PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #9.D
SUBJECT/TITLE:
FISCAL YEAR 2023 SECOND 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 six 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 $9.50 million, which is $3.03 million greater than the FY 2022 ending unassigned fund balance. This increase is largely due to the $4.03 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.
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 six months of the fiscal year, the General Fund is projected to end FY 2023 with a $9.50 million unassigned fund balance.
The FY 2023 projected $9.50 million unassigned fund balance is $610 thousand less than the FY 2023 Revised Budget. This decrease is attributable to $1.20 million fewer projected operating revenues compared to the Revised Budget, $117 thousand fewer projected one-time revenues compared to the Revised Budget, and a $6 thousand contribution to Reserves, offset by $712 thousand projected expenditure savings compared to the Revised 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. 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. Finally, staff have identified about $10.1 million of various capital projects that are projected to cost more than the current budget based on increase in scope for these projects compared to the original budgeted project.
9.D-1Council Agenda 2-21-2023
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 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 2023 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 fund balance is revised to $25.73 million. This includes $8.47 million of unassigned fund balance and $17.26 million of carryforward fund balances.
AB CD = C - B
($ 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 32,498 32,390 31,192 (1,198) Operating Expenditures 23,404 27,877 27,165 (712) Net Operating Surplus/(Deficit) 9,094 4,514 4,027 (486) One-time Revenues 1,250 281 163 (117) One-time/Capital Expenditures 3,054 18,408 10,952 (7,456) Ending Fund Balance 25,490$ 12,113$ 18,966$ 6,853$ Unassigned Fund Balance 6,476$ 10,113$ 9,504$ (610)$ Committed Fund Balance 17,259 - 7,456 7,456 Contribution to Reserves (245) - 6 6 Budget Stabilitation Set-Aside 2,000 2,000 2,000 -
9.D-2Council Agenda 2-21-2023
Table 2: FY 2023 General Fund, Beginning Fund Balance
III. General Fund Reserve
The City maintains various General Fund reserves totaling $7.71 million for emergency operations, building depreciation, and risk management. These reserves are crucial in order to avoid disrupting the City’s operations following unanticipated events. The reserves are shown in the table below, followed by a summary of each reserve.
Table 3: General Fund Reserves
Reserve Amount ($ thousands)
General Fund 25% Reserve $6,963
City Building Reserve 500
Risk Management Reserve 250
Total $7,713
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 $6.94 million, which is 25% of the total FY 2023 budgeted annual operating expenditures of $27.88 million. Currently, the General Fund Reserve is $6.96 million, of which $6.95 is invested in various securities and $10 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 $6 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
9.D-3Council Agenda 2-21-2023
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 $32.67 million. FY 2023 projected actual revenues are $31.36 million, or $1.32 million less than budget. Compared to the previous year, FY 2023 projected actual revenues are $2.39 million, or 7.1% 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 and a projected reduction of $1.36 million in Transient Occupancy Tax revenues. 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 $1.36 million less than budget and are projected to be $1.38 million, or 8.1%, less than the previous year’s TOT revenues. TOT revenues are equal to 11% of the rent charged by all lodging businesses for a person exercising occupancy for 30 consecutive calendar days or less. This decrease in TOT revenues reflects a decrease in TOT revenues received through the second quarter and a projected 8.0% decrease for the year in FY 2023 compared to FY 2022. Based on projections from Oxford Economics forecast for A B C D = C - B E = C - A F = C/A-1
($ 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$ 15,631$ (1,359)$ (1,379)$ -8.1% 49.9% Property Related Taxes 6,480 6,588 6,688 100 208 3.2% 21.3% Sales and Use Tax 4,089 3,650 4,150 500 61 1.5% 13.2% Other revenues 1,461 1,853 1,600 (252) 139 9.5% 5.1% Permits 1,356 1,256 1,280 23 (77) -5.7% 4.1% Franchise Taxes 688 631 688 57 - 0.0% 2.2% Departmental Revenues 625 760 619 (142) (7) -1.1% 2.0% Business Tax 241 211 241 30 - 0.0% 0.8% Other Taxes 218 78 121 43 (97) -44.5% 0.4% Transfers In 140 140 140 - - 0.0% 0.4% Intergovernmental Revenue 97 48 34 (15) (63) -65.2% 0.1% Other Finan Sources 47 92 - (92) (47) -100.0% 0.0% Grants 44 93 - (93) (44) -100.0% 0.0% Total Operating Revenues 32,498$ 32,390$ 31,192$ (1,198)$ (1,306)$ -4.0% 99.5% One-time Revenues 1,250 281 163 (117) (1,087) -86.9% 0.5% Total Revenues 33,748$ 32,671$ 31,355$ (1,316)$ (2,393)$ -7.1% 100.0%
9.D-4Council Agenda 2-21-2023
Pismo Beach lodging businesses funded by Visit SLO Cal, the atmospheric river that dumped rain in Pismo Beach and the surrounding area for most of January causing flooding in California and fewer visitors to the beach, and the abundance of snow in the mountains as an attractive alternative to visiting the beach, staff projects a decrease of 26% in January and February 2023 TOT revenues compared to the first two months of 2022, a projected 16% decrease in TOT revenues in March, and a projected decrease of 5% during April through June compared to the previous April through June 2022.
