LTC 096-2008 Analysis of Budget to Actual Revenues and Expenses for the Three Months Ended 12/31/07
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OFFICE OF THE CITY MANAGER ..~'.t, ~
NO. LTC #096-2008 LETTER TO COMMISS~I~
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TO: Mayor Matti Herrera Bower and Members of the City Commission ~:~' ~
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FROM: Jorge M. Gonzalez, City Manager ~ •'
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DATE: April 8, 2008
SUBJECT: ANALYSIS OF BUDGET TO ACTUAL REVENUES AND EXPENSES FOR THE THREE MONTHS ENDED
DECEMBER 31, 2007, WITH OPERATING BUDGET PROJECTIONS THROUGH SEPTEMBER 30, 2008 FOR THE
GENERAL FUND
The Purpose of this LTC is to provide the Mayor and Commission with the status of the FY
2007/08 budget to actual revenue and expenses at the end of the first quarter with
projections through September 30, 2008. Based on the review, it is projected that, overall,
there will be an operating budget surplus of $513,090 (0.2%) in the General Fund.
I. General Fund Overview
An analysis of the actual three month operating revenues and expenditures for the period
October 1, 2007 through December 31, 2007, reveals an operating surplus of $56,528,305.
While the surplus as of December 31St seems unusually large as compared to the final
projected for the year ending on September 30th, it should be noted that the City receives a
greater percentage, approximately 60% of its ad valorem taxes in the first quarter. Ad
valorem tax revenues representing approximately 54% of total revenues have been almost
65% received whereas the remaining 46% of revenues are approximately at the 25% level
as of December 31St
A summary of preliminary General Fund Revenues and Expenditures as of September 30,
2008 is as follows:
Adopted Budget Projected Budget/Actual
General Fund FY 2007/08 Sept. 30, 2008 Over/(Under)
Revenues $230,624,537 $232,222,027 $1,597,490
Expenditures 230,624,537 231,708,937 1,084,400
Surplus/(Deficit) $ 0 $ 513,090 $ 513,090
For a detail of General Fund Revenues by category and Expenditures by Department, see
attached schedule. Detailed comments on those revenue and expenditure categories with
significant variances over $300,000 are shown below.
General Fund Operating Revenues
As of December 31, 2007, revenues collected were 46% of budget or $107,113,273.
Historically, the City receives approximately 60% of its ad valorem taxes in the first quarter,
which must be considered when analyzing actual revenues and formulating year-end
revenue projections. Year-end projections through September 30, 2008 which total
$232,222,027 indicate that revenues will be above budget by $1,597,490 or approximately
0.7%.
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LTC #096-2008 ANALYSIS OF BUDGET TO ACTUAL REVENUES AND EXPENSES FOR THE THREE MONTHS
ENDED DECEMBER 31, 2007, WITH OPERATING BUDGET PROJECTIONS THROUGH SEPTEMBER 30,
2008 FOR THE GENERAL FUND
Page 2
Licenses and Permits -This category includes licenses and building and special use
permits. Despite the downturn in the building industry, projections indicate that year-end
collections will exceed budget by 15% or $2,280,500. This is primarily due to the
implementation of new processes and the related continuing review of existing open
building and trade permits from which approximately $2.1 million has been collected to
date.
2. Intergovernmental -This category includes state-shared revenues such as cigarette,
gas, and sales taxes. Projections indicate that year-end collections will be below budget
by 4.6% or $489,600. This is mainly due to lower than budgeted revenues, specifically
from half cent sales tax as well as local option gas taxes and motor fuel taxes collected
statewide.
3. Miscellaneous -This category includes concessions, planning fees, and other
reimbursements. Projections indicate that year-end revenues will be 5% below budget
or $377,905. This is due primarily to lower than expected revenues from construction
management charges to capital projects due to vacant positions in the CIP department,
thereby also creating offsetting reductions in expenditures.
General Fund Operating Expenditures
As of December 31, 2007, actual expenditures were 22% of budget or $50,584,968. On a
straight-line average for three months ended December 31, 2007, expenditures should have
been at a minimum, approximately 25% of budget or $57,656,134. Year-end projections
through September 30, 2008 indicate that expenditures of $231,708,937 will be 0.5% over
budget. With the exception of the Fire and Police Departments, there are no significant
deviations from budgeted expenditures, and almost all remaining departments are projected
to underspend their budgets.
Significant variances to budget in excess of $300,000 by General Fund department are
explained below:
Police
Budget Projected Budget/Projected
FY 2007/08 Sept. 30, 2008 Over/(Under)
$76,957,768 $78,307,768 $ 1,350,000
The Police Department is expected to spend approximately 1.8% over its budget in the
amount of $1,350,000 due primarily to higher than anticipated overtime usage. The
department will be meeting with management staff to develop a plan with the goal of being
within budget by the end of the fiscal year.
