02-04-2003 - 2002/03 Mid-Year Review & Recommended Budget Adjustments0
0
TO: Andrew G. Pasmant, City Manager
and City Council
FROM: Tom Bachman, Director
Finance Department
City of West Covina
Memorandum
AGENDA
Item No.: E-2
Date: February 4, 2003
SUBJECT: 2002-03 MID -YEAR REVIEW AND RECOMMENDED BUDGET
ADJUSTMENTS
RECOMMENDATION:
Receive and file Mid -Year Review and approve the appropriation adjustments presented in this
report.
DISCUSSION:
The City adopted a $41,474,291 General Fund Budget for 2002-03 that contained a budget gap
of $3,296,071. Since the time the budget was adopted, City staff has been working to come up
with solutions to close the gap in the current year as well as in future years. A combination of
increased estimates of certain revenue sources, reduction in projected expenditures and
recommended deferral of capital projects will allow the City to significantly close the budget
gap. As of December 31, 2002, General Fund revenues were at 46.7% of budget and General
Fund operating expenditures were at 44.4%. Total City wide expenditures, including the
Redevelopment Agency, are at 40.4% of budget through the first six months of the fiscal year. A
printout of mid -year expenditures is included in Attachment A. Below is a chart and discussion
of the General Fund's major revenue sources through December 31, 2002.
REVENUESOURCE
Sales Tax
% of Total
30.6%
Budget
11,700,000
YTD Actual
5,832,232
Balance
Remainina'.
5,867,768
Received
49.8%
Vehicle in Lieu Tax
15.5%
5,900,000
3,077,564
2,822,436
52.2%
Property Tax
14.7%
5,628,075
2,506,759
3,121,316
44.5%
Interest
13.6%
5,200,000
2,056,326
3,143,674
39.5%
Franchise Tax
6.5%
2,477,900
100,000
2,377,900
4.0%
Overhead Char ebacks
4.9%
1,865,623
898,164
967,459
48.1%
Business License Tax
2.5%
960,000
178,400
781,600
18.6%
Transient Occupancy Tax
2.2%
850,000
347,553
502,447
40.9%
Other Revenues
6.3%
2,401,652
2,263,281
138,371
94.2%
Transfers In/Intemal Svc Charges
3.1%
1,194,970
579,768
615,202
48.5%
Total Revenues
100.0%1
38,178,220
17,840,048
20,338,172
46.70]/o
Sales Tax — Although sales tax is right at 50% through the first six months of the year, this does
not include the fourth quarter receipts, which is typically the largest quarter, and includes only
one quarter of sale tax transfer from the Fashion Plaza CFD. Sales tax receipts at this time last
year were about $5.3 million. Sales tax for the year should exceed the budget estimate and be in
the _$12.1 million range, which would be 4.3% increase over last years amount.
Motor Vehicle in -lieu — The City uses the revenue estimates provided by the State Controller's
Office, which are usually conservative. Based on receipts to date, the revised estimate for the
current year is $6.2 million, a 1.9% increase over last years amount of $6.084 million. This
estimate is contingent on cities being successful in getting the state to reinstate the vehicle
license fees to previous levels instead of cutting the backfill to local governments.
•
Property taxes - Property tax revenues are right on track where they should be based on the
payment schedule from the county.
Interest - Interest income is running below the revenue estimate due to timing of interest
payments on certain investments.
Franchise Tax - Franchise tax receipts are only at 4% due to the fact that most payments are not
required to be made until later in the year. This is consistent with prior years.
Overhead Chargebacks - These are budgeted chargebacks to various department and funds that
receive external funding. This revenue source should meet its budget projection.
Business License Tax - Business license revenues are only at 18.6% due to most revenue from
this source is due in January. Additionally, effective January 1, 2003, the business license rates
for most businesses increased by a three-year cumulative CPI increase of 10% and commercial
landlords rates no longer include the waiver of 50% of their tax. Both of these provisions are
contained in the Municipal Code and should generate an additional $380,000 over the budget
estimate.
Transient Occupancy Tax - This revenue source is a little below its budget estimate but only
includes five months of collections and should be pretty close to its budget projection.
