CITY OF SEBASTOPOL CITY COUNCIL
AGENDA ITEM REPORT FOR MEETING OF: November 19, 2024
=========================================================================================== To: Honorable Mayor and City Councilmembers
From: Ana Kwong – Administrative Services Director
Don Schwarz – City Manager
Subject: FY24-25 Quarter 1 Financial Update – General Fund =========================================================================================== RECOMMENDATION:
Staff recommends the Sebastopol City Council receive year-to-date financial information for the General Fund.
EXECUTIVE SUMMARY:
Based on the best available information as of September 30, 2024, the city's general fund revenue is currently less than 10% of the budget. Ideally, if all factors were consistent, it should be at 25% by this time of the year. The primary reason for revenue not being at 25% is that major revenue categories, such as property tax and sales tax, do not follow a linear pattern throughout the year. Expenses are tracking slightly below budget.
BACKGROUND:
This report represents the City’s General Fund results for the first quarter of the current fiscal year. However, for several reasons first quarter reports are inherently of limited value. That is largely because the available data are limited, in some cases including a month of revenue such as for sales taxes, our largest source of revenue. We will not receive the first payment of property taxes, our second largest source of revenue, until December. Numerous revenue sources are not linear, meaning that we cannot accurately project year-end results from limited data – Transit Occupancy Tax is an example. The same is true to a lesser degree for some expense categories.
Many cities do not create first quarter reports because of the inherent uncertainties that come with limited data.
Nonetheless, we have received some newer information since adopting the budget. Most importantly:
I. Based on notification from the County, it appears that our budgeted property tax revenue is $117,000 too high.
II. While we have only one month of actual results for our sales taxes, our consultant has projected that our budgeted estimate (which they developed for us) is $54,000 too high.
III. We are reviewing our estimates for building fees, and expect to have updated numbers for the Council at your November 19 meeting.
IV. On the expense side, the Council has approved numerous increases in compensation for employees. This is because negotiations for new labor agreements were not completed in time to include in the adopted budget, and because we have raised salaries for some Department Head positions to improve our ability to attract strong candidates as several of these positions turn over.
V. The budget did not include savings for vacant positions that occur over the year. We know that there will be some savings and are working on developing estimates.
Staff is working with our financial advisor, Bob Leland, to update our long-term financial model. That update will consider all of the factors above, and others including but not limited to the results of the election for Measure U.
We believe that updating this model should be the focus of our efforts.
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
Update on FY 23-24 Results
The City's independent auditor has completed the audit for FY23-24. Until the financial statement is officially certified by the auditor, it is referred to as “unaudited.” Overall, the FY23-24 unaudited actuals show that while a $1,140,000 deficit was projected in the Spring, the actual deficit was $287,000. While a smaller deficit is good news for the City’sfinancialsituation, it does not change the fundamental need for additional on-going revenue to sustain services.
FY23-24
Estimated
Actual
FY23-24
* Unaudited
Actual
$ Difference
from
Unaudited vs.
Estimated
Actual
% Difference
from
Unaudited vs.
Estimated
Actual
Revenues 13,819,441 $ $ 13,980,694 $ 161,253 1.2%
Expenditures 14,961,428 $ $ 14,267,418 $ (694,010) -4.6% Net Results (1,141,987) $ $ (286,725)
Revenues were 5% higher than budgeted for the year, and 1.2% higher than projected in the Spring. Such variations are within a normalrange. The mostsignificant increases were in salestax, interest earnings, and Transit Occupancy Tax.
Expenses were 6% lower than the budget, and 4.6% lower than projected in the Spring (this excludes the $1.1 million General Fund loan to the Wastewater fund). The mostsignificant decreases were in the Police Department, and appear due to projections for PERS costs. We have simplified our methodology for estimating these costs to make it easier for Departments to project them in the future. We also saw significant decreases in Public Works, most likely due to conservative projections and belt tightening, which we also saw in other Departments. Other savings came from not transferring $100,000 to our PERS reserve, after the Spring projections. An additional $50,000 in savings came from delaying a capital project one year. These were off-set in part by a payment to a contractor and debt service payment that were not included in the Spring projections.
As part of the upcoming Management Review we will look for further opportunities to improve our projections.
Summary of Q1 Financials:
The financial information reported includes transactions through September 30, 2024, 3 months through the fiscal year. The current actual collection shows total general fund revenue is $1.37M, which equates to 9.6% of budget.
