HomeMy WebLinkAbout5B - 2008 Second Quarter Budget Reports
4646 Dakota Street S.E.
Prior Lake, MN 55372-1714
MEETING DATE:
AGENDA #:
PREPARED BY:
AGENDA ITEM:
DISCUSSION:
RECOMMENDED
MOTION:
ReVie(jd by:
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Frank B01' Cit I ~
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CITY COUNCIL AGENDA REPORT
JULY 7,2008
5B
Ralph Teschner, Finance Director
CONSIDER APPROVAL OF 2008 2nd QUARTER BUDGET SUMMARY
REPORTS AND GENERAL FUND OVERVIEW
Introduction
The City Council has directed Staff to prepare an accompanying written
narrative that would serve as an informational excerpt to the quarterly budget
reports. Attached to the 2nd Quarter Budget Report is a document entitled
"Budget Report Overview" for the General Fund that is intended to satisfy your
request. The 2nd Quarter Budget Reports shows the status of expenditures for
the first three months of activity in 2008 for the General Fund and Enterprise
Funds consisting of the water & sewer, water quality and transit funds.
The "overview" provides information related to those areas within the general
fund budget that have experienced exceptions (normally :f:5% variation) to the
approved budget levels. The report identifies revenue shortfalls and surpluses
and includes a short explanation as to the various reasons. Expenditures are
also summarized on this basis.
The "Budget Report Overview" is intended to serve as narrative support to the
Quarterly Budget Report and highlight the performance results of the General
Fund budget. Please feel free to contact me at 447-9841 for more information.
A motion as part of the consent agenda to approve the 2008 2nd Quarter
Budget Report as submitted.
1. 2008 2nd Quarter Budget Summary Reports
2. Budget Report Overview (General Fund)
www.cityofpriorlake.com
Phone 952.447.9800 / Fax 952.447.4245
2008 2nd Quarter General Fund Budget Summary Report
Budget Amount Expended Percent
General Government 2,516,582.00 1,069,479.00 42%
Mayor & Council 69,931.00 34,860.00 50%
Ordinance 12,000.00 3,323.00 2H%
City Manager 365,418.00 166,432.00 46%
Boards & Commissions 13,337.00 2,045.00 15%
Elections 16,297.00 0.00 0%
Director of Finance 130,865.00 65,209.00 50%
Accounting 174,226.00 84,944.00 49%
Internal Auditing 22,200.00 19,190.00 86%
Assessing 110,800.00 0.00 0%
Law 376,000.00 152,157.00 40%
Personnel 78,343.00 26,465.00 34%
Communications 126,798.00 48,311.00 38%
Community Dev./Nat Resource 434,716.00 210,234.00 48%
Data Processing 175,595.00 42,865.00 24%
Buildings & Plant 410,056.00 213,444.00 52%
Public Safety 4,237,976.00 1,837,029.00 43%
Police 2,992,990.00 1,431,136.00 48%
Fire & Rescue 766,153.00 176,941.00 23%
Building/Transportation Services 436,443.00 213,441.00 49%
Emergency Management 7,500.00 656.00 9%
Animal Control 34,890.00 14,855.00 43%
Public Works 1,806,123.00 785,825.00 44%
Engineering 560,159.00 264,316.00 47%
Street 949,651.00 377,704.00 40%
Central Garage 296,313.00 143,805.00 49%
Culture-Recreation 1,882,397.00 800,859.00 43%
Recreation 478,473.00 178,285.00 37%
Parks 1,302,992.00 574,145.00 44%
Libraries 100,932.00 48,429.00 48%
Economic Development 131,872.00 62,484.00 47%
Debt Service 1,576,481.00 449,285.00 28%
Contingent Reserve 275,000.00 90,000.00 33%
Revenues 12,426,431.00 5,333,240.00 43%
General Property Taxes 8,131,224.00 3,945,179.00 49%
Licenses & Permits 625,925.00 189,756.00 30%
Intergovernmental Revenue 1,305,838.00 559,649.00 43%
Charges for Services 1,594,344.00 462,752.00 29%
Fines & Forfeits 189,600.00 97,139.00 51%
Miscellaneous Revenue 267,500.00 77,415.00 29%
Other Financing Sources 312,000.00 1,350.00 0%
Total Budget Expenditures 12,426,431.00 5,094,961.00 41%
Total Budget Revenues 12,426,431.00 5,333,240.00 43%
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Enterprise Funds
2008 2nd Quarter Enterprise Funds Budget Summary Report
Budget Amount Expended Percent
Utility Fund 5,099,065.00 1,926,829.00 38%
Water 1,768,821.00 752,182.00 43%
Sewer 1,976,830.00 977,769.00 49%
Lift Station Upgrade 250,000.00 0.00 0%
CIPP Pipe Slip Lining 100,000.00 171.00 0%
Transfers 1,003,414.00 196,707.00 20%
Water Quality 315,537.00 82,139.00 26%
Transit Services 575,651.00 335,932.00 58%
Revenues 5,651,295.00 2,503,740.00 44%
Water Utility Revenues 4,723,494.00 1,953,027.00 41%
Water Quality Utility Revenues 352,150.00 189,543.00 54%
Transit Revenues 575,651.00 361,170.00 63%
Total Budget Expenditures 5,990,253.00 2,344,900.00 39%
Total Budget Revenues 5,651,295.00 2,503,740.00 44%
BUDGET REPORT OVERVIEW
(2008 2nd Quarter Budget Report)
Expenditures:
General Government
. Ordinance costs for legal notices is largely unspent because only a few ordinance
publications occurred during the first six months, which is the main reason why the YTD
percentage is only at 28%.
