Item 8 - FOURTH QUARTER FINANCIAL REPORT FOR FISCAL YEAR 2021-22AGENDA ITEM NO.8
AGENDA STAFF REPORT
City of West Covina I Office of the City Manager
DATE: November 15, 2022
TO: Mayor and City Council
FROM: David Carmany
City Manager
SUBJECT: FOURTH QUARTER FINANCIAL REPORT FOR FISCAL YEAR 2021-22
RECOMMENDATION:
It is recommended that the City Council take the following actions:
1. Receive and file the Fourth Quarter Financial Report for Fiscal Year 2021-22; and
2. Adopt the following resolution:
RESOLUTION NO. 2022-103 - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
WEST COVINA, CALIFORNIA, ADOPTING A BUDGET AMENDMENT FOR THE FISCAL YEAR
COMMENCING JULY 1, 2021 AND ENDING JUNE 30, 2022 (FOURTH QUARTER FINANCIAL
REPORT)
BACKGROUND:
The City has completed the fourth quarter of Fiscal Year 2021-22. The Fourth Quarter Financial Report
(Attachment No. 1) summarizes the overall financial performance of the City for the period of July 1,
2021 through June 30, 2022, but it is not meant to be inclusive of all finance and accounting transactions.
While the focus of the report is the General Fund, summary financial information is also provided for the
Enterprise Fund and Special Revenue Funds. The financial information included in this report is
preliminary, unaudited and subject to revision upon completion of the City's closing and audit. This report
is intended only to provide the City Council and the public with an overview of the City's general fiscal
condition.
The City will make the Quarterly Financial Report available on the City's website for review by the City's
stakeholders.
DISCUSSION:
The revenue and expenditures per the Budget to Actual comparisons include adjustments for carryovers
and any appropriations made as of June 30, 2022. The information presented reports revenues as they
are received and expenditures when paid. Revenues and expenditures are only accrued at year end to
account for such activity in the correct fiscal year.
Additionally, a budget amendment is proposed with the Quarterly Report to adjust revenue and
expenditures based on activity to date.
LEGAL REVIEW:
The City Attorney's Office has reviewed the resolution and approved it as to form.
Prepared by: Stephanie Sikkema, Finance Director
Fiscal Impact
FISCAL IMPACT:
The original adopted General Fund budget for FY 2021-22 was $67,814,100 for revenues and
expenditures. Council since added personnel and crossing guard services increasing expenditures to
$69,859,100 and revenue to $67,880,100.
The mid -year budget amendment adjusted revenues less expenditures to-$7,371,524. However,
$7,087,000 of this was for the allocation of unassigned fund balance making the net impact on the
General Fund-$284,524.
The third quarter budget amendment had an overall positive impact on the General Fund of $2,048,400
making the revised General Fund budget projection to be-$5,323,124. However, this still included
$7,087,000 for the allocation of unassigned fund balance making the net impact on the General Fund
positive $1,763,876.
The proposed fourth quarter budget amendment has an overall positive impact on the General
Fund of $1,985,592.
