LTC 353-2013 Analysis of Budget to Actual Revenues and Expenses MIAMI_
S2 73
OFFICE OF THE CITY MANAGER; r�
NO. LTC# 353 -avi3 LETTER TO COMMISSION*
TO: Mayor Matti Herrera Bower and Members of th City Commission
FROM: Jimmy.Morales, City Manager
DATE: September 26, 2013
SUBJECT: ANALYSIS OF BUDGET TO ALUAL EV ENUES AND EXPENSES FOR THE
NINE MONTHS ENDING JUNE 30, 2013, WITH OPERATING BUDGET
PROJECTIONS THROUGH SEPTEMBER 30, 2013
The purpose of this LTC is to provide the Mayor and Commission with the status of the FY
2012/13 budget and a comparison of actual revenue and expenses reflected at the end of the
third quarter with projections through September 30, 2013.
At this stage of projecting the fiscal year end, there are issues still to be, determined. The first 9
months of any fiscal year do not provide a definitive indication of where we will be at the end of
the year. However, with nine full months of data we have a good idea of what the issues are.
With nine full months of data we have a better idea of year end results. Certain assumptions on
both revenue and expenditures were made that are still developing, particularly related to
property tax collections. Those assumptions, as well as our continued effort at managing the
City's expenditures, will affect our final results.
The FY 2011/12 year -end budget amendment adopted by the City Commission in November,
2012, identified approximately $1.4 million in encumbrances and set asides for projects
budgeted in FY 2011/12 that will instead be spent in FY 2012/13. The FY 2012/13 budget
amendment adopted in April, 2013 reflected the carry forward of these unspent funds.
Accordingly, the projections presented below are compared to the April budget amendment.
GENERALFUND
Upon review, it is projected that the General Fund revenues will exceed expenditures by
approximately $62,000, an improvement from the second quarter projection of a $2 million
shortfall.
Both the first and second quarter shortfalls were driven by projected employee givebacks that
had not been achieved to date, particularly in the Fraternal Order of Police (FOP) and the
International Federation of Fire Fighters (IAFF) bargaining units, as well as accumulated leave
payouts related to the previously negotiated changes in the Fire and Police Pension Plan that
amended the timeframe for eligibility to purchase prior creditable service. However, the third
quarter projection reflects improvement due to higher projected revenues based on actuals,
salary savings in part due to several high -level positions that were held vacant, pending my
appointment, as well as the savings resulting from unspent contingency.
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
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General Fund Overview
An analysis of the actual nine -month operating revenues and expenditures for the period
October 1, 2012 through June 30, 2013, reveals an operating budget surplus of $23.1 million.
While the surplus as of June 30 seems unusual as compared to the projection for the fiscal
year ending on September 30 th , it should be noted that the City receives a greater percentage
of ad valorem taxes during the first three quarters, (historically 95 percent). Ad valorem tax
revenues represent approximately 45 percent of total budgeted revenues and represent 53
percent of the revenues received in the first three quarters of the fiscal year.
As of June 30, 2013, total General Fund revenues collected were approximately 79 percent of
the amended budget or $204.3 million. This year,. 94 percent of the budgeted property tax
revenue was received in the first three quarters, as compared to the historical level of 95
percent as noted above. The remaining 55 percent of revenues are at approximately 37
percent of the adopted budget as of June 30, 2013, as compared to approximately 39 percent
in FY 2011/12.
This is primarily due to interest earning revenues which are reflected as negative $2.8 million
for the first nine months. This is due to an accounting reversal of "Unrealized Gains on
Investments" which was accounted for at the end of FY 2011/12. This is a non -cash impact,
and, if the City's investment status is similar at the end of FY 2012/13 as it was in FY 2011/12,
there will be a similar offsetting accounting entry for a net gain /loss of $0 at year -end. In
addition, the actuals do not reflect the budgeted use of prior year carryover. If revenues are
adjusted for these items, actuals would be 39 percent of budget
Further, it is important to note that a significant portion of the surplus is due to Building
Department revenues in excess of budget by $2.0 million, resulting in a surplus of $2.073
million attributable to Building rather than a loss of $1.7 million as budgeted. As a result, it is
not recommended to transfer the $1.5 million from Building Reserves into the General Fund
and revising the projected Building surplus to $573,000. We will continue to refine the estimate
and present an update once the year -end close -out process is complete, typically in the March
timeframe.
Expenditures are approximately 71 percent of the FY 2012/13 amended budget, slightly lower
than the 73 percent expended in - the same period during FY 2011/12.
FY 2012/13 Budget
Variance from 3/4
Amended Budget 3/4 of Amended Amended Budget
General Fund 2013 Budget Actual as of 06/30/13 Over/ (Under)
Revenues $ 257,670,000 $ 193,252,500 $ 204,347,981 $ 11,095,481
Expenditures $ 257,670,000 $ 193,252,500 $ 184,071,995 $ (9,180,505)
Surplus /(Deficit) $ 0 $ 0 $ 20,275,986 $ 20,275,986
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
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General Fund Year -End Projections
The projected year -end operating revenues and expenditures through September 30, 2013,
provide a more realistic snapshot of anticipated year -end shortfalls or surpluses at this point in
time. Further, while the actual revenues and expenditures presented are as of June 30, 2013,
some of the projections have incorporated more recent information, as available.
