General Fund and Special Revenue Funds April 24, 2016 Budget Workshop No. 3
Discussion Overview • Budget Workshop Calendar • Council Priorities: Strategic and Budget • Follow-up Discussion Items • FY 2017-2018 Draft Budget Overview & Highlights • General Fund • Special Revenue Funds • Council Discussion
Workshop Schedule Date
Time
Workshop Title
4/14/17
5:00 p.m.
Enterprise Funds
4/21/17
5:00 p.m.
Capital Budgets & CIP
4/24/17
5:00 p.m.
General Fund and Special Revenue Funds
6/13/17
6:00 p.m.
Public Hearing with Possible Adoption
By June 30
Adoption of Final Budget
Follow-up Items from Budget Work Shop 1 and 2 • Enterprise Funds Reserve Policy – Fiscal and Investment Oversight Committee and Water Ad Hoc Committee recommendations expected in May. • Other items as necessary.
Strategic Priorities • Economic Development: Strategic investments that ensure longterm fiscal sustainability via growth of jobs and local revenues.
• Infrastructure: Underlying foundation on which the continuance and growth of our community depends.
• Organizational Efficiency: To bring about an optimal organizational size and structure to ensure agility in meeting operational demands and achieving sustainable practices in the face of rapidly changing environments.
• Team Cohesion: Council and staff unity in fulfilling the organization’s vision and mission.
Budget Priorities • Council’s Budget Priorities from January 2017 Retreat • • • •
Emphasize projects that are cost cutting. Improvements to downtown infrastructure. Balance General Fund without using reserves. No major changes in spending from prior fiscal year. • Expect no significant increase or new source of revenue. • Maintain existing service levels.
FY 2017-2018 Annual Budget Overview and Highlights • Maintains existing service levels (Council budget priority); • No major changes in spending from prior fiscal year (Council budget priority); • Total proposed City Budget is $84.4 million across 46 funds.
Funds Overview
• General Fund (Fund 100) • Development Services Fund (Fund 248) • PFE Funds
Future Budget Challenges • • • • • • •
CalPERS Rate Increases (2018/19) Changes to Health Insurance Premiums Labor Market Competitiveness State Budget Activities Funding the OPEB obligation Negative Fund Balances (PFE) Funding the Capital Replacement Funds
New Proposed Positions • New positions to replace outside contractors Engineering – Construction Inspector
• New positions requiring new funding Public Services – Recreation Coordinator (programed for 6 months with offsetting revenue) Streets – FT Maintenance Worker (converting 2 PT into 1 FT position)
Impacts to Salaries & Benefits • Increase due to new proposed positions: $150,840 (General Fund, Streets, Water, Landscape & Lighting and Development Services Funds) • Potential increase due to Public Safety Agreements: $181,400 (General Fund)
Initiatives • Continue funding for Fire Shared Services – Total Cost: $286,700 – Projected increase in costs for FY 17/18: $52,700
• Library funding maintained – Hours per week funded: 31 hours
• Police LT position budgeted – Total cost: $186,400
Current GF Reserves Catastrophic Reserve – Policy: The greater of $2 million or 15% of General Fund expenditures. – Catastrophic Reserve Balance Funded: $2,000,000
Economic Reserve – Policy: Minimum 15% of General Fund expenditures. – Economic Reserve Balance Funded: $2,000,000
Proposed GF Reserve changes Catastrophic Reserve Cap at $2,000,000
Economic Reserve Increase from 15% to 25% of GF total expenditures Draft budget would create reserve of $4,367,940
Application of Unreserved Fund Balance Adopt policy to fund $300,000 annually for the replacement of Public Safety vehicles and equipment
General Fund FY 2017-2018 Budget Overview
FY 2017-2018 GF Budget • The General Fund is the main operating fund of the City for public safety, recreation and library services. • Primary revenue sources are Property Taxes and Sales Taxes. • Adopted Reserve Policy includes the Catastrophic Reserve and Economic Reserve.
GF Budget Assumptions • No new sources of revenue • Minor increase of existing revenue • Continued long-term obligations • Maintain balanced budget
FY 2017-2018 GF Budget • Beginning unaudited balance July 1, 2017 8,001,207 – Total Inflows 17,482,406 – Total Outflows (17,456,098) • Projected ending balance * June 30, 2018 8,027,515 •
Ending fund balance does not include reserve balances
Revenues General Fund
FY 2017-2018 GF: Funding Sources FY 2015-16 Actuals
FY 2016-17 Projected
FY 2017-18 Proposed Budget
Beginning Balance
5,269,285
6,530,611
8,001,207
Property Taxes
5,946,420
6,232,979
6,363,138
Sales & Other taxes
3,391,748
4,111,370
3,765,300
Intergovernmental
3,096,539
3,288,447
3,323,258
Leisure Services
795,165
816,960
921,250
Fees & Permits
750,092
758,497
900,350
Service Charges
530,289
549,670
410,249
Other Revenues
1,906,348
1,682,469
1,798,861
21,685,886
23,971,003
25,483,613
Funding Sources
Total Sources
Funding Sources 5%
2%
10% 36%
5%
19%
22%
Property Taxes
Sales & Other taxes
Intergovernmental
Fees & Permits
Service Charges
Other Revenues
Leisure Services
GF Net Revenues $2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$-
$(500,000)
$(1,000,000) FY2009-10 Operating Position $(600,000)
FY2010-11
FY2011-12
FY2012-13
FY2013-14
FY2014-15
FY2015-16
FY2016-17 Projected
$400,000
$300,000
$400,000
$400,000
$2,100,000
$1,100,000
$1,400,000
FY2017-18 Proposed Budget $-
Key Revenue Assumptions Secured Property Tax
1.2%
Sales Tax (HDL Estimate)
1.0%
All Other Revenue
4%
– Franchise Fee / Charges for Services / Fees and Permits / Recreation Fees
GF Revenue History $18.0 $17.0 $16.0
$ Million
$15.0 $14.0 $13.0 $12.0 $11.0 $10.0 $9.0 $8.0
Revenue Expenditures
FY200910
FY201011
FY201112
FY201213
FY201314
FY201415
FY201516
FY201617 Projected
$13.6 $14.2
$13.7 $13.3
$12.4 $12.1
$14.6 $14.2
$14.3 $13.9
$16.4 $14.3
$16.4 $15.3
$17.4 $16.0
FY201718 Proposed Budget $17.4 $17.4
Library Funding Summary • • • •
City of Lincoln General Fund: Sierra College: Western Placer Unified: UAIC
• Friends of Lincoln Library:
$334,000 $142,000 $ 85,000 $ 5,000 TBD *
* Friends of Lincoln Library donations will fund additional programs and services.
• Library PFE Funding (Collections and Capital Improvements)
$313,000
Expenditures General Fund
FY 2017-2018 GF: Funding Uses Funding Uses
Salaries & Benefits
Operations & Maintenance
Capital Outlay
Allocation
Debt Service
Total Uses
FY 2015-16 Actuals
FY 2016-17 Projected
FY 2017-18 Proposed Budget
10,109,716
10,155,763
11,355,196
2,337,310
3,285,267
3,372,443
95,601
34,958
70,000
2,120,112
2,001,708
2,306,200
492,536
492,100
352,259
15,155,275
15,969,796
17,456,098
Funding Uses 2% 13% 0%
19%
65%
Salaries & Benefits
Operations & Maintenance
Capital Outlay
Allocation
Debt Service
FY 2017-2018 GF: Department Detail Uses by Department
FY 2014-15 Actuals FY 2015-16 Actuals
FY 2016-17 Projected
FY 2017-18 Proposed Budget
City Attorney
148,097
193,055
289,548
202,700
City Council/Treasurer
131,511
161,180
249,696
296,680
City Manager's Office
246,350
266,578
303,391
300,019
Community Development
620,943
707,675
856,533
960,791
4,049,116
4,189,667
4,540,250
4,607,077
397,620
454,492
474,688
566,538
5,038,798
5,288,498
5,104,589
5,717,150
Recreation
637,442
712,597
835,213
1,089,274
Support Services
330,267
373,675
417,070
494,082
Public Services
297,293
360,933
403,573
493,328
Debt Service/Overhead
2,526,572
2,707,674
2,493,808
2,658,459
Total
14,424,009
15,416,024
15,968,359
17,386,098
Fire Department Library Police Department
Difference between slide 27 and 29 is due to a $70k capital budget item that doesn’t show up in this operating detail summary.
GF Expenditures Comparison by Department $7.0 $6.0 $5.0 $4.0 $3.0 $2.0 2017-2018 $1.0 $-
Projected 2016-2017
GF Expenditures by Department Police 33%
Fire 26%
Support Services 3% City Council/City Manager/City Attorney 5% Parks & Facilities Maint. 3%
Debt Service/Overhead 15% Community Development 6%
Library 3%
Recreation 6%
Key GF Expenditures Changes • Increase to Shared Fire Administration Services contract • Public Safety employee agreement impacts (not budgeted) • Funding of the OPEB Annual Required Contribution
Funded Special Requests • Lincoln Community Foundation – $25,000 • Lincoln Volunteer Center - $2,500 • The Gathering Inn - $15,000
FY 2017-2018 GF Budget Decision Points • Beginning unaudited balance July 1, 2017 8,001,207 – Total Inflows 17,482,406 – Total Outflows (17,456,098) • Projected ending balance * June 30, 2018 8,027,515 • Decision Points: • • • •
1) Maintain OPEB funding? 2) Maintain Police Lieutenant funding? 3) Special Requests Funding? 4) Expected MOU increases—currently not funded? (staff will be prepared to propose strategies for MOU funding at Monday’s workshop meeting)
FY 2017-2018 Budget Overview Development Services
Development Services Budget FY 2017-2018 • Beginning unaudited balance July 1, 2017 • Total Inflows • Total Outflows • Projected June 30, 2018
3,334,475 2,294,360 (2,966,354) 2,662,481
Summary of PFE Funds Fund #
Fund Name
240
Transportation
241
CS - Police
244
CS - Library
Available Funds July 1, 2017
Projected 2017-18 Revenues / Expenses
Available Funds June 30, 2018
6,144,728
719,437
6,864,165
331,549
37,059
368,608
3,888,453
(277,000)
3,611,453
10,364,730
479,496
10,844,226
(10,906,308)
88,917
(10,817,391)
242
CS - Fire
243
CS - Administration
(418,515)
245,835
(172,680)
246
CS - Parks
(685,276)
523,839
(161,437)
247
Drainage
(3,031,298)
248,332
(2,782,966)
(15,041,397)
1,106,923
(13,934,474)
Review of PFE Funds Deficit
Additional Information Attachments include: 1. Fund Balance, Revenue & Expenditures Summary 2. Department Operating Budgets • City Council / Treasurer • City Manager’s Office • City Attorney • Police Department • Fire Department • Library • Support Services • Community Development • City Engineer • Public Services • Leisure Services
Council Discussion on Proposed Operating Budget
FY 2017-2018