PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #9.C
SUBJECT/TITLE:
FISCAL YEAR 2023 FIRST 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 status of Fiscal Year (FY) 2022-23 ending on June 30, 2023, or FY 2023, financial status based on actual revenues and expenditures during the first three months of the fiscal year.
Overall, the City of Pismo Beach’s funds are projected to be financially stable, with sufficient fund balances. The FY 2023 ending General Fund unassigned fund balance is projected to be $10.59 million, which is $4.12 million greater than the FY 2022 ending unassigned fund balance. This increase is largely due to the $4.65 million projected net operating surplus in FY 2023, which contributes to the ending unassigned fund balance.
For most of the City’s other funds, revenues and expenditures are projected to be on budget and the ending fund balances are in line with the FY 2023 Adopted Budget ending fund balances. In all the funds, there are sufficient fund balances and projected revenues to cover projected expenditures.
It should be noted that the FY 2022 actual revenues and expenditures are not yet final as staff continues to confirm those amounts in the process of completing the City’s FY 2022 financial statements. As such, the FY 2023 projected beginning fund balances in this report are not yet final and may change in future reports to reflect the final minor adjustments.
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 early projections from the first three months of the fiscal year, the General Fund is projected to end FY 2023 with a $10.59 million unassigned fund balance.
The FY 2023 projected $10.59 million unassigned fund balance is $57 thousand less than the FY 2022 Revised Budget. This decrease is attributable to $124 thousand greater projected operating revenues compared to the Revised Budget, offset by a $67 thousand contributions to Reserves.
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. Also, a portion of the unassigned fund balance could be used to help pay for a portion of the Public Safety Facility to help reduce ongoing borrowing costs.
Council Agenda 12-6-2022 9.C-1
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 2022 preliminary actuals and the FY 2023 General Fund revised budget, projected actuals, and a variance comparing the budget to projected actuals.
Table 1: FY 2023 General Fund Budget Summary
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 $9.19 million. Based on changes during FY 2022 and carrying forward fund balance to cover previously budgeted but not-yet-spent expenditures, the preliminary estimated fund balance is revised to $25.73 million. This includes $8.47 million of unassigned fund balance and $17.26 million of carryforward fund balances.
A B C D = C - B
($ thousands)
FY 2022
Actuals
FY 2023
Revised
Budget
FY 2023 Year-
End Projected
Actuals
Variance
(Actuals-
Budget)
Unassigned Fund Balance 14,225$ 8,469$ 8,469$ -$ Committed Fund Balance 3,976 17,259 17,259 - Beginning Fund Balance 18,200 25,727 25,727 - Operating Revenues 32,491 32,335 32,460 124 Operating Expenditures 23,404 27,811 27,811 - Net Operating Surplus/(Deficit) 9,087 4,524 4,648 124 One-time Revenues 1,250 281 281 - One-time/Capital Expenditures 3,054 17,998 12,266 (5,732) Ending Fund Balance 25,483$ 12,534$ 18,390$ 5,856$ Unassigned Fund Balance 6,469$ 10,534$ 10,591$ 57$ Committed Fund Balance 17,259 - 5,732 5,732 Contribution to Reserves (245) - 67 67 Budget Stabilitation Set-Aside 2,000 2,000 2,000 - Council Agenda 12-6-2022 9.C-2
Table 2: FY 2023 General Fund, Beginning Fund Balance
(Preliminary Estimate)
III. General Fund Reserve
The City maintains various General Fund reserves totaling $7.64 million for emergency operations, building depreciation, and risk management. These reserves are crucial in order to avoid disrupting the City’s operations following unanticipated events. The reserves are shown in the table below, followed by a summary of each reserve.
Table 3: General Fund Reserves
Reserve Amount ($ thousands)
General Fund 25% Reserve $6,886
City Building Reserve 500
Risk Management Reserve 250
Total $7,636
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 2023. The General Fund reserve should be equal to $6.953 million, which is 25% of the total FY 2023 budgeted annual operating expenditures of $27.81 million. Currently, the General Fund Reserve is $6.89 million, of which $6.58 is invested in various securities and $308 thousand is pending investment. 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. The City Treasurer will be investing an additional $67 thousand to meet the 25% operating expenditure budget during FY 2023.
