Sacramento Public Library Authority

Transcription

1 Thursday, May 28, 2015 Overhead Cost Allocation Update Presentation of Results and Model Sacramento Public Library Authority Item 5.2

2 Willdan Financial Services Background Willdan Financial Services - over 60 employees providing financial services to local agencies More than 25 years providing Financial Consulting, Federal Compliance and District Administration Services Financial Consulting Services: Cost Allocation Plans and User Fee Studies Water, Wastewater and Solid Waste Utility Rate Studies Special District Formations (CFD, AD, LLD, BID) Prop 218 Nexus Studies and Compliance Impact and Connection Fee Studies Assessment & Re-assessment Engineering / Balloting

3 Willdan Project Team Chris Fisher, Project Director Resource coordination, strategy development QA/QC, review of reports and models Tony Thrasher, Senior Analyst Lead analytical and modeling efforts Incorporate direct data and feedback

4 What is a Cost Allocation Plan? Cost Allocation Plan (CAP) ensures that costs associated with Central Service Departments are appropriately allocated to respective Operating Departments, branches and/or funds Tool that formulates an equitable methodology to identify and allocate indirect costs to direct cost programs Allocations should represent how the library branches use and benefit from central support services

5 Building Blocks of a Cost Allocation Plan Evaluate costs of central service departments (donors) to determine which amounts are appropriately allocable to each branch Identify the major functions of each central service Determine how branches utilize and benefit from central overhead service functions Identify distribution bases that best represent those functions and collect necessary data Allocate the cost of central services using the distribution bases

6 Authority Internal Structure Donor Departments Library Branches Director Finance Human Resources Central service departments provide support to branches Central Library Carmichael Library Arden Library Individual branches provide services directly to the public

7 Project Objectives Work with staff to understand overall system objectives, challenges, political and policy direction Develop defensible allocation of OH to each library branch Develop easily updatable full cost CAP and model Conduct interactive data gathering to ensure accuracy, integrity of model inputs, understanding of organization Provide custom model, analysis, report Update the Model and Plan yearly using the previous years budget

8 Overhead Cost Allocation Update Process Kick-off discussion determine necessary adjustments from previous year and current plan structure Gather updated financial and expenditure data Review and analyze previous year s budget to identify allocable costs Interview staff to: Understand structural or functional changes within expenditure data Highlight and resolve issues or anomalies Discuss needs for changing and updating distribution bases Run updated model to reflect Authority s current operation Review and finalize updated results with staff

9 Double-Step Down Allocation Approach Widely accepted methodology - accurate and equitable Utilizes two steps to allocate indirect costs: First Step: Identify allocable budget of each Donor (overhead) department Distribute allocable costs to central and operating entities based on functions provided and appropriate allocation bases Second Step ( Close Out ): For each Donor department, Central Service allocations from the first step are reallocated to all remaining entities Each central service is closed out one by one After closing out Donor departments costs are fully allocated to the operating entities (branches)

10 Example of Allocation Bases Branch Square Footage Human Resources 48% 52% Total FTE s Central Service Department Allocable Budget Salaries & Benefits Employee Hours Service Area Population SURF Requests Equal Distribution Director 41% 41% 18% Communications 42% 58% Administrative Services 37% 37% 6% 20% Passport Services 100%

11 Summary of Allocable Costs Allocable Cost Summary Unallowable Cost Allocable Cost Total Cost Summary $ 873,392 $ 20,124,575 $ 20,997,968 Donor Administrative Services (224,293) 453, ,607 Bookmobiles 1,062 92,168 93,230 Collection Management Svcs. (CVD/TEC) 2,217,880 2,217,880 Communications 20, , ,576 Community Services 3, , ,593 Director 272, ,932 1,128,161 Finance 55, , ,494 General Services 14,000 2,691,909 2,705,909 Human Resources 10, , ,028 Information Technology 108,500 3,346,058 3,454,558 Literacy 46,957 46,957 Passport Services 18,000 18,000 Sacramento Room 176, ,692 Shared Public Services (General) 371, ,705 Tellis 406, ,739 Youth Services 24, , , Book Fund 4,230,886 4,230, County of Sacramento Public Svcs. (General) 325,100 2,148,545 2,473, City of Sacramento Public Svcs. (General) (61,108) 254, , City of Sac Special Tax (General) 225,348 68, , Special Tax Public Services (Measure B) 100,554 13, ,154

12 Allocated Cost Summary Summary of Costs Allocated to Branches Total 2015 Budget Indirect (Includes CIP and DS) Allocation Summary $ $ 16,348,392 20,124,574 Recipient Arcade Library 532, , Arden Library 757, , Carmichael Library 902,201 1,377, Courtland Library 106, , Elk Grove Library 776,583 1,224, Fair Oaks Library 694, , Franklin Library 573, , Galt Library 284, , Isleton Library 115, , North Highlands/Antelope Library 743,981 1,260, Orangevale Library 289, , Rancho Cordova Library 648,357 1,188, Rio Linda Library 272, , Southgate Library 703, , Sylvan Oaks Library 849,712 1,057, Walnut Grove Library 154, , Belle Cooledge Library 557, , Central Library 2,047,961 1,777, Colonial Heights Library 385, , Del Paso Library 275, , Galleria 410, , Martin Luther King Library 431, , McClatchy Library 255, , McKinley Library 316, , North Sacramento Library 286, , South Natomas Library 408, , Central Library - 28, Colonial Heights Library 107, , Del Paso Library 22,187 51, Martin Luther King Library 96, , McKinley Library 74,446 92, North Natomas Library 140, , North Sacramento Library 23,201 54, Pocket-Greenhaven Library 532, , South Natomas Library 66, , Valley Hi Library 106, , Belle Cooledge Library 12, Central Library 489,489 60, Del Paso Library 29, North Natomas Library 413, , Valley Hi Library 451, ,791

13 FUND FY 10/11 FY 11/12 FY 12/13 FY 13/14 FY 14/15 FY 15/16 County/Cities 66% 58% 58% 58% 60% 60% City General 20% 28% 28% 26% 24% 26% City Parcel Tax - X 14% 14% 14% 16% 15% 9% City Parcel Tax - B 5% The addition of the Measure B fund following the completion of the prior CAP has caused a shift in the allocation splits between the funds. Trend of CAP Outcomes

14 Questions and Comments