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“Establishing a solid financial foundation while prudently planning for the future”

City of Menifee Budget adoption Fiscal Year 2013/2014. “Establishing a solid financial foundation while prudently planning for the future”. June 18, 2013 7pm . Improving the quality of life of Menifee residents. Overview. Robert Johnson, Interim City Manager Budget: Team Approach

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“Establishing a solid financial foundation while prudently planning for the future”

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  1. City of MenifeeBudget adoption Fiscal Year 2013/2014 “Establishing a solid financial foundation while prudently planning for the future” June 18, 2013 7pm Improving the quality of life of Menifee residents

  2. Overview • Robert Johnson, Interim City Manager • Budget: Team Approach • The building of a comprehensive municipal budget • Budget Highlights • Balanced budget, personnel, expenses Improving the quality of life of Menifee residents

  3. The Big Picture • Staff is continuing to do more with less • What does this mean? • $4M lost to Vehicle License Fee reduction – this figure continues to rise as our population rises ($50 p/capita) • This year will be $4,114,600, or the cost of: • 17 police officer positions, constructing a new fire station, constructing 2 new parks, completing a project like the Newport Road Widening or the Menifee Road Missing Link • Increased sales tax not bridging the gap, but keeping pace • Sales tax is our best opportunity to increase revenue • New Restaurants, retail outlets, entertainment venues Improving the quality of life of Menifee residents

  4. The Big Picture • Staff is continuing to do more with less – cont… • What does this mean? • Menifee’s current population (5/1/13) is 82,292 with a current Full Time staffing level of 36 • 80,593 (2012) served with 36 full time staff • 77,000 (2011) served with 28 full time staff • No new staffing positions being requested at this time • No staffing increases in Police and Fire, but increases to the contract rate due to negotiated compensation rates • City staff is doing a great job, continues to produce a high volume of work and morale has dramatically improved Improving the quality of life of Menifee residents

  5. Budget: Team Approach • Staff is presenting a comprehensive municipal budget that provides for & plans for the future • Revenue generation is a necessary key component for Menifee now & in the future • Bringing back long term financial plan at a future date Improving the quality of life of Menifee residents

  6. Menifee’s current revenue streams do not support enhancement of City services • As the City continues to complete its separation from the County, it does not yet have full access to the funding sources “typical” cities do • Menifee’s total & per capita sales tax generation is dramatically lower than other cities in the region Revenue Breakdown Improving the quality of life of Menifee residents

  7. City of MenifeeBudget Workshop Fiscal Year 2013/14Terri Willoughby, Finance Director June 4, 2013 Improving the quality of life of Menifee residents

  8. Budget Purpose Budget is a financial plan of expenditures • Council sets goals and policy • Budget allocates resources to follow and meet these goals • Budget provides a management tool for staff to carry out Council policy Improving the quality of life of Menifee residents

  9. Budget basics Budget: An annual financial plan that identifies revenues, types and levels of services to be provided and the amount of funds that can be spent. Balanced budget: a budget in which planned operating expenditures do not exceed operating revenues. FUND: An independent fiscal and accounting entity. Improving the quality of life of Menifee residents

  10. Tax dollars at work A penny of the sales tax flows to the City of Menifee For every $1.00 candy bar sold within the City of Menifee If 32 million candy bars are sold this year within the City of Menifee The City could purchase a $320,000 Fire Truck with the resulting sales tax revenue Improving the quality of life of Menifee residents

  11. Budget Overview Revenue (+) Expenditures (-) & = ProposedBudget Improving the quality of life of Menifee residents

  12. Assessment • (February) • Performance Measures • Current Year Mid-Year Report • Policy & Strategy • (March) • Budget Priorities • Budget Kickoff Meeting • Development • (April) • Department Budgets • Department Meetings Budget Process • Review • (May) • CIP Fixed Assets • Prepare proposed budget • Budget Adoption • (June) • City Council Budget Workshop(s) • Council Meetings • Budget Management • (Year Round) Improving the quality of life of Menifee residents

  13. Budget Summary Improving the quality of life of Menifee residents

  14. TheFourPillars 1 No Tax Increases 2 Build Reserves 3 No Added Staff Positions 4 No Material Reduction of Services

  15. City of Menifee is fiscally sound, despite loss of VLF revenues • Growth in other revenues • Spending prudently, making careful financial decisions and expanding as resources allow • Doing more with less Budget Summary Improving the quality of life of Menifee residents

