2013/2014 Biennial Budget 2 nd Quarter 2014 Financial Report and Mid-Year Budget Adjustment. Presented by City Council Study Session July 29, 2014

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1 2013/2014 Biennial Budget 2 nd Quarter 2014 Financial Report and Mid-Year Budget Adjustment Presented by City Council Study Session July 29, nd Quarter 2014 Financial Presentation General Fund 2014 Finances through 2nd Quarter General Fund-Supported Funds Finances 2014 Finances through 2nd Quarter 2

2 2 nd Quarter General Fund Update General Fund balance through Q2 approximately $6.5 M better than planned budget $2.4 M more in revenues Favorable trends in Property Taxes, Sales Taxes, Business Taxes and Business & Licenses Permit revenues $4.0 M less in expenditures Less expenditures than planned due to delayed timing of capital purchases, Library vacancies, City Attorney legal costs, lower assessments, as well as deferred or delayed expense payments 4

3 General Fund Revenues General Fund Revenues (Millions) $450 $400 $350 $300 $250 $200 $150 $100 $50 $- $ $ General Fund Revenues (Millions) $ $ Biennial Budget 2014 Planned Q2 Planned Q2 Actual Budget 2014 Planned Q1 Planned Q1 Actual Variance % Variance from Target $394.6 $195.9 $ $ $ % 6

4 2014 General Fund Revenues All Sources (Millions) $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0 December November October September August July June May April March February January 7 Monthly Planned Revenues Monthly Actual Revenues General Fund Revenue Variance (Millions) Revenue Source Plan Actual Variance Business Taxes $22.81 $ Sales Taxes Utility Taxes (0.03) Property Taxes Other Revenue Total $ $ DRAFT

5 Revenue Variance Detail $2.40 M above budget plan: $0.61 M in Business Taxes Favorable service tax revenues $0.67 M in Sales Tax Favorable due to positive trend in sales tax collections ($0.03) M in Utility Taxes Unfavorable Waste Water revenue $0.50 M in Property Taxes Favorable due to more timely property tax payments 0.65 M in Other Revenues Favorable business licenses and permit revenue Favorable leasehold tax revenues 9 $35 General Fund Q2 Tax Revenue 2013 v (Millions) Update Needed $30 $27.90 $28.76 Millions $25 $20 $15 $23.42 $22.06 $20.76 $21.35 $23.66 $22.22 $10 6% 3% 3% $5 10 $0 Business Taxes Property Tax Sales Tax Gross Earning Tax

6 General Fund Expenditures 11 General Fund Expenditures (Millions) $450 $400 $350 $300 $250 $200 $150 $100 $50 $- $ $ $ $ Biennial Budget 2014 Planned Q2 Planned Q2 Actual Budget General Fund Expenditures (Millions) 2014 Planned Q2 Planned Q2 Actual Variance % Variance from Target $ $207.4 $ $ $ % 12

7 General Fund Expenditure Variance (Millions) Department Plan Actual Variance Police $36.03 $34.92 $1.10 Fire Public Works Non Departmental Library Neigh & Comm Svcs Other Departments Total $ $ Expenditure Variance Detail $4.0 M below budget plan: $1.1 M - Police Department $560K delayed billings for capital purchases $233K fuel savings and delayed vehicle purchases $315K labor, assessment, and other expenditures lower than anticipated $0.48K - Library Favorable variance is due to vacancy savings $0.58K - Non Departmental Lower medical claims from retired LEOFF I Police and Firefighters $1.84K - Other Departments (Incl. Public Works, Library, NCS) Vacancies, deferred costs, and miscellaneous savings 14

8 General Fund Supported Funds 15 General Fund Supported Funds Traffic Enforcement Permit Services Streets Maintenance & Engineering Parking Public Assembly Facilities Convention Center Tacoma Dome Cheney Stadium 16

9 Traffic Enforcement Fund (Millions) Plan Actual Variance Favorable / (Unfavorable) Revenues $1.52 $1.51 ($0.01) Expenditures $1.86 $1.50 $0.36 Total $0.35 Revenues and expenditures on target with plan 17 Permit Services Fund Budgeted Revenues (Millions) Plan Actual Variance Favorable / (Unfavorable) Revenues $2.91 $3.89 $0.98 Expenditures $3.97 $4.24 ($0.27) Total $0.71 Revenues favorable due to increased development activity 18

10 Streets Maintenance & Engineering Fund (Millions) Plan Actual Revenues $7.07 $7.03 ($0.04) Expenditures $7.58 $7.66 ($0.08) Total ($0.12) Expenditures to be realigned with recommended Budget amendment Variance Favorable / (Unfavorable) 19 Parking Fund Budgeted Revenues (Millions) Plan Actual Variance Favorable / (Unfavorable) Revenues $3.72 $3.23 $(0.49) Expenditures $3.63 $2.57 $1.06 Total $0.57 Revenues and expenditures impacted by Council approved initiates not yet implemented 20

11 PAF Convention Center (Millions) Plan Actual Variance Favorable / (Unfavorable) Revenues $3.86 $3.36 ($0.50) Expenditures $4.62 $3.49 $1.13 Total $0.63 Revenues Variance Detail Number of events YTD lower, resulting in lower than anticipated revenues Expenditures Variance Detail Delayed billings, lower assessment costs 21 PAF Tacoma Dome (Millions) Plan Actual Variance Favorable / (Unfavorable) Revenues $2.96 $2.84 ($0.12) Expenditures $2.99 $2.75 $0.24 Total $ Revenue Variance Detail Unfavorable due to underperformance at several events Expenditure Variance Detail Favorable due to less overtime and lower repair & maintenance contract costs