Proposed General Fund (Fund 110) changes are summarized as follows:
Revenue
Property Tax
28,204,200
29,504,200
1,168,399
30,672,599
Sales Tax
15,900,000
22,900,000
22,900,000
Other Taxes
8,167,200
8,467,200
627,021
9,094,221
Charges for Services
5,336,000
8,280,000
530,814
8,810,814
Revenue from Other Agencies
4,483,300
2,808,900
2,808,900
Licenses & Permits
1,964,100
3,194,100
475,953
3,670,053
Interdepartmental Charges
1,423,800
1,423,800
1,423,800
Use of Money & Property
1,183,600
1,183,600
1,183,600
Fines & Forfeitures
608,000
755,000
755,000
Cost Recovery
330,000
1,600,000
1,600,000
Transfers In
131,100
131,100
131,100
Other Revenues
82,800
82,800
82,800
Revenue Total
rr
80,330,700
Expenditures
Police
24,010,300
27,203,512
27,203,512
Fire
16,989,200
20,946,900
20,946,900
Transfers Out
13,782,200
19,621,012
816,595
20,437,607
Public Services
5,593,200
5,862,750
5,862,750
Administration
2,535,200
2,712,400
2,712,400
Finance
1,996,600
3,593,600
3,593,600
Community Development
1,862,900
4,352,650
4,352,650
Human Resources
666.200
895,200
895,200
City Clerk
378,300
465,800
465,800
Expenditures Total
Revenue Less Expenditures
rr
0
(5,M,124)
1,985,592
r ,419
(3,337,532)
Prior General Fund Budaet Amendments
Resolution No 2021-89, BA 004, New Employees
(2,010,000)
Resolution No. 2021-88, BA 011, Crossing Guards
31,000
Resolution No. 2021-102, BA 023, Municipal Fee Study
(94,500)
Resolution No 2021-118, BA 028, 1Q Financial Report
1,336,476
Resolution No. 2022-15, BA 034, 2Q Financial Report
(6,644,500)
Resolution No. 2022-49, BA 059, 301 Financial Report
2,048,400
Resolution No_ 2022-86, BA 088, Prelim -Year End Adj_
-
Total GF Budget Amendments
(5,323,124)
Less Use of Unassigned Fund Balance 0 7.087.000 7,087,000
Net Impact to General Fund 0 1,763,876 1,985,592 3,749,468
Proposed changes to other funds are summarized below:
Attachments
Attachment No. 1 - Fourth Quarter Financial Report for Fiscal Year 2021-22
Attachment No. 2 - Resolution No. 2022-103
CITY COUNCIL GOALS & OBJECTIVES: Enhance City Image and Effectiveness
Maintain Good Intergovernmental Relations
Achieve Fiscal Sustainability and Financial Stability
ATTACHMENT NO. 1
CITY OF WEST COVINA
Fiscal Year 2021-22
The City has completed the fourth quarter of Fiscal
Year 2021-22. This report summarizes the overall
financial performance of the City for the period of July
1, 2021, through June 30, 2022, but it is not meant to
be inclusive of all finance and accounting transactions.
While the focus of the report is the General Fund,
summary financial information is also provided for the
Enterprise Fund and Special Revenue Funds. The
information presented is unaudited. This report is
intended to provide City Council and the public with an
overview of the City's general fiscal condition.
The revenue and expenditures per the Budget to
Actual comparisons include adjustments for carryovers
and any appropriations made as of June 30, 2022. The
information presented reports revenues as they are
received and expenditures when paid. Revenues and
expenditures are only accrued at year end to account
for such activity in the correct fiscal year.
GENERALFUND
The General Fund is the general operating fund for the
City. It provides the resources to sustain the day-to-
day activities and services to the community. All nine
departments receive support, either directly or
indirectly, from the General Fund.
General Fund
Budget vs. Year -to -Date Actual
88,000,000
85,653,824
86,000,000
84,000,000
82,000,000
80,000,000
82,212,892
80,330,700
in
Revenue Expenditures
■Curent Budget ■YTDARual
The General Fund original budget for FY 2021-22 was
$67,814,100 for revenues and expenditures. With
amendments, the current FY2021-22 budget is
$80,330,700 for revenues and $85,653,824 for
expenditures. With 100% of the year complete,
General Fund revenues are at 102% of budget and
expenditures are at 97.5%.