Other Revenues - This revenue source is at 94% due to the sale proceeds of $1.2 million from
Shakespeare Park. Additionally, building permits and related charges for service are exceeding
budget estimates through the first six months. Fee and charge increases will also be brought to
the City Council in the near future that should result in an increase in the current year of
approximately $100,000.
Fund Transfers - Fund transfers into the General Fund should increase as a result of being able
to transfer interest earnings in excess of debt service payments from the City's debt service fund
into the General Fund. This is a result of the refunding of the civic center bonds. An
appropriation request for $220,000 is included in the budget adjustment section of this report.
Based on revised revenue estimates discussed above, revenue in the current year should exceed
the original estimates by $1.4 million, not including the sale of Shakespeare Park.
A chart of expenditures to date is shown below. Amended budget amounts include
encumbrances from the prior year, carryover capital projects and additional appropriations made
during the current year.
EXPENDITURES
Elected/Appointed
% of Total
0.6%
. .
budget
267,413
Yl L) Actual
95,954
:.
Remaining
171,460
%
Expended
35.9%
General Administration
3.0%
1,315,868
450,123
865,745
34.2%
City Clerk
1.6%
732,850
186,209
546,641
25.4%
finance
5.5%
2,435,452
1,037,154
1,398,299
42.6%
Human Resources
1.2%
538,683
221,409
317,274
41.1%
Police
39.2%
17,469,142
7,920,336
9,548,806
45.3%
Fire
22.5%
10,019,048
4,511,983
5,507,066
45.0%
Communications
3.8%
1,711,925
738,501
973,424
43.1%
Planning
1.2%
546,533
237,263
309,270
43.4%
Environmental Management
0.4%
193,810
65,998
127,812
34.1%
Public Works
8.8%
3,898,485
1,783,714
2,114,771
45.8%
Community Services
2.2%
992,878
600,834
392,043
60.5%
Transfers Out
0.5%
239,672
77,596
162,076
32.4%
Total Operating Budget
40,361,759
17,927,074
22,434,686
44.4%
Capital Projects Total
9.3%
4,159,879
1,619,578
2,540,301
38.9%
General Fund Budget Total
100.0%
44,521,638
19,546,654
24,974,987
43.9°/
0 •
The amended budget of $44,521,638 includes $2,612,379 of carryover capital projects, $156,723
of 2001-02 encumbrances, $154,716 of 2001-02 approved department carryover requests and
additional 2002-03 appropriations of $135,100. Departments for the most part have done a good
job of managing their expenditures and most departments are under projected expenditure levels
to date. Community Services is at 60% of budget due in large part to the Special Events
division, which has had most of its events already occur.
Based on the current level of expenditures, the City Manager directed all departments in
December to spend only 97% of the current year budget allocations. Complying with this
direction will generate approximately $1.2 million in current year savings. Staff has also
reviewed all capital projects funded by the General Fund to determine which projects could be
deferred or funded with other funding sources. A list of these recommendations is included in
the budget adjustment section of this report. The City can also eliminate the fund transfer of
$132,000 from the General Fund to the City's debt service fund due to lower than expected debt
service payments on the civic center bonds.
A summary of the General Fund 2002-03 Budget is below:
Revenues and transfers in $38,178,220
Expenditures and transfers out 41,474,291 (includes $1,435,000 CIP funding)
Budget Gap $ (3,296,071)
Revised revenue estimates
1,400,000
3% Expenditure reduction
1,200,000
Deferral - capital projects
460,000 * requires City Council action below
Shift funding— capital projects
77,000 * requires City Council action below
Defer Heritage Park Restrooms
136,000 * pending grant application see #4
Elimination of debt service transfer
132,000
2002-03 additional appropriations
(135,100)
Cameron Park Community Center (350,000)
Revised Current Budget Gap $
(376,171)
Below is the list of recommended budget adjustments requiring City Council approval.
1. Appropriate a $220,000 transfer of funds from the City Debt Service Fund (200) to the
General Fund (110), which reflects excess interest earnings above the required debt
service requirements of that fund.
2. Defer the following capital projects to a future year:
a.
City Hall Lobby Enclosure
(110-320-3296-7500)
$120,000
b.
Accounting Software Lease
(110-320-3313-7130)
$ 50,000
c.