A summary of preliminary projected - General Fund Revenues and Expenditures as of
September 30, 2013, is as follows and reflects revenues in excess of expenditures by
approximately $62,000, assuming no additional contingency is spent for the remainder of the
year. ,
FY 2012/13 Budget
Variance
Amended Budget Projected/
2012/13 (April Amended
General Fund Amendment) Projected Budget
Revenues $ 257,670,000 $ 256,756,000 $ (914,000)
Expenditures' 257,670,000 256,694,000 (976,000)
Surplus /(Deficit) $ - $ 62,000 $ 62,000
Operating Contingency $ - $ - $
Net surplus (Deficit) $ $ 62,000 $ 62,000
Prior to Expenditure of Operating Contingency
Status of Employee Givebacks
The FY 2012/13 General Fund budget includes nearly $3 million of General Fund employee
givebacks.- At the time of budget development, � the $3 million in employee givebacks were
allocated across all salary groups proportionate to salaries. Subsequently targets were
developed for each salary group proportionate to each group's share of the City's total pension
-and health costs, since these have been the major cost drivers of personnel costs, in recent
years. The initial budget assumed merit and step increases for all seven (7) salary groups.
However, it was anticipated that a large share of the employee givebacks for FY 2012/13
_would be achieved through negotiating merit and step freezes, adherence to the Fair Labor
Standards Act (FLSA) for the purposes of calculating overtime, as well as a reduction or
elimination of various "extra" pays for those employees covered by the FOP and the IAFF.
The reality is that employees covered by the FOP and the IAFF have not experienced a freeze
in their step increases in the last four (4) years, while the American Federation of State, County
and Municipal Employees (AFSCME) and the Government Supervisors Association of Florida
(GSAF) experienced a freeze on merit increases for two (2) years. Merits for employees
covered by GSAF were reinstated effective October 1, 2012 and merits for employees covered
by AFSCME have been reinstated effective April 1, 2013; however, the maximum merit
increase was reduced from four percent to two percent once reinstated. In comparison, this is
the third year of no merit increases for employees covered by the Communication Workers
Association (CWA) as it is a "status quo" provision in the CWA collective bargaining
agreement. Furthermore, this is the fourth straight year that employees in the "Unclassified"
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
Page 4 of 15
and "Other' salary groups have not received any merit increases. These assumptions are
utilized for the projections throughout the remainder of the fiscal year.
The chart below provides a summary of the budgeted employee givebacks by salary group, the
target employee givebacks by salary group and the employee givebacks achieved to date.
There are no changes in any of the collective bargaining agreements throughout the remainder
of the fiscal year.
The Administration has been successful in negotiating some significant changes through the
collective bargaining process, totaling $4,635,000 to the General Fund in FY 2013/14.
Implementation of long term pension changes for current and future employees are projected
to result in savings of $5,664,000 to the General Fund (CWA $120,000, IAFF $2,152,000 and
FOP $3,392,000).. CWA impacts "for three percent merit eligibility, eleven percent extension of
the salary range for Lifeguard II and Lieutenants, changes to holiday pay and increase of union
time bank hour resulting in $507,000 increase in salaries, and a $30,000 increase for
reinstated shift differential. IAFF impacts for increase on -call supplement for Fire Investigators
and PTO's, and increase paramedic recertification pay resulting in an increase in salaries of
$57,000 and increase of $80,000 in capital and debt for take -home vehicle assignments. FOP
impacts for implementation of voluntary annual physical fitness assessment incentive resulting
in an increase in benefits of $355,000.
General Fund
General Fund Givebacks
Budgeted Achieved -- Difference from
SALARY GROUP Target Givebacks current status Budget
AFSCME $ 322,000 $ 119,000 $ - $ (119,000)
CWA* $ 417,000 $ 291,000 $ 183,000 $ (108,000)
FOP $ 1,396,000 $ 1,342,000 $ - $ (1,342,000)
GSA $ 74,000 $ 32,000 $ $ (32,000)
IAFF $ 900,000 $ 900,000 $ $ (900,000)
Unclassified/ Others $ 673,000 $ 499,000 $ 735,000 $ 236,000
Total $ 3,782,000 $ 3,183,000 $ 918,000 $ (2,265,000)
*CWA includes $183,000 of givebacks built into the FY2012/13 CSL Budget
In addition, other savings have been achieved by senior management positions which had
been held vacant in anticipation of the hiring of a new City Manager. All General Fund
Department expenditures are projected to be below budget, with the exception of the City
Attorney's Office and Police Department are forecasted to be over budget by $183,000 and
$1.5 million, respectively.
Accumulated Leave
The accumulated leave payout budget for FY 2012/13 is $1.9 million and was developed based
on experience in the prior year. Expenditures are projected to be $6 million, a difference of
$4.1 million. The most significant portion of this increase was due to an increase in leave
payments used for Fire and Police pension buybacks.
As explained in the FY 2011/12 year -end agenda item and the first quarter LTC, this is
primarily driven by the 2010 Fire and Police Pension Plan changes that became effective on
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
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June 27, 2012 with the Third District Court of Appeal's unanimous decision that the collective
bargaining process set out in the Public Employee Relations Act is the final word on
implementing the collective bargaining rights guaranteed by the Florida Constitution. Included
in the negotiated pension changes was the ability for a member to exercise their right to buy
back prior creditable service upon vesting (ten years of service) compared to the previous
pension benefit that provided the ability for a member to buy back prior creditable service upon
twenty years of creditable service with the City.