The following table illustrates the actual TOT revenues received by month in FY 2023 and FY 2022, showing a decrease of 4.9% compared to the previous year.
Table 5: TOT Revenues for the First Six 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 decrease in TOT revenues is primarily due to an increase in room revenue. The average daily rate decreased by 5.0% on average during the first six months of FY 2023 compared to the same period in the prior fiscal year. Occupancy rates during the first six months of FY 2023 had a smaller average decrease of 1.6% compared to the same period in the prior fiscal year.
Staff projects TOT revenues to reach $15.63 million, which is $1.36 million less than budget and are projected to be $1.38 million, or 8.1%, less than the previous year’s TOT revenues.
Property related tax revenues are projected to be $100 thousand greater than budget and $208 thousand, or 3.2%, greater than previous year’s property tax related revenues. There are two sources of property related tax revenues:
o Property Tax Assessed Value revenues: equivalent to 1% of assessed values o Property Tax In Lieu of Vehicle License Fees: 1% tax on the market value of a registered vehicle.
Assessed value cannot increase by more than 2.0% per year per Section 2 of Article XIIIA of the California Constitution. However, the San Luis Obispo County Auditor- ($ thousands)
Month FY 2022 FY 2023 Variance % Change
July 2,354 2,289 (65)$ -2.7%
August 1,886 1,824 (61) -3.2%
September 1,553 1,496 (57) -3.7%
October 1,354 1,305 (49) -3.6%
November 1,153 1,067 (86) -7.5%
December 985 853 (132) -13.4%
Total 9,285$ 8,835$ (450)$ -4.9%
9.D-5Council Agenda 2-21-2023
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 $500 thousand greater than budget and $61 thousand, or 1.5%, 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.
The Bradley-Burns uniform sales and use tax is expected to be $500 thousand greater than the prior year due to an increase in projected sales.
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 $500 thousand greater than budget and $61 thousand, or 1.5%, greater than the prior year.
V. General Fund Expenditures
The FY 2023 Revised Budget expenditures total $46.29 million. Operating expenditures are projected to be $712 thousand less than the Revised Budget based on second quarter expenditures. One-time capital costs are projected to be $7.46 million less than the Revised Budget to reflect the timing of the two-year construction period of the Paving Project.
Total operating expenditures for the second quarter total should be about 50% of the budget, assuming the timing of expenditures is consistent throughout the year. This year, about 40% of the operating budget has been spent in the first two quarters, while only 4% of the one-time capital expenditure budget has been spent through the second 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 50% mark.
9.D-6Council Agenda 2-21-2023
Table 6: FY 2023 General Fund Expenditure Budget and Projected Actuals
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 61% of the budget spent through the second quarter.
Operations & Maintenance, which reflects that 37% was spent through the second quarter, reflecting a delay in payments and allocations. These costs are typically more consistent throughout the year, and are projected to on budget. Professional Services, which reflects that 11% was spent through the second quarter.
These costs are based on the timing of work performed and are not set amounts per month.
Other Financing Uses, which includes a $1.00 million general contingency budget and reflects that only 13% of the budget has been spent through the second quarter. This budget is allocated over time based on unanticipated costs that come up throughout the year and are not a consistent allocation of expenditures. Retiree Medical Insurance costs, which reflects that 25% of budget was spent through the second quarter. The monthly costs are payments to Retirees, but the majority of these payments are contributions to CalPERS for the actuarially determined contribution and are paid toward the end of the fiscal year.