Civic Center Security Fencing
(110-320-3300-7500)
$146,000
d.
Traffic Signals Minor Modifications
(114-320-3355-7800)
$ 50,000
e.
Safety Netting -Cortez Park
(114-320-3357-7700)
$ 26,000
f.
Foul Ball Netting -Maverick Field
(114-320-3361-7700)
$ 50,000
g.
Safety Netting -Shadow Oak Park
(114-320-3362-7700)
$ 12,000
h.
Backstop Netting -Shadow Oak Park
(114-320-3363-7700)
$ 6,000
Total Deferred Capital Projects
460 000
3. Shift funding for the Fire Station #1 Refurbishment capital project in the amount of
$77,000 from the General Fund (110-320-3305-7500) to the CDBG Fund (131-320-3305-
7500).
4. Defer Heritage Park Restrooms capital project until the City receives a decision on the
grant, which it has applied for. This project has a General Fund budget of $136,000
5. Transfer the appropriations of $12,000 from account #122-320-2445-6120 (Prop C-
Eastland Park and Ride) and $13,000 from account #122-320-2446-6120 (Prop C-
Fashion Plaza Park and Ride) for a total of $25,000 to account # 122-320-2442-6120
(Prop C-Metrolink Services). This amount is needed to cover the current annual cost for
these transit services.
6. Transfer the following appropriations to the newly established division number for the
West Covina Sportsplex/Commercial Center (BKK) project, which was set up to easily
monitor expenditures for this project.
a. $125,000 from: 876-320-5500-6111 to: 876-320-5540-6111
b. $ 73,400 from: 876-320-5500-6114 to: 876-320-5540-6114
C. $109,000 from: 876-320-5500-6117 to: 876-320-5540-6117
d. $ 25,000 from: 876-320-5500-6120 to: 876-320-5540-6120
7. Appropriate an additional $409,000 from the West Covina Merged Project Area fund
balance (Fund 876) to account number 876-320-5540-6111 to cover unanticipated legal
fees on the West Covina Sportsplex/Commercial Center (BKK) project.
8. Appropriate an additional $131,584 from the Housing Set -aside fund balance (Fund 862)
to account numbers 862-320-2412-XXXX (various salary and benefit accounts) and de -
obligate $131,584 back to CDBG fund balance from account numbers 131-320-2412-
XXXX (various salary and benefit accounts). This shifting of funding for the Home
Improvement personnel costs to the redevelopment -housing fund will free up CDBG
funds, which can be used for other purposes such as the fire station rehabilitation
mentioned above.
FISCAL IMPACT:
The fiscal impact for the requested City Council action items is summarized below:
• Increase the General Fund (110) balance by $398,500.
• Increase the Community Enhancement Fund (114) balance by $144,000.
• Reduce the West Covina Redevelopment Agency Merged Project Area Fund (876)
balance by $409,000.
• Increase the CDBG Fund (131) balance by $54,584.
Prepared by: Tom Bachman
Director of Finance
City of West Covina
City -Wide Expenditure Summary
For The Month Ending December 31, 2002
(Average Year -To -Date Percent Expended is 50.0%)
1----- FY 2002103 ---- 4
1 ' ------- FY 2002103 ----------
Original
Revised
Y-T-D
Encumbered
%
Balance
Fund Department Description
Budget
Budget
Expenditure
Amount
Expended
Available
Comment
General Funds
110 2110 Police
17,472,125.00
17,469,141.91
7,920,335.91
19,020.35
45.45%
9,529,785.65
110 2170, 2181, 2182, 2185,2188 Fire
10,005,306.00
10,019,048.36
4,511,982.57
14,903.77
45.18%
5,492,162.02
110 2651-2658 Appointed Commissions
32,987.00
52,812.00
12,230.18
-
23.16%
40,581.82
110 2210, 2211, 2212 Building
732,672.00
733,172.00
364,641.68
30,721.01
53.92%
337,809.31
110, 112, 114, 115 3001-3999 Capital Projects
1,435,500.00
4,159,879.07
1,619,578.06
135,322.01
42.19%
2,404,979.00
110 2660 City Attorney
444,130.00
444,130.00
74,104.38
1,100.00
16.93%
368,925.62
110 2510, 2511 City Clerk
732,850.00
732.850.00
186,208.72
2.262.32
25.72%
544,378.96
110 2610 City Council
190,424.00
213,376.30
83,153.19
1,852.23
39,84%
128,370.88
110 2620, 2632, 2640 City Manager
851,522.00
871,737.72
376,018.62
52,286.18
49.13%
443,432.92
110 2190 Communications
1,710,808.00
1,711,924.75
738,501.19
11.91
43.14%
973,411.65
110 2345-2359 Community Services
934,183.00
992,877.77
600,834.46
5,194.81
61.04%
386,848.50
110,114 2311, 2314 Environmental Management
169,000.00
169.000.00
55,804.05
25,200.00
47.93%
87,995.95
110 2520-2550 Finance
2,286,715.00
2,436,677.36
1,037,724.27
138,906.46
48.29%
1,260,046.63
110 2220, 2331 Maintenance
1,110,420.00
1,124,718.14
577,066.52
75,914.63
58.06%
471,736.99
180 2216, 2241-2254, 2280, 3156 Non -Assessable Citywide Maintenance
1,855,310.00
1,864,415.00
761,068.32
330,530.14
58.55%
772,816.54
.