Specific items attributed to year-to-date income are as follows:
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
Description
2022-23
Actual
Unaudited*
2023-24
Actual
2024-25
Adopted
Budget
2024-25
Adjusted
Budget
Y-T-D
Actual
9/30/24 Footnote
% of
Budget
OPERATING REVENUE
Property Tax 3,293,347 3,443,916 3,620,000 3,620,000 -0 1 0.0% Real Property Transfer Tax 49,530 36,506 40,000 40,000 6,338 2 15.8% Sales Taxes 4,718,318 4,626,788 4,563,925 4,563,925 399,845 3 8.8% User Taxes 858,334 871,287 887,175 887,175 144,463 4 16.3% Transient Occupancy Tax 544,128 519,452 519,000 519,000 101,134 5 19.5% Franchise Fees 468,871 489,591 502,250 502,250 51,404 6 10.2% Licenses & Permits 709,578 498,057 1,442,500 1,442,500 105,477 7 7.3% Fines & Special Assessments 51,623 70,560 66,700 66,700 31,311 8 46.9% Intergovernmental Revenues 2,068,971 438,560 22,890 22,890 -0 9 0.0% Interest & Rents 31,471 155,296 132,250 132,250 29,354 10 22.2% Charges for Services 182,938 122,530 136,800 136,800 36,480 11 26.7% Miscellaneous Revenue 788,352 120,010 183,225 183,225 24,243 12 13.2% Cost Allocation Plan 2,189,693 2,476,141 1,761,797 1,761,797 440,449 25.0% Transfers In 102,500 112,000 425,951 425,951 -0 13 0.0% TOTAL REVENUES 16,057,653 13,980,694 14,304,463 14,304,463 1,370,498 9.6%
1. Property Tax: The City receives property tax payments twice a year, in December and again in late April 2025. As stated above, according to the most recent notification from the County, the projected property tax budget of $3.62 million is overstated by $117,000. We will have a clearer understanding of the property tax trend once the City receives the first distribution.
2. Real Property Transfer Tax: The amount of $6,338 represents two months of collections. When compared to the same period in previous years, the revenue received so far this fiscal year aligns closely, suggesting that the original budget projections are too high.
3. Sales taxes: Sales tax collections during the first quarter is only recorded July activities. Our sales tax consultant has provided the latest projection based on Q2-2024 collections (April-June 2024) and preliminary year end projection does appear to be lower by $54,000 from the adopted budget. The table below illustrates that while sales tax revenue is lower compared to the same period last year, it is higher than it was two years ago.
.
Category July 2022 July 2023 July 2024
Bradley Burn 172,069.17 208,784.89 191,282.24
Measure T 59,905.25 66,050.45 62,450.28
Measure Q 119,941.21 131,380.35 124,807.72
Total 351,915.63 406,215.69 378,540.24
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
4. User Taxes: The city imposes a tax on the usage of telephone, garbage, and cable services. This tax is collected by these providers and then remitted to the city on a monthly and quarterly basis. The table below shows the revenue received through August. The cost of electricity has significantly increased, leading to higher electric bills for many residents. Consequently, this has resulted in an increase in the utility user tax.
Although the city is receiving more revenue from this tax, it’s still unknown at this point if the the adopted budget of $887K need any adjustments.
Category 2022 2023 2024
$ Diff
2024 vs
2023
% Diff
2024 vs
2023 2022 2023 2024
$ Diff
2024 vs
2023
% Diff
2024 vs
2023
Electric 37,148 37,504 46,269 8,765 23.4% 38,888 40,294 48,196 7,902 19.6% Garbage 6,733 7,602 8,535 12.3% 7,312 933 8,097 8,187 1.1% 90 Cable 6,262 6,096 5,983 (279) -4.5% 6,111 6,155 5,848 (307) -5.0% Others * 11,446 10,203 (783) 9,420 -7.7% 11,427 11,103 12,026 923 8.3% Total 61,423 61,571 70,206 8,636 14.0% 63,737 65,649 74,257 8,608 13.1% * Others refer to smaller operators in the industry such as gas, communication, energy, wireless July August
5. Transient Occupancy Tax (TOT): TOT is about 4% of the budgeted revenue. The city has received nearly 20% of this revenue from hotel/motel, and bed, and breakfast room rentals. This year-to-date amount of $101,000 represents two months of Transient Occupancy Tax (TOT) activities. While it might be tempting to project this figure linearly—by dividing the total received by two months and multiplying by twelve to estimate over $600,000 for the year—it's important to consider the seasonal nature of bed tax. Before FY23-24, the results were too irregular and influenced by COVID to be useful for any meaningful comparison. Therefore, the table below shows the full year of FY23-24 actual amount received of $519,000 and the first two months for both years, indicating a relatively flat revenue stream. Given this seasonality, it is more accurate to base our projections on prior year actuals.
Fiscal Year
Full Year
Amount
July
Actual
August
Actual
FY2023-24 519,452 51,166 51,077
FY2024/25 Budget 519,000 49,851 51,892
6. Franchise Fees: The franchise fee category includes PG&E, Garbage, and Cable TV/Video. The PG&E franchise fees are normally received in late April. The Video franchise fees are submitted quarterly, and collections to-date have been received through August for garbage only.
