Attachment 5 - General Fund Revenue and Expenditure Assumptions 1 CATEGORY ASSUMPTIONS
REVENUES
PROPERTY TAXES
Assessed Value (AV) Growth stems from a combination of factors such as 2 percent Consumer Price Index (CPI) growth for most properties, new valuation for properties that were sold during 2024. Estimated growth of 4.0 percent for Secured Property Taxes and 2 percent for several revenue streams within this category, and a decrease of 12 percent for the Successor Agency Surplus account stemming from actuals received in FY 2023-24 and year to date, leading to overall growth of 1.3 percent for the Property Tax cate
gory.
SALES & USE TAX
The City’s Sales Tax consultant has presented a more optimistic outlook based on the figures from Quarter 4 of 2024, compared to those from Quarter 3 of the same year. This is largely attributed to an overcorrection applied in Quarter 3 in response to recent negative statewide sales tax trends. Additionally, some revenues initially expected in Quarter 3 were received late and carried over into Quarter 4.
Richmond's local performance has also slightly surpassed initial expectations. Furthermore, the continued outperformance of local businesses has exceeded projections. Overall, the City is poised to meet, and potentially exceed, the sales tax forecast provided earlier this year for both FY 2024-25 and FY 2025-26.
UTILITY USERS TAX (UUT)
The analysis was in part provided by Avenu Insights and Analytics. Historically, growth rates applied to individual revenue streams within the UUT category, such as Cable, and Telecommunications, continue to decrease due to industry changes, while others such as Gas and Electricity continue to increase due to rate increases. Additionally, the Settlement Amount expired in FY 2024-25; the cap amount paid by Chevron is based on Ener
gy Services CPI for the Bay Area. Overall, net increase of 4.6 percent.
OTHER TAXES
Revenue streams in this category vary yearly due to different influences, but most are expected to remain stable. The Documentary Transfer Tax is budgeted using the Guiding Fiscal Policy formula, based on the monthly average since the tiered structure was approved by voters.
LICENSES, PERMITS & FEES
The primary revenue stream is Business Tax and a growth factor of 8.5 percent based on actual amounts received in the last full year, FY 2023-24, plus a conservative growth factor of 2.0 percent. Net change for the cate
gory is 5.6 percent.
FINES & FORFEITURES Net increase of Parking citations and Muni Court Fines of 13.4 percent. Increase stems from actual amounts received last year and year to date.
INTEREST INCOME Interest income stemming from interest in pooled cash.
CHARGES FOR SERVICES
Most items entered by corresponding departments based on their estimated level of service. Most amounts are about the same with the exception of additional revenues from Public Works. Net increase of
14.4 percent.
OTHER REVENUE
The Other Revenue category is typically unpredictable with very few items included in the budget line item.
However, for FY 2025-26, this revenue category will include the $50,000,000, limited-term revenue. The remainin
g budgeted revenue funds are estimated by various departments.
RENTAL INCOME Proposed amounts are slightly higher and tied to current year actuals and leases.
GRANTS Only known grants are budgeted
PROCEED FROM SALE OF PROPERTY Based on historical trend OPERATING TRANSFERS IN Based on Analysis of the Pension Tax Override (PTORS) fund, estimated AV growth, minus scheduled uses. Left over funds are transferred to the General Fund to be used for eli gible Pension expenses.
EXPENDITURES
SALARIES AND WAGES
An increase of $1,393,530: Due to the reduction in Vacancy Savings Rate from 11 percent to 9.7 percent, salaries are increasing by $1,171,300 plus an additional appropriation of $225,480 has been included for part-time staff
PYROLL/FRINGE BENEFIT Retirement and Healthcare costs are based on the most recent CalPERS valuation reports and current Kaiser rates, respectively, and will adjust as new information becomes available.
PROF & ADMIN Baseline budget
OTHER OPERATING Baseline budget
UTILITIES Increased to reflect rate increases from utility agencies EQUIPMENT & CONTRACT SERVICES Baseline budget
PROVISION FOR INSURANCE LOSS Insurance Premiums
COST POOL
Vehicles, per Equipment Services provided list.
General Liability, rates provided by Risk Mgmt. to achieve 80 percent confidence over 5 years.
Civic Center Allocation, amount driven from the debt service, cash balance, and square footage used by programs.
ASSET/CAPITAL OUTLAY Based on draft Capital Improvement Plan DEBT SERVICE EXPENDITURE Debt Service Schedule, maintained by Treasury A87 COST PLAN REIMBURSEMENTS Based on current Cost Allocation Plan GRANT EXPENDITURES Based on the awarded grants
OPERATING TRANSFERS OUT Recurring and onetime subsidies to Non-GF programs. Reimagining Public Safety allocations same as current year.