General Fund Revenue
Property Tax
29,504,200
30,687,088
104.0%
Sales Tax
22,900,000
23,180,793
101.2%
Other Taxes
8,467,200
9,773,175
115.4%
Charges for Services
8,280,000
8,512,897
102.8%
Licenses & Permits
3,194,100
4,476,096 I
140.1%
Revenue from Other Agencies
2,808,900
2,825,802
100.6%
Cost Recovery
1,600,000
1,580,715 I
98.8%
Interdepartmental Charges
1,423,800
1,188,500
83.5%
Use of Money & Property
1,183,600
863,593
73.0%
Fines & Forfeitures
755,000
910,120
120.5%
Transfers In
131,100
140,497
107.2%
Other Revenues
82,800
1,926,385-2326.6%
The City's two major General Fund revenue sources
are Property Tax and Sales Tax which make up 65%
of the General Fund revenues.
• Property Tax: The third major apportionment
distribution to the City for FY 2021-22 was
received in April 2022. Included in this line item
are Secured Property Taxes, Property Taxes
In -Lieu of Vehicle License Fees (VLF), and
residual payments from the dissolution of the
former redevelopment agency. An increase in
property tax revenue is included in the
proposed budget amendment in the amount of
$1,168,399.
• Sales Tax: As of June 30, 2022, the allocation
received represents approximately 101.2% of
the total sales tax allocation for the year. The
City received its final sales tax allocation
distributed by the California State Department
of Taxes and Fees Administration (CDTFA) in
August 2022. Sales Tax ended higher than the
current budget and surpassed prior -year
actuals.
City of West Covina
Fourth Quarter Financial Report FY 2021-2022
Other Taxes: This category includes
Franchise Fees, Business License Tax,
Transient Occupancy Tax (TOT), and Property
Transfer Tax. Transient Occupancy Tax ended
over the current budget with over 117%, or
$1,756,473, received. Adjustments totaling
$627,021 have been included in the proposed
Budget Amendment to reflect these actuals.
License & Permits: Revenues for licenses &
permits include building and engineering
permits, and animal licenses. Revenue ended
higher than originally projected mainly due to
building activity increases. Adjustments
totaling $475,953 have been included in the
proposed Budget Amendment to reflect these
actuals.
Revenues from other Agencies: This
category includes Vehicle In -Lieu, State
Mandated Cost reimbursement revenue, and
the exchange of Prop A funds, which are the
largest revenue source in this category.
Charges for Services: These revenues
include plan check and zoning related fees,
recreation fees, interfund charges, police and
fire fees. These fees are at approximately
103% or $8,512,146 through June 2022.
Adjustments totaling $530,814 have been
included in the proposed Budget Amendment
to reflect these actuals.
Revenue projections are revised with the Quarterly
Report based on revenue trends, and activity to date.
The total proposed adjustment is an increase of
$2,802,187 in revenue to the General Fund.
Tax
15,900,000
22,900,000
22,900,000
r Taxes
8,167,2001
8,467,2001
627,0211
9,094,221
]as for SeMces
5,336,000
8,280,000
530,814
8,810,814
nue from Other Agencies
4,4a3,300
2,808,900
2,808,900
lass & Permits
1,964,100
3,194,100
475,953
3,670,053
lepartmental Charges
1,423,800
1,423,800
1,423,800
)f Money & Property
1,183,600
1,183,600
1,183,600
& Forfeitures
608,000
755,000
755,000
Recovery
330,000
1.600,000
1,600,000
fers In
131,100
131,100
131,100
As of June 30, 2022, with 100% of the year complete,
$83.5 million or 97.5% of the General Fund budget has
been expensed (see chart below). With the exception
of transfers out, all departments are at or below 100%
through the end of the year.
City Clerk
465,800
399,082
85.7%
Community Development
4,352,650
4,004,072
92.0%
Finance
3,593,600
2,405,873
66.9%
Fire
20,946,9001
20,830,973
99.4%
Human Resources
895,200
884,616
98.8%
Police
27,203,512
27,108,090
99.6%
Public Services
5,862,750
5,021,307
85.6%
Transfers Out
19.621.012
20.433.506
104.1%
Transfers Out is over budget due to a transfer to the
Sportsplex fund (No. 242) and (No. 367) to cover its
negative revenue less expenditures. The total of these
transfers, $816,595, is included in the proposed
budget amendment.
