HomeMy Public PortalAbout12) 7G FY11-12 Mid Year Budget ReviewCity Council
April 3, 2012
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FY 2011·12 GENERAL FUND REVENUES
A revenue analysis has been completed for FY 2011-12 General Fund Revenues.
Although most revenues are in line with projections, there are some revenues that
require adjustments. Below is a brief discussion of each significant revenue source
with an explanation of the requested adjustment. The table below summarizes the
City's significant General Fund revenues and provides an overview of the
recommended changes based on mid-year review by staff.
General Fund Revenues
FY 2011-12 FY 2011-12
Revenue Source Budget Revised Increase Percent
Revenue Projection {Decrease} Change
Property Tax $2,240,250 $2,240,250 $0 0%
Sales Tax $1,082,870 $1,157,870 $75,000 6.9%
Other Taxes $1,082,470 $1,082,470 $0 0%
License & Permits $1,204,860 $1,324,860 $120,000 9.9%
Motor Vehicle In $3,150,800 $3,273,500 $122,700 3.9%
Lieu
Charge for $759,590 $759,590 $0 0%
Services
Court Fines $627,000 $627,000 $0 0%
Investments $353,600 $363,600 $10,000 0%
Other Revenue $374,515 $374,515 $0 0%
Totals $10,875,955 $11 ,203,655 $327,700 3.0%
• Property Tax; Property taxes continue to be one of the City's strongest
revenue sources. Under Proposition 13, property is generally reassessed only
when there is a change in ownership. After which, its assessed value is
adjusted annually by an inflation factor not to exceed 2 percent. The property
tax revenue for Temple City continues to be strong. Temple City's assessed
valuations are increasing and resale values are much higher than the original
amount budgeted in FY 2010-11 of $1 ,842,000. The actual amount was
$2,160,300. Based on the previous fiscal year, staff estimated an increase of
4% to the Property Tax for FY 2011-12 at budget time. No adjustments are
recommended.
• Sales Tax: There was a 16.9% increase from the projected amount of
$1,046,250 to actual of $1,223,188 for FY 2010-11. In FY 2011-12, the
budgeted amount is $1 ,082,870. Based on the prior fiscal year's actual
amount received for the sales tax and the slowly recovering economy, an
adjustment in the amount of $75,000 is being recommended for sales tax,
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April 3, 2012
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resulting in a new budget projection of $1,157,870.
• Other Taxes: Other tax revenues include franchise fees and transient
occupancy tax. Franchise fee taxes are collected from service providers, such
as Athens Services, Gas Company and Cable services. A 1 0% transient
occupancy tax is collected from each guest that rents a room from any
hotel/motel located within the City and is directly paid to the City by the owners.
At this time, these revenues are in line with estimated projections and no
adjustment is recommended.
• License & Permits: License & permits include building permits, business
license fees, animal license fees, parking permits, impound fees, temporary
parking permits, code enforcement fees and in lieu parking fees. The City
received a total of $154,550 more than the second quarter of FY 2010-11.
These additional increased revenues were a result of the City's Cost of
Services Study prepared by Revenue & Cost Specialists. LLC and the new
services costs and fee changes was adopted by the City Council starting with
FY 2011-12 to recover the City's costs to provide better services to the
community. Based on the six months of revenues received, staff recommends
a $120,000 or 10% increase resulting in a new budget projection of
$1,324,860.
• Motor Vehicle in-lieu fee (VLF): Established in 1935 as a uniform statewide
tax, the VLF is a tax on the ownership of a registered vehicle in place of taxing
vehicles as personal property. By law, all revenues from the VLF fund city and
county services, but the state legislature controls the tax rate and the allocation
among local governments. In 2004, the Legislature permanently reduced the
VLF tax rate and eliminated state general fund backfill to cities and counties.
Instead, cities and counties now receive additional transfers of property tax
revenues in lieu of VLF. The projected In Lieu VLF for FY 2011-12 is
$3,150,800. Based on the first allocation, an adjustment to increase the
projection by $122,700 is recommended resulting in a new projection of
$3,273,500.
• Charge of Services: Charge of services are revenues received from recreation
fees, facility rental fees, zoning fees and plan check fees. These revenues are
reflected when services, classes or events are provided. This category may
fluctuate based on the number of participants who enroll to various programs.
Based on the current revenues, the estimate may be slightly lower than
projected. At this time, no adjustments are recommended.
• Court Fines: Court Fines are revenues collected from citations written from
both the Los Angeles County Sheriff's Department and authorized City staff. At
this time, these revenues are in line with estimated projections and no
adjustment is recommended.