12 PAF Cheney Stadium (Millions) Plan Actual Variance Favorable / (Unfavorable) Revenues $0.73 $0.73 $0.00 Expenditures $0.63 $0.59 $0.04 Total $0.04 Revenues and expenditures on target with plan 23 2nd Quarter Summary 24

13 Budget/Finance Condition Summary Through June, revenue collections above budget plan and expenditures below budget plan Budget Office, Finance, and City Manager s Office will continue to analyze revenue and expenditure trends monthly Recommended Mid-Year Budget Adjustments

14 Recommended Council Actions Biennial Budget Amendments 2013 Year End Revenues Public Works Adjust for New Projects (General Fund) Align Budget with New Fund Structure (Street & Capital Funds) Office of Environmental Policy Appropriate Grants and Contributions received (General Fund) Fire Department Appropriate Grants Received and Grant Matches (Fire Special Revenue Fund) Planning and Development Services Enhance Funding for Permit Services (Permit Services Fund) Year End General Fund Revenues 2013 Year End General Fund Revenues Year-end revenues favorable over plan by $1.9 M Revenue Utilization - $1.9 M Recommended Public Work projects - $1.1 M US Open Preparation Improvements Expansion of School Zones Street Lighting Wire Thefts Design Costs for Eastside PCB Clean-up Project Reserves $0.8 M 28

15 General Fund Reserves Adjustment Current Budgeted Contribution to Reserves 2013/2014 Budget Modified Contribution to Reserves (in Millions) $ Additional Year End Revenues Expenditure Adjustments (1.1) Net Contribution to Reserves $ Public Works General Fund - $1.1 M U.S. Open Preparation - $550 K South 56th Street (I-5 to South Orchard) - $490 K Street maintenance, welcome signage, replacement/installation of traffic control and street signage Downtown Tacoma (South 13th Street, Pacific Avenue to Commerce) - $60 K Sidewalk installation and landscaping 30

16 Public Works General Fund - $1.1 M Expansion of School Zones - $54 K Expand School Zones near 11 elementary, middle and high schools Street Lighting Wire Thefts - $328 K thefts; thefts to date Design Costs for Eastside PCB Clean-up Project - $165 K Environmental Laws (MTCA and TSCA) require the City to mitigate hazards to human health and the environment 31 Public Works Streets and Capital Fund - $1.0 M In 2014, Transitioned from One Fund to Two Funds Separated Capital from Operations 2013 Financial Close Results in needed $1 M carryover appropriation from Transportation Capital & Engineering Fund to Street Fund 32

17 Office of Environmental Policy - $176 K Grants and Contributions Commute Trip and Residential Trip Reductions - $127 K Bike Month - $21 K Other miscellaneous grants and contributions - $28 K 33 Fire Department - $5.6 M Grants and Grant Matches Port Security Grant - $3.5 M Purchase of 50 foot fireboat and for port security training and equipment Staffing for Adequate Fire & Emergency Response (SAFER) grant award - $1.6 M Personnel costs of 20 firefighters for two years Miscellaneous Grant Awards and Matching Funds - $587 K 34

18 35 Planning & Development Services Performance Report and Enhancement Requests Planning & Development Services 2014 Permit Revenues Thousands 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, January February March April May June Projection 484, ,315 1,453,972 1,938,630 2,423,287 2,907,945 Actuals 542, ,341 1,565,803 2,425,158 3,282,153 3,890,780 36

19 Building Permits 2014 permits through 2 nd Quarter RESIDENTIAL COMMERCIAL Jan-Mar Apr-Jun Jul-Sep Oct-Dec 0 Jan-Mar Apr-Jun Jul-Sep Oct-Dec Building Permit Value 2014 permits through 2 nd Quarter RESIDENTIAL COMMERCIAL Jan-Mar Apr-Jun Jul-Sep Oct-Dec Jan-Mar Apr-Jun Jul-Sep Oct-Dec Target Target

20 Budget Adjustment Request Business Operations Reinvestment Plan Reinvest excess revenues over budgeted amounts back into its business operations to stabilize its increased workload, and achieve a base service level. 39 Adjustment Overview DESCRIPTION FTE AMOUNT Economic Development and Customer Intake Support 2.00 $130,000 Accela and GIS 1.00 $220,000 Organizational Change Management and Permitting Streamlining N/A $105,000 Tide flats Area ITS Planning, Emergency Response & Evacuation Assessment N/A $200,000 Training and Development N/A $50,000 Total 3.00 $705,000 40

21 41 Summary of Recommended Budget Adjustments Recommended Council Actions Biennial Budget Amendments 2013 Year End Revenues Public Works Adjust for New Projects (General Fund) Align Budget with New Fund Structure (Street & Capital Funds) Office of Environmental Policy Appropriate Grants and Contributions received (General Fund) Fire Department Appropriate Grants Received and Grant Matches (Fire Special Revenue Fund) Planning and Development Services Enhance Funding for Permit Services (Permit Services Fund) 42

22 2013/2014 Biennial Budget 2 nd Quarter 2014 Financial Report and Mid-Year Budget Adjustment Presented by City Council Study Session July 29,