The 225 members that had ten or more years of creditable pension service time as of
September 30, 2010, were notified that they have until September 30, 2013, to exercise their
right to purchase these buybacks. As a result, there continues to be an influx of members who
are exercising this right and purchasing creditable pension service time following the Third
District Court of Appeal's decision. The members have until September 30, 2013, to elect this
option. The buyback and leave payouts through June 30, 2013, totaled $3.9 million. Based on
actual amounts already paid to date, known requests which have not yet been processed and
a contingency for others who may elect to use their eligible payout by 9/30/13, an additional
$2.1 million has been incorporated in the projection as of September 30, 2013.
Medical Insurance
It is important to note that as of the third quarter projection, no transfers are projected to the
health self- insurance plan.
As of September 2012, the City's benefits consultant, Gallagher Benefit Services, projected a
loss for FY 2012/13, with a 12 percent premium increase, of $309,000. The City's budget for
FY 2012/13 assumed a 10 percent increase in the City's share of premium costs. However,
premium increases for FY 2012/13 were subsequently deferred pending review of the entire
health plan structure by the City's Budget Advisory Committee.
Fortunately, plan expenditures declined significantly during the first quarter of FY 2012/13 as
compared to the first quarter of FY 2011/12, and, in - fact, claim expenditure per plan member
for calendar year 2012 declined overall by 9 percent as compared to calendar year 2011. This
trend has continued through the third quarter, with FY 2012/13 YTD claims declining by 10.9
percent to date as compared to FY 2011/12. As of September 2013, Gallagher Benefit
Services is projecting premiums slightly in excess of claims for FY 2012/13.
General Fund Operating Revenues
For a detail of General Fund Revenues by category, see attached Schedule A.
At this time, we are projecting property tax collections for FY 2012/13 at 99 percent of total
budgeted property taxes revenues. The adopted budget includes 95 percent of total property
taxes assessed, thereby allowing adjustments for discounts, as well as a level of adjustments
due to appeals similar to long -term historical levels. It is important to note that, in the last two
(2) years, property tax collections have been significantly below prior year levels due to higher
levels of appeals and adjustments. The impact of appeals and adjustments for the FY 2012/13
budget provided by the Miami -Dade County Property Appraiser in July, 2013 reflect a 4.6
percent reduction in property tax values.
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
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Overall revenues are projected to be approximately $0.9 million above the amended budget.
However Building Development Process Fee revenues (Licenses and Permits)', are projected
to exceed the budget by approximately $3.2 million (16 percent). This increase is projected to
be offset by significant declines in Interest Earnings, Electricity Franchise and Communications
tax revenues, a continuing trend in recent years.
As in prior years, significant variances to budget in excess of $300,000 or 10 percent by
revenue category are explained below:
Other Taxes This category includes franchise and utility taxes and is projected to be
below budget by $1.28 million primarily due to lower than projected electricity franchise
and telephone utility tax revenues, which are derived from customer usage.
Licenses and Permits — This category includes business tax receipts, licenses/
building /special use permits, and sidewalk cafe fee revenues and is projected to be in
excess of budget by $3.2 million (16 percent above the amended budget) primarily due to
increases in Building Development Process Revenues, reflecting continuing improvement
in the economy.
Fines & Forfeits — This category is projected to be in above budget by .$0.4 million
(approximately 19 percent above the amended budget), primarily due to building code
violation revenues projected to be above budget by $611,000.
Rents & Leases — This category is projected to be in above budget by $0.3 million
(approximately 4.8 percent above the amended budget), primarily due to the Miami Beach
Marina rental revenue projected to be above budget by $233,000 which includes an
additional true -up from FY 2010/11.
Miscellaneous Revenues — This category is projected to be below budget by $0.4 million
and includes the Capital Improvement Projects (CIP) department's allocation, which is
based on the projected expenses for CIP at year end. The department is projected to be
under budget by $0.7 million.
Building Department Reserve — The budgeted included $1.5 million to be transferred in
from the Building department reserve to cover budgeted operating losses in that
department. This is not being recommended to be transferred since building revenues are
projected to be in excess of operating expenditures.
General Fund Operating Expenditures
As of June 30, 2013, actual expenditures were approximately 80 percent of budget or $184
million. Year -end projections through September 30, 2013, indicate that expenditures will be
$255 million, approximately $2.1 million (1 percent) under the amended budget.
Citywide Accounts are projected to be above budget by approximately $1 million due to leave
liability payouts (driven by an influx of Fire and Police Pension Plan buybacks) projected to be
above budget by approximately $3.1 million, as explained above. This is offset by savings in
various accounts.
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
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A comparison of actual and projected expenditures to budget by Department is provided in
Schedule A. The other major drivers of expenditures above budget are the City Attorney's
Office and the Police departments. As in prior years, Departments with significant variances to
budget in excess of $300,000 or 10 percent are explained below:
City Attorney's Office — Is projected to be $225,000 or 5.2% above the amended budget
primarily due charges for outside legal fees. The Office has experienced higher than
budgeted expenses for outside legal fees directly related to labor /union negotiations for
the City's five labor unions whose contracts were up for renewal.
