City of Rialto
FISCAL YEAR 2021
-
2022
MID
-
YEAR FINANCIAL REVIEW
FEBRUARY 22, 2022
2 FY 21
-
22 Budget
City of
Rialto
General Fund Budget Review
•
City Council adopted balanced budget on July 27, 2021
•
General Fund Revenues of $104.2 million
•
General Fund Expenditures of $104.2 million
3 FY 21
-
22 General Fund Budgeted Revenues
City of
Rialto
General Fund Budget Review
•
Three Largest Revenue
Sources:
Property Tax (29.0%)
Sales Tax (25.2%)
UUT (13.1%)
4 Sales Tax Revenue
–
First Half of FY 21
-
22 City of
Rialto
General
Fund Budget Review
5 Sales Tax Revenue
–
First Half of FY 21
-
22 City of
Rialto
General Fund Budget Review
•
FY 21
-
22 Budget estimated sales tax revenues of $26,275,000
based on traditional growth prior to an awareness of any change in fulfillment center corporate structure affecting sales tax distribution
•
Prior FY 20
-
21 actual sales tax revenues were $39,427,628
–
final
revenues were received in August and reconciled in September 2021 after adoption of the current FY 21
-
22 Budget
•
FY 21
-
22 estimated sales tax revenues are $47,893,500
6 Sales Tax Revenue
–
First Half of FY 21
-
22 City of
Rialt
o
General Fund Budget Review
•
Why the increased sales tax revenues?
•
A certain fulfillment center changed its corporate ownership structure establishing it as a “point
-
of
-
sale” for sales tax
revenues pursuant to California Dept. of Tax and Finance regulations
•
Prior method of ownership required sales tax revenues to be distributed into the San Bernardino County “Pool”
7 Sales Tax Revenue
–
First Half of FY 21
-
22 City of
Rialt
o
General Fund Budget Review
•
CAUTION!!!
•
Increased sales tax revenues due to online sales may not be permanent!
•
State may determine to revise sales tax distribution laws; or •
Fulfillment centers may change corporate ownership requiring sales distributed through County “Pool”; or
•
Fulfillment centers may change what goods are distributed in the centers to an “end of line” distribution with no sales tax generated.
8 Property Tax Revenue
–
First Half of FY 21
-
22 City of
Rialt
o
General Fund Budget Review
9 Property Tax Revenue
–
First Half of FY 21
-
22 City of
Rialt
o
General Fund Budget Review
10 Property Tax Revenue
–
First Half of FY 21
-
22 City of
Rialt
o
General Fund Budget Review
•
Timing of property tax distributions are staggered.
•
December 2020 payment was only $9,000 compared to
December 2021 payment of $7.7 million
•
January 2021 payment was $14.8 million
•
January 2022 payment was $8.8 million
•
Property tax revenue is trending slightly higher than prior year •
No adjustment recommended at this time
11 UUT Revenue
–
First Half of FY 21
-
22 City of
Rialto
General Fund Budget Review
12 UUT Revenue
–
First Half of FY 21
-
22 City of
Rialto
General Fund Budget Review
•
UUT revenue is trending slightly higher than prior year •
No adjustment recommended at this time
13 All Other Gen Fund Revenue
–
First Half of FY 21
-
22 City of
Rialto
General Fund Budget Review
14 All Other Gen Fund Revenue
–
First Half of FY 21
-
22 City of
Rialto
General Fund Budget Review
•
These revenues include all other sources, including permits, fees, investment proceeds, etc.
•
Revenue is tracking higher than last year
•
No adjustment recommended at this time
15 General Fund Expenditures
–
First Half of FY 21
-
22 City of
Rialto
General Fund Budget Review
•
Expenditures are tracking on budget at 50%
16 General Fund Reserve
City of
Rialto
General Fund Budget Review
17 General Fund Reserve
City of
Rialto
General Fund Budget Review
•
City’s financial reserve is strong, BUT
•
Pension UAL was $121.2 million as of June 30, 2019
•
Pension Obligation Bond will NOT reduce debt, just refinance interest rate, any savings will be budgeted in accordance with City Council pension investment policy
•
OPEB liability was $44.9 million as of June 30, 2021
•
City has existing debts and liabilities to consider with one -
time
revenues
18 Recommended Personnel Additions
City of
Rialto
General Fund Budget Review
•
City Manager’s Office: Add (1) new Assistant to the City Manager, and Add (1) new City Manager’s Assistant
•
Human Resources: Add (1) new HR/RM Analyst
•
Finance: Add (2) Administrative Analysts for Budget and Payroll •
Finance: Reclassify (1) Part
-
Time Admin Aide and (1) Part
-
Time
Intern to (2) Full
-
Time Sr. Accounting Assistants
•
Police: Add (1) Animal Control Officer II
•
Total FY21
-
22 Cost is $201,375; FY22
-
23 Annual Cost is $700,000
19 Recommended Additional Expenditures
City of
Rialto
General Fund Budget Review
•
Community Development: +$1.4 million for on
-
call plan check and
inspection services to accommodate significant pace of economic development (offset with corresponding revenues)
•
Community Development: +$282,000 for contractual services •
Community Services: +$113,475 for various recreational programs and related cost
•
Fire: +$500,000 mutual aid costs (offset by +$640,000 mutual aid reimbursements)
20 Recommended Additional Expenditures
City of
Rialto
General Fund Budget Review
•
Human Resources: +$113,040 for salary expenditures
•
Police: +$170,000 for (2) new vehicles for Park Rangers •
Total net increased expenditure budget = +$879,890
21 Recommended One Time Use of Funds
City of
Rialto
General Fund Budget Review
•
New Police Station Project:
$10 million
•
OPEB Fund:
$5 million
•
General Liability Fund:
$3 million
22 City of
Rialto
General Fund Budget Review
QUESTIONS?