City Building Reserve
The Council created a City Building Reserve of $500 thousand, for the maintenance and upkeep of City facilities and buildings, particularly if funds are not available. This amount is equal to five years of annual depreciation on City-owned buildings.
($ thousands)
Adopted
Budget
Budget
Revisions Actuals
Unassigned Fund Balance 9,185$ (717)$ 8,469$
Capital Funds Carryforward 16,246 16,246
Purchase Orders Carryforward 963 963
Prepayment Carryforward 50 50
Total Fund Balance 9,185$ 16,542$ 25,727$
$17,259
Carryforward
Council Agenda 12-6-2022 9.C-3
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 2023 Revised Budget revenues total $32.62 million. FY 2023 projected actual revenues are $32.74 million, or $124 thousand greater than budget. Compared to the previous year, FY 2023 projected actual revenues are $1.00 million, or 3.0% less than FY 2022. This decrease over the prior year is largely due to the one-time revenue of the American Rescue Plan Act of 2021 revenues that were received in FY 2022 in the amount of $976,980 and not projected to be received in FY 2023. The table below summarizes the General Fund revenue budget and projected actual revenues for FY 2023, which is followed by a brief discussion of the top three FY 2023 projected actual sources of revenues.
Table 4: FY 2023 General Fund Revenue Budget and Projected Actuals
Transient Occupancy Tax (TOT) revenues are projected to be $226 thousand less than budget and are projected to be $226 thousand, or 1.5%, less than the previous year’s TOT revenues. TOT revenues are equal to 11% of the rent charged by all lodging businesses for a person exercising occupancy for 30 consecutive calendar days or less. This decrease in TOT revenues reflects a decrease in TOT revenues received in the first quarter and a projected 1.5% decrease for the year in FY 2023 compared to FY 2022. The following table illustrates the actual TOT revenues A B C D = C - B E = C - A F = C/A-1
($ thousands)
Revenue Category
FY 2022
Actuals
FY 2023
Revised
Budget
FY 2023
Projected
Actuals
Variance
(Projected
Actuals -
Revised
Bdgt)
Variance
(FY23 Proj
Act - FY22
Actuals)
% Variance
(FY23 Proj
Act v FY22
Actuals)
Proj
Actual
% of
Total
Transient Occupancy Tax 17,011$ 16,990$ 16,764$ (226)$ (247)$ -1.5% 51.2% Property Related Taxes 6,480 6,588 6,588 - 108 1.7% 20.1% Sales and Use Tax 4,089 3,650 3,966 316 (123) -3.0% 12.1% Other revenues 1,454 1,853 1,853 - 399 27.4% 5.7% Permits 1,356 1,256 1,204 (53) (153) -11.3% 3.7% Departmental Revenues 625 760 760 - 135 21.6% 2.3% Franchise Taxes 688 631 688 57 - 0.0% 2.1% Business Tax 241 211 241 30 - 0.0% 0.7% Transfers In 140 140 140 - - 0.0% 0.4% Other Finan Sources 47 92 92 - 44 0.0% 0.3% Other Taxes 218 78 78 - (140) -64.2% 0.2% Intergovernmental Revenue 97 48 48 - (49) -50.1% 0.1% Grants 44 38 38 - (6) -14.2% 0.1% Total Operating Revenues 32,491$ 32,335$ 32,460$ 124$ (31)$ -0.1% 99.1% One-time Revenues 1,250 281 281 - (970) -77.6% 0.9% Total Revenues 33,741$ 32,616$ 32,740$ 124$ (1,001)$ -3.0% 100.0% Council Agenda 12-6-2022 9.C-4
received by month in FY 2023 and FY 2022, showing a decrease of 3.2% compared to the previous year.