Amended Variance
Budget 2012/13 Projected/
(April Amended
City Attorney Amendment) Projected Budget
Expenditures 4,318,000 4,543,000 225,000
Office and Budget and Performance Improvement (OBPI) — In part due to the
additional employee givebacks from Unclassified employees as explained above, but also
due to a number of vacancies for most of the year, including the Director and the Budget
Officer, the OBPI department is projected to be approximately $398,000 below the
amended budget (approximately 18 percent).
Amended Variance
Budget 2012/13 Projected/
(April Amended
OBPI Amendment) - Projected Budget
Expenditures 2,160,000 1,762,000 (398,000)
Human Resources /Labor Relations — In part due to the additional employee givebacks
from Unclassified employees as explained above, but also due to turnover of a number of
positions including the Director and positions that were held vacant, pending the hiring of
the City Manager position. The Human Resources /Labor Relations department is
projected to be approximately $217,000 below the amended budget (approximately 12
percent).
Amended Variance
Budget 2012/13 Projected/
(April Amended
HR/Labor Amendment) Projected Budget
Expenditures 1,827,000 1,610,000 (217,000)
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
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Planning — In part due to the additional employee givebacks from Unclassified employees
as explained above, but also due to a number of vacancies for most of the year including
the Planning Director, the Human Resources /Labor Relations department is projected to
be approximately $391,000 below the amended budget (approximately 11 percent).
Amended Variance
Budget 2012/13 Projected/
(April Amended
Planning Amendment) Projected Budget
Expenditures 3,419,000 3,028,000 (391,000)
Real Estate Housing and Community Development (REHCD) — In part due to
additional employee givebacks from Unclassified employees as explained above, as well
as various vacancies including the REHCD Director, the department as a whole is
projected to be approximately $356,000 (14.2 %) below the amended budget
Amended' Variance
Budget 2012/13 Projected/
(April Amended
REHCD Amendment) Projected Budget
Expenditures 2,507,000 2,151,000 (356,000)
Capital Improvements Projects Office (CIP) — In part due to additional employee
givebacks from Unclassified employees explained above, as well as numerous vacancies
including the CIP Director, the department is projected to be approximately $771,000
(15.9 %) below the amended budget. This savings is also reflected as a reduction in
reimbursements to the General Fund for capital projects for this department.
Amended Variance
Budget 2012/13 Projected/
(April Amended
CIP Amendment) Projected Budget
Expenditures 4,858,000 4,087,000 (771,000)
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
Page 9 of 15
Parks & Recreation — Is projected to be $448,000 or 2% above the amended budget
primarily due to the realignment of the internal service charge for janitorial, elevator, and
other service contracts from the Normandy Shores Golf Club (NSGC) to Recreation to
more accurately reflect charges incurred. This overage is offset by savings in the Golf
Courses.
Amended Variance
Budget 2012/13 Projected/
(April Amended
Parks Amendment) Projected Budget
Expenditures 22,179,000 22,627,000 448,000
Police Department— Is projected to be approximately $1,553,000 or 1.6% above the
amended budget. In addition to the $1.4 million in budgeted employee givebacks that have
not been achieved, General Fund overtime costs are projected to be $663,000 over the
FY 2012/13 budget amount.
Note that Police overtime is also budgeted in other funds (RDA, etc.). Across all funds,
combined Police overtime is projected to be $1.5 million over budget.
Amended Budget Projected/
2012/13 (April Amended
Police Amendment) Projected Budget
Expenditures 94,970,000 96,523,000 1,553,000
Fire — The Fire Department is projected to be $1,479,000 or 2.4% below the amended
budget. This is mostly attributable to various vacancies throughout the year including the
Vacancies indicated on the LTC Vacancy Report submitted to the Commission on 9/5/13.
It should be noted that the department recently conducted a recruitment class and hired
eight new Firefighters on 9/3/13 and anticipates another recruitment class in the second
quarter of FY 2013/14. The department will also be conducting a promotional Lifeguard
exam to fill vacancies within the Ocean Rescue division during the first quarter of FY
2013/14.
Amended Variance
Budget 2012/13 Projected/
(April Amended
Fire Amendment) Projected Budget
Expenditures 62,263,000 60,784,000 (1,479,000)
ENTERPRISE FUNDS
The City accounts for proprietary operations in Enterprise Funds. Convention Center, Parking,
Sanitation, Sewer, Stormwater, and Water are included in this grouping. The expenditures for.
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
Page 10 of 15
these funds are budgeted to be fully offset by charges for services.
An analysis of the actual nine -month operating expenditures for the period October 1, 2012
through June,30, 2013, reveals that all funds except Convention Center have expenditures less
than three - quarters of their budget. However, this is not representative, as there is often a lag
in expenditures, particularly related to those billed by outside entities.
