FY2016 Annual Budget
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FY 2016 PRELIMINARY YEAR-END VARIANCE ANALYSIS Council Workshop December 13, 2016
FY2016 Annual Budget
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PURPOSE • 4th Quarter Report and Preliminary Year-End provide a picture of financial condition of the City • Numbers are not yet audited or final • Compare projections to actuals
FY2016 Annual Budget
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General Fund Revenue General Fund Revenues: Revenue Type
Projected YE per Budget as of July 26, 2016
Preliminary Actual as of Sept. 30, 2016
$ Variance
% Variance
Property Tax
$11,673,060
$11,636,698
($36,362)
(0.3%)
Sales Tax
$12,357,361
$12,679,188
$321,827
2.6%
All Other Revenues
$30,297,652
$30,089,475
($208,177)
(0.7%)
Total Revenue
$54,328,073
$54,405,361
$77,288
0.1%
FY2016 Annual Budget
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General Fund Expenses General Fund Expenses Projected YE per Budget as of July 26, 2016
Preliminary Actual as of Sept. 30, 2016
$ Variance
% Variance
$9,844,300
$9,800,872
$43,428
(0.4%)
$561,439
$541,209
$20,230
(3.6%)
$11,810,683
$11,815,511
($4,428)
0.1%
GUS
$7,443,255
$6,900,627
$542,628
(7.3%)
Management Services
$6,379,556
$6,182,599
$196,957
(3.1%)
$14,000,500
$13,553,097
$447,403
(3.2%)
Transportation
$3,789,723
$3,603,267
$186,456
(4.9%)
Transfers
$1,512,955
$1,531,334
($18,379)
1.2%
$53,928,514 $1,413,897
(1.5%)
Expense Type Downtown & Community Services Finance & Admin Fire (Amended 10-24-2016)
Police
Total Expenses
$55,342,411
FY2016 Annual Budget
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General Fund Balance • Including transfer to Council SRF General Fund – Fund Balance
Fund Balance
Projected YE per Budget as of July 26, 2016
Preliminary Actual as of Sept. 30, 2016
$ Variance
% Variance
$9,154,300
$10,645,485
$1,491,185
16.3%
FY2016 Annual Budget
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Debt Service Fund
General Debt Service – Fund Balance
Fund Balance
Projected YE per Budget as of July 26, 2016
Preliminary Actual as of Sept. 30, 2016
$ Variance
% Variance
$1,530,625*
$1,870,004
$339,379
22.2%
*Reflects Council’s Anticipated Approval of Budget Amendment 12-13-2016.
FY2016 Annual Budget
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Joint Services Fund
Joint Services Fund– Fund Balance
Fund Balance
Projected YE per Budget as of July 26, 2016
Preliminary Actual as of Sept. 30, 2016
$ Variance
% Variance
$749,366
$280,454
($468,912)
(62.6%)
FY2016 Annual Budget
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Internal Service Funds Internal Service Funds – Fund Balance Projected YE per Preliminary Actual Budget as of as of July 26, 2016 Sept. 30, 2016 Facilities Maintenance Fund Balance Fleet Management Information Services
Self Insurance*
$ Variance
% Variance
$364,386
$762,242
$397,856
109.2%
$1,337,221
$1,762,672
$425,451
31.8%
$394,592
$778,187
$383,595
97.2%
$1,040,984*
$1,041,019
$35
0.0%
*Reflects Council’s Anticipated Approval of Budget Amendment 12-13-2016.
FY2016 Annual Budget
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Special Revenue - EMS
Paramedic EMS SRF– Fund Balance
Fund Balance
Projected YE per Budget as of July 26, 2016
Preliminary Actual as of Sept. 30, 2016
$ Variance
% Variance
($853,003)
($826,180)
$26,823
(3.1%)
FY2016 Annual Budget
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Special Revenue - Tourism
Tourism SRF– Fund Balance
Fund Balance
Projected YE per Budget as of July 26, 2016
Preliminary Actual as of Sept. 30, 2016
$ Variance
% Variance
$435,421*
$489,121
$53,700
(12.3%)
*Reflects Council’s Anticipated Approval of Budget Amendment 12-13-2016.
FY2016 Annual Budget
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Other Special Revenue Funds Special Revenue Funds – Fund Balance Projected YE per Budget as of July 26, 2016
Preliminary Actual as of Sept. 30, 2016
$ Variance
% Variance
$1,657,580
$2,028,946
$371,366
22.4%
$59,052
$75,308
$16,256
27.5%
-
($3,894)
($3,894)
0.0%
Animal Services
$169,738
$191,929
$22,191
13.1%
Library Restricted*
$52,754
$52,731
($23)
(0.1%)
Main Street Facade
$117,879
$114,333
($3,546)
(3.0%)
Parks Restricted
$634,444
$987,778
$353,334
55.7%
Street Maintenance Tax Permitting CDBG (Sidewalks)
(Tree Fund, Parkland & Parks)
*Reflects Council’s Anticipated Approval of Budget Amendment 12-13-2016.
FY2016 Annual Budget
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Other Special Revenue Funds Special Revenue Funds – Fund Balance Projected YE per Budget as of July 26, 2016
Preliminary Actual as of Sept. 30, 2016
$ Variance
% Variance
Police Restricted
$121,648
$133,703
$12,055
9.9%
Fire Billing
$58,262
$36,873
($21,389)
(36.7%)
Conservation
$390,534
$452,907
$62,373
16.0%
Council Discretionary
$185,045
$185,694
$649
0.4%
Cemetery
$399,673
$401,659
$1,986
0.5%
Court Fees
$56,593
$43,167
($13,426)
(23.7%)
$287,148
$309,735
$22,587
7.9%
$439
$440
$1
0.2%
$175,589
$176,090
$501
0.3%
TIRZ’s Wolf Ranch PID PEG Fee
FY2016 Annual Budget
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Water Funds Water Services Fund Projected YE per Budget as of July 26, 2016
Preliminary Actual as of Sept. 30, 2016
$ Variance
% Variance
Operating
$42,042,687
$45,215,145
$3,172,458
7.6%
Non-Operating
$6,642,373
$8,498,116
$1,855,743
27.9%
Operating
$32,153,130*
$30,440,792
$1,712,338
6.3%
Non-Operating
$48,104,534
$18,227,144
$29,877,390
(62.1%)
$18,126,211*
$54,744,140
$36,617,929
206.5%
Revenues:
Expenses:
Fund Balance
*Reflects Council’s Anticipated Approval of Budget Amendment 12-13-2016.
FY2016 Annual Budget
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Stormwater Drainage Fund Stormwater Drainage Fund Projected YE per Budget as of July 26, 2016
Preliminary Actual as of Sept. 30, 2016
$ Variance
% Variance
$3,213,564
$3,288,759
$75,195
2.3%
$720,000
$363,400
($356,600)
(49.5%)
Operating
$2,281,565
$2,297,829
($16,624)
0.7%
Non-Operating
$1,809,794
$1,544,820
$264,974
(14.6%)
$1,554,508
$1,521,813
($32,695)
(2.1%)
Revenues: Operating Non-Operating
Expenses:
Fund Balance
FY2016 Annual Budget
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Airport Fund Airport Fund Projected YE per Budget as of July 26, 2016
Preliminary Actual as of Sept. 30, 2016
$ Variance
% Variance
$2,759,231
$2,866,783
$107,552
3.9%
$50,000
$90,229
$40,229
80.5%
Operating
$2,544,028
$2,435,379
$108,469
(4.3%)
Non-Operating
$1,013,672
$1,004,214
$9,458
(0.9%)
$43,849
$309,736
$265,887
606.4%
Revenues: Operating Non-Operating
Expenses:
Fund Balance
FY2016 Annual Budget
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Electric Fund Airport Fund Projected YE per Budget as of July 26, 2016
Preliminary Actual as of Sept. 30, 2016
$ Variance
% Variance
$65,910,665*
$65,373,714
($536,951)
(0.8%)
$1,500,000
$1,761,132
$261,132
17.4%
Operating
$55,772,846*
$60,769,589
($4,996,743)
9.0%
Non-Operating
$12,370,307
$12,087,657
$282,650
1.9%
$12,683,353*
$7,693,441
($4,989,912)
(39.3%)
Revenues: Operating Non-Operating
Expenses:
Fund Balance
*Reflects Council’s Anticipated Approval of Budget Amendment 12-13-2016.
FY2016 Annual Budget
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Electric Fund • Reasons for Operating Revenue/Expense Variances: – Mild summer temperatures – August/September significant weather impacts – Increase in Capital Improvement Program • Requirements due to growth
FY2016 Annual Budget
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FY2016 – Cause and Effect - Weather • Mild, Wet Late-Summer (standard weather fluctuation) – Lower retail customer demand • → Lower revenue • → But also Excess supply
– Entire Wholesale Market has excess supply • → Market price depressed • → Wholesale Clearing Price below Purchase Price
– → Power Purchase loss from clearing excess supply • → Used Cash Reserves
FY2016 Annual Budget
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2016 May-Aug averaged 5° below budget FY2016 was 19.1” above normal rainfall 90 80 70
+4.4 -5.3
60
+3.7 -1.7
50
+2.0
-0.8
-6.7
-7.7
-1.3
-4.8
+2.2
16 14 12 10
-0.4
8
40
6
30 20
4
10
2
0
0 Oct
Nov
Dec
Jan Avg Temp
Feb
Mar Normal Temp
Apr
May Rain (In)
Jun
Jul
Normal Rain
Aug
Sep
FY2016 Annual Budget
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Average KWh Sales per day by temp (2011-2012 data) Percentage Impact of 5° Temp Variance & FY16 Actual Monthly Variance 2.5
May –6.7° -12.3% KWh Jun -7.7° -19.3% KWh
2
Millions of kWhs
1.5
1
0.5
Jul -1.3° -8.3% KWh
Aug -4.8 -13.9% KWh 50° - 45° 55° - 50° 60° - 55° 65° - 60° 70° - 65° 75° - 70° 80° - 75° 85° - 80° 90° - 85° +10.7% +2.4% +2.1% -5.9% -2.5% -15.8% -13.8% -16.1% -12.8% -9.6% -2.3% -2.0% +6.3% +2.6% +18.8% +16.0% +19.2% +14.7%
0 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 5 degree bands
Avg Kwh at temp
FY16 May-Aug
FY2016 Annual Budget
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Electric Fund • FY 2016 Solutions – Adjust allocations between the Electric and Water Funds to appropriately recognize shared costs • CIS Project • Infrastructure Control Operations
– Debt fund the CIS project in the Electric Fund – Recognize Payment from NRG purchase of Buckthorn Project
• FY 2017 Solutions – Reduce cash funding and increase debt funding for planned capital projects
FY2016 Annual Budget
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Electric Fund - Moving Forward • Monitor purchased power costs closely • Improve cash position of the fund to improve buffering weather fluctuations
FY2016 Annual Budget
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Summary • General Fund: – Revenue:
• Additional sales revenue review was recognized due to nearly 25% increase in collections in August. • This one-time in nature payment was used to offset the overage in Fire due to OT costs stemming from staff vacancies. • Total sales tax projection moved from 22.9 M to 23.4 M. • Year-end actuals finished around 22,437,000.
– Expenses:
• Overage in Fire OT costs was adjusted through Budget amendment.
FY2016 Annual Budget
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Summary • Internal Service Funds: – Fleet:
• Increase in fund balance is the result of less expenses in capital repair.
– Facilities:
• Increased fund balance because GMC parking lot delayed. Savings in janitorial services due the timing of the West Side Service Center. • Savings in landscape services while negotiating new contract.
– IT:
• Increase in fund balance because of underspending.
• General Capital Projects:
– Working on roll forward of all CIP and will bring for Council review in January
FY2016 Annual Budget
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Summary • Special Revenue Funds: – Paramedic: • Preliminary actuals close to year-end projections, despite the increase in overtime. – Street Maintenance Fund: • Increase in fund balance due to the decision to hold off on spending on Fog Seal.
FY2016 Annual Budget
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Summary •
Special Revenue Funds:
– Parks: • Additional revenue of $101K recognized for the Pipeline Easement revenue. • Expenses are under due to a roll forward on Founders’ Park, which will be done in a January budget amendment. – Council Discretionary Fund: – Increase in fund balance due to interest earned on beginning fund balance of $650. – Airport: • Operating revenues exceeded the projections increasing the health of the fund.
FY2016 Annual Budget
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Summary • Debt Service: – The Debt Service Fund reflects the refunding (refinancing) of $7.9M Contractual Obligations for 2006 and 2007 for vehicles and equipment from various City departments. – The refunding was approved by Council in spring of 2016 and resulted in $861,000 savings on interest rates. • Tourism Fund: – The Tourism Fund reflects an increases in both revenue ($40K) and expenditures ($50K) for Poppy Festival activities and CVB operations activities.
FY2016 Annual Budget
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Summary • Self-Insurance Fund: – The Self-Insurance Fund is amended by ($500K) in revenue and ($34K) in expenditures to reflect plan contributions and medical claims that were higher than budgeted. • Library Restricted: – The Library Special Revenue Fund is amended to recognize additional donation revenue ($16K) and appropriate additional Library related expenditures ($15K).
FY2016 Annual Budget
Summary
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• Electric and Water Funds: – The Electric and Water Funds are adjusted so that the Water Fund contributes toward half of the costs of the Customer Information System (CIS) project, and contributes toward Control Center, Meter Services and SCADA department costs based on meter allocation. – This amendment is needed to improve cash flow in the Electric Fund as a result of a current year loss on Purchased Power costs. • This budget amendment decreases the CIS budget in the Electric Fund by $2.2M and increases it in the Water Fund by the same amount. • This amendment also transfers $711K out of the Water Fund to the Electric Fund for shared Control Center Costs. – Since Electric and Water services benefit from both the Customer Information System and the Control Center, the funds will share costs in future fiscal years.
FY2016 Annual Budget
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Next Steps • Budget Amendments – 2016…. – Capital Improvement Program “Roll Forward”
• Bond Reimbursement Resolution • External Audit • Comprehensive Annual Financial Report