Table 5: TOT Revenues for the First Three Months of FY 2023 and FY 2022
Based on data obtained from Smith Travel Research Inc., a provider of competitive benchmarking, information services, and research to the hotel industry, the increase in TOT revenues is primarily due to an increase in room revenue. The average daily rate decreased by 4.4% on average during the first three months of FY 2023 compared to the same period in the prior fiscal year. Occupancy rates during the first three months of FY 2023 remained flat with a slight increase of 0.2% compared to the same period in the prior fiscal year.
Staff projects TOT revenues to reach $16.76 million, which is $247 thousand less than budget and are projected to be $226 thousand, or 1.5%, less than the previous year’s TOT revenues.
Property related tax revenues are projected to be equal to budget and $108 thousand, or 1.7%, greater than previous year’s property tax related revenues . There are two sources of property related tax revenues:
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, the San Luis Obispo County Auditor- Controller’s office is projecting assessed values to increase by 4.0%. 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 $316 thousand greater than budget and $123 thousand, or 3.0%, less than the prior year. Sales and use tax revenues are made up of two sources:
o Bradley-Burns uniform sales and use tax, which is a 1.0% tax on taxable sales within the City.
($ thousands)
Month FY 2023 FY 2022 Variance % Change
July 2,289$ 2,354$ (65)$ -2.7% August 1,824 1,886 (61) -3.2% September 1,496 1,553 (57) -3.7% Total 5,610$ 5,792$ -183 -3.2%
Council Agenda 12-6-2022 9.C-5
o Public safety tax, which is a 0.5% tax on taxable sales for specified public safety purposes.
The Bradley-Burns uniform sales and use tax is expected to be $1 thousand greater than the prior year due to a slight increase in projected sales. Staff will continue to monitor these revenues that may be impacted by a slight economic decline.
The public safety sales tax revenues are budgeted at $106 thousand in FY 2023 and are anticipated to be on budget. This FY 2023 projected amount is $18 thousand less than the FY 2022 public safety sales tax revenues.
In summary, sales and use tax revenues are projected to be $316 thousand greater than budget and $123 thousand, or 3.0%, less than the prior year.
V. General Fund Expenditures
The FY 2023 Revised Budget expenditures total $45.81 million. Operating expenditures are projected to be equal to the Revised Budget based on first quarter expenditures. One- time capital costs are projected to be $5.7 million less than the Revised Budget to reflect the timing of the two-year construction period of the FY 2022 Paving Project.
Total operating expenditures for the first quarter total should be about 25% of the budget, assuming the timing of expenditures is consistent throughout the year. This year, about 22% of the operating budget has been spent in the first quarter, while only 3% of the one- time capital expenditure budget has been spent in the first quarter. These one-time costs are dependent on the timing of construction of these projects. The table below provides details of actuals as a percentage of budget by expenditure category, followed by explanations of the large variances from the 25% mark.
Table 6: FY 2023 General Fund Expenditure Budget and Projected Actuals
A B C D = C/B E F = B - E
($ thousands)
Expenditure Category
FY 2022
Actuals
FY 2023
Revised
Budget
FY 2023
First Quarter
Actuals
First Quarter
Actuals % of
Budget
FY 2023
Projected
Actuals
Variance
(Revised
Bdgt -
Projected
Actuals)
Proj
Actual
% of
Total
Salaries & Wages 7,685$ 9,186$ 1,966$ 21%9,186$ -$ 22.9% Benefits 5,726 5,776 2,244 39%5,776 - 14.4% Professional Services 3,566 4,631 167 4%4,631 - 11.6% Contract Services 2,533 3,115 1,023 33%3,115 - 7.8% Operations & Maintenance 1,583 1,483 231 16%1,483 - 3.7% Other Expenses 788 1,046 214 20%1,046 - 2.6% Other Financing Uses 125 1,010 109 11%1,010 - 2.5% Transfers Out 503 611 117 19%611 - 1.5% Retiree Medical Insurance 450 475 61 13%475 - 1.2% Debt Service 434 432 - 0%432 - 1.1% Capital Projects 11 46 5 0%46 - 0.1% Total Operating Expenditures 23,404$ 27,811$ 6,138$ 22% 27,811$ -$ 69.4% One-time Capital Costs 3,054 17,998 488 3%12,266 5,732 30.6% Total Expenditures 26,458$ 45,810$ 6,626$ 14% 40,078$ 5,732$ 100.0% Council Agenda 12-6-2022 9.C-6
Some operating costs that do not reflect consistent monthly spending include:
Benefits, which includes retirement, health, and other benefits for employees. In order to take advantage of a 3% savings in CalPERS pension costs, the City prepaid the full year of its projected normal CalPERS pension costs. As such, the Benefits expenditure category reflects that 39% of the budget spent in the first quarter. Contract Services, which reflects that 33% was spent in the first quarter. These costs reflect the prepayment of insurance costs in the first quarter. Professional Services, which reflects that 4% was spent in the first quarter. These costs are based on the timing of work performed and are not set amounts per month. Other Financing Uses, which includes a $1.00 million general contingency budget and reflects that only 11% of the budget has been spent in the first quarter. This budget is allocated over time based on unanticipated costs that come up throughout the year and are not a consistent allocation of expenditures.