110 2560 Personnel
538,033.00
538,683.00
221,408.94
-
41.10%
317,274.06
110 2313, 2320 Planning and Code Enforcement
707,824.00
722,713.08
318,200.67
719.08
44.13%
403,793.33
110,112,113,114,15 2,999 Transfers Out
239,672.00
239,672.00
77,596.02
-
32.38%
162,075.98
120 2315 Waste Management Enforcement
1 24,810.001
24,810.00
1 10,194.14
-
41.09%
14,615.86
4.1 74,291:00
44,521,638.46
" 19,546,651.89
833,944.90
45.78%
24;141,041.67.
Total General Funds
Other Funds
111 2348-2440, 2710-2760 Fee & Charge
116 2110 State Asset Forefeiture
117 2135, 3100, 3112 Drug Enforcement Rebate
119 2319 Air Quality Improvement Trust
1,147,871.00 1,147,871.00 560,857.74 8,648.65 49.61% 578,364.61
53,800.00 57,494.92 2,398.84 500.00 5.04% 54,596.08
52,500.00 53,551.55 - - 0.00% 53,551.55
134,685.00 214,635.00 116,455.56 1,000.00 54.72% 97,179.44
n
C+
w
9
ro
121 2440-2448, 3041-3253 Proposition "A"
2,756,172.00 3,326,551.41 872,058.44 997,045.15 56.19% 1.457.447.82
n
122 2218, 2442-2447, 3032-3926 Proposition "C"
88%392.00 2,976,979.83 1,148,144.36 392,949.04 51.77% 1,435,886.43
Prepared by L Shan 1/31/2003, 8:57 AM Page 1 of 14
Fund
123
124
125
126
127
128
129
130
131
135
136
138
139
140
141
142
143
144
145
146
149
150
152
153
155
158
159
160
2214,3040-3256
2214, 2230, 3137-3256
3250
3158,3728
2110
3132,3248
2312
2110
2320, 2411-2417, 3013-3935
2112
2110
3346
2182
3043, 3137
2110
2110
3285-3817
3351
2315
2392
2312
2110
2346, 2621, 3024-3870
2110
2110
2312
2343
3002-3726
Traffic Safety
State Gas Tax
Traffic Congestion (AB2928)
Proposition "111"
Police Donations
Transportation Development Act
Integrated Waste Management
Bureau of Justice Assistant Grant
Housing Development Block Grant
BJA Block Grant 1997-1999
Bureau of Justice Grant 2000
Traffic Safety Grant
FEMA Grant
F.A.U. / I.S.TE.A. / T21
G. R. E. A. T. Grant
OCJP Domestic Violence Grant
LA County Park Bond
Tree Fund
Waste Management Grant
Senior Meals Program
Used Oil Block Grant
Inmate Welfare
BKK Community
Public Safety Augmentation
COPS/SLES
C.R.V. / Litter Removal Grant
Summer Meals Program
Capital Projects
City of West Covina
City -Wide Expenditure Summary
For The Month Ending December 31, 2002
(Average Year -To -Date Percent Expended is 50.0%)
\---- FY 2002/03 ----- /
Original Revised
Budget Budget
846,004.00 989,667.00
2,414,528.00 2,645,087.27
191,000.00 310,338.82
- 214 665 04
40,000.00
220,063.00
1,646,712.00
100,000.00
150.000.00
22,000.00
29,127.00
184,934.00
60,814.00
10,500.00
686,821.00
860,000.00
61,858.00
17,600.00
2,500.00
5,243.00
105,908.75
220,063.00
20,799.09
1,781,999.61
115, 714.00
105,000.00
100,000.00
30,040.00
150,000.00
15,760.81
210,001.76
22,000.00
31,624.25
