HomeMy WebLinkAbout5B - 4th Quarter Budget Report
MEETING DATE:
AGENDA #:
PREPARED BY:
AGENDA ITEM:
DISCUSSION:
RECOMMENDED
MOTION:
CITY COUNCIL AGENDA REPORT
MARCH 5, 2007
5B
Ralph Teschner, Finance Director
CONSIDER APPROVAL OF 2006 4th 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 4th Quarter Budget Report is a document entitled
"Budget Report Overview" for the General Fund that is intended to satisfy your
request. The 4tth Quarter Budget Reports shows the status of expenditures for
the 12 months of activity in 2006 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 :t5% 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 2006 4th Quarter
Budget Report as submitted.
Reviewed by:
1. 2006 4th Quarter Budget Summary Reports
2. Budget Report Overview (General Fund)
www.cityofpriorlake.com
Phone 952.447.9800 / Fax 952.447.4245
2006 4th Quarter General Fund Budget Summary Report
Budget Amount Expended Percent
General Government 2,145,109.00 2,068,123.00 96%
Mayor & Council 61,487.00 60,119.00 98%
Ordinance 12,000.00 10,079.00 M%
City Manager 347,407.00 311,084.00 90%
Boards & Commissions 13,337.00 9,796.00 73%
Elections 15,356.00 14,585.00 95%
Director of Finance 125,666.00 125,649.00 100%
Accounting 162,658.00 158,661.00 98%
Internal Auditing 17,100.00 17,223.00 101%
Assessing 92,100.00 92,705.00 101%
Law 283,000.00 357,418.00 126%
Personnel 98,478.00 98,576.00 100%
Communications 129,131.00 103,329.00 80%
Planning & Zoning 333,259.00 306,950.00 92%
Data Processing 160,735.00 161,208.00 100%
Buildings & Plant 293,395.00 240,741.00 82%
Public Safety 3,773,432.00 3,723,377.00 99%
Police 2,603,682.00 2,605,655.00 100%
Fire & Rescue 611,261.00 580,337.00 95%
Building Inspection 499,989.00 484,679.00 97%
Civil Defense 27,300.00 19,478.00 71%
Animal Control 31,200.00 33,228.00 107%
Public Works 1,603,914.00 1,570,921.00 98%
Engineering 556,403.00 518,644.00 93%
Street 775,672.00 783,224.00 101%
Central Garage 271,839.00 269,053.00 99%
Culture-Recreation 1,655,038.00 1,646,361.00 99%
Recreation 380,113.00 356,327.00 94%
Parks 1,185,130.00 1,204,912.00 102%
Libraries 89,795.00 85,122.00 95%
Economic Development 173,206.00 145,041.00 84%
Debt Service 1,290,035.00 1,290,562.00 100%
Contingent Reserve 200,000.00 141,689.00 71%
Revenues 10,840,734.00 11,916,678.00 110%
General Property Taxes 6,931,236.00 6,697,421.00 97%
Licenses & Permits 819,950.00 832,610.00 102%
Intergovernmental Revenue 1,127,864.00 1,155,057.00 102%
Charges for Services 1,349,784.00 1,541,067.00 114%
Fines & Forfeits 152,400.00 194,641.00 128%
Miscellaneous Revenue 197,500.00 788,731.00 399%
Other Financing Sources 262,000.00 707,151.00 270%
Total Budget Expenditures 10,840,734.00 10,586,074.00 98%
Total Budget Revenues 10,840,734.00 11,916,678.00 110%
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Enterprise Funds
2006 4th Quarter Enterprise Funds Budget Summary Report
Budget Amount Expended Percent
Utility Fund 2,956,304.00 3,125,695.00 106%
Water 1,001,802.00 1,057,692.00 106%
Sewer 1,954,502.00 2,068,003.00 106%
Water Quality 355,926.00 284,071.00 80%
Transit Services 592,068.00 487,944.00 82%
Transfers 500,141.00 500,406.00 100%
Revenues 5,429,638.00 6,828,400.00 126%
Water Utility Revenues 4,500,750.00 5,820,334.00 129%
Water Quality Utility Revenues 336,820.00 373,670.00 111%
Transit Revenues 592,068.00 634,396.00 107%
Total Budget Expenditures 4,404,439.00 4,398,116.00 100%
Total Budget Revenues 5,429,638.00 6,828,400.00 126%
BUDGET REPORT OVERVIEW
(2006 4th Quarter Preliminary Budget Report)
Expenditures:
General Government
. Ordinance expenses were down at 84% because of lower publication expenses as fewer
legal and ordinance notices were required this past year.
. City Manager costs were marginally under at 90% because the Miscellaneous expense
category of$25,000 was largely unspent.
· Boards and Commissions expenses were down at 73% of budget because a number of
planning commission meetings were cancelled.
. Legal expenditures of $357,418 exceeded the $283,000 budget estimate by 26%
because of litigation associated with the special assessment appeals while prosecution
expenses were higher as the Scott Joint Prosecution budget increased more than
expected for this year. Also, our activity level for Prior Lake was higher than that of
the other cities percentage wise and since costs are distributed on a percentage basis,
our share for the year was more.
. Communication expenditures were lower than budget at 80% because of the position
opening during 2006 which carried over into the expense categories as well.
. Planning & Zoning expenses of 92% ended lower than budget because the
professional services category was not utilized.
. Bldgs & Plant expenditures of 82% came in under budget because we realized a
savings in the areas of repair and maintenance service and utility accounts as a result
of the demolition of the old city hall.
. Remaining categories lvere in conformance with budget estimates with a favorable
overall General Government budget performance of96%.
Public Safety
. Fire Department expenses were slightly below at 95% because of the new response
call policy that reduced total response hours and overall volunteer compensation at
year-end.
. Civil Defense costs were relatively low at 71% because the new Brooksville Hills
siren replacement came in less than anticipated and we incurred virtually no repairs to
the existing sirens which are typically caused by lightning damage.
. Animal control came in higher at 107% as a result of sales tax that was applicable this
year on our contracted services with 4 Paws Animal Control Services.
. Public Safety total budget performance H'as 99% for the year in view of the fact that it
accounts for the major public service categOTY and for more than a third of the city's
entire general operating budget.
Public Works
. Engineering Department expenses were slightly below at 93% because of personnel
reorganization within the department which resulted in lower salary costs and less
overtime expenses.
. Remaining categories were in c01?formance 1vith budget estimates with overall Public
Works budget performance of98%.
Culture-Recreation
. Recreation costs were under at 94% primarily because expenditures associated with
instructor fees and seasonal employees were reduced in an effort to more efficiently
operate the summer recreation programs.
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· Parks expenditures were slightly over budget at 102% primarily attributed to
additional temporary employees that were needed as a result of the active use of the
parks and city sponsored events such as Lakefront Days.
· Library budget totals came in lower at 95% because the cost for gas utilities was
down considerably as a result of the mild winter that was experienced.
· Culture-Recreation totals were in conformance with budget estimates at 99%.
Economic Development
· Budget expenditures were below projections due to the land options appropriation
that was unexpended.
· Economic Development totals were under budget estimates at 84%.
Debt Service
· Debt Service totals were in general conformance with budget estimates at 100%.
Contingent Reserve
. The following Contingency related expenditures occurred