Convention
ENTERPRISE FUNDS Sanitation Sewer Stormwater Water Parking Center
Budget Amendment (April 2013) 17,328,000 37,730,000 11,984,000 34,684,000 47,702,000 12,702,000
3/4 of Amended Budget 12,996,000 28,297,500 8,988,000 26,013,000 35,776,500 9,526,500
Expenditures as of 6/30/13 11,245,723 27,005,386 8,433,676 22,027,858 28,767,164 10,026,117
Expenditure Above!(Below) 3/4 of
Amended Budget (1,750,277) (1,292,114) (554,324) (3,985,142) (7,009,336) 499,617
The projected year -end operating revenues and expenditures through September 30, 2013, is,
however, a more realistic snapshot of anticipated surplus or shortfall at this point in time. In
addition, while the actual revenues and expenditures presented are as of June 30, 2013, the
projections have incorporated more recent information, as available.
As represented below, for all funds, revenues are projected to be equivalent or in excess of
expenditures, with the exception of Sewer and Stormwater. Further, while Convention Center is
projected to be over budget, primarily due to expenditures related to the Convention Center
Development project, some of which may be reimbursed by the Miami -Dade County General
Obligation Bond.
Sewer
Projected expenditures are anticipated to exceed the amended budget by $805,000 due to
higher than anticipated sewer treatment costs and a reallocation of debt service expenses from
Water to Sewer, based on updated data provided by the Finance department. Overall,
projected revenues are higher than the amended budget 'due to increased demand that is
projected to offset the additional expenditures above budget.
Sanitation
The Sanitation fund expenses are projected to be below budget by $0.496 million. This is due
primarily to projected salary savings of $124,000; savings in temporary labor, of $75,000;
savings in other contractual services of $55,000; and capital items budgeted but not projected
to be purchased in the amount of $76,000.
Water
The Water fund expenses are projected to be below budget by $4.8 million. This is mainly due
to water for resale expenses projected to be approximately $0.7 below budget, a Miami Dade
County True -Up credit of $1.8 million, $0.9 million in unused contingency as well as a $0.8
million reallocation of debt service expenses from Water to Sewer, based on updated data
provided by the Finance department.
Convention Center
The Convention Center is projected to have a surplus of approximately $0.9 million and be
over budget by approximately $1.8 million. This is primarily due to an increase in the number of
events, which is offset by revenues being projected over budget.
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
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Convention
Sanitation Sewer Stormwater Water Parking Center
REVENUES
Projected Revenues
Charges for Service $ 16,453,500 $ 35,184,000 $ 11,611,000 $ 32,820,000 35,898,000 9,619,451
Other $ 378,500 $ 574,000 161,000 $ 353,000 $ 11,555,000 5,825,067
Total Projection $ 16,832,000 $ 35,758,000 $ 11,772,000 $ 33,173,000 $ 47,453,000 $15,444,518
EXPENDITURES
Projected Expenditures $ 16,831,400 $ 38,535,000 $ 12,502,000 $ 29,810,000 $ 47,453,000 $14,494,000
Surplus /(Shortfall) $ 600 $ (2,777,000) $ (730,000) $ 3,363,000 $ - $ 950,518
Projected Rate Stabilization Revenue $ - $ 2,777,000 $ 730,000 $ - $ - $
Surplus /(Shortfall) Net of Budgeted Rate
Stabilization $ 600 $ - $ - $ 3,363,000 $ - $ 950,518
Variance from Expenditure Amended
Budget - Over/ (Under) $ (496,600) $ 805,000 $ 518,000 $ (4,874,000) $ (249,000) $ 1,792,000
In addition, despite expenditures being close to budget, Parking is anticipated to have a
surplus of approximately $0.7 million due to. increased revenues. Together with the $4.8
million budgeted to be used to increase reserves, this should provide year -end available cash
balance funding towards the annual transfer of $8.4 million to the General Fund in FY 2013/14.
INTERNAL SERVICE FUNDS
The City accounts for those goods and services provided by one Department to other
Departments citywide on a cost reimbursement basis. Central Services, Fleet Management,
Information Technology, Property Management, and Risk Management (Self Insurance) are
included in this grouping.
An analysis of the actual nine -month operating expenditures for the period October 1, 2012
through June 30, 2013, reveals that all funds have expenditures less than three - quarters of the
Amended Budget. However, as with Enterprise Funds, this is not representative since there is
often a lag in expenditures, particularly related to those billed by outside entities.
CENTRAL INFORMATION PROPERTY
INTERNAL SERVICE FUNDS SERVICES FLEET MGT TECHNOLOGY MGT RISKMGT
Amended Budget (April 2013) $ 906,000 $ 9,723,000 $ 16,656,000 $ 9,004,000 $ 23,500,000
3/4 of Amended Budget $ 679,500 $ 7,292,250 $ 12,492,000 $ 6,753,000 $ 17,625,000
Expenditures as of 6/30113 $ 655,007 $ 4,608,403 $ 9,927,985 $ 5,162,757 $ 14,370,434
Expenditure Above /(Below) 3/4 of
Amended Budget $ (24,493) $ (2,683,847) $ (2,564,015) $ (1,590,243) $ (3,254,566)
Based on the more realistic projection of year -end operating revenues and expenditures
through September 30, 2013, and incorporating more recent information as available, all
Internal Service Funds, are expected to have revenues equal to or in excess of expenditures.
As illustrated below, Property Management's expenses are expected to be below budget by
$0.57 million. This is primarily due to a projected $232,000 salary savings based on staff
turnover; a $206,000 projected savings in contract maintenance; and a $125,000 saving in
repairs and maintenance. We will continue to monitor this and address during the year end
process.