184,934.00
60,814.00
10,500.00
1,258,823.79
860,000.00
429.307.00
61,858.00
17,600.00
60, 767.52
Y-T-D
ti--------------- FY 2002/03 ---------------/
Encumbered % Balance
e ` Amount Expended Available
531,271.21
5.69
53.68%
458,390.10
942,926.45
14,513.52
36.20%
1,687,647.30
307,000.00
15,083.00
103.78%
(11,744.18)
66,832.73
115,919.59
85.13%
31,912.72
157.70
52,257.30
91,450.08
19,679.78
884,958.50
34,251.65
14,622.98
162.65
43,065.96
3,850.00
9,518.03
122,276.35
8,200.89
267.04
232,718,38
257,500.02
51,901,00
7,874.14
16, 000.00
12, 372.00
5,535.00
9,900.00
17,979.81
16,320.33
14,061.45
7,960.00
190.35
3.01 %
54.57%
46.06%
94.62%
50.67%
43.70%
0.00%
0.00%
0.00%
0.00%
92.78%
100.00%
27.20%
30.7
66.1
13.4
67,860.12 23.88%
250,888.86 59.11%
12.09%
16,840.72 39.95%
90.91 %
20.36%
5,085.30
48,116.45
118,712.92
1,119.31
879,061.30
65,142.02
105,000.00
100,000.00
30,040.00
150,000.00
1,137.83
(162.65)
152,874.35
10,190.00
21,915.87
62,657.65
52,613.11
10,232.96
958.245.29
351,611.12
377,406.00
37,143.14
1,600.00
48,395.52
0
0
Prepared by L Shan
1131/2003, 8:57 AM
Page 2 df 14
161
163
169
170
171
172
173
174
175
176
181
182
184
186
187
188
189
190
194
197
198
199
a
a
3001-3857
3237, 3244
3239, 3286, 3287
3260,3261
3127, 3128, 3266
3045-3320
3244,3522
3107-3268
3211, 3522
3235
2261.3756
2262
2264, 3019, 3756
2266
2267
2216, 2241, 2244, 2270
2215, 2230, 2257, 3202. 3504
2269
2110
2110,2111
2110
2449, 3043, 3160, 3253
2110-2750
2570
2570,2830
2570,2830
2224-3277
2801
Construction Tax
Park Fund
State Park Bond
Park Dedication Fees "A"
Park Dedication Fees "B"
Park Dedication Fees "C"
Park Dedication Fees "D"
Park Dedication Fees "E"
Park Dedication Fees "F"
Park Dedication Fees "G"
Maintenance District #1
Maintenance District #2
Maintenance District #4
Maintenance District #6
Maintenance District #7
Citywide Maintenance District
Sewer Maintenance
Business Improvement District
OCJP- CLETEP
COPS SRO Grant
OTS Grant
MTA Grant
City Debt Service
Self Insurance - Uninsured Loss
Self Insurance - General & Auto Liability
Self Insurance - Workers' Compensation
Fleet Management
Simulator Enterprise
City of West Covina
City -Wide Expenditure Summary
For The Month Ending December 31, 2002
(Average Year -To -Date Percent Expended is 50.0%)
1----- FY 2002/03----d
Original I Revised
272,500.00
27,000.00
1,400.00
7,000.00
25,000.00
56,000.00
1.400.00
228,195.00
60,305.00
1,015,985.00
94,525.00
92,575.00
1, 392, 355.00
1,240, 286.00
74,192.00
85,650.00
229,000.00
1,608,110.00
100,000.00
1,660,191.00
1,552,260.00
26,295.00
300,056.00
606,450.84
38,784,45
1,422,698.72
4,212.30
122,487.88
540,850.64
364.07
128,134.70
133,277.28
1,625.00
360,709.35