Retiree Medical Insurance costs, which reflects that 13% of budget was spent in the first quarter. The monthly costs are payments to Retirees, but the majority of these payments are contributions to CalPERS for the actuarially determined contribution and are paid toward the end of the fiscal year.
VI. General Fund Contingency Budgets
General Contingency
The FY 2023 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, $126 thousand of this appropriation was allocated, leaving $874 thousand remaining. Details of the allocation is provided in the following table.
Table 7: FY 2022 General Fund General Contingency Budget
Council Contingency
The FY 2023 Adopted Budget also includes a $5 thousand City Council contingency appropriation that may be used for various one-time items that come up during the year.
None of this contingency has been allocated in the first quarter of FY 2023.
Beginning Balance July 1, 2022 1,000,000$
Appropriations
Janitorial Services (59,984)
Fireworks Waiver July 4, 2022 (5,449)
Street Sweeping agreement (60,488)
Total Appropriations (125,921)
Ending Balance as of September 30, 2022 874,079$
Council Agenda 12-6-2022 9.C-7
VII. Next Level Budget
The FY 2023 Adopted Budget includes $400 thousand in the General Fund non- department contract services account that may be used for various “next-level” contract services. Of this amount, $396 thousand of this appropriation is allocated, leaving $4 thousand remaining. Details of the allocation is provided in the following table.
Table 8: FY 2023 Next Level Budget
Beginning Balance July 1, 2021 400,000$
Appropriations
Records scanning for Community Development (36,000)
Public Interactive Digital Budget Book and Budget In
Brief (10,000)
Price House Landscaping (35,000)
Pothole repairs (40,000)
Two Maintenance Workers and EV Utility Truck (225,000)
Community Drinking Fountains (50,000)
Total Appropriations (396,000)
Ending Balance as of September 30, 2022 4,000$
Council Agenda 12-6-2022 9.C-8
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 2023 Adopted Budget beginning fund balances.