. Boards and Commissions constitute the Planning Commission and EDA whose per
diem salaries are paid after the end of each quarter therefore the quarter lag accounts
for the 15% result.
. Expenses associated with Elections and Assessing are typically not incurred until the
latter part of the budget year i.e., fall election judge salaries and mid-year contract
assessing billing, therefore the zero amounts.
. Internal Auditing billings are complete. The remaining $3000 was initially allocated
for the GASB 43 & 45 OPEB report; however this work will actually be completed
with next year's financial statements so the 86% is final.
. Legal fees in the general service area is running lower at 36% than projected at this
point of the budget cycle due to the fact that city attorney costs represent only five
months of billings. The overall legal expense category (prosecution and city attorney)
outcome is 40% of the year to date budget.
. Personnel expenses of 34% are somewhat less than normal as expenditures associated
with professional consultant services and public information categories for the most part
have not been expended.
. Communication expenditures are lower than budget at 38% because postage and
expenses associated with miscellaneous brochure mailings have not been incurred
plus only four Wavelength publication invoices have been processed to date. Also
webcasting has not been initiated.
. Data Processing is below estimates at 24% because our contract support services have
been less and we have expended only a limited portion of the capital dollars assigned
for scheduled computer replacements.
. Bldgs & Plant is above at 52% because of higher than anticipated utility costs
associated with electric and gas usage for City Hall.
. General Government totals are in general conformance with budget estimates at
42%.
Public Safety
. Fire Department expenses are fairly low at 23% because 27% of department costs are
attributed to the state aid insurance and pension contributions, both of which are paid
as an annual lump sum near year-end. In addition our annual share for the joint public
safety training facility occurs later in the year as well.
. Emergency Management costs of 9% are low because we have not sustained any
repairs to the existing sirens which are typically caused by lightning damage.
. Animal control does not represent a full quarter of service because they are billed one
month in arrears.
. Public Safety totals are in general conformance 'with budget estimates at 43%.
Public Works
. Engineering Department expenses were slightly below at 47% because of the unfilled
engineering position, which reduces personnel expenses within the department.
. Street Department expenses of 40% are lower because department activity associated
with crack sealing, seal coating and bituminous overlay are to be scheduled for
completion in the next few weeks which is a major repair and maintenance category.
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. Public Works totals are in general conformance with budget estimates at 44%.
Culture-Recreation
. Due to the seasonal nature of recreation programs and parks maintenance, their
budget expenditures normally lag during the I st half of the year that accounts for their
budget performance levels of only 37% and 44% respectively. Recreation's major
activity levels occur during the summer months that involve park programs,
community events and instructor fees.
. Culture-Recreation totals are near seasonal budget expectation at 43%.
Economic Development
. The budget expenditures are slightly under as the general professional services are
largely unexpended to date.
. Economic Development totals are in general conformance with budget estimates at
47%.
Debt Service
. All general debt service bond payments are made during the months of June (interest
only) and December (principal/interest).
Contilllzent Reserve
. One Contingency expenditure of $90,000 has occurred which represents the final
dump site cleanup payment to Scott County.
Expenditure Summary:
2008 General Fund 2nd Quarter operating expenditures are on track with our expenditure
reduction plans and represent 41 % of the total $12,426,431 operating budget. This
actually compares favorably \vith 2007 I st quarter results of 44%.
Revenues:
. The current property tax settlement in June showed no apparent delinquency problem
as collections reached 49%.
. License & Permit fees are under projection at 30% as building permit activity is
lagging substantially and is not expected to pick up appreciably until possibly 2010
reflecting the national slowdown in the overall housing market.
. Intergovernmental revenue is under at 43% of the quarterly budget estimate because
the Fire and Police aid funded by the 2% surcharge on property and casualty
insurance premiums is not paid until September by the State of Minnesota.
. Charges for services is significantly under expectations at 29% primarily due to the
fall off in building permit plan check fees, the timing of franchise fee payments which
occur shortly after the end of each quarter and the project administration/engineering
transfer which is recognized at year end.
. Fine revenue is actually averaging slightly above projections at 51% even though
payments are in arrears by one month.
. Miscellaneous Revenue is under budget at 29% of estimates as no development
revenue has been generated.
. Other Financing Sources primarily consists of the $300,000 enterprise fund
contribution transfer, which is recognized at year-end.
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Revenue Summarv:
Revenues realized are approximately 43% of budget and is on average weaker in relative
comparison to the past five years that have shown a spread of 45-51 % at midyear. This is
primarily the result ofthe slowdown in residential housing construction.
2nd QUARTER BUDGET RECAP:
Overall, the 2008 2nd quarter financial performance is fairly typical to past years with no
significant expense variances. In the area of Licenses and Permits we will incur a sharp
revenue shortfall of nearly $500,000 as the economy continues to soften and building
activity further declines. However, the City has positioned itself in response to these
economic shortcomings with an organizational restructuring that will trim a number of
employee personnel as we move forward into 2009. If other expenditure reduction
measures are required they will be identified and brought back to the Council for
approval. The need for the Contingency balance of $185,000 to be reserved is also
important. Implementing these action steps as we progress further into the fiscal year
will allow the City to balance its resources against service demands.
* [2nd Quarter Budget Report represents expenditures and revenues to date and do not
include outstanding appropriations or receipt expectations.]
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