7. Licenses & Permits: The majority of this line item revenue comes from development-related activity fees, which account for 10% of the budget. These fees are collected when permits are issued, and their timing can vary throughout the year depending on the development period. Additionally, this category includes business license fees, with the bulk of collections occurring during the renewal period in December.
8. Fines & Special Assessments: This category includes vehicle code violations and parking fines. The collections to date have exceeded the 25% quarterly mark due to the state mandated cost reimbursement for racial and ID profiling. This State-mandated cost reimbursement for racial and identity (ID) profiling involves compensating local governments for the expenses incurred in complying with state laws aimed at preventing and addressing racial and identity profiling by law enforcement agencies. To support these Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
efforts, the state provides financial reimbursement to local governments for the costs associated with implementing these requirements.
9. Intergovernmental Revenues: This category includes reimbursement from other agencies, and it can vary throughout the year and challenge to predict. For the first quarter of the fiscal year, the city has not received our casino mitigation income and/or POST reimbursement.
10. Interests and Rents: Fluctuations in cash balances throughout the year may cause variations in interest income. This category is tracking as expected and has the potential to exceed its target if the cash position remains stable.
11. Charges for Services: Most line items are trending in line with budget.
12. Miscellaneous Revenue: This category housed reimbursement for chemicals and electricity the city paid on behalf of the pool. The electricity bills for the pool have been lower than expected so far in this fiscal year.
Therefore, this is a direct correlation with lower expenses means lower reimbursement.
13. Transfer In: The budgeted transfer-in of $426,000 comprises of the list below. These transfers are typically made in the fourth quarter of the fiscal year.
Description
2024-25
Adopted
Budget
TRANSFERS IN
Transfer in
From Building, Facilities & Infra Reserve (Fund 103) 41,400 From Vehicle Abatement (Fund 125) 4,500
From Inclusionary Housing (Fund 205) 22,000
From Police Grant (Fund 209) 120,000
From Measure H (Fund 248) 238,051
3999 - Transfers In 425,951
Staff is not recommending any adjustments at this time. We plan to reassess the situation as we update the City’s long-term financial model and after mid-year, when we will have a clearer picture of the overall financial performance and can make more informed decisions.
The first quarter expenses for the General Fund are summarized below. In some cases expenditures are not linear.
Overall, all departments reported that their expenditures are tracking slightly below budget.
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
Description
2022-23
Actual
Unaudited*
2023-24
Actual
2024-25
Adopted
Budget
2024-25
Adjusted
Budget
Y-T-D
Actual
9/30/24 Footnote
% of
Budget
OPERATING EXPENDITURE - By Department
10 - City Council 503,256 202,385 198,625 198,625 30,119 15.2% 11 - City Manager 340,598 518,664 698,885 698,885 172,144 24.6% 12 - City Attorney 461,932 759,058 647,900 647,900 158,317 24.4% 13 - City Clerk 424,717 366,405 430,771 430,771 100,638 23.4% 14 - Administrative Services (Finance) 1,218,805 1,314,441 1,436,923 1,438,173 358,150 24.9% 21 - Planning 596,114 532,564 616,426 616,426 120,716 19.6% 22 - Building 248,051 214,977 302,220 302,220 58,676 19.4% 23 - Engineering 515,766 544,009 553,020 553,020 73,081 13.2% 31 - Fire & Prevention 1,302,704 1,230,393 1,535,910 1,535,910 219,179 14.3% 32 - Police 5,002,699 4,995,733 5,366,488 5,413,761 1,244,384 23.2% 40 - Senior Center 64,732 72,703 41,038 41,038 7,775 18.9% 41 - Public Works 1,672,896 1,610,650 1,769,079 1,769,079 412,187 23.3% 42 - PW-Community Center 442,528 279,473 169,724 169,724 53,845 31.7% 43 - PW-Ives Pool 146,925 249,957 297,301 297,301 26,422 8.9% 00 - Non Departmental 280,357 210,838 191,645 191,645 5,856 3.1% Debt Service Payments 254,140 300,407 446,094 446,094 356,512 a 79.9% Transfers Out 228,163 864,763 300,000 300,000 -
b 0.0%
TOTAL EXPENDITURES 13,704,385 14,267,418 15,002,049 15,050,572 3,398,002 22.7%
a. Debt Service Payments: Debt service payments consist of various debt obligations, with the fire truck principal and interest amount being paid in the first quarter of the fiscal year. This means that a significant portion of the debt has been paid, and the residual will be paid in the remainder of the year. b. Transfer-out: The cost of the library HVAC toof project has been covered by the general fund earlier this year.
