CITY OF OCEANSIDE FINANCIAL STATUS REPORT Fiscal Year Second Quarter Ending December 31, 2017

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1 CITY OF OCEANSIDE FINANCIAL STATUS REPORT Fiscal Year Second Quarter Ending December 31, 2017 This report summarizes the activities of the major operating funds and is not meant to be inclusive of all finance and accounting transactions and excludes encumbrances. It is intended only to provide Council and the public with an overview of the state of the City s general fiscal condition. This is a preliminary report for the quarter ending December 31, GENERAL FUND BUDGET POSITION The City Council adopted the FY budgets on June 7, 2017, with approved General Fund revenues of $ million and expenditures of $ million. In the following sections, the amounts in the tables listed as include supplemental appropriations approved by Council throughout the year. GENERAL FUND REVENUES Table 1 highlights the amount and percentage of revenues received in each of the major classifications as of December 31, The preliminary second quarter results show General Fund revenues coming in at 38% of budget which is consistent with prior year revenues. Revenue receipts are cyclical in nature and they are not received evenly throughout the year. Table 1 GENERAL FUND REVENUES Revenue Type Property Taxes $ 58,038 $ 58,038 $ 16,847 29% Sales Taxes 22,287 22,287 8,130 36% Transient Occupancy Tax (TOT) 6,695 6,695 3,333 50% All Other Taxes 3,802 3,802 1,642 43% Licenses & Permits 5,022 5,022 2,826 56% Franchise Fees 4,477 4, % Fines/Forfeitures 3,485 3,485 1,493 43% Use of Money & Property 5,228 5,297 2,907 55% Intergovernmental % Ambulance Billing 4,519 4,519 2,136 47% Charges for Services 11,233 11,300 5,350 47% Other Revenue & Transfers 20,792 20,819 10,504 50% Total Revenues $ 145,988 $ 146,165 $ 55,896 38% Property Taxes comprise 40% of the total General Fund revenues and are primarily received in the December/January and April/May timeframes. Property tax revenues through December 31 are at 29% of the adopted budget and are up 7% over last year. Sales Taxes comprise 15% of the total annual General Fund revenues. Revenues received through December 31 are at 36% of the adopted budget and are up 4% over last year. Page 1 of 9

2 Transient Occupancy Tax comprise 5% of total General Fund revenues. The City collects 10% of the room rent charged by a hotel or vacation rental operator to tourists occupying a room within the City for a period of less than 30 days. The City also collects a 1.5% assessment of the room rent which is passed through to Visit Oceanside for marketing purposes. As of December 31, TOT is at 50% of adopted budget. TOT is up 18% over last year for the same period. Increased revenues are due, in large part, to increases from approximately 300 units becoming compliant in the past year due to Host Compliance efforts. Licenses and permits are at 56% of the adopted budget at December 31 due to an increase in building permits. This rate of increase is not likely to be sustainable over time. GENERAL FUND EXPENDITURES Table 2 highlights the amount and percentage expended by each department. As of December 31, the General Fund expended 53% of the amended budget. The actual expenditures exceeded the budget benchmark of 50% due to Fire mutual aid overtime not yet reimbursed and timing of expenditures. Department General Government City Council 952 Table 2 GENERAL FUND EXPENDITURES $ $ 958 $ % City Clerk 1,205 1, % City Treasurer % City Manager % City Attorney 1,749 1, % Non Departmental 6,225 6,666 2,801 42% Non Depart CALPERS Add'l Payment 1,106 1,106 8,050 NA Financial Services 5,781 5,812 2,708 47% Human Resources % Economic Development % Public Safety Police 58,054 58,970 28,792 49% Fire 30,438 30,451 15,801 52% Public Works Property Mgmt % Public Works 11,494 11,687 5,356 46% Harbor & Beaches 3,610 3,653 1,650 45% Community Development Development Services 8,852 8,880 3,767 42% Community/Cultural Svcs Library 5,231 5,306 2,589 49% Neighborhood Services 7,157 7,472 3,318 44% Total Expenditures $ 145,238 $ 147,501 $ 78,237 53% Page 2 of 9