A B C D = C/B E F = B - E
($ thousands)
Expenditure Category
FY 2022
Actuals
FY 2023
Revised
Budget
FY 2023
Second
Quarter
Actuals
Second
Quarter
Actuals % of
Budget
FY 2023
Projected
Actuals
Variance
(Revised
Bdgt -
Projected
Actuals)
Proj
Actual
% of
Total
Salaries & Wages 7,685$ 9,233$ 4,518$ 49%8,258$ 975$ 21.7% Benefits 5,726 5,785 3,501 61%6,399 (614) 16.8% Professional Services 3,566 4,635 523 11%4,635 - 12.2% Contract Services 2,533 3,068 1,472 48%2,717 351 7.1% Operations & Maintenance 1,583 1,483 548 37%1,483 - 3.9% Other Expenses 788 1,084 499 46%1,084 - 2.8% Other Financing Uses 125 918 122 13%918 - 2.4% Transfers Out 503 718 117 16%718 - 1.9% Retiree Medical Insurance 450 475 120 25%475 - 1.2% Debt Service 434 432 - 0%432 - 1.1% Capital Projects 11 46 9 19%46 - 0.1% Total Operating Expenditures 23,404$ 27,877$ 11,430$ 41% 27,165$ 712$ 71.3% One-time Capital Costs 3,054 18,408 704 4% 10,952 7,456 28.7% Total Expenditures 26,458$ 46,285$ 12,133$ 26% 38,117$ 8,168$ 100.0%
9.D-7Council Agenda 2-21-2023
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, $218 thousand of this appropriation was allocated, leaving $782 thousand remaining. Details of the allocation is provided in the following table.
Table 7: FY 2023 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.
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 $4 thousand remaining. Details of the allocation is provided in the following table.
Table 8: FY 2023 Next Level Budget
Beginning Balance July 1, 2022 1,000,000$
Appropriations
Janitorial Services (59,984)
Fireworks Waiver July 4, 2022 (5,449)
Street Sweeping agreement (60,488)
City Hall/Corp Yard Improvement (82,000)
Fingerprinting machine replacement (9,900)
Total Appropriations (217,821)
Ending Balance as of December 31, 2022 782,179$
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 December 31, 2022 4,000$
9.D-8Council Agenda 2-21-2023
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
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 25,727,499 31,355,234 38,116,794 (6,761,560) 18,965,939 7,456,219 11,509,720 1002 Half‐Cent Sales Tax Fund 4,735,902 2,051,600 5,614,285 (3,562,685) 1,173,217 ‐ 1,173,217 Special Revenue Funds
2001 Gas Tax Fund 92,009 368,055 205,231 162,824 254,833 0 254,833 2002 Local Transportation 317,181 206,483 173,323 33,160 350,341 ‐ 350,341 2003 PEG Fund 166,492 37,000 171,978 (134,978) 31,514 ‐ 31,514 2004 Grants‐NonCapital 343,801 153,300 454,872 (301,572) 42,229 ‐ 42,229 2005 Housing In Lieu Fee 3,404,394 30,000 2,528,823 (2,498,823) 905,572 ‐ 905,572 2006 LBID Operations 864,743 1,422,667 1,712,684 (290,017) 574,726 ‐ 574,726 2006 LBID Improvements (568,864) 1,422,667 346,664 1,076,003 507,139 ‐ 507,139 2007 Chapman Estate 34,433 1,061,018 1,073,847 (12,829) 21,604 ‐ 21,604 Capital Project Funds
3001 Capital Projects (463,088) 18,944,736 18,444,736 500,000 36,912 36,912 ‐ 3002 Public Facilities Fund 849 ‐ ‐ ‐ 849 ‐ 849 3003 Park Development Fund 291,042 40,113 245,955 (205,842) 85,200 2,992 82,208 3101 Circulation Fees 603,543 9,470 211,000 (201,530) 402,013 90,000 312,013 3102 Impact Fees 637,875 97,146 1,418 95,728 733,603 ‐ 733,603 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 5,107,388 8,280,452 11,070,260 (2,789,807) 2,317,581 2,317,581 ‐ 6102 Water Tax (Lopez/State) 139,495 3,098,000 2,778,933 319,067 458,562 458,562 ‐ 6103 Water Construction Fund 1,062,040 1,864,134 1,915,897 (51,763) 1,010,277 1,010,277 ‐ 6104 Water Expansion Fund 1,177,239 5,600 ‐ 5,600 1,182,839 1,182,839 ‐ Water Enterprise Funds 7,486,162 13,248,187 15,765,090 (2,516,903) 4,969,259 4,969,259 ‐ 6201 Wastewater Treatment 7,743,324 7,545,866 12,669,773 (5,123,907) 2,619,417 2,619,417 ‐ 6202 Wastewater Capital Proj 1,158,972 4,012,495 3,815,282 197,213 1,356,185 1,356,185 ‐ 6203 Wastewater Expansion 1,927,321 28,800 497 28,303 1,955,624 1,955,624 ‐ Wastewater Enterprise Fund 10,829,616 11,587,162 16,485,552 (4,898,390) 5,931,226 5,931,226 ‐ 6301 Local Trans Transit 28,113 ‐ 2,900 (2,900) 25,213 25,213 ‐ 6401 Pier Enterprise 85,844 65,652 70,000 (4,348) 81,497 81,497 ‐ 6501 Parking Enterprise 5,565,297 2,623,794 1,365,803 1,257,991 6,823,288 6,823,288 ‐ Internal Service Funds
7101 Technology Service Fund 479,061 1,656,393 1,749,190 (92,798) 386,263 ‐ 386,263 7201 Motor Vehicle Fund 3,613,438 1,239,207 3,430,528 (2,191,322) 1,422,117 ‐ 1,422,117
9.D-9Council Agenda 2-21-2023
