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HomeMy WebLinkAboutA- 4 Mid Year Review 2/I01,0 `611 The City of Azusa ... c, ., , ,,_,„, 44-OR Finance Department• 213 E. Foothill Blvd. • P.O. Box 1395 • Azusa, CA 91702-1395 . Tel : (626)812-5203 • FAX(626)334-6358 AGENDA ITEM TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: GEOFF CRAIG, DIRECTOR OF FINANC VIA: JOSEPH F. HSU, INTERIM CITY ADM TRATOR ,gyp - DATE: February 18, 1998 SUBJECT: MIDYEAR REVIEW GJC/ts • Background In the FY 1997-98 budget the City Council challenged the staff and the Azusa Community to enter a new era. Staff accepted the challenge and, under Council's direction, has completed many of the FY 97-98 goals, with the remainder well under way. Staff offers, with this mid-year review, the progress thus far and recommends adjustments to estimated revenues and appropriations for your approval. Findings Azusa's fiscal year runs from July 1 to June 30. During the first half of the fiscal year the budget is established, the prior year's books are closed and financial reports are prepared. Finance has successfully closed the books and prepared the financial report for fiscal year 1996-97. The department submitted it to the Government Finance Officer's Association for competition and grading. Now during the second half of the fiscal year, Finance can assist Council in its review of estimated revenues and appropriations and suggest adjustments and improvements that assure completion of the goals. Progress on Council's Fiscal Year 1997-98 Vision Goals A. New sidewalks have been put in on 5th Street,the 600 block of Sunset Street and Zachary Padilla Street. Handicap ramps have been retrofitted in various locations throughout the City. B. The City building cabling project is completed and staff is converting all E-mail users to the new computer server. The cabling is a vital link that allows computers to communicate with each other. It is also the first step in converting to the new finance system. C. Staff met with four potential finance hardware and software vendors and will present their recommendation for a new system to the Council at the March 2 meeting. The new system will take about 18 months to install and test and with the year 2000 just 22 months away, progress will start immediately. D. The new mission format for budgeting has been completely implemented this year. In addition, most accounts in the Consumer Services Fund and the Light Fund now use an account number system promulgated by the Federal Energy Regulatory Commission and staff adopted them to our utilities. Preparatory to beginning the budget next year, we will adopt the water account numbers to the California Public Utility Commission numbering system. E. In a January 25, 1998 article in the Los Angeles Times Jean Merl reported that Azusa, included with 15 other cities, were singled out as most likely to provide financial incentives to business. This favorable press could aid in attracting new businesses to the City. Obviously,the achievement of Council's goals and objectives is having a positive effect! S:\USERS\SBRI\MYR98 • How the Budget Was Balanced Following the loss of the Fire Safety Assessment and most of the November revenue measures ballot issues, Council balanced the budget as follows: GENERAL FUND Budgeted Projected Beginning Fund Balance $2,896,000 $2,896,000 Revenues 18,341,827 18,583,777 Successful Ballot Measures 188,005 73,005 L.A. County Fire Rebates (December- June) 195,222 195,222 Other Revenues (December- June) 160,950 34,000 Expenditures (19,084,326) (18,790,016) Expenditure Reductions (December- June) 513,186 513,186 Net Transfers (interest income, gas tax, debt service) 1,101,709 1,101,759 "Loan"to Fire Services Fund (1,812,623) (1,930,623) Ending