HomeMy WebLinkAbout03. Budget Message-FY1415_1_201409081100547213Budget message
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TO: Honorable Mayor and Members of the City Council
FROM: James Makshanoff, City Manager
SUBJECT: City Manager’s Budget Message for Fiscal-Year 2014-2015
DATE: June 16, 2014
I am pleased to present the Budget for the 2014-2015 Fiscal Year. The Annual Budget is the Council’s most important
annual legislative responsibility. Budget preparation identifies community standards with respect to acceptable service
levels for our citizens and the establishment of service priorities by the City Council. This document outlines and describes
specific programs, along with a financial plan designed to meet the service requirements of our citizens for the next twelve
months.
The adopted FY 2015 budget continues to focus on cost control without impacting the City’s core services. The City is
anticipated to be in a structural deficit position in FY2016. As such, the City Staff will be working closely with Council to
explore different options to address this fiscal issue.
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The 2014-2015 Budget stays within current projected resources. Cost containment measures will remain in effect, and we
will actively focus on revenue enhancement to increase the City’s General Fund resources.
Again this year, as in the past several years, we will keep a careful watch on the State budget and legislative action that
may have an impact on the City’s financial condition. The strategy for preparing the 2014-2015 Budget documents was
designed to facilitate a balanced budget, to maintain and where necessary, enhance service levels, and to meet the City’s
non-discretionary financial commitments for the 2014-2015 Fiscal Year.
Revenues
General Fund revenues and transfers reflect an increase of 2.18% from the prior year’s budget. Property tax revenues
and projected increase with MRF are the major factors in the increase. However, the slight sales tax revenue increase
only represents a slow recovery from the higher historic revenue levels the City received prior to the recession. Other
major revenues are anticipated to remain at prior year levels as the economy recover slowly from the recession. A
detailed list of revenue projections is included in the Summary section of this Budget.
Expenditures
General Fund expenditures, operating transfers out and funding for capital outlay ($35,449,915) show an increase of
1.23% for FY 2014-2015. This was a result of additional program activities and personnel costs. However, departments
were instructed by the City Manager to maintain their current budget level and defer new initiatives until the fiscal
condition improves for the City. Summaries of expenditures by Department for all funds and the General Fund
specifically, are included in the Budget in the Summary section.
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General Fund Summary
The following schedule summarizes the revenues, expenditures and changes in the General Fund balance for FY 2014-
2015. The primary focus of attention continues to be the General Fund which accounts for the majority of non-utility
operations, including, Police, Fire and General Government.
The overall condition of the City’s non-general funding sources is included in the Summary section of this Budget.
FY 14-15
Projected Revenues& Transfers In 35,650,455
Balance Available 0
Less: Operating Expenses& Transfers out (35,499,110)
Preliminary Projected Balance @ 6/30/15 151,345
Less Discretionary & One Time Expenses
None for FY2015 ( 22,135)
Projected Fund Balance @ 6/30/15 $ 129,210
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Summary
This Budget, as presented, provides for the maintenance of service levels for the majority of City programs. However,
there are several items that may affect our ability to maintain our current service levels due to anticipated cost increases
and limited available revenues. For those reasons, we will conduct a study session with Council to go over the financial
status and explore different options to address the projected deficit. The projected General Fund un-designated reserves
for FY2014-2015 will be $129,210. Our goal is to continually look at our revenue resources, continue to monitor our
expenditures, and implement efficiencies wherever possible.
The 2014-2015 Budget represents a program designed to ensure that Azusa remains an outstanding City in which to live,
work, and conduct business. Furthermore, I believe these programs reflect your priorities, as well as the priorities of the
community, as they can be achieved within the City’s financial resources.
Respectfully submitted,
James Makshanoff
City Manager
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