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 $4.74 million beginning fund balance (after including carryforward fund balances). Projected actual revenues are $2.05 million. Projected actual expenditures are $5.61 million. Based on the projected revenues and expenditures for the current year, there is a $1.17 million 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 $92 thousand beginning fund balance (after including carryforward fund balances). Projected actual revenues are $368 thousand and projected actual expenditures are $205 thousand for the Paving project.
Based on the projected revenues and expenditures for the current year, there is a $255 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 Paving Project. Based on the projected revenues and expenditures for the current year, there is $350 thousand projected ending fund balance for this fund.
Projects FY 2023 Budget
Paving Project $ 4,885,098
Signalize Bello/Price Canyon Rd 389,000
Tennis Court relocation 302,891
City Hall Parking Lot 25,000
Storm Drains Project 12,296
Total $ 5,614,285
9.D-10Council Agenda 2-21-2023
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 $172 thousand, the PEG Fund is expected to end the year with a $32 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 $906 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 $865 thousand beginning fund balance. City staff projects that LBID assessment revenues and interest earnings will be $1.42 million. Operating expenditures are projected $1.71 million. The fund is expected to end the year with a $559 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 $569 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 $1.42 million. Expenditures include $300 thousand for the Spyglass Sidewalk under the US 101 as part of the 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 $507 thousand ending unrestricted fund balance. This amount, plus FY 2024 projected assessment revenues are anticipated to support the Addie Street improvements and new restroom project.
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 $1.06 million of revenues, including $965 thousand from the General Fund for Chapman Estate improvements and the Chapman Inventory projects and $90 thousand from the General Fund to support operations. Proposed private event
9.D-11Council Agenda 2-21-2023
revenues are not anticipated at this time until the accessible restrooms are built. Projected actual expenditures are $1.07 million, including $938 thousand for the Chapman Estate improvements project, $111 thousand for operating 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 $22 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 $291 thousand and is projected to receive $40 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 an $82 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 $11.07 million.
The projected ending fund balance for the Water Enterprise Fund is $2.32 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 $4.97 million.
Wastewater Treatment Fund (6201)
The Wastewater Treatment Fund is an Enterprise Fund consisting of revenues from wastewater billings and expenditures for direct services and supplies; operation and maintenance of the City’s wastewater treatment plant and the wastewater collection Projects
FY 2023
Budget
Price Historic Park/ Meherin House 94,087$
Palisades and Chumash Park Improvements 86,925
South Palisades Outdoor fitness equipment/trail 60,000
Overhead costs 4,943
Total 245,955$
9.D-12Council Agenda 2-21-2023
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 $2.62 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 $5.93 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 $66 thousand, from revenues from the Pier Airstreams. Projected expenditures include $70 thousand for Pier and Pier Plaza operating costs. The Pier Enterprise Fund is expected to end the year with a $81 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 $2.62 million to fund operating expenditures of $556 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. Of these projects, staff projects only $810 thousand will be spent while the other projects are delayed. The FY 2023 projected ending fund balance is $6.82 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 $3.61 million beginning fund balance. The interfund loan is anticipated to be paid overtime during FY 2021 through FY 2023. The FY 2023 projected ending fund balance is $1.42 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.
9.D-13Council Agenda 2-21-2023
ALTERNATIVES:
1. Request additional information from staff.
ATTACHMENTS:
None
Submitted by: Meeting Date: February 21, 2023
Nadia Feeser, Administrative Services Director
City Manager Approval:
9.D-14Council Agenda 2-21-2023