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City of Modesto Fiscal Year 2012-13 Budget Workshops Follow-Up

City of Modesto Fiscal Year 2012-13 Budget Workshops Follow-Up. May 23, 2012. Agenda. ISF & Cost Allocation Distribution of Costs (120 Day Review - Aug. – Dec., 2012) Overview Budget Picture Public Works & UP&P $3.8 Million Shortfall Mayor’s Reductions (Initial and Additional 3%)

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City of Modesto Fiscal Year 2012-13 Budget Workshops Follow-Up

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  1. City of Modesto Fiscal Year 2012-13Budget Workshops Follow-Up May 23, 2012

  2. Agenda • ISF & Cost Allocation Distribution of Costs (120 Day Review - Aug. – Dec., 2012) • Overview • Budget Picture Public Works & UP&P $3.8 Million Shortfall Mayor’s Reductions (Initial and Additional 3%) • Department Presentations (Service Enhancements, Reductions, Impacts and Revenue Enhancements) • UP&P - Workload/Workflow of Capital Improvement Support Fund • Mayor’s Closing Comments • Finance Committee Deliberations and Policy Considerations

  3. GAAP Distribution of Costs The City of Modesto utilizes 4 methods to distribute costs for services. These methods are industry standard and supported under Government Accepted Accounting Principles (GAAP)

  4. Distribution of Cost Methods Defined

  5. Methods Used by Departments

  6. Addressing Distribution of Costs – Models Moving Forward • Complex allocation models • Not 1 for 1 reductions – Costs savings are not specific to General Fund (i.e., 40% General Fund to 60% Enterprise Fund) • Plan to address distribution of cost models (Aug. -Dec., 2012) • City Manager will request the City Council direct the City Auditor to review and make recommendations to current allocation models.

  7. Budget Picture • Continued challenges • Expenditures still exceed revenues • Service levels remain flat but needs are evident • Water & Wastewater stable - Future rate increases being proposed • Salary & Benefits (contractual raises, increased pension costs, retiree health care costs projected to increase annually) • MPOA – 2% August, 2012 – Estimated at $310,052 • MPMA – 2% August, 2012 – Estimated at $82,571 • MCFFA – 3% July, 2012 – Estimated at $460,898 • No furlough savings are currently budgeted • Obligations to JPA/MRFA

  8. Modesto Regional Fire Authority(MRFA) – Additional Expenses • City of Modesto has received and is reviewing the preliminary MRFA budget for FY13. • Capital equipment needs will need to be discussed and addressed. • Larger increases include: • Pension Increase - $480,000 • 3% Raises July, 2012 - $460,000 • Airport Staffing - $160,000

  9. General Fund Overview – FY12/13 Notes: Revenues include Transfers In Transfers Out include: Debt Service - $3,400,801 Surface Transportation MOE - $1,687,715 4th Year of PD ARRA Grant - $986,000 Mayor's Recommended Reductions or Enhancements Are Not Included

  10. Shortfall for 2012 / 13

  11. Source of FY 11-12 Fund Balance Carryover

  12. FY12/13 Proposed General Fund Expenditures

  13. Mayor’s Reductions -Initial and additional 3% • Reduction Worksheets

  14. Closing The Shortfall

  15. Finance Committee Deliberations and Policy Considerations

  16. Closing Thank you & Questions

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