The City will be reimbursed for this cost when the project is completed after the rain stops.
Update on FY 24-25 Projections
As noted above, there is considerable uncertainty in projecting the year-end results for the current FY based on one quarter of results, which is why we have not included projections in the attached tables.
Nonetheless, the Budget Committee requested the best available information on this topic, presented below. The adopted budget includes a deficit of approximately $700,000. There are several factors which could increase or decrease the deficit that we are aware of now. Please recall that in developing the budget we used ‘down the middle’ estimates, intending to use the best available information and not being overly aggressive nor conservative in projecting revenues or expenditures.
Factors which could increase the deficit include:
a. $117,000 in lower property taxes, noted above, based on the latest projections from the County. This is 3% lower than budget.
b. $54,000, or 1%, lower sales taxes (before Measure U) c. Property tax transfer revenue of $6,338 for two months. Combined with significantly lower than budgeted revenues in FY 23-24 compared to the prior year, this may reflect a slow down in real estate due to higher interest rates in recent years. A slow down could lead to lower property tax revenues. We will revisit our property tax projections going forward.
d. $115,000 less in building permit fees due to fee adjustments proposed for this Council meeting.
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
e. Higher compensation for employees approved by the Council in recent months, with a high-end estimate of $186,000.
Factors which could decrease this year’s deficit include:
a. Unbudgeted salary savings: Because of many uncertainties about positions at the time of budget adoption, the budget does not include savings from positions that have been vacant. Most of these are being filled.
We will be estimating these savings as we update our projections. b. Revenue from Measure U, which will go into effect on April 1. We estimate receiving $188,000 that we can include in the FY 24-25 budget if we receive only ½ of the Measure U funding. We plan to use that figure in updating our projections until more is known about the outcome of discussions with the state on Measure I.
Measure U Follow Up
Measure U should increase our General Fund revenue by about $1.5 million/year and stabilize the City’s finances.
However, because Measure I also passed there are uncertainties about the amount of new revenue that we will receive. We are discussing this with the California Department of Tax and Fee Administration (CDTFA). We do not anticipate a definitive resolution imminently. The sales tax increases will not occur until April 1, 2025. Due to the uncertainty, we are planning on receiving ½ of the projected Measure U revenues (or a ¼ cent increase) for now.
As noted in the adopted budget, a ¼ cent increase in salestax revenue willrequire eithersubstantial cutsin services, less investment in our infrastructure and facilities, or a combination of both.
Also due to the uncertainty, we are for now holding a vacant Public Works Maintenance I position open. If we filled it with an internal promotion, we would continue to have a vacancy. Public Works is nearing completion of its usual tasks in preparing downtown for the holiday season. Should the Council direct staff to further focus on downtown it would require Public Works to adjust its priorities such as completing the clearing of gutters on City buildings and removing leaves from storm drains to reduce the risks of flooding. Holding the position vacant would also allow the incoming Public Works Director to make the hiring decision.
Measure H Update
Measure H was the ½ cent County-wide sales tax to support fire services approved in March of this year. While initial plans called for us to receive seven months of revenue during the current fiscal year ($600,000), we now expect to receive nine months of revenue, or about $750,000. Because of Maintenance of Effort (MOE) requirements in the Measure, we cannot reduce the $1.5 million in General Funds budgeted for the Fire Department even if the Council desired to do so. The Fire Ad Hoc Committee is discussing the use of Measure H funds.
Auditor Update
It is recommended that cities change auditors periodically to ensure some ‘distance’ between the outside auditor and the City. We have been unsuccessful in finding a new outside auditor, despite issuing two Requests for Proposals. Thus, we plan to hire the same firm we have been using, which will assign a different person to the role.
Thisis considered an acceptable alternativewhen a city cannotfind a newauditor.Other cities have reported similar difficulties.
Next Steps
Because there is considerable new information and changes since we last updated the City’s long-term budget model, updating the model is a high priority over the next several weeks. While we are eager to update the model quickly, we also want to ensure it includes solid information. Staff have been trained on the model and will work Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
with our financial consultant, Bob Leland, on the updated version. We anticipate presenting the results to the Council as soon as possible after they are available and reviewed by the Budget Committee.
Additionally,we anticipate bringing an item to the Budget Committee and City Council to formally adopt resolutions to reflect Council-approved budget changes this FY when that has not already occurred. This will help us to better track our finances in our systems and reduce the chance of errors.
PUBLIC COMMENT:
As of the writing of this staff report, the City has not received any public comment on this item. However, if staff receives public comment from interested parties following the publication and distribution of this staff report,such comments will be provided to the City Council as supplemental materials before or at the meeting.
COMMUNITY OUTREACH:
This item has been noticed in accordance with the Ralph M. Brown Act and was available for public viewing and review at least 72 hours prior to the scheduled meeting date.
