fund is $13 thousand.
Park Development Fund (3003)
The Park Development Fund is a Capital Project Fund with Quimby Act (park development in-lieu) fees and Impact Fees as funding sources to support construction costs of new parks and park lands, and the enhancement of existing parks to serve new development. The fund started the year with $594 thousand and is projected to receive $192 thousand in revenues. Projected actual expenditures total $483 thousand and include the following projects.
Table 12: Park Development Fund FY 2022 Budgeted Projects
The fund is expected to end the year with a $96 thousand ending fund balance, which can be used for the future Palisades and Chumash Park improvements project in FY 2023.
Water Enterprise Fund (6101)
The Water Enterprise Fund is an Enterprise Fund consisting of revenues from water billings and expenditures for: contract meter reading; direct water services and supplies; on-going inspection, repair, and maintenance of the City’s wells, tanks, booster stations, hydro-pneumatic system, and water distribution system components; water conservation efforts; and ensuring that a safe, drinkable supply of water is provided to Pismo Beach.
Water revenues are projected to be $5.54 million and expenditures are projected to be $6.42 million.
The projected ending fund balance for the Water Enterprise Fund is $6.01 million, which is allocated for future water system capital costs, including the Central Coast Blue project.
Projects
FY 2022
Budget
FY 2022
Projected
Actuals
Dinosaur Caves Restroom 384,038$ 381,046$
Price Historic Park/ Meherin House 141,366 84,548
Palisades Park improvements 100,000 13,075
South Palisades Outdoor fitness equipment/trail 60,000 - Overhead costs 4,707 4,707
Total 690,111$ 483,376$
9.E-13Council Agenda 9-6-2022
Note that the Water Enterprise Fund also includes the Water Tax, Water Construction, and Water Expansion Funds and the ending fund balance across all these funds is $8.41 million.
Wastewater Treatment Fund (6201)
The Wastewater Treatment Fund is an Enterprise Fund consisting of revenues from wastewater billings and expenditures for direct services and supplies; operation and maintenance of the City’s wastewater treatment plant and the wastewater collection facilities including pumps and pipelines; and ensuring the City’s treatment and collection system operations meet City, federal, and state laws and requirements. The ending fund balance is $8.22 million which is already allocated for other wastewater capital projects.
Note that the Wastewater Treatment Funds also include the Wastewater Capital Fund and the Wastewater Expansion Fund. The total combined ending fund balance across all these funds is $11.06 million.
Pier Enterprise Fund (6401)
The Pier Enterprise Fund includes revenues from a concession lease on the Pier and expenditures for repair and maintenance of the Pier, Promenade, and nearby facilities.
The beginning fund balance is $94 thousand and projected revenues are $81 thousand, primarily from revenues from the Pier Airstreams. Projected expenditures are $68 thousand, including $61 thousand primarily for pier and pier plaza operating costs. The Pier Enterprise Fund is expected to end the year with a $107 thousand ending fund balance.
Parking Enterprise Fund (6501)
The Parking Enterprise Fund is an Enterprise Fund consisting of revenues from parking kiosks, parking citations, and parking permits to support a Parking Supervisor and implement the goals of the Pismo Beach Parking Management Plan to administer existing parking more efficiently, provide more downtown parking, improve enforcement and parking management, and provide funds for future parking structures. Revenues are projected to reach $2.76 million to fund operating expenditures of $636 thousand.
In addition to operating expenditures, the budget includes $3.77 million for one-time projects, including $2.51 million for the purchase of property to increase the City’s parking inventory, $750 thousand for paving the parking lots, $250 thousand for a Police Downtown Sub-station, $101 thousand for the Secure Communication Radio project, $100 thousand for the Addie Street Parking and Access Improvements project, $35 thousand for the Parking Management Study, $19 thousand for additional parking meters, $4 thousand for a radio system upgrade and reliability project, and $825 for other projects.
The FY 2022 projected ending fund balance is $2.01 million.
Motor Vehicle Replacement Fund (7201)
The Motor Vehicle Replacement (MVR) Fund is an Internal Service Fund that funds the City’s motor vehicle operations and maintenance and motor vehicle replacements for various City departments. These costs are funded by accumulated fund balance, transfers from other funds, and motor vehicle rental charges to other funds. In FY 2020, the MVR Fund is provided a $3.28 million interfund loan from its cash balance to the LBID
9.E-14Council Agenda 9-6-2022
Fund for the Pier Plaza project. Consequently, the MVR Fund has a $2.15 million beginning fund balance. The interfund loan is anticipated to be paid overtime during FY 2021 through FY 2023. The FY 2022 projected ending fund balance is $1.86 million, which are accumulated funds necessary to fund future replacements.
FISCAL IMPACT:
There is no fiscal impact from receiving this report as it is information only.
ALTERNATIVES:
1. Request additional information from staff.
ATTACHMENTS:
None
Prepared by: Meeting Date: September 6, 2022
Nadia Feeser, Administrative Services Director
City Manager Approval:
9.E-15Council Agenda 9-6-2022