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Home My WebLink About4F - Investment Report AGENDA #: PREPARED BY: SUBJECT: DATE: INTRODUCTION: STAFF AGENDA REPORT 4F RALPH TESCHNER, FINANCE DIRECTOR CONSIDER APPROV AL OF 2ND QUARTER BUDGET REPORT AND OVERVIEW JULY 15, 1996 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" that is intended to satisfy your request. The "overview" provides information related to those areas within the budget that have experienced exceptions 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 ePort to the Quarterly Budget Report and enhance your nderstanding of performance results. Please feel free to contact me at extension 204 for more information. ~ 16200 m~~ Creek Ave. S.E., Prior Lake, Minnesota 55372-1714 / Ph. (612) 447-4230 / Fax (612) 447-4245 AN EQUAL OPPORTUNITY EMPLOYER 1996 2nd Quarter Budget Report Budget Amount Expended Percent General Government 1,209,390.00 569,515.00 47% Mayor & Council 25,110.00 11,396.00 45% Ordinance 14,675.00 3,594.00 240/0 City Manager 224,190.00 107,950.00 480/0 Boards & Commissions 5,395.00 154.00 3% Elections 4,000.00 0.00 00/0 Director of Finance 86,710.00 40,129.00 46% Accounting 57,965.00 28,833.00 500/0 Internal Auditing 9,700.00 8,825.00 910/0 Assessing 32,410.00 31,812.00 980/0 Law 186,800.00 103,215.00 55% Personnel 62,4 70.00 33,129.00 530/0 Planning & Zoning 236,320.00 91,243.00 39% Data Processing 71,825.00 27,734.00 39% Buildings & Plant 191,820.00 81,501.00 420/0 Public Safety 1,961,540.00 870,859.00 44% Police 1,491,270.00 683,020.00 46% Fire & Rescue 184,560.00 58,685.00 32% Building Inspection 268,430.00 123,496.00 460/0 Civil Defense 6,050.00 1,092.00 18% Animal Control 11,230.00 4,566.00 410/0 Public Works 733,900.00 285,825.00 39% Engineering 431,780.00 189,399.00 44% Street 302,120.00 96,426.00 32% Culture-Recreation 861,800.00 454,120.00 53% Recreation 229;150.00 119,049.00 520/0 Parks 619,385.00 330,874.00 53% Libraries 13,265.00 4,197.00 32% Economic Development 51,560.00 27,715.00 54% Debt Service 488,815.00 91,944.00 19% Contingent Reserve 140,000.00 49,847.00 360/0 Revenues 5,447,005.00 2,073,865.00 38% General Property Taxes 2,728,210.00 1,137,581.00 42% Licenses & Permits 371,710.00 250,410.00 67% Intergovernmental Revenue 1,447,655.00 267,101.00 18% Charges for Services 560,230.00 324,898.00 58% Fines & Forfeits 60,000.00 25,362.00 42% Miscellaneous Revenue 103,200.00 64,363.00 62% Other Financing Sources 176,000.00 4,150.00 2% Total Budget Expenditures 5,447,005.00 2,349,825.00 43% Total Budget Revenues 5,447,005.00 2,073,865.00 38% BR02.XLS BUDGET REPORT OVERVIEW (1996 2nd Quarter Budget Report) Expenditures: General Government · Ordinance expenditures are somewhat under budget due to the fact that ordinance codification costs have yet to be billed to the City plus legal notice expenses are down from the previous year. · Expenses associated with Boards and Commissions and Elections are typically not incurred until the latter part of the budget year i.e., December planning commission per diems, fall elections, therefore the minimal amounts. . While the overall City Attorney costs are at 550/0 of budget, general legal services (69%) are significantly higher than normal during the 1 st half of the year because the changeover of attorney firms has resulted in dual utilization until all pending files and cases are closed plus litigation activity has increased. Offsetting these increased costs are lower prosecution costs (34%) due to positive restitution cost recovery. . Personnel expenditures are slightly above due to substantial employment hiring costs i.e., advertisements, testing etc. · Planning department expenditures are down by nearly 10% because their professional service account balance of $14,000 remains unexpended to date. These dollars are scheduled to be used later in the year during the process of amending the subdivision and zoning ordinances. . Data Processing and Buildings & Plant expenses are somewhat lower than projected because the majority of the capital dollars for equipment and building improvements have not been spent to date. . General Government totals are in general conformance with budget estimates. Public Safety . Unfilled patrol vacancies for the major portion of the year is responsible for the 46% Police Department outcome at mid-year which also has resulted in extensive overtime costs. . Fire Department expenses are fairly low because over 50% of department costs are attributed to volunteer and pension contribution which is paid as an annual lump sum at year end. . 