FISCAL IMPACT:
There is no fiscal impact in receiving this informational financial update.
RESTATED RECOMMENDATION:
That the City Council receive year-to-date financial information.
OPTIONS:
There are no options to consider.
ATTACHMENTS:
Attachment A – Quarterly Financial Reports
Powerpoint Presentation
APPROVALS:
Department Head Approval: Approval Date: __10/14/24____ CEQA Determination (Planning): Approval Date: ___N/A_______ The proposed action is / is not exempt from the requirements of the California Environmental Quality Act (CEQA) Administrative Services/Financial Approval: Approval Date: ___10/14/24___ Costs authorized in City Approved Budget: ☐ Yes ☐ No N/A Account Code (f applicable) ___________________________ City Attorney Approval: Approval Date: __10/31/24____
City Manager Approval: Approval Date: ___11/12/24_______ Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
Description
2022-23
Actual
Unaudited*
2023-24
Actual
2024-25
Adopted
Budget
2024-25
Adjusted
Budget
Y-T-D
Actual
9/30/24
Footnote
% of
Budget
OPERATING REVENUE
Property Tax 3,293,347 3,443,916 3,620,000 3,620,000 -0 1 0.0% Real Property Transfer Tax 49,530 36,506 40,000 40,000 6,338 2 15.8% Sales Taxes 4,718,318 4,626,788 4,563,925 4,563,925 399,845 3 8.8% User Taxes 858,334 871,287 887,175 887,175 144,463 4 16.3% Transient Occupancy Tax 544,128 519,452 519,000 519,000 101,134 5 19.5% Franchise Fees 468,871 489,591 502,250 502,250 51,404 6 10.2% Licenses & Permits 709,578 498,057 1,442,500 1,442,500 105,477 7 7.3% Fines & Special Assessments 51,623 70,560 66,700 66,700 31,311 8 46.9% Intergovernmental Revenues 2,068,971 438,560 22,890 22,890 -0 9 0.0% Interest & Rents 31,471 155,296 132,250 132,250 29,354 10 22.2% Charges for Services 182,938 122,530 136,800 136,800 36,480 11 26.7% Miscellaneous Revenue 788,352 120,010 183,225 183,225 24,243 12 13.2% Cost Allocation Plan 2,189,693 2,476,141 1,761,797 1,761,797 440,449 25.0% Transfers In 102,500 112,000 425,951 425,951 -0 13 0.0% TOTAL REVENUES 16,057,653 13,980,694 14,304,463 14,304,463 1,370,498 9.6% OPERATING EXPENDITURE - By Department
10 - City Council 503,256 202,385 198,625 198,625 30,119 15.2% 11 - City Manager 340,598 518,664 698,885 698,885 172,144 24.6% 12 - City Attorney 461,932 759,058 647,900 647,900 158,317 24.4% 13 - City Clerk 424,717 366,405 430,771 430,771 100,638 23.4% 14 - Administrative Services (Finance) 1,218,805 1,314,441 1,436,923 1,438,173 358,150 24.9% 21 - Planning 596,114 532,564 616,426 616,426 120,716 19.6% 22 - Building 248,051 214,977 302,220 302,220 58,676 19.4% 23 - Engineering 515,766 544,009 553,020 553,020 73,081 13.2% 31 - Fire & Prevention 1,302,704 1,230,393 1,535,910 1,535,910 219,179 14.3% 32 - Police 5,002,699 4,995,733 5,366,488 5,413,761 1,244,384 23.2% 40 - Senior Center 64,732 72,703 41,038 41,038 7,775 18.9% 41 - Public Works 1,672,896 1,610,650 1,769,079 1,769,079 412,187 23.3% 42 - PW-Community Center 442,528 279,473 169,724 169,724 53,845 31.7% 43 - PW-Ives Pool 146,925 249,957 297,301 297,301 26,422 8.9% 00 - Non Departmental 280,357 210,838 191,645 191,645 5,856 3.1% Debt Service Payments 254,140 300,407 446,094 446,094 356,512 a 79.9% Transfers Out 228,163 864,763 300,000 300,000 -
b 0.0%
TOTAL EXPENDITURES 13,704,385 14,267,418 15,002,049 15,050,572 3,398,002 22.7% Net Surplus/(Deficit) 2,353,268 (286,725) (697,586) (746,109) (2,027,503)
GENERAL FUND
QUARTERLY REPORTING - BY DEPARTMENT