Table 9: Other Funds
A B C D = B - C E = A + D F G = 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 25,727,499 32,740,098 40,077,541 (7,337,443) 18,390,056 5,732,119 12,657,937 1002 Half-Cent Sales Tax Fund 4,734,649 1,566,600 5,614,285 (4,047,685) 686,964 - 686,964 Special Revenue Funds
2001 Gas Tax Fund 201,445 382,889 205,231 177,658 379,103 - 379,103 2002 Local Transportation 403,644 206,483 173,323 33,160 436,804 - 436,804 2003 PEG Fund 166,492 37,000 161,978 (124,978) 41,514 - 41,514 2004 Grants-NonCapital 327,701 153,300 454,872 (301,572) 26,129 - 26,129 2005 Housing In Lieu Fee 3,404,394 80,000 2,528,823 (2,448,823) 955,572 - 955,572 2006 LBID Operations 841,855 1,548,480 1,724,176 (175,696) 666,159 - 666,159 2006 LBID Improvements (545,976) 1,548,480 346,664 1,201,816 655,840 - 655,840 2007 Chapman Estate 30,913 970,103 1,092,509 (122,406) (91,493) - (91,493) Capital Project Funds
3001 Capital Projects (462,718) 45,217,871 43,355,615 1,862,256 1,399,538 1,399,538 - 3002 Public Facilities Fund 849 - - - 849 - 849 3003 Park Development Fund 289,688 33,200 248,947 (215,747) 73,941 - 73,941 3101 Circulation Fees 603,344 6,700 301,000 (294,300) 309,044 - 309,044 3102 Impact Fees 609,328 16,100 1,418 14,682 624,010 - 624,010 3103 Developer Impact Fee 57,259 1,000 - 1,000 58,259 - 58,259 3201 Underground Utility Fnd 15,979 - - - 15,979 - 15,979 Debt Service Funds
4001 PFA Debt Service - 392,863 392,863 - - - - 4002 PF Agency Debt 57 707,555 676,948 30,607 30,664 - 30,664 4101 Reass 92-1 Fwy Fthlls 739 - - - 739 - 739 4102 Spyglass 92-4 12,308 - - - 12,308 - 12,308 Enterprise Funds
6101 Water Enterprise 5,642,675 8,280,452 11,036,814 (2,756,362) 2,886,314 2,886,314 - 6102 Water Tax (Lopez/State) 966,510 3,098,000 2,778,933 319,067 1,285,577 1,285,577 - 6103 Water Construction Fund 1,006,865 1,864,134 1,915,897 (51,763) 955,102 955,102 - 6104 Water Expansion Fund 1,173,350 5,600 - 5,600 1,178,950 1,178,950 - Water Enterprise Funds 8,789,400 13,248,187 15,731,644 (2,483,457) 6,305,942 6,305,942 - 6201 Wastewater Treatment 7,817,870 7,545,866 12,699,618 (5,153,751) 2,664,118 2,664,118 - 6202 Wastewater Capital Proj 1,047,972 4,077,256 3,880,042 197,213 1,245,185 1,245,185 - 6203 Wastewater Expansion 1,916,087 28,800 497 28,303 1,944,390 1,944,390 - Wastewater Enterprise Funds 10,781,928 11,651,922 16,580,157 (4,928,235) 5,853,693 5,853,693 - 6301 Local Trans Transit 28,188 - 2,900 (2,900) 25,288 25,288 - 6401 Pier Enterprise 85,844 94,767 116,032 (21,264) 64,580 64,580 - 6501 Parking Enterprise 5,409,268 2,340,743 4,986,789 (2,646,046) 2,763,222 2,763,222 - Internal Service Funds
7101 Technology Service Fund 479,061 1,504,551 1,535,708 (31,158) 447,903 - 447,903 7201 Motor Vehicle Fund 3,438,893 1,192,031 3,013,352 (1,821,322) 1,617,571 - 1,617,571 Council Agenda 12-6-2022 9.C-9
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 $4.73 million beginning fund balance (after including carryforward fund balances). Projected actual revenues are $1.57 million. Projected actual expenditures are $5.61 million. Based on the projected revenues and expenditures for the current year, there is a $687 thousand projected ending fund balance in this fund.
The following table lists the budgeted projects in this fund for FY 2023.
Table 10: Half-Cent Sales Tax Fund FY 2023 Budgeted Projects
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 $201 thousand beginning fund balance (after including carryforward fund balances). Projected actual revenues are $383 thousand and projected actual expenditures are $205 thousand for the FY 2022 Paving project. Based on the projected revenues and expenditures for the current year, there is a $379 thousand 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 $206 thousand and $173 thousand of expenditures are budgeted for the FY 2022 Paving Project. Based on the projected revenues and expenditures for the current year, there is $437 thousand projected ending fund balance for this fund.