General Fund Overtime
Overtime expenditures exceeded budget in
Administration, Fire, Police, and Public Services. The
Police Department ended 1.7% or $77,764 over
budget and the Fire Department ended 2.7% or
$55,412 over budget. Public Services was also over by
49.1 % or $29,374.
Administration
2,000
2,796
139.8%
Finance
2,000
568
28.4%
Fire
3,350,000
3,405,412
101.7%
Police
2,881,000
2,958,764
102.7%
2 1 P a g e
City of West Covina
Fourth Quarter Financial Report FY 2021-2022
Overall, total General Fund Revenue ($82.2M) less
expenditures ($83.5M) for the year is negative $1.3
million.
GF Revenue Less Expenditures by FY
As of Fourth Quarter
FYE2018 FYE2019 FYE2020 FYE2021 FYE2022
6.00 5
p 5.00
4.00
3.00
2.00
1.00 1
■(1.00)
(2.00) (�)
(3.00) (3j
(4.00)
The original adopted General Fund budget for FY
2021-22 was $67,814,100 for revenues and
expenditures. Council since added personnel and
crossing guard services increasing expenditures to
$69,859,100 and revenue to $67,880,100.
The mid -year budget amendment adjusted revenues
less expenditures to-$7,371,524. However,
$7,087,000 of this was for the allocation of unassigned
fund balance making the net impact on the General
Fund-$284,524.
The third quarter budget amendment had an overall
positive impact on the General Fund of $2,048,400
making the revised General Fund budget projection to
be-$5,323,124 by the end of this fiscal year. However,
this still included $7,087,000 for the allocation of
unassigned fund balance making the net impact on the
General Fund positive $1,763,876.
The proposed fourth quarter budget amendment has
an overall positive impact on the General Fund of
$1,985,592.
City Clerk
378,300
465,800
465,800
Community Development
1,862,900 I
4,352,650 I
4,352,650
Finance
1,996,600
3,593,600
3,593,600
Fire
16,989,200
20,946,900
20,946,900
Human Resources
666,200
895,200
895,200
Police
24,010,300
27,203,512
27,203,512
Public Services
5,593,200
5,862,750
5,862,750
Tmnsfers Out
13.782.200
19.621.012
816.595 20.437.607
The proposed General Fund budget amendment has a
positive net impact of +,985,592 and includes the
following:
1) Staff proposes increasing revenue based on
year-end actuals for Property Tax ($1,168,399), Other
Taxes ($627,021), Charges for Services ($530,814)
and Licenses & Permits ($475,953).
2) Transfer to the Sportsplex fund ($754,253) and
Vehicle Replacement fund ($62,342) to cover negative
fund balances.
ENTERPRISE FUND
The Police Department's Computer Service Group
ended under budget at 84.1 %.
Police Enterprise Current Budget YTD Actual
FF 916,888 F- F',
.- . F
Grand Total 1,738,302 1,636,798 94.2%
3 1 P a g e
City of West Covina Fourth Quarter Financial Report FY 2021-2022
OTHER FUNDS discretionary portion of Proposition A funds received
Budget versus actual comparisons for both revenue that cannot be exchanged.
and expenditures for other
funds are presented below:
2) Fund 120 (Integrated Waste Management):
The budget is proposed to be increased by $59,570 to
Other Funds
Current Budget YTDActual %
Revenue
89,111,973
81,125,571
91.0%
reflect actual expenditures.
Assessment Districts
4,671,100
4,157,719
89.0%
CDBG
3,313,566
2,063,345
62.3%
3) Fund 139 (FEMA Grant): An additional $31 is
4,998,212
4,994,145
100.0%
necessary to cover a transfer out to the General Fund
De
Debt Service
14,998,212
14,994,145
100.0°/
due to excess funds.