3 ENTERPRISE FUNDS Enterprise funds, also known as business-type activities, are used to account for the acquisition, operation and maintenance of governmental facilities and services that are entirely or predominantly self-supporting through user charges. The operations of Enterprise Funds are accounted for in such a manner as to show a profit or loss similar to comparable private enterprise. The financial status of operating funds for Water, Sewer and Solid Waste Disposal are discussed below. Please note that Water and Sewer budgets consist of multiple funds (operating, replacement and developer connection). Debt service is not included. Generally accepted accounting principles (GAAP) call for fiscal analysis of Enterprise Funds to reflect a roll up of all funds into one report. WATER FUND REVENUES Overall revenues for the Combined Water Funds are at 53% of the adopted budget as of December 31 as shown in Table 3, up 4% from prior year. WATER FUND EXPENDITURES Table 3 highlights the amount and percentage expended and encumbered by each water program. As of December 31, the Water Combined Funds have expended and encumbered 52% of the amended budget, up 11% from prior year. Operating revenues exceed operating expenditures by $8.0 million, down 11% from prior year. As of December 31, capital project expenses and encumbrances are 72% of the total budget. Expenditures for capital projects can vary depending on which stage the project is in. Page 3 of 9

4 Table 3 WATER COMBINED FUNDS Operating Revenues Water Sales $ 62,331 $ 62,331 $ 33,406 54% Developer Fees 2,491 2, % Other Revenue 1,882 1, % Total Operating Revenues $ 66,703 $ 66,704 $ 35,116 53% Expenditures Administration & General $ 37,991 $ 38,005 $ 17,546 $ % Flood Control/Storm Drains % Water Distribution 1,403 1, % Water Filtration Plant 1,742 1, % Desalting Plant 2,365 2, % Water Maintenance 2,438 2,463 1, % Water Meter Services 2,880 2,895 1, % Clean Water Program 1,215 1, % Other Water Programs 3,680 3,681 1, % Miscellaneous Projects % Total Operating Expenditures $ 54,579 $ 54,685 $ 23,882 $ 1,459 46% Depreciation/GASB 31 Expenses $ - $ - $ 2,845 Total Expenditures $ 54,579 $ 54,685 $ 26,727 $ 1,459 52% Transfers In $ 77 $ 112 $ 59 53% Transfers Out % Operating Income/Loss $ 11,648 $ 11,450 $ 8,044 Capital Projects Transfer In $ - $ - $ - - Other Revenue % Total Capital Revenues $ 500 $ 500 $ - 0% Replacement Projects $ 20,300 $ 23,214 $ 4,591 $ 11,631 70% Connection Projects 11,900 26,221 2,502 16,658 73% Total Capital Expenditures $ 32,200 $ 49,435 $ 7,093 $ 28,288 72% Page 4 of 9

5 SEWER FUND REVENUES Table 4 shows overall revenue and expenditures for the Sewer Fund as of December 31. Sewer Combined Fund revenues are at 48% of budget, up 6% from prior year. SEWER FUND EXPENDITURES Table 4 also highlights the amount and percentage expended and encumbered by each sewer program. As of December 31, Sewer Combined Funds have expended 59% of the amended expenditure budget. Capital Project expenses and encumbrances are at 71% of budget. As in the Water Fund, most of the capital projects are in the planning and design phase and the majority of funds have yet to be expended. Table 4 SEWER COMBINED FUNDS Operating Revenues Sewer Service & Flow Fees $ 38,236 $ 38,236 $ 17,788 47% Developer Fees 1,341 1, % Other Revenue 1,039 1,039 1, % Total Operating Revenues $ 40,616 $ 40,616 $ 19,649 48% Expenditures Administration & General $ 5,889 $ 5,903 $ 2,860 $ % Facilities Maintenance 2,277 2, % Sewer Collections 3,590 3,634 1, % La Salina Wastewater 3,012 3,028 1, % San Luis Rey Wastewater 7,547 7,596 2, % Sewer Laboratory % SCADA Program % GIS Program % Miscellaneous Projects 1,702 1, % Total Operating Expenditures $ 25,594 $ 25,738 $ 10,672 $ 2,304 50% Depreciation/GASB 31 Expense $ - $ 4,411 Total Expenditures $ 25,594 $ 25,738 $ 15,083 59% Transfers In $ - $ - $ 9 Transfer Out - 1,610 1, % Operating Income/Loss $ 15,022 $ 13,268 $ 2,965 Capital Projects Transfer In $ - $ - $ - Miscellaneous Income 1,500 1,500-0% Total Capital Revenues $ 1,500 $ 1,500 $ - 0% Replacement Projects $ 26,850 $ 20,959 $ 2,788 $ 12,697 74% Expansion Projects 4, % Total Capital Expenditures $ 31,600 $ 21,709 $ 2,788 $ 12,697 71% Page 5 of 9