Fund Balance $2,500,000 2,500,000 Available for Council to Consider 176,310 Mid-Year Report- General Fund Total General Fund revenue collections are 1.4% less than what was estimated for midyear, for the same period expenditures are experiencing a 1.6% savings, due to conservative spending and to unfilled staff positions, for a net budget that is essentially on target. Below, five key revenue accounts are discussed to explain some of the trends in the General Fund. 1. Current Secured Property tax collected through December 31 is $23,480 more than expected at Midyear. This is due to easing of refunds from appeals, as well as the new housing in the City being added to the property tax rolls and to slight increases in the assessed value of real estate that was purchased during the year. S:\USERS\SBRI\MYR98 • 2. Sales Tax revenues are $99,063 under-realized at December 31 but in February, when Christmas Sales Tax receipts are received, revenues will probably demonstrate the ability to achieve 100%of estimate by year end. Sales Tax revenue in Azusa is holding its own because it reflects about the same amount of downturn as do most Southern California communities. The next 12 months will tell the tale. 3. Motor Vehicle In-Lieu tax is $33,733 under-realized for the year. However, by June 30 Motor Vehicle In-Lieu tax should increase to 100% of projections due to increased car sales in the spring. 4. Business License revenue is $47,844 greater than expected for this time of year. This is attributable to combining staff from two former divisions, Business License and Code Enforcement. Pooling their efforts formed a more productive, better managed and more effective Business License sub- mission team. 5. Special Franchise fees are ahead of estimate by $27,676. They are a derivative of the sale of electricity and water. There is relatively modest growth in this account. Key General Fund Revenue Sources $1,000,000 - $800,000 • - $600,000 • $400,000 mi 6111 111 1 II $200,000 0 $ Curr Secured Sales Tax Motor Vehicle Business Lic Spl Franchise Legend Adjusted Estimated Revenue ® Revenue Meetings with the operators of the rock extraction firms in the City have produced a commitment to provide the $115,000 in the balancing plan that was attributed to them. The other increases to fees and charges will have to be postponed to budget time due to lack of staff time to do the analysis. This amounts to a$126,950 reduction in estimated revenues but it will be offset by increases in Business License and Special Franchise Fees. Other departments have experienced problems due to short staffing as well. For example,the maintenance division is behind on its sidewalk repairs, Community Development is behind on plan check, and we have no ability to be pro-active in our approach to redevelopment projects. S:\USERS\SBRNNYR98 • Per Council direction, the former City Administrator"froze" all General Fund positions as they came open and Finance has perpetuated this practice. This resulted in the following savings over and above the revised plan: 1. At its current rate, Public Safety sub-mission will have saved over $122,000 by the end of the fiscal year. 2. The City Administration sub-mission will save $37,109 by year end. 3. The Public Works sub-mission will have saved $84,771 by June 30. 4. The Engineering Division will have saved $14,154. 