2. Fire
Budget Projected Budget/Projected
FY 2007/08 Sept. 30, 2008 Over/(Under)
$45,774,552 $46,844,552 $ 1,100,000
The Fire Department is expected to spend approximately 2.4% over its budget in the amount
LTC #096-2008 ANALYSIS OF BUDGET TO ACTUAL REVENUES AND EXPENSES FOR THE THREE MONTHS
ENDED DECEMBER 31, 2007, WITH OPERATING BUDGET PROJECTIONS THROUGH SEPTEMBER 30,
2008 FOR THE GENERAL FUND
Page 3
of $1,100,000. The major contributing factors are as follows: (1) internal service costs in
Fleet Management are expected to be over approximately $260,000 due to higher fuel costs;
(2) personnel costs are expected to be over budget by approximately $840,000 due primarily
to holiday pay ($348,000) arising from contractual obligations, as well as overtime
($325,000).
As discussed in LTC #042-2008 entitled "Analysis of Budget to Preliminary Actual Revenues
and Expenses for the Fiscal Year Ending September 30, 2007, for General, Enterprise, and
Internal Service Funds" overtime in the Fire Department has been an ongoing issue since
the minimum staffing ordinance was implemented in February 2003. As compared with FY
2002/03, overtime in the Fire Department Suppression, Rescue, and Support Divisions has
increased from $365,362 to $1,518,898 in FY 2006/07, an increase of 316% in total and
over 63% annually. The FY 2007/08 projected year end for these divisions, represents
$1,581,454; bringing the total cumulative increase over FY 2002/03 to 333%. In addition,
based on a review conducted in mid FY 2006/07, the Fire Department level of unanticipated
leave usage is the highest of any other department in the City. Prior efforts made to address
overtime usage in excess of budget, including increasing the overtime budget, adding
positions, hiring in advance of anticipated vacancies and instituting a sick leave sell-back
program, continue to fail in yielding results.
CONCLUSION
This analysis of budget to actual operating revenues and expenses for the General Fund
with projections through September 30, 2008, provides the status of the FY 2007/08 General
Fund Budget as of the first three months of the Fiscal Year. The Administration will continue
to monitor revenues and expenses to ensure that we close the fiscal year in a positive
position with overall revenues exceeding overall expenses.
JMG/KGB/JC~y~,
ATTACHMENT
FY 2007108 General Fund Operating Summary Projection
Adopted As of Projected Proj-Adptd
FY 2007/08 Dec. 31, 2007 FY 2007108 Over!(Under)
REVENUES
Ad Valorem Taxes-S Pte Costs
Ad Valorem Cap.Renewal & Replace.
Ad Valorem S Pte Cap.Ren & Repl
Ad Valorem Taxes-Norm Shores
Other Taxes
Licenses and Permits
Intergovernmental
Charges for Services
Fines and Forfeits
Interest
Rents and Leases
Miscellaneous
Other -Resort Tax contribution
Other -Non Operating revenues
Fund Balance
Mayor and Comr
City Manager
Communications
City Clerk
Finance
Office of Budget & Perf Improve.
Human Resources/Labor Relations
Procurement
City Attorney
Economic Development
Building
Planning
Tourism & Cultural Development
Neighborhood Services
Parks and Recreation
Public Works
Capital Improvement Program
Fire
Police
Citywide Accounts
Citywide Accounts-Normandy Shore
Citywide Accounts-Transfers
Capital Renewal & Replacement
AL
$ 114,114,196 $ 73,880,705 $ 114,114,196
7,718,251 4,993,708 7,718,251
3,266,096 2,113,164 3,266,096
234,435 151,679 234,435
148,820 96,287 148,820
22,833,300 3,704,092 22,955,300
14,941,425 7,163,846 17,221,925
10,713,940 1,890,467 10,224,340
8,242,350 1,733,621 8,279,950
1,975,000 238,206 1,892,000
6,200,000 1,503,993 6,200,000
4,371,150 359,857 4,479,045
7,479,914 2,898,693 7,102,009
20,696,309 4,592,827 20,696,309
7,689,351 1,792,128 7,689,351
0 0 0
$ 230,624,537 $ 107,113,273 $ 232,222,027
$ 1,403,877 $ 338,670 $ 1,383,877
2,289,042 595,052 2,279,042
1,224,962 268,622 1,214,962
1,669,012 361,597 1,659,012
4,274,374 989,756 4,104,374
1,904,001 468,075 1,875,001
1,802,168 511,331 1,915,568
926,568 211,994 891,568
4,213,126 922,342 4,193,126
933,299 240,782 943,299
8,689,391 1,863,656 8,439,391
3,215,399 649,834 3,165,399
3,147,135 550,787 2,997,135
5,532,938 1,260,117 5,452,938
28,142,606 6,247,064 27,892,606
6,222,817 1,357,573 6,117,817
3,376,245 655,712 3,076,245
45,744,552 11,767,872 46,844,552
76,957,768 19,529,367 78,307,768
12,570,893 1,790,038 12,570,893
203,833 0 203,833
12,680,000 4,727 12,680,000
3,500,531 0 3,500,531
$ 230,624,537 $ 50,584,968 $ 231,708,937
0
122,000
2,280,500
37,600
0
107,895
(377,905;
0
(20,000)
(10,000)
(10,000)
(10,000)
(170,000)
113,400
10,000
(50,000
(150,000
(105,000)
(300,000)
1,100,000
1,350,000
EXCESS OF REVENUES OVER/
(UNDER) EXPENDITURES $ 0 $ 56,528,305 $ 513,090 $ 513,090