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
Description
2022-23
Actual
Audited
2023-24
Actual
2024-25
Adopted
Budget
2024-25
Adjusted
Budget
Y-T-D
Actual
9/30/24
Footnotes
% of
Budget
OPERATING REVENUE
Property Tax 3,293,347 3,443,916 3,620,000 3,620,000 -0 1 0.0% Real Property Transfer Tax 49,530 36,506 40,000 40,000 6,338 2 15.8% Sales Taxes 4,718,318 4,626,788 4,563,925 4,563,925 399,845 3 8.8% User Taxes 858,334 871,287 887,175 887,175 144,463 4 16.3% Transient Occupancy Tax 544,128 519,452 519,000 519,000 101,134 5 19.5% Franchise Fees 468,871 489,591 502,250 502,250 51,404 6 10.2% Licenses & Permits 709,578 498,057 1,442,500 1,442,500 105,477 7 7.3% Fines & Special Assessments 51,623 70,560 66,700 66,700 31,311 8 46.9% Intergovernmental Revenues 2,068,971 438,560 22,890 22,890 -0 9 0.0% Interest & Rents 31,471 155,296 132,250 132,250 29,354 10 22.2% Charges for Services 182,938 122,530 136,800 136,800 36,480 11 26.7% Miscellaneous Revenue 788,352 120,010 183,225 183,225 24,243 12 13.2% Cost Allocation Plan 2,189,693 2,476,141 1,761,797 1,761,797 440,449 25.0% Transfers In 102,500 112,000 425,951 425,951 -0 13 0.0% TOTAL REVENUES 16,057,653 13,980,694 14,304,463 14,304,463 1,370,498 9.6% Operating Expenditure - Category
Salaries & Wages 4,762,291 4,705,009 4,620,599 4,655,099 1,083,674 23.5% Benefits 3,048,693 3,039,292 3,592,788 3,606,811 819,667 22.8% Contracted Services 2,527,667 2,601,237 3,189,634 3,189,634 561,347 17.6% Services & Supplies 530,478 478,098 637,038 637,038 132,965 20.9% Special Programs 232,719 196,122 58,300 58,300 30,650 52.6% Equipment (under $10K) 37,396 2,622 20,000 20,000 407 2.0% Equipment Rental/Maintenance 70,564 62,235 90,230 90,230 12,147 13.5% Utilities-City 2,719 5,377 12,000 12,000 2,350 19.6%
Vehicle Expense 158,091 161,226 174,025 174,025 32,228 18.5% Conference & Training Expense 52,182 39,828 68,870 68,870 9,856 14.3% Utilities 255,989 270,880 444,382 444,382 65,489 14.7%
Telecommunications 82,670 78,058 80,880 80,880 13,669 16.9% Council Objectives 355,106 60,418 6,500 6,500 - 0.0%
Allocated Insurance 923,677 1,192,721 1,100,910 1,100,910 275,228 25.0% Capital Outlay 181,841 209,126 159,800 159,800 1,812 1.1% Debt Service Payments 254,140 300,407 446,094 446,094 356,512 a79.9% Transfers Out 228,163 864,763 300,000 300,000 -
b
0.0%
TOTAL EXPENDITURES 13,704,384 14,267,419 15,002,049 15,050,572 3,398,002 22.7% Net General Fund Surplus/(Deficit) 2,353,268 (286,725) (697,586) (746,109) (2,027,504)
GENERAL FUND
QUARTERLY REPORTING - BY CATEGORY
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
Revenue Categories
2022-23
Actual
Unaudited*
2023-24
Actual
2024-25
Adopted
Budget
2024-25
Adjusted
Budget
Y-T-D
Actual
9/30/24
Footnote
% of Budget
3000 - Property Tax Secured / Unsecured 2,384,387 2,487,900 2,595,000 2,595,000 -0 1 0.0% 3002 - Real Property Transfer Tax 49,530 36,506 40,000 40,000 6,338 2 15.8% 3004 - Property Tax in Lieu of VLF 908,960 956,016 1,025,000 1,025,000 -0 0.0% Property Tax 3,342,877 3,480,422 3,660,000 3,660,000 6,338 0.2% 3010 - Sales Tax-Bradley Burn 2,255,817 2,199,730 2,173,000 2,173,000 191,282 8.8% 3011 - Sales Tax-1/4 cent (T) 780,207 770,928 760,000 760,000 65,376 8.6% 3012 - Sales Tax-1/2 cent (Q) 1,572,895 1,550,631 1,520,125 1,520,125 124,808 8.2% 3014 - Sales Tax-Prop 172 109,400 105,500 110,800 110,800 18,379 16.6% Sales Taxes 4,718,318 4,626,788 4,563,925 4,563,925 399,845 3 8.8% 3020 - Transient Occupancy Tax 544,128 519,452 519,000 519,000 101,134 5 19.5% -0