6 SOLID WASTE DISPOSAL FUND REVENUES Overall revenues for the Solid Waste Disposal Fund are at 51% of the adopted budget as of December 31. Trash Pick-Up Fees these fees are collected to provide all the costs associated with solid waste disposal. Waste Management Collector Payment contract with Waste Management, the annual collector payment remitted is the greater of nine percent of gross receipts for the prior year or $1.7 million. SOLID WASTE DISPOSAL FUND EXPENDITURES Table 5 highlights the amount and percentage expended by expenditure category. As of December 31, the Solid Waste Disposal Fund has expended 45% of the amended budget. Table 5 SOLID WASTE DISPOSAL FUND 731 Operating Revenues Trash P/U Fees $ 20,831 $ 20,831 $ 10,650 51% Waste Mgmt Collector Payment 1,994 1, % City Waste Services 3,673 3,673 1,828 50% Other Revenue 8 8-0% Total Operating Revenues $ 26,506 $ 26,506 $ 13,420 51% Expenditures Personnel $ 656 $ 663 $ 279 $ - 42% Maintenance & Operations 18,741 18,745 7, % Internal Service Charges 1,402 1, % Interfund Transfers Out 5,720 5,848 3,027-52% Total Operating Expenditures $ 26,519 $ 26,658 $ 11,680 $ % Depreciation/GASB 31 Expense $ - $ - $ 3 Operating Income/(Loss) $ (13) $ (152) $ 1,737 Capital Projects Solid Waste Projects $ 450 $ 834 $ 13 $ % Total Capital Expenditures $ 450 $ 834 $ 13 $ % Page 6 of 9

7 HARBOR FUND REVENUES Overall revenues for the Harbor Fund are at 49% of amended budget as of December 31 as noted in Table 6, which is flat compared to prior year. Slip rental revenue is at 48% of budget and parking revenue is at 61% of budget. The parking revenue is higher than the 50% benchmark due to seasonal use. HARBOR FUND EXPENDITURES Table 6 highlights the amount and percentage expended by expenditure category. As of December 31, the Harbor Fund has expended 52% of the operating expenditure budget. Table 6 HARBOR FUND 751 Operating Revenues Slip Rental Revenue $ 5,200 $ 5,200 $ 2,503 48% Harbor Leases 1,172 1, % Parking % Interest % Other Revenue % Total Operating Revenues $ 7,409 $ 7,423 $ 3,654 49% Expenditures Transfer - Harbor Police $ 2,351 $ 2,351 $ 1,176 50% Transfer - Harbor Admin % Transfer - Harbor Maint 2,707 2,707 1,353 50% Transfer - Prop Mgmt % Transfer - Harbor Lifeguard % Transfer - Risk Management % Transfer - Tideland Lease % Capital Outlay % Debt Service % Total Operating Expenditures $ 7,223 $ 7,481 $ 3,881 52% Depreciation/GASB 31 Expense $ 160 $ 160 $ 238 1% Operating Income/(Loss) $ 186 $ (58) $ (465) CAPITAL PROJECTS Harbor Projects $ 350 $ 560 $ 146 0% Total Capital Expenditures $ 350 $ 560 $ 146 0% Page 7 of 9