5. The Finance Department will have saved $36,276. Key General Fund Sub-Mission Expenditures $8,000,000 $6,000,000 $4,000,000 $2,000,000 $0 Public Safety City Administration Public Works Engineering Finance Legend Adjusted Appropriations • Expenditures Of these modest savings in the General Fund,the amount of$118,000 is required for an increase in the fire contract charges retroactive to July 1,1997. In addition, staff is recommending that Council consider reinstating six positions described below. This still leaves $42,936 that could be programmed. In the Redevelopment Agency, there is another$37,109 available. Staff is recommending reinstating the redevelopment director at $24,000. This still leaves $13,109 for programming. S:\USERS\SBRI\MYR98 General Fund Recommended Budget Adjustments Fiscal Year 1997-98 Funding sources: Public Works salary savingsA.. $84,771 Finance salary savings 36,276 Police Department salary savings 122,000 Engineering Assistant salary savings 14,154 City Administrator salary savings _x 37,109 $294,310 Required for Fire Department y .- i •- (118,000)1 �l Recommended Positi einstatements: ,' > �,�'.` 1 a � Yz Dispatchers (2 �,`1- ' J (46,446) '. Police Officers (2� (63,928 Engineering Aide (10,000) •. Planner (13,000) Council Directed(please refer to the attached copy of the (42,936) (176,310) November 25 balancing memo) (294,310) Azusa Redevelopment Agency: Executive Director salary savings $37,109 Redevelopment director (24,000) Council Directed (13,109) $0 Mid-Year Report-Enterprise Funds The Light Fund has a budget surplus. If this is fully realized at year end, it will be a significant addition to the Rate Stabilization Fund that has now grown to $6,430,433. The Water Funds also have a budget surplus. However,the Sewer Fund may be overspent so appropriations will need to be reduced. The following are the details: 1. The Light Fund is ahead of budget at mid-year by $1,695,250. However capital outlay expenditures on the Light Fund have not yet commenced and we anticipate that most budgeted funds will be used or encumbered by June 30. it e„. .. S (,( S:\USERS\SBRI\MYR98 V. IP \.1Vl 2. The combined City and Azusa Valley Water Funds have an appropriation surplus of$2,541,661 at. the midyear point for fiscal year 1997-98. However, large water line projects are programmed for the second half of the fiscal year and all appropriations should be used or encumbered by June 30. 3. The Sewer Fund displays an over appropriated condition. Although there is a retained earnings balance of$3,139,606, there are $412,873 of expenses against appropriations adjusted to midyear of$312,174 for over-spending of$100,699. Council should direct the Maintenance Department _ to prepare a report showing how he can correct this by June 30. And next year a balanced budget should be achieved. 4. The Central Services Fund is holding the line on its expenditures. There are expenses totaling $1,602,609 and adjusted appropriations of$1,733,436. However, most of the favorable difference is or will be expended in May when the City pays its annual premium to ICRMA. Recommendation Staff recommends that Council: 1. Conduct a public hearing on appropriation amendments for the mid-year of FY 97-98; and 2. Pass the attached draft resolutions approving appropriations in FY 97-98; and 3. Adopt the Mid-Year Review as presented by staff. f' S:\USERS\SBRI\MYR98 The title of the City Resolution would be: "A Resolution of the City Council of the City of Azusa Approving City Appropriation Amendments for Fiscal Mid-Year 1997-98" The title of the Azusa Redevelopment Agency Resolution would be: "A Resolution of the Board of Directors of the Azusa Redevelopment Agency Approving Appropriation Amendments for Fiscal Mid-Year 1997-98" CITY OF AZUSA FINAL REVISED TENTATIVE BALANCING PLAN 1997-98 BUDGET (Entire Year) Approved Proposed July through November December through June Amount Sub-total Amount Sub-total Total Shortfall: Projected Shortfall (Structural Deficit) $635,991 Projected Shortfall (Fire Safety Assessment) 1,812,623 Subtotal -Budget Shortfall $2,448,614 Adjustments to Proposed Appropriations: Mission I -Legislation Sub-Mission 1.1 - Legislation Council Stipend ($3,600) $3,600 Legal Fees (100,000) Meetings and Conventions (4,370) (5,530), Hiring Freeze -Administrative Analyst (5,925) Memberships (5,936) Special Supplies (113,906) (1,500) (9,355) (123,261) Sub-Mission 1.2-Administration Administrative Analyst Reclassification (5,400) Hiring Freeze-Administrative Analyst (11,850) Meetings & Conventions (3,000) (2,700) Legal Fees (8,400) (40,000) (54,550) (62,950) Page 1 of 7 CITY OF AZUSA >, FINAL REVISED TENTATIVE BALANCING PLAN 1997-98 BUDGET (Entire Year) Approved Proposed July through November December through June Amount Sub-total Amount Sub-total Total Sub-Mission 1.3- Promotion • Hiring Freeze -Administrative Analyst (7,900) Centennial (40,000) Chamber of Commerce (20,000) Advertising (3,500) Azusa at a Glance (13,000) Meetings and Conventions (1,850) Cable TV Production (9,000) (82,000) (13,250) (95,250) Sub-Mission 1.6 - Elections Election Expense 30,000 Ballot Counting Machine 30,000 (10,000) (10,000) 20,000 Mission II - Public Safety Sub-Missions 2.1 & 2.2- Protection of Life and Property Hiring Delay- Jailer (16,376) Hiring Freeze- Records Specialist (38,200) Hiring Freeze- Commun.Service Officer (46,427) Hiring Freeze - Police Officer (81,480) Use of Asset Seizure Reserves (50,000) Fire Contract 60,000 Salary & Benefit Savings (66,410) Capital Outlay (232,483) (7,535) (13,945) (246,428) Page 2 of 7 CITY OF AZUSA FINAL REVISED TENTATIVE BALANCING PLAN 1997-98 BUDGET (Lnlire Yeah Approved Proposed July through November December through June Amount Sub-total Amount Sub-total Total Mission Ill -Leisure & Cultural Services Sub-Mission 3.1 - Organized Recreation Hiring Freeze - Community Services Director (59,107) Woman's Club-to Concessionnaire (63,270) 63,270 Part-time Salaries- Various Programs (48,411) Disaster Relief Supplies (9,465) Trips and Tours (5,700) Tree Lighting, Santa, etc. (14,900) Holiday Boutique, etc. (2,200) Pony Baseball Officials (9,900) Recreation Class Brochure (3,200) Postpone Construction of Snack Bar at Pool (35,135) Eliminate part-time staff: Christmas Tree Lighting, Halloween Carnival, Summer Carnival, Cinco de Mayo Carnival, Santa Claus Visits (12,161) Close playgrounds during Christmas vacation period (2 weeks, 12/22/97 - 1/2/98) (4,316) Eliminate vacation field trip personnel (1,098) Eliminate trips and tours staffing (659) Eliminate Birthday Party Program staffing (459) Special Events (6,480) (174,222) (38,969) (213,191) Sub-Mission 3.2- Park Maintenance Hiring Freeze - Park Maint.Worker III (24,022) Night & Weekend Standby Service (6,940) 6,940 Restroom Lock Up (11,278) • Training (600) Landscaping Maintenance (14,000) Land Improvement Maintenance (7,600) (40,418) (17,082) (57,500) Page 3 of 7 CITY OF AZUSA 1 FINAL REVISED TENTATIVE BALANCING PLAN 1997-98 BUDGET (Entire Year) Approved Proposed July through November December through June Amount Sub-total Amount Sub-total Total Sub-Mission 3.4 -Activities/Elderly Hiring Freeze - Site Manager (Part-time) (4,350) (4,350) (4,350) Sub-Mission 3.5 - Information Retrieval & Delivery Hiring Freeze - Library Assistant II (36,671) Library Coordinator Reclassification (3,540) Books (3,000) Meetings & Conventions (2,000) Cafe (46,914) (50,454) (41,671) (92,125) Mission IV -Municipal Utilities Sub-Mission 4.5- Rubbish Collection Hiring Freeze-Administrative Analyst (11,850) (11,850) (11,850) Mission V -Circulation Sub-Mission 5.1 - Roadway Design/Maintenance Engr. Technician - Pay with Prop C (28,693) Vehicles (33,000) Front-End Loader (First Part) (29,000) Dump Truck (45,000) Training (6,500) Traffic Counter (5,000) Outside Services (3,190) (138,883) (11,500) (150,383) Sub-Mission 5.2-Traffic Signal Design/Development