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April 3, 2012
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• Investments: The City receives interest on various investments on a monthly;
quarterly or annual basis based on the type of investment. Currently the City
invests with Local Agency Investment Fund (LAIF); Certificates of Deposit
(CD); and security investments with various banks and agencies. Interest rates
on investment have decreased over the past few years. However, the City was
able to invest $2.5 million more from December 2010 to December 2011. An
adjustment to increase $10,000 is being recommended resulting in a new
projection of $363,600.
• Other Revenue: Other revenue include: recyclable revenue; sale of City
property; and donations . At this time, no adjustments are recommended .
I. FY 2011-12 GENERAL FUND EXPENDITURES
The adoption of FY 2011-12 City Budget estimated total General Fund operating
expenditures of $11.2 million. At this time, staff is not recommending any
adjustments for the department expenditure level.
General Fund Expenditures
FY 2011-12 FY 2011-12
Budget Revised Increase Percent
De~artment Ex~enditure Projection (Decrease} Change
Management $1,885,250 $1,885,250 $0 0%
Services
Administrative $1,122,075 $1,122,075 $0 0%
Services
Community $3,062,255 $3,062,255 $0 0%
Development
Parks $1,725,770 $1,725,770 $0 0%
& Recreation
Law $3,413,310 $3,413,310 $0 0%
Enforcement
Totals $11,208,660 $11,208,660 $0 0%
Due to the windstorm on November 30, 2011, the City issued a Declaration of a
Local Emergency on December 1, 2011 at a Special City Council meeting and the
State declared it on December 10, 2011 where as the Federal Government has
declined the declaration of the emergency for Los Angeles County.
The City applied for the State resources to recover eligible costs for reimbursement
of the windstorm damages. However, the City is not guaranteed to receive
reimbursement as the State currently has a $140 million obligation deficit from
previous disasters. To date, $244,144 has been incurred for this disaster. The City
may have to pay out of the general fund one-time expenditure for this disaster if no
reimbursement is received from the State .
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April 3 , 2012
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The total General Fund Mid-Year Budget adjustments requested are $327,700. This
amount will increase the estimated General Fund Balance from $21 ,425,021 to
$21,752,721.
II. CAPITAL IMPROVEMENT PROJECTS (CIP)
Temple City has been very busy this year completing various Capital Improvement
Projects (CIP). During the adoption of FY 2011-12 City Budget, the City Council
approved $20.1 million in CIP expenditures. The good news is that only 1.3% of the
total expenditures ($272,000) will be funded by the General Fund . The majority of
the expenditures are for the Rosemead Boulevard Safety Enhancement &
Beautification Project, $12.4 million was budgeted this fiscal year (as of December
2011 ). This project has been presented and has continued to be a proposed project
that will not use General Fund monies .
The Capital Improvement Projects that are in progress or were completed during
the FY 2011-12: Renovation of circular planter at Live Oak Park, Temple City Park
and Monument Sign Project; Temple City Library Mural; Citywide Traffic Calming
Study Master Plan; Comprehensive Downtown Parking Study and Strategic Plan;
left turn phasing on Las Tunas Drive and Temple City Boulevard for East-West
traffic; left turn phasing on Olive Street and Baldwin Avenue for North-South traffic;
Rosemead Boulevard Improvement Project; and Council Chamber Upgrades.
At this time, staff is not requesting any adjustments for FY 2011 -12 CIP Budget.
Adjustments to projects are usually requested after a project has begun or other
funding sources are available .
Ill. COMMUNITY REDEVELOPMENT AGENCY
With the dissolution of the Community Redevelopment Agency as of January 31,
2012, the City has become the Successor Agency to the Community
Redevelopment Agency. Actions taken include the transferring of fund from Local
Agency Investment Fund (LAIF) in the amount of $2,318,691 to the City as the
Successor Agency to the Temple City Community Redevelopment Agency.
The allocation of the transfer translated as follow:
• 80% for Non-Housing Fund ($1 ,854,953).
• 20% for Housing Fund {$463,738).
CONCLUSION:
As the economy slowly recovers, it is reassuring to know that Temple City has survived
the economic recession. Not only has Temple City lived within its means the past
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April 3, 2012
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couple of years, but we are proposing $327,700 in our General Fund Reserve which if
approved by City Council would increase up to $21,752 ,721 . Throughout the remaining
three months additional amendments may be required, but if we continue with our
conservative spending, Temple City will complete another successful year.
FISCAL IMPACT:
It is recommended the City Council approve the above mentioned General Fund Mid-Year
adjustments which will increase the General Fund estimated Fund Balance by an
additional $327 ,700. The projected General Fund Balance as of June 30, 2012 will be
$21 ,752 ,721 .