3050 - Garbage Franchise 260,922 296,817 301,350 301,350 51,404 17.1% 3051 - PG&E Franchise 113,597 121,383 124,025 124,025 -0 0.0% 3052 - Cable TV Franchise 94,352 71,390 76,875 76,875 -0 0.0% Franchise Fees 468,871 489,591 502,250 502,250 51,404 6 10.2% 3055 - Vehicle in lieu Tax 7,710 9,291 10,000 10,000 -0 0.0% 3056 - UUT PG&E 421,904 429,651 428,600 428,600 71,481 16.7% 3057 - UUT Sonoma Clean Power 128,652 128,152 135,300 135,300 22,984 17.0% 3058 - UUT Garbage 84,878 96,555 98,400 98,400 16,722 17.0% 3059 - UUT Cable 57,239 72,492 76,875 76,875 11,831 15.4% 3060 - UUT Misc 156,671 135,059 136,500 136,500 21,446 15.7% 3061 - UUT (AB-1717) 1,280 88 1,500 1,500 -0 0.0%
User Taxes 858,334 871,287 887,175 887,175 144,463 4 16.3% 3101 - Business License 145,992 142,770 140,000 140,000 7,039 5.0% 3102 - Business License-Late Fees 5,443 6,388 2,500 2,500 180 7.2% 3103 - Building Permits 558,093 348,900 1,300,000 1,300,000 98,259 7.6% 3104 - Pet Shelter Release Fee 50 -0 -0 -0 -0 0.0%
Licenses & Permits 709,578 498,057 1,442,500 1,442,500 105,477 7 7.3% 3105 - Vehicle/ Criminal Code Fines 10,388 13,906 13,700 13,700 4,077 29.8% 3106 - Parking Fines 18,378 20,760 18,000 18,000 3,270 18.2% 3107 - RBS Training Fees 12,800 11,600 12,000 12,000 1,000 8.3% 3110 - Business License - DSA 70% $1 5,735 5,415 5,000 5,000 380 7.6% 3202 - State Mandated Cost Reimb 4,322 18,880 18,000 18,000 22,584 125.5% Fines & Special Assessments 51,623 70,560 66,700 66,700 31,311 8 46.9% 3203 - POST Reimb 3,096 2,703 2,700 2,700 -0 0.0%
3204 - Casino Mitigation 19,149 24,224 20,190 20,190 -0 0.0% 3206 - County Grant -0 60,000 -0 -0 -0 0.0%
3207 - State Grant 395,493 351,632 -0 -0 -0 0.0%
3209 - Federal Grant 1,651,233 -0 -0 -0 -0 0.0%
Intergovernmental Revenues 2,068,971 438,560 22,890 22,890 -0 9 0.0%
GENERAL FUND REVENUES DETAILED
QUARTERLY REPORTING
The information pertaining to each footnote is located in the section that follows the transfers schedule Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
Revenue Categories
2022-23
Actual
Unaudited*
2023-24
Actual
2024-25
Adopted
Budget
2024-25
Adjusted
Budget
Y-T-D
Actual
9/30/24
Footnote
% of Budget
GENERAL FUND REVENUES DETAILED
QUARTERLY REPORTING
The information pertaining to each footnote is located in the section that follows the transfers schedule 3300 - Interest Income -21,286 97,452 77,000 77,000 18,432 23.9% 3301 - Cell Tower Lease Rental 39,608 45,594 43,000 43,000 7,788 18.1% 3302 - City Property Rental - Little League 2,974 2,300 2,300 2,300 1,369 59.5% 3304 - City Property Rental - Parking Space 500 500 500 500 40 8.0% 3305 - City Property Rental - Palm Ave 3,000 2,250 2,250 2,250 -0 0.0% 3401 - Plaza and Special Event Fees 6,675 7,200 7,200 7,200 1,725 24.0% Interest & Rents 31,471 155,296 132,250 132,250 29,354 10 22.2% 3404 - Credit Card Transaction Fee 177 1,000 1,000 1,000 697 69.7% 3405 - Finance Fee 7,407 5,000 5,000 5,000 1,170 23.4%
3425 - Fire Dept Fees 57,534 30,000 40,000 40,000 6,096 15.2% 3426 - Planning Fees 44,217 25,000 21,000 21,000 7,761 37.0% 3427 - Special Projects Plans/Specs 200 -0 -0 -0 -0 0.0% 3428 - GIS Fees 460 -0 -0 -0 -0 0.0%
3441 - Encroachment Permits Fee 27,074 30,000 30,000 30,000 10,398 34.7% 3442 - Grading Permit Fee 1,032 1,030 1,000 1,000 1,090 109.0% 3445 - Public Works Services 8,940 7,000 7,500 7,500 54 0.7% 3502 - Police Services 17,240 15,000 18,000 18,000 5,471 30.4% 3504 - Impounded Vehicle Release Fee 2,240 1,800 1,800 1,800 500 27.8% 3505 - Police Reports Copy Fee 3,878 4,000 4,000 4,000 280 7.0% 3506 - Police False Alarms Fee 3,400 -0 -0 -0 -0 0.0%