Gas Tax
2,745,100
2,492,584
90.8%
grant
Internal Service Funds
7,243,300
7,029,353
97.0%
Measure M
1,522,200
1,897,011
124.6°r
4) Fund 171 (PDF B Palm View): Expenditures
Measure R
1,347,700
1,676,987
124.4%
totaling $82,434.00 were necessary to cover
Prop
2,246,600
2,680,426
119.3%
improvements to Palmview Park that were not eligible
Prop C
2,318,600
2,285,095
98.6°r
f
LA County Park bond funds.
SB1
2,680,300
2,735,551
102.1%or
Sewer Maintenance
3,230,000
4,310,406
133.4%
Sportsplex
-
978,134
100.0%
5) Fund 190 (Auto Plaza Improvement District):
An additional $4,900 is necessary to cover the budget
Other SR
4,159,934 4,497,128 108.1%
Grant
15,093,761
10,081,216
66.8°r
shortfall in professional services.
Impact Fees
292,000
267,817
91.7%
PDF
538,900
4,415,259
819.3%
FOR MORE INFORMATION
Police Computer Service Fund
881,900
916,888
104.0%
Successor Agency
12,745,800
6,061,068
47.6%
Housing Authority
42,000
355,422
846.2%
This summary report is derived from detailed financial
CFD
4,316,000
2,426,355
562%
information generated by the Clty's Finance
Private Purpose Trust Funds
-
78,763
100.0%
Expenditures
114,632,506
83,057,395
72.51/6
Department. Additional financial information is
Assessment Districts
4,705,747
3,411,061
72.5%
available online at www.westcovina.org.
CDBG
3,908,021
2,148,283
55.0%
CIP
10,458,800
7,810,515
74.7%
Debt Service
14,946,612
14,946,062
100.0%
Gas Tax
2,995,000
2,358,182
78.7%
Internal Service Funds
7,955,900
7,247,283
91.1 %
Measure M
836,203
308,006
36.8%
Measure R
2,143,434
952,517
44A
Prop A
2,930,900
2,842,893
97.0%
Prop C
2,289,680
1,845,156
80.6%
Sat
2,263,183
2,028,786
89.6%
Sewer Maintenance
6,897,050
3,612,127
52A%
Sportsplex
1,498,929
982,264
65.5%
Other SR
8,374,407
3,571,557
42.6%
Grant
24,781,761
10,692,151
43.1%
Impact Fees
607,377
187,464
30.9%
PDF
1,121,100
494,913
43.3%
Police Computer Service Fund
856,402
719,911
84.1%
Successor Agency
9,032,300
6,939,092
76.8%
Housing Authority
1,236,000
918,087
74.3%
CFD
4,793,700
8,738,474
182.3%
Private Purpose Trust Funds
-
219,811
100.0%
#N/A
-
92.800
100.0%
In addition to the amendments being proposed under
the General Fund, the following amendments are
recommended for other funds:
1) Fund 120 (Prop A Discretionary): This is a new
proposed fund to separately account for the
4 1 P a g e
ATTACHMENT NO.2
RESOLUTION NO.2022-103
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
WEST COVINA, CALIFORNIA, ADOPTING A BUDGET
AMENDMENT FOR THE FISCAL YEAR COMMENCING
JULY 1, 2021 AND ENDING JUNE 30, 2022 (FOURTH
QUARTER FINANCIAL REPORT)
WHEREAS, the City Manager, on or about June 15, 2021, submitted to the City Council a
proposed budget for the appropriation and expenditure of funds for the City of West Covina for Fiscal
Year 2021-22; and
WHEREAS, following duly given notice and prior to budget adoption, the City Council
held public meetings, considered and evaluated all comments, and adopted a budget for the fiscal
year commencing July 1, 2021 and ending June 30, 2022; and
WHEREAS, amendments must periodically be made to the budget to conform to changed
circumstances following adoption of the budget.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF WEST COVINA,
CALIFORNIA DOES RESOLVE AS FOLLOWS:
SECTION 1. The City Council hereby approves Budget Amendment No. 093 attached
hereto as Exhibit A, for Fiscal Year 2021-22.