69,505.00
1,128,173.69
95,025.00
93,075.00
1,396,355.00
1,269,936.35
74,192.00
50,546.03
85,650.00
12,073.00
609,617.64
1,632,660.98
141, 730.41
1,660,191.00
1,560, 260.00
275,069.63
300,056.00
Y-T-D
t---------------FY 2002103 ------- /
Encumbered % Balance
e Amount Expended Available
49,354.31 18,534.00 11.19% 538,562.53
7,103.00
574,597.47
11, 702.02
430,740.74
150.00
14,850.43
155.06
140,689.42
25,305.12
388,723.38
34, 317.65
26,846.65
690,037.00
534,379.22
53,358.84
8,881.14
58,937.94
5,066.32
8,796.46
399,314.42
10,573.27
1,030,333.70
813,656.69
422,986.32
105,415.47
505,281.74
1,369.30
1,850.00
21,136.54
1,450.00
46,802.00
5,166.00
149,254.20
23,374.26
12,508.72
55,968,34
103,250.00
6,140.00
20,973.60
85.19
49,254.94
13,464.25
6,000.00
144.10
10,552.69
18.31 %
75.90%
32.51 %
11.06%
83.55%
41.20%
12.72%
0.12%
0.00%
51.98%
43.84%
47.69%
60.71 %
42.28%
53.43%
50.21 %
80.20%
59.06%
68.81 %
41.96%
1.46%
27.47%
16.96%
62.42%
52.16%
157.61 %
35.13%
31,681.45
342,819.51
2,843.00
108,935.86
88,973.36
214.07
111,834.27
133,122.22
1,625.00
173,217.93
39,033.88
590,196.11
37,333.09
53,719.63
650,349.66
632,307.13
14,693.16
20,691.29
26,712.06
7,006.68
600,735.99
1,184,091.62
117,692.89
623,857.30
746,459.21
(158,469.38)
194,640.53
Prepared by L Shan
1131/2003, 8:57 AM
Page 3 of 14
City of West Covina
City -Wide Expenditure Summary
For The Month Ending December 31, 2002
(Average Year -To -Date Percent Expended is 50.0%)
\---- FY 2002/03-----/
1------------- FY 2002/03--------- -----/
Original
Revised
Y-T-D
Encumbered
%
Balance
Fund Department Description
Budget .
Budget
Expenditure
Amount
Expended
. Available
Comment
375 2141-3231 Computer Enterprise
1,258,282.00
1,425,312.31
516,744,96
61,563,66
40.57%
847,003.69
850 5100 RDA Debt Service
(15,781.56)
0.00%
15,781.56
•
853 5100 CFD Debt Service
3,533,236.00
3,533,236.00
2,219,174.16
62.81%
1,314,061.84
862 2320, 5100, 5221, 5250, 5500 RDA Housing Set -Aside
1,906,119.00
6,941,846.47
1,414,217.73
53,226.43
21.14%
5,474,402.31
876 2430, 5100, 5270, 5455-5520 RDA Capital Projects
2,845,721.00
14,267,092.01
1,393,044.62
882,428.60
15.95%
11,991,618.79
877 2430, 5100, 5500, 5530 RDA City Wide Project Area
216,392.00
226,482.23
66.668.95
10,988.84
34.29%
148,824.44
882 5100 RDA Debt Service - PFA Notes
9,296,780.00
9,296,780.00
2,942,365.46
31.65%
6,354,414.54
883 5100 RDA Citywide Debt Service
11,521.94
100.00%
(11,521.94)
Total Other Fundsl 41,785,691.00 l 67,300,061.40 l 20,805,258:08 1 4,013,968.68 1 36.88%1 .42,480,834.64
Total All Funds[_83,259,982.00 1 111,821,699.86 1 40,351,909.97 1 4,847,913.58 1 40.42%1 66,621,876.31
0
Prepared by L Shan 1/31/2003. 8:57 AM Page 4 of 14