3507 - Police OT Reimbursement 9,139 2,700 7,500 7,500 2,964 39.5% Charges for Services 182,938 122,530 136,800 136,800 36,480 11 26.7% 3801 - Sales of Surplus Equipment 31,222 -0 10,000 10,000 870 8.7% 3804 - Insurance Claims 224,633 450 500 500 8,968 1793.5% 3805 - Miscellaneous Income 9,178 100 100 100 590 590.2% 3806 - Donations & Contributions 427,775 500 500 500 -0 0.0% 3807 - Rebates 14,100 14,000 14,000 14,000 2,576 18.4%
3810 - Pool Expense Reimbursement 81,445 104,960 158,125 158,125 11,239 7.1% Miscellaneous Revenue 788,352 120,010 183,225 183,225 24,243 12 13.2% 3998 - Cost Allocation Plan 2,189,693 2,476,141 1,761,797 1,761,797 440,449 25.0% 3999 - Transfers In 102,500 112,000 425,951 425,951 -0 13 0.0% -0
Total Revenue 16,057,653 13,980,694 14,304,463 14,304,463 1,370,498 9.6% Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
GENERAL FUND
FIRST QUARTER REPORT
NOVEMBER 19, 2024
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
HIGHLIGHTS
• ACTUALS VARY IN TIMING, ESPECIALLY REVENUE
• CANNOT DRAW MANY CONCLUSIONS THIS EARLY IN FY
• MANY CITIES DON’T PRODUCE Q1 REPORTS
• ACTUAL REVENUES THROUGH SEPTEMBER 30: 9.6% OF BUDGET
• ACTUAL EXPENSES THROUGH SEPTEMBER 30: 22.7%
• WE BUDGETED “DOWN THE MIDDLE”
• MANY CITIES BUDGET MORE CONSERVATIVELY
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
WHERE WILL WE END UP?
• BUDGETED DEFICIT: $698K
• TOO SOON TO TELL WHERE WE’LL END UP
• UPDATING LONG-TERM MODEL WITH SOLID
INFORMATION IS HIGH PRIORITY
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
UPS AND DOWNS ON FY 24-25 DEFICIT
• FACTORS WHICH COULD INCREASE DEFICIT:
• PROPERTY TAXES: $117K LOWER (3%)
• SALES TAXES: $54K LOWER (1%)
• BUILDING FEES: $115K LOWER (9%)
• EMPLOYEE COMPENSATION: $186K HIGHER (2%)
• FACTORS WHICH COULD DECREASE DEFICIT:
• VACANCY SAVINGS (AMOUNT TBD)
• MEASURE U: $188K HIGHER (ASSUMES ¼ CENT FOR 3 MONTHS
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
FY 23-24 RESULTS
• ACTUAL DEFICIT: $287K; $855K LESS THAN PROJECTED IN
SPRING
• REVENUES UP 1.2% COMPARED TO SPRING
• EXPENSES DOWN 4.6%
• REVIEWING OUR PROCESS FOR PROJECTIONS
• FUNDAMENTAL NEED FOR MORE REVENUE REMAINS
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
MEASURE U FOLLOW UP
• $1.5M ANNUALLY FROM MEASURE U
• POTENTIAL FOR $750K WITH MEASURE I
• DISCUSSING WITH STATE
• IN MEANTIME . . . PROJECTIONS WILL ASSUME $750K
• LONG-RUN: $750K MEANS SIGNIFICANT REDUCTIONS IN SERVICES, LESS IN INFRASTRUCTURE, BUILDINGS, ETC. OR SOME OF EACH • SHORT-RUN: HOLDING MAINTENANCE WORKER I VACANT
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
MEASURE H UPDATE
• INITIALLY BUDGETED $600K FOR FY 24-25
• CURRENT PROJECTION: $750K
• SOME MAY TRANSFER TO GOLD RIDGE IN REORGANIZATION
• ALLOCATED $300K IN BUDGET
• FIRE AD HOC DISCUSSING USES OF MEASURE H FUNDS
• $1.5M GENERAL FUND REQUIREMENT FOR FY 24-25 REMAINS
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024
NEXT STEPS:
UPDATING OUR FINANCIAL MODEL
• HIGH PRIORITY
• WILL FACTOR IN MEASURE U
• WILL REFLECT OTHER KNOWN CHANGES
• WILL UPDATE WITH BETTER INFORMATION
• VACANCY SAVINGS
• PLANNING DEPARTMENT REVENUES
• BUILDING FEES
• ETC.
Agenda Item Number 10 Agenda Item Number 10
City Council Meeting Packet of November 19, 2024