SECTION 2. The City Clerk shall certify to the adoption of this resolution and shall enter
the same in the book of original resolutions and it shall become effective immediately.
APPROVED AND ADOPTED this 15th day of November, 2022.
APPROVED AS TO FORM
Thomas P. Duarte
City Attorney
Dario Castellanos
Mayor
ATTEST
Lisa Sherrick
Assistant City Clerk
I, LISA SHERRICK, Assistant City Clerk of the City of West Covina, California, do hereby
certify that the foregoing Resolution No. 2022-103 was duly adopted by the City Council of the City
of West Covina, California, at a regular meeting thereof held on the 15th day of November, 2022, by
the following vote of the City Council:
AYES:
NOES:
ABSENT:
ABSTAIN:
Lisa Sherrick
Assistant City Clerk
EXHIBIT A
BUDGET AMENDMENT
CITY OF WEST COVINA
BUDGET AMENDMENT
BA # 093
Posted By:
Date Posted:
Date: 11/15/2022 Fiscal Year: 2021-2022
Requested by: Stephanie Sikkema, Finance Director Amount: 963,530.00
Dept/Div: Finance Description: 4th Quarter Budget Amendment
EXPENDITURES
Account Number
Dept/Account Description
Current Budget
Proposed
Amendment
Amended
Budget
110.95.9500.9367
TRANSFER OUT
80,000
62,342
142,342
110.95.9500.9242
ITRANSFER OUT
-
754,253
754,253
Subtotal General Fund
1 ,5 5
896,5 5
190.22.2231.6110
PROFESSIONAL SERVICES
4,600
4,900
9 Soo
120.61.5140.6110
PROFESSIONAL SERVICES
-
59,570
59,570
139.95.9500.9110
TRANSFER OUT
-
31
31
21005.171.7700
Pour/Play Pla rounds-DN PV A W Parks
-
82,434
82,434
171.80.7004.7700
CIP PARK
-
Subtotal Other Funds
TOTAL EXPENDITURES
84,600
963,53O
1,048,130
REVENUES
Account Number
Account Description
Current Budget
Proposed
Amendment
Amended Budget
110.00.4010
CURRENT YEAR SECURED
13,000,000
800,266
13,800,266
110.00.4012
SUPPL IN LIEU OF VLF
12,904,200
368,133
13,272,333
110.00.4120
FRANCHISE
4,435,800
370,548
4,806,348
110.00.4130
TRANSIENT OCCUPANCY TAX
1,500,000
256,473
1,756,473
110.32.4630
FIRE PLAN CHECK/INSP. FEES
287,000
85 412
372,412
110.61.4663
FACILITY RENTAL - CCC
130,000
129,990
259,990
110.71.4220
BUILDING PERMITS
1,850,000
131,797
1,981,797
110.71.4290
JOTHER LICENSES & PERMITS
15 400
344,156
359,556
110.71.4613
IPLAN REVIEW SURCHARGE
90,000
262 667
352,667
110.71.4614
IPLAN CHECK FEES
2,799,000
52,745
2,851,745
Subtotal General Fund
, ,Zff
---7,ff67,-f FT
39,813,587
242
Sorts lex
-
70 893
70,893
242
Sorts lex
-
102 243
102 243
367
Vehicle Replacement
80,000
62,342
142,342
171
PDF B Palm View
-
1,750,000
1,750,000
242
Sorts lex
-
754,253
754,253
Subtotal Other Funds
80,050
TOTAL REVENUE
37,091,400
5,541,918
42,633,318
APPROVALS
City Council Approval Date (if required, attach minutes):
Dept Head Approval:
Date:
Finance Director: Date:
Funds Available? ❑ Yes ❑NO
❑ Approval Not Required
City Manager: Date:
(if aver $100,000)
n Approved n Denied