8 BUDGET TRANSFERS In compliance with Section OB-2 of Council Policy Financial Policies, the City Manager has the authority to transfer monies appropriated within the same fund for the same department provided the total amount within a fund has not changed. transfers in excess of $25,000 are presented to the City Council on a quarterly basis for notification purposes. Table 7 below highlights the budget transfers. Table 7 BUDGET TRANSFERS IN EXCESS OF $25,000 October through December 2017 Description of Business Unit or Project Account Reason Amount Water Filtration Plant M&S - Chemicals ($100,000) Water Filtration Plant Repairs & Maintenant, Reallocation of Machinery & Equipment $100,000 Parks Maint/Upgrades Repairs & Maintenant ($60,000) Reallocation of Parks Maint/Upgrades Matl Supplies & Services $60,000 Building Crafts Repairs & Maintenant ($41,000) Building Crafts Matl Supplies & Services, Reallocation of Water, Uniforms $41,000 Harbor Maintenance Repairs & Maintenant ($48,109) Matl Supplies & Services, Reallocation of Harbor Maintenance Rent & Leases, Energy Loan, $48,109 Training, Advertising City Building Maintenance Repairs & Maintenant ($116,000) City Building Maintenance Matl Supplies & Services, Reallocation of Water, Telephone $116,000 Street Light Maintenance Repair and Maintenance ($50,000) Reallocation of Street Light Maintenance Matl Supplies&Services $50,000 Parks Maintenance Repair and Maintenance ($137,877) Matl Supplies & Services, Reallocation of Parks Maintenance Rents & Leases, Energy $137,877 Loan, Uniform Upgrade Traffic Signal Infrastructure <$100K ($46,000) Reallocation of Upgrade Traffic Signal Professional Services $46,000 Upgrade Traffic Signal Matl Supplies & Services ($30,000) Reallocation of Upgrade Traffic Signal Machry&Eqp <$100K $30,000 Mission Branch Regular Employees Properly Classify ($49,999) Support Services Machry&Eqp <$10K Exependitures $49, Morro Hills SpTx-Ref IA1 Spec Assmt Admin Fee & Taxes Properly Classify $536, Morro Hills CFD (ImpArea#1) Spec Assmt Admin Fee & Revenues Taxes ($536,025) 14 Morro Hills SpTx-Ref IA1 Principal, Interest, Debt Mgmt, Services, Fees Properly Classify ($536,701) 14 Morro Hills CFD (ImpArea#1) Principal, Interest, Debt Exependitures Mgmt, Services, Fees $536,701 Ada Ramp Rplcmt/Sdwlks In-fill Matl Supplies & Services ($30,000) Reallocation of Ada Ramp Rplcmt/Sdwlks In-fill Infrastructure $30,000 Oceansid Lighting Dist Professional Services Transfer budget for Light $28,000 Oceansid Lighting Dist Electricity Grid ($28,000) Harbor Maintenance Infrastructure < $100K ($51,257) Electric Carts Harbor Maintenance Machinery & Equipment $51,257 Page 8 of 9

9 Table 7 (continued) BUDGET TRANSFERS IN EXCESS OF $25,000 October through December 2017 Description of Business Unit or Project Account Reason Amount Recreation Programs Electricity Transfer budget for ($43,795) Recreation Programs Administration Fees M&O costs $9,740 Recreation Programs Repair and Maintenance $10,000 Recreation Programs Professional Services $24,055 Food Waste To Energy Professional Svcs Transfer budget for food waste to energy master $991,757 Food Waste To Energy Studies & Reports plan ($991,757) AB1826 Compliance Professional Svcs Food/Organic Transfer budget to cover $70,000 cost of design PSA AB1826 Compliance Infrastructure Food/Organic ($70,000) Fire Suppression Regular Employees Salary Savings to ($283,984) Fire Suppression Fringe Benefit Burden Overtime ($158,207) Fire Suppression Overtime $442,191 Street Restoration Infrastructure Transfer budget due to ($100,000) Street Restoration Materials & Supplies needs in M&O $100,000 Engineering Regular Employees One time use of ($150,000) Engineering Professional Services personell savings from $150,000 Parks Projects Regular Employees open positions to ($108,971) Parks Projects Fringe Benefit Burden temporarily utilize ($40,882) Parks Projects Fringe Benefit Burden-WC project management ($147) consultant Parks Projects Professional Services $150,000 Desalter Facility Buildings/Treatment Plant Transfer budget due to ($155,000) Desalter Facility Studies & Reports needs in M&O $155,000 Water Maintenance Materials & Supplies Transfer budget due to ($50,000) Water Maintenance Repair & Maintenance needs in M&O $50,000 Section 8 Vouchers ($126,420) Section 8 Vash $126,420 Section 8 Port Out HAP ($75,890) Section 8 HAP FSS $30,379 Section 8 Home Ownership $17,376 Section 8 HAP to Owners Adjust based on ($352,785) Section 8 Project Based HAP actual expenditures $95,883 Section 8 Preservation Based HAP $52,095 Section 8 VASH HAP $510,972 Section 8 FUP 45 HAP ($278,030) Section 8 HUD HAP ($73,332) Section 8 NEDS HAP ($79,461) Section 8 FUPS HAP $152,793 CFD-2017 Pacific Coast Bus Prk Principal & Interest ($492,393) Properly Classify Pacific Coast Business Park CFD-2017 Pacific Coast Bus Prk Exependitures $492,393 Principal & Interest Page 9 of 9