Traffic Signal Maintenance (44,000) Traffic Signal Repair (45,000) Front-End Loader (Second Part) (61,000) (150,000) (150,000) Sub-Mission 5.3 - Roadway Maintenance Gladstone, Motor St. overlays-transfer Gas Tax to General Fund (71,000) Pavement Maintenance Program - General Fund (50,000) Hiring Freeze - Street Maintenance Worker III (28,951) Pavement Maint. - transfer Gas Tax to General Fund (50,000) (199,951) (199,951) Page 4 of 7 CITY OF AZUSA FINAL REVISED TENTATIVE BALANCING PLAN 1997-98 BUDGET { ptire Year) Approved Proposed July through November December through June Amount Sub-total Amount Sub-total Total Sub-Mission 5.4 -Alley Maintenance All Except Graffiti Abatement Program (35,451) (35,451) (35,451) Sub-Mission 5.5 - Sidewalk Maintenance Sidewalks Paid by Gas Tax (50,000) (50,000) (50,000) Mission VI -Resource Management Sub-Mission 6.1 - Land Use Management Hiring Freeze - City Planner(1/2) (37,750) General Plan Update (31,600) Special Studies 2,883 Vehicles (9,000) (78,350) 2,883 (75,467) Sub-Mission 6.2 - Community Design Hiring Freeze - City Planner (1/2) (37,750) Hiring Freeze - Student Intern (.40) (37,750) (8,595) (8,595) (46,345) Sub-Mission 6.3 - Community Improvement Community Improvement Manager Reclass. (9,060) Community Improvement Specialists Reclassification (13,644) (22,704) (22,704) Sub-Mission 6.4 - Business Registration/Tax Collection Laptop Computer (3,057) (3,057) (3,057) Sub-Mission 6.5 - Code Enforcement Equipment & Machinery (7,200) (7,200) (7,200) • Sub-Mission 6.6 - Rental Housing Inspections Vehicles - (11,200) (11,200) (11,200) Sub-Mission 6.7 - Real Property Records Reports Equipment and Machinery (1,600) (1,600) (1,600) Sub-Mission 6.10- Historic Preservation Hiring Freeze -Administrative Analyst (1,975) (1,975) (1,975) Page 5 of 7 CITY OF AZUSA FINAL REVISED TENTATIVE BALANCING PLAN 1997-98 BUDGET [E=ntire; Year) Approved Proposed July through November December through June Amount Sub-total Amount Sub-total Total Mission VII - Business Services Sub-Mission 7.8 - Payroll & Accounting Services Hiring Freeze - Office Specialist II (12,125) (12,125) (12,125) Sub-Mission 7.12- Purchasing Hiring Freeze - Purchasing Officer (78,675)_ (78,675) (78,675) Sub-Mission 7.13 - Personnel Administration Human Rescource Manager Reclass. (6,732) Hiring Freeze- Office Specialist I - Full-time (6,732) (8,393) (8,393) (15,125) Total Appropriation Adjustments (1,234,977) (513,186) (1,748,163) Revenue Adjustments Mission II -Public Safety Sub-Mission 2.2 - Protection of Property County Fire Rebate- Principal 107,069 107,069 149,897 149,897 256,966 Mission III -Leisure & Cultural Services Sub-Mission 3.1 - Organized Recreation Fees- Woman's Club (34,000) 34,000 Fees- Pony Baseball (6,808) • Fees- Excursions (16,788) (57,596) 34,000 (23,596) Sub-Mission 3.5 - Information Retrieval & Delivery Literacy Grant Renewal 74,426 74,426 74,426 Page 6 of 7 CITY OF AZUSA FINAL REVISED TENTATIVE BALANCING PLAN 1997-98 BUDGET (Entire Year) Approved Proposed July through November December through June Amount Sub-total Amount Sub-total Total Mission VI -Resource Management Sub-Mission 6.1 - Land Use Management Fees-Zone Change, etc. 70,000 70,000 70,000 Sub-Mission 6.3 - Building Safety Fees- Building Insp/Plan Check 56,950 56,950 56,950 Sub-Mission 6.4 - Business Registration/Tax Collection Franchise- Rock Extraction @ 18c 115,000 Business License Tax- Swap Meet Vendors 42,615 Business License Tax- Swap Meet Operators 625 Admissions Tax- Swap Meet 29,765 188,005 188,005 Mission VII -Business Services Sub-Mission 7.7 - Cash Management County Fire Rebate- Interest 32,375 32,375 45,325 45,325 77,700 Total - Revenue Adjustments 156,274 544,177 $700,451 NET-TENTATIVE BALANCING PLAN $0 Page 7 of 7