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
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The Risk Management expenses are expected to be below budget by $110,000. This is
primarily due to savings in salaries and benefits as a result of turnover within the department.
CENTRAL INFORMATION PROPERTY
SERVICES FLEET MGT TECHNOLOGY MGT RISKMGT
REVENUES
Projected Revenues
Charges for Service 1,040,000 9,205,000 14,604,000 8,455,000 22,734,000
Other 2,000 541,000 1,931,000 306,000 856,000
Total Projected Revenues $ 1,042,000 $ 9,746,000 $ 16,535,000 $ 8,761,000 $ 23,590,000
EXPENDITURES
Projected Expenditures $ 905,200 $ 9,465,790. $ 16,510,000 $ 8,427,000 $ 23,019,000
Surplus /(Shortfall) $ 136,800 $ 280,210 $ 25,000 $ 334,000 $ 571,000
Variance from Expenditure Amended
Budget - Over/ (Under) $ (800) $ (257,210) $ (146,000) $ (577,000) $ (481,000)
RESORT TAX FUND
The City's Resort Tax Fund is primarily supported by Resort Taxes collected pursuant to
Chapter 67 -930 (Section 6) of the Laws of Florida, as amended, and Section 5.03 of the City of
Miami Beach Charter, as amended. This legislation authorizes the use of Resort Taxes for the
promotion of the tourist industry, which includes, but is not restricted to the following: Publicity,
advertising, news bureau, promotional events, convention bureau activities, capital
improvements and the maintenance of all physical assets in connection therewith; and for the
payment of the reasonable and necessary expenses of collecting, handling and processing of
said tax.
Typically, the City has considered the following services as "Services Related to the Promotion
of Tourism ":
Police Officers serving entertainment areas
• A portion of Fire Rescue services from Fire Stations 1 &2 -
Ocean Rescue services
• Sidewalk pressure cleaning in South, Middle and North Beach visitor areas
• South Beach sanitation
• Enhanced Code Compliance /Enforcement provided to respond to evening
entertainment area violations and staffing of special events
• Other Code Compliance /Enforcement activities in tourism and visitor related
facilities /areas
• Tourism, Cultural and Economic Development Department and the Cultural Arts
Council
• Museums and Theatres (Garden Center, Bass Museum, and Colony)
• Golf courses (net of revenues) -
• Memorial .Day and other special event costs
• Homeless services
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
Page 13 of 15
• Visitor Center funding, Holiday Lights, Festival of the Arts, Jewish Museum, MDPL,
Orange Bowl, Monuments, etc.
These allowable uses have led to increased tourism related activities, such as special events,
Art Basel, and various concerts.
The 2 percent Resort Tax Fund operating revenues are projected to be in excess of budget. by
approximately $2.6 million and, as a result, payments to the Visitor's Convention Authority
(VCA), which are based on a percent of revenues, are projected to exceed budget. In addition,
savings are projected in salaries due to staff turnover and the use of contingency is projected
to be below budget.
In addition to the uses listed above, the proceeds of the. additional one percent (1 percent) tax
are used as follows: Fifty percent of the amount earned is committed to the payment of a
portion of the debt service on the Miami Beach Redevelopment Agency City Center Bonds.
The remaining fifty percent'is allocated equally among North Beach, Middle Beach and South
Beach for capital projects that enhance Miami Beach's tourist related areas and various arts
and cultural programs. The 1 percent Resort Tax Fund operating revenues are projected to be
in excess of budget by approximately $1.5 million and, as a result, the debt service and
transfers to North Beach, Middle Beach, and South Beach for capital projects and the transfers
to the arts and cultural programs are projected to exceed budget as represented below.
In total, the projected revenues are estimated to be in excess of budget by $4.1 million and
expenditures in excess of budget by approximately $1.1 million for the reasons described
above. This results in a net operating surplus of approximately $2.9 million. No surplus is
projected for the 1 percent revenues.
RESORT TAX FUND
FY 2012/13, FY 2012/13 FY 2012/13 FY 2012/13
Revenues Adopted Budget Amendment Amended 6/30113 Actual Projection Over/ (Under)
2% Resort Tax $ 44,132,000 $ 44,132,000 $ 34,632,066 $ 46,747,000 $ 2,615,000
1 %Resort Tax 9,368,000 9,368,000 8,354,634 10,881,000 1,513,000
Other Revenues 754,000 754,000 725,693 730,000 24,000
Total Revenue $ 54,254,000 $ $ 54,254,000 $ 43,712,393 $ 58,358,000 $ 4,104,000
Expenditures
General Fund Contribution $ 30,965,000 $ 30,965,000 $ 23,223,750 $ 30,965,000 $
Other Operating /Other Uses 4,548,079 4,548,079 1,573,403 4,297,000 (251,079)
Contributions to VCA and GMCVB 7,427,361 7,427,361 6,152,084 7,553,000 125,639
Marketing 248,000 248,000 2,963 6,000 (242,000)
Contingency 482,241 482,241 - 445,000 (37,241)
2% Debt Service 1,215,319 1,215,319 1,215,319 1,216,000 681
1% Debt Service 4,684,000 4,684,000 4,177,317 5,441,000 757,000
Transfer to Capital and the Arts (1 %) 4,684 4 684,000 4,177 316 5,441,000 757,000
Total Expenditure $ 54,254,000 $ $ 54,254,000 $ 40,522,152 $ 55,364,000 $ 1,110,000
Surplus /(Deficit) $ (0) $ $ (0) $ 3,190,241 $ 2,994,000 $ 2,994,000
CONCLUSION
This analysis of budget to actual operating revenues and expenses with projections through
September 30, 2013, provides the status of the FY 2012/13 Adopted Budget for the first nine
months of the fiscal year. The Administration will continue to monitor revenues and expenses
throughout the remainder of the fiscal year and resulting impacts on the FY 2012/13 budget.