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. Public Works . Engineering expenses are lagging primarily due to the fact that only 12% of their professional service line item category has been expended which is normally reserved for consulting engineering fees that are needed for special projects. . Street Department expenses typically lag during the 1 st quarter due to the fact that a major share of its operating expenses are incurred during summer and fall. . Public Works totals are somewhat under budget estimates because we are in the beginning of the construction season. Culture-Recreation . Recreation program expenditures represent a budget performance of 520/0. . Park Department expenditures of 53% are a little higher than the nominal year to date . Library results are favorable due to the fact that virtually no repair and maintenance costs were incurred during the first half of the year. BR0296.DOC · Culture-Recreation totals are fairly consistent with seasonal expectations and budget estimates. Economic Development . The budget expenditure variance occurs within the professional services line item where $7000 has been expended relating to the Highway 13 redevelopment project. Contin~ent Reserve . Contingency expenditures to date in excess of $49,000 are primarily associated with the replacement of the squad ($20,750 in vehicle and equipment costs) which was totaled in January and $6300 for Minnesota Valley Electric power pole damages sustained in the accident. Approximately $12,000 has been paid to date on building/office repairs caused by the roof leakage at City Hall plus an additional $20,650 on a park backstop fence that collapsed due to the ice buildup. The wind storm accounted for an additional $6,000 spent to accommodate debris pickup service for the public. These emergency expenditures totaled over $65,000. We have recovered $33,000 in insurance payments subject to our annual aggregate deductible of $20,000 and depreciation allowance. [Council authorization will be requested subject to final cost determination.] The remaining contingency expenditures of $17,000 are attributed to the Lakefront Master Plan previously approved by the City Council. Expenditure Summary: 1996 General Fund 2nd Quarter operating expenditures are on track and represent 43% of the total $5,447,005 operating budget. This actually compares with 1995 2nd quarter results of 41 %. The main reason for the differential being the emergency incident expenditures within the Contingent Reserve that we have experienced this year. Revenues: . The current property tax settlement in June showed no apparent delinquency problem as collections were slightly above 49%. The first half of fiscal disparities will be remitted by the County to Prior Lake during the first week of July. . Building permit activity has picked up considerably as we have entered the summer building season as is evident by revenue collections of 62% compared to the 50% nominal for mid-year. As a result License & Permits revenue is considerably ahead of pace for the year at 67% of budget. . Intergovernmental revenue in the form of state aids and homestead and agricultural credit (HACA) is received in two installments in late July and end of December. . Charges for Services is above expectations at 580/0 of revenue realized. Again, building activity in the area of plan check fees contributed to this amount. Also several categories such as the cable franchise fee, tower antenna rental fees etc. have already been 100% collected for the year. Of some concern is Fire & Rescue revenue which is significantly below estimates ($6,000 received to date versus half year expectations of$18,750). . Fine revenue is averaging $4800 or $200 less per month than projected. . Development revenue in excess of $50,000 was earned during the 2nd quarter which is greater than the entire $35,000 budgeted for the year. . Other Financing Sources primarily consists of the $175,000 enterprise fund contribution transfer which will be transferred at year end. BR0296.00c Revenue Summary: Revenues realized are somewhat higher than typical at approximately 38% of budget which compares positively to the past five years which have shown a spread of 32-36% at mid year. Because of the increase in building related revenues, an additional $30,000 has been authorized within Building Inspection for increased inspection services due to the higher building activity. 2ND QUARTER BUDGET RECAP: Overall, the 1996 2nd quarter financial performance is fairly typical to past years. Contingency expenditures are running higher and will increase as we repair the roof structures of City Hall, Police Annex and the Library during the year. Therefore the present Contingency balance of $90,000 will be reduced by approximately $34,000 for these repairs plus an additional amount for the Smoke House. Also all labor contract settlements are still pending for 1996. As these are resolved, retroactive pay compensation will result in higher 3rd & 4th quarter personnel expenditures. *[2nd Quarter Budget Report represents expenditures and revenues to date and do not include outstanding appropriations or receipt expectations.] BR0296.DOC