Projects FY 2023 Budget
2022 Paving Project $ 4,885,098
Signalize Bello/Price Canyon Rd 389,000
Tennis Bball Court relocation 302,891
City Hall Parking Lot 25,000
Storm Drains Project 12,296
Total $ 5,614,285
Council Agenda 12-6-2022 9.C-10
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. Charter Communications) with franchise operations within city limits. Expenditures include capital costs related to governmental cable broadcasting and equipment. Based on projected revenues of $37 thousand and projected expenditures of $162 thousand, the PEG Fund is expected to end the year with a $42 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 $956 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 $841 thousand beginning fund balance. City staff projects that LBID assessment revenues and interest earnings will be $1.55 million . Operating expenditures are projected to be equal to budget. The fund is expected to end the year with a $666 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 $546 thousand 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 $1.55 million. Expenditures include $300 thousand for the Spyglass Sidewalk under the US 101 as part of the FY 2022 Paving Project, $36 thousand for the beach swing replacements at Main and Addie Streets, which is currently on order, and $11 thousand for interest costs on the interfund loan. The third and final interfund loan payment is expected to be $1,077,042. The fund is expected to end the year with a positive $656 thousand ending unrestricted fund balance.
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 $31 thousand and is expected to receive $970 thousand of revenues, including $965 thousand from the General Fund for Chapman Estate improvements and the Chapman Inventory projects.
Proposed private event revenues are not anticipated at this time until the accessible restrooms are built. Projected actual expenditures are $1.09 million, including $938 thousand for the Chapman Estate improvements project, $127 thousand for operating Council Agenda 12-6-2022 9.C-11
costs of the home and grounds and monthly maintenance costs for utilities and gardening, and $24 thousand for an inventory project. The remaining projected ending balance of this fund is negative $91 thousand. Due to this negative ending fund balance, staff recommends that Council appropriate a transfer of $110 thousand from the General Fund to the Chapman Estate Fund to support the operations until the Estate is able to hold private events. Staff will come back to Council at the Mid-Year Budget in December 2022 to reflect this recommendation. Note that in FY 2022, the Chapman Estate used $382 thousand of the Chapman Trust on the most recent Chapman roofing project as well as on Chapman Estate operating costs.
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 $290 thousand and is projected to receive $33 thousand in impact fee and permit revenues. Projected actual expenditures total $246 thousand and include the following projects.
Table 11: Park Development Fund FY 2023 Budgeted Projects
The fund is expected to end the year with $74 thousand ending fund balance.
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 $8.28 million, including $2.96 million in one-time revenues for the Central Coast Blue project and expenditures are projected to be $11.04 million.
The projected ending fund balance for the Water Enterprise Fund is $2.89 million, which is allocated for future water system capital costs, including the Central Coast Blue project.
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 $6.31 million.
Projects
FY 2023
Budget
Price Historic Park/ Meherin House 94,087$
Palisades and Chumash Park Improvements 86,925
South Palisades Outdoor fitness equipment/trail 60,000
Overhead costs 4,943
Total 245,955$
Council Agenda 12-6-2022 9.C-12
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 $2.66 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 $5.85 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 $86 thousand and projected revenues are $95 thousand, of which $75 thousand is from revenues from the Pier Airstreams and $20 thousand is from the General Fund. Projected expenditures include $116 thousand for Pier and Pier Plaza operating costs. The Pier Enterprise Fund is expected to end the year with a $65 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 Parking Enforcement Officer 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 $2.34 million to fund operating expenditures of $916 thousand.
In addition to operating expenditures, the budget includes $4.07 million for one-time projects, including $2.51 for the purchase of property to increase the City’s parking inventory, $750 thousand for paving the parking lots, $500 thousand for the Police and Parking Substation, $101 thousand for the Secure Communication Radio project, $100 thousand for Addie Street Parking and Access Improvements, $70 thousand for additional parking meters, $35 thousand for the Parking Management Study, $4 thousand for a radio system upgrade and reliability project, and $824 for other projects. The FY 2023 projected ending fund balance is $2.76 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 Fund for the Pier Plaza project. Consequently, the MVR Fund has a $3.44 million beginning fund balance. The interfund loan is anticipated to be paid overtime during FY Council Agenda 12-6-2022 9.C-13
2021 through FY 2023. The FY 2023 projected ending fund balance is $1.62 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
Submitted by: Meeting Date: December 6, 2022
Nadia Feeser, Administrative Services Director
City Manager Approval:
Council Agenda 12-6-2022 9.C-14