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
Page 14 of 15
SCHEDULE A
CITY OF MIAMI BEACH
FY 2012/13 GENERAL FUND PROJECTIONS
Quarter 3
Over/
°h Actual of (Under) % Ova r/
FY 2012113 FY 2012113 FY13 FY 2012113 Amended (Under)
Adopted Amended Actualsasof Amended Projection as Budget As of Amended
Budget Budget June 30, 2013 Budget of Quarter 3 Quarter 3 Budget
REVENUES
Ad Valorem Taxes $ 102,171,000 $ 102,171,000 $ 95,884,935 94% $ 101,053,000 (1,118,000) -1.1%
Ad Valorem Taxes -S Pte Costs 10,296,000 10,296,000 9,696,229 94% 10,183,000 (113,000) -1.1%
Ad Valorem Cap.Renewal & Replace. 1,850,000 1,850,000 2,154,718 116% 1,829,000 (21,000) -1.1%
Ad Valorem Taxes -Norm Shores 129,000 129,000 0 0% 127 (2,000) -1.6%
Other Taxes 24,023,000 24,023,000 13,982,633 58% 22,743,000 (1,280,000) -5.3%
Licenses and Permits 20,033,000 20,033,000 18,814,534 94% 23,278,000 3,245,000 16.2%
Intergovemmental 9,827,000 9,827,000 6,911,978 70% 9,982,000 155,000 1.6%
Charges for Services 4,689,000 4,689,000 3,674,884 78% 4,436,000 (253,000) -5.4%
Golf Courses 5,979,000 5,979,000 4,703,751 79% 5,773,000 (206,000) -3.4%
Fines and Forfeits 2,199,000 2,199,000 2,070,034 94% 2,611,000 412,000 18.7%
Interest - 2,983,000 2,983,000 2,942,390 99% 2,866,000 (117,000) -3.9%
Unrealized Gains/ (Losses)- Investment 0 0 (2,860,106) 0% 0 0 0.0%
Rents and Leases 6,464,000 6,464,000 5,914,135 91% 6,772,000 308,000 4.8%
Miscellaneous 11,830,000 11,830,000 5,022,341 42% 11,406,000 (424,000) -3.6%
Other - Resort Tax contribution 30 ,965,000 30,965,000 23,636,250 76% 30,965,000 0.0%
Other - Non Operating re%enues 8,532,000 8,532,000 6,399,276 75% 8,532,000 (0) 0.0%
Reserve- Building Department Ops. 1,500,000 1,500,000 0 0% 0 (1,500,000) - 100.0%
Prior Year -End Carryover 3,400,000 4,790,000 0 0% 4,790,000 0.0%
Prior Yr Surplus from Parking Oper Fd 7,200,000 7,200,000 5,400,000 75% 7,200,000 0.0%
Prior Yr Set Aside for Pension Credit 2,210,000 2,210,000 0 0% 2,210,000 0.0%
TOTAL REVENUES $ 256,280,000 $ 257,670,000 204,347,981 79% 256,756,000 (914,000) -0.4%
Unrealized Gains/ (Losses} Investment 2,860,106
Total Net of Unrealized Gains /.(Losses) $ 256,280,000 1 $ 257,670,000 207,208,087 r 80%1 256,756,000 1 (914,000)
EXPENDITURES
Mayor and Commission 1,648,000 1,648,000 1,181,907 72% 1,621,000 (27,000) -1.6%
City Manager 2,313,000 2,745,000 2,005,177 73% 2,699,000 (46,000) -1.7%
Communications 893,000 893,000 581,234 65% 837,000 (56,000) -6.3%
City Clerk 1,505,000 1,505,000 938,425 62% 1,417,000 (88,000) -5.8%
Finance 4,426,000 4,426,000 3,196,441 72% 4,183,000 (243,000) -5.5%
Office of Budget & Perf Improve. 2,160,000 2,160,000 1,231,359 57% 1,762,000 (398,000) - 18.4%
Human Resources /Labor Relations 1,827,000 1,827,000 1,167,349 64% 1,610,000 (217,000) -11.9%
Procurement 1,063,000 1,068,000 704,744 66% 970,000 (98,000) -9.2%
City Attorney 4,318,000 4,318,000 3,232,402 75% 4,543,000 225,000 5.2%
Real Estate, Housing & Comm Dev 1,048,000 1,048,000 599,240 57% 791,000 (257,000) -24.5%
Community Services 460,000 460,000 333,774 73% 458,000 (2,000) -0.4%
Homeless Services 990,000 990,000 610,898 62% 902,000 (88,000) -8.9%
Building' 10,985,000 11,072,000 7,590,112 69% 10,837,000 (235,000) -2.1%
Code Compliance 4,647,000 4,647,000 3,230,204 70% 4,333,000 (314,000) -0.8%
Planning 3,419,000 3,419,000 2,178,380 64% 3,028,000 (391,000) -11.4%
Tourism & Cultural Development 2,503,000 2,503,000 1,615,759 65% 2,431,000 (72,000) -2.9%
Parks and Recreation 22,153,000 22,179,000 15,236,752 69% 22,627,000 448,000 2.0%
Golf Courses 6,619,000 6,619,000 4,662,548 70% 6,048,000 (571,000) -8.6%
Public Works 6,548,000 6,688,000 4,387,649 66% 6,569,000 (119,000) -1.8%
Capital Improvement Program 4,841,000 4,858,000 2,877,079 59% 4,087,000 (771,000) -15.9%
Fire 62,242,000 62,263,000 45,275,439 73% 60,784,000 (1,479,000) -2.4%
Police 94,963,000 94,970,000 73,052,960 77% 96,523,000 1,553,000 1.6%
Citywide Accounts 8,817,535 9,467,535 8,103,057 86% 12,712,000 3,244,292 34.3%
Citywide Acc-Operating Contingency 1,000,000 1,000,000 0 0% 0 (1,000,000) - 100.0%
Citywide Accounts - Normandy Shore 187,292 187,292 0 0% 213,000 25,708 13.7%
Citywide Accounts- Normandy Shores Transfer 2,014,173 2,019,173 79,107 4% 2,019,000 - 0.0%
Reserve- Future Budget Shortfalls 831,000 831,000 0 0% 831,000 0 0.0%
Capital Renewal & Replacement 1,859,000 1,859,000 0 0% 1,859,000 0 0.0%
Reserve - Canyforward Pension Credit Surplus 0 i 0 0 0% 0 0 0.0oo
00
TOTAL EXPENDITURES $ 256,280,000 $ 257,670,0 184,071,995 71% 256,694,000 (976,000) -0.4%
EXCESS OF REVENUES OVER/
(UNDER) EXPENDITURES $ M 0 23,136,093 1 0% 62,000 1 62 ,000 13.7%
LTC - Analysis Of Budget To Actual Revenues And Expenses For The Nine Months Ending June 30,
2013, With Operating Budget Projections Through September 30, 2013
Page 15 of 15
SCHEDULE B
POLIO OVEI�TF FY1
M3 PRC}IECT #t}N - ):XCLUCINCtI/iUFtSALFS31( NON CITY ENTITIES
FY13 Projection
FY13 Adopted as of August
FY10Actual FY13 Actual FY12 Actual Budget 8/25 /13 Actual 2013 FY13Variance %Variance
South Pointe Spring Break 0 92,203 121,067 100,000 0 0 - 100,000 -100%
South Pointe Other 72,241 69,018 137,375 100,000 83,723 86,838 - 13,162 -13%
City Center 174 350 452 450 295 356 -93,015 -21
Crime Investigations 987,957 920,087 979,973 899 649,540 718,576 -180 -20°/
Manpower Shortage 921,943 829 1 866 1 1 558 64%
General Fund Regular 373,194 403,311 621,555 379,000 500,499 547,906 168,906 45%
Neighborgood Resource Officer- Homeless 519 10,007 45,928 10000 35,510 39,288 29,288 293°/
Spring Break 0 561,042 726,401 750,000 883,046 883,046 133,046 18%
Other Special Events (inclduding Spring Break
and New Year's Eve prior to FY 2010/11 and
New Year's Eve prior to FY 2011/12) 871 419,391 635,138 150,000 507,714 569,740 419,740 280
Memorial Day 0 857 954 916 869 869 -46 -5%
New Years Eve (Previously budgeted under
Mis. Special Events) 44,671 159,817 0 105,000 106,829 106,829 1,829 2%
Misc. Special Eve nts 0 0 0 100,000 0 0 - 100,000 -1D0%
Chargebacks to Sanitation /Parks /E911 /Parking 580 401,699 160,917 160,000 157,943 173,897 13,897 9 -
Other' 166 303 116 -258,000 1 479 489 043 747 -290°/
Sub- TotalTotal $4194,264 377,256 $6302546 $4,7275 $5,8�i,388 $6265,797
QTALOVER11ME 4,194,264 5,377,256 6,302,546 5,271,000 5,857,188 6,265,797 994,797 19%
RDA -City Ctr 174,814. 350,461 452 450,000 295,896 356,975 - 93,025 -21% -
-
Spring Break _ 0 653 693 850 883 983 33 4
Memorial Day 0 0 954,704 916 869 869 -46 -5%
New Years Eve (Previously budgeted under
- Mis. Special Events ) 0 891 104,782 105 106 106 1 2
Parking 148,618 1 110,304 313 0 0 0 1 0 0o/
Other Reimbursables 0 0 -1,734 0 431,429 0220,8 431 100°/
Sanitation 31,256 30,429 26,916 30,000 18,876 -9,116 -30%
Net General Fund 3$39576 4,23 925 071,385 2920,00(1 9 749 1 677 23%
E - 911 399 905 259 066 133 688 130 000 131097 15 044 12% Memorial Day priorto FY12 0 857,044 0 0 0 0 0o/ 0 1,009 2,472 0 0 0 0%
Police General Fund 3 1 311 9$5224 790 52: 4 227 24%