  16. Budget Highlights: FY 2013/14 General Fund budget does not include Vehicle License revenue lost due to the passage of Senate Bill 89 as part of the State’s budget Balanced Budget with continued emphasis on enhancing service levels as resources allow Capital Improvement Plan includes $6.0 million in new projects for Fiscal Year 13/14 Improving the quality of life of Menifee residents

  17. General Fund:Operating Revenues vs. Expenditures Improving the quality of life of Menifee residents

  18. General Fund: Revenue Sources Improving the quality of life of Menifee residents

  19. General Fund: Revenue Sources Improving the quality of life of Menifee residents

  20. General Fund Tax Revenue:FY 10/11 to FY 13/14 Improving the quality of life of Menifee residents

  21. General Fund operating Expenditures Improving the quality of life of Menifee residents

  22. General Fund: Expenditures by Type Improving the quality of life of Menifee residents

  23. General Fund: Expenditures by Department Improving the quality of life of Menifee residents

  24. New Positions: FY 13/14 • No new positions are being requested at this time • As the City’s fiscal position improves, positions may be strategically added and will be brought forward for Council approval Improving the quality of life of Menifee residents

  25. General Fund Capital/One-Time Requests Improving the quality of life of Menifee residents

  26. Funding Capital/One-Time Requests The City pays for Capital and One-Time items from its savings account, or fund balance. To put this in perspective, it is similar to how an individual buys a car.

  27. Funding Capital/One-Time Requests Purchasing a car? Option A: Loan Option B: Savings An individual would typically not buy a car from their paycheck, but instead would either use savings or take out a loan. The City is using savings, or fund balance for Capital/One-Time Requests. OR • Use of savings? • One lump-sum payment? • Interest payments? • Recurring payments?

  28. General Fund Balance – History Improving the quality of life of Menifee residents

  29. General Fund Balance – Proposed FY 13/14 $36,532 $6.3 M $2.4 M Assigned-Fire Safety ($21,532) (AMR Revenues) Assigned-Insurance ($15,000) (3 x SIR) Emergency Contingency Committed by City Council –(28% of Operating Expenditures) General Fund Unassigned Available TOTAL= $8.7 MILLION-38% of Operating Expenditures Improving the quality of life of Menifee residents

  30. Other Funds: FY 13/14 • The City has several other types of funds: • Special Revenue Funds Special Revenue funds are used to account for the proceeds of specific revenue sources that are restricted to expenditures for specific purposes. The City has the following Special Revenue Funds: Gas Tax, Measure A, Supplemental Law Enforcement Services, Air Quality Management District, Community development block grant, community service district funds (2012-1 and 2012-2) and development impact fees. Improving the quality of life of Menifee residents

  31. Other Funds: FY 13/14 • Capital Project Funds Capital Projects funds are used to account for the financial resources to be used for the acquisition and construction of major capital facilities. The City’s Capital Projects funds include the City Capital Projects Fund, LLMD 89-1, Menifee Valley and Scott Road Road and Bridge Benefit Districts, and County Service Area funds. • Debt Service Funds Debt Service funds are used to track revenues and expenditures related to the repayment of principal and interest costs associated with borrowing money for long-term obligations, in this case the City’s obligation associated with the Total Road Improvement Program financing completed in May 2012.

  32. Other Funds: FY 13/14 Improving the quality of life of Menifee residents

  33. New Projects for Fiscal Year 13/14: (first year of five year program funded) Newport Road Widening $3,000,000 Holland Road Overcrossing 1,400,000 Bradley Road Bridge 980,000 McCall Interchange 500,000 CDBG funded – Senior Center 84,112 CDBG funded-Lazy Creek 36,048 Total: $6,000,160 Capital Improvement Program Improving the quality of life of Menifee residents

  34. Action Plan: FY 13/14 • Moderate recovery underway • Maintain prudent spending plan-expanding only as resources allow • Increase existing revenue sources • Develop additional revenue sources to increase diversity of revenue Improving the quality of life of Menifee residents

  35. Action Plan: FY 13/14 • Scale back of expansion plans due to loss of Vehicle License Fee revenue • Continue to work with newly incorporated cities to seek restoration of VLF revenues • Continue vigorous economic development plan • Seek new revenue sources Improving the quality of life of Menifee residents

  36. Expected Business Openings Improving the quality of life of Menifee residents

  37. CONCLUSION • No action needed on budget at this time • Budget will be presented for final adoption at the City Council meeting on June 18, 2013 • Draft Budget will be available on City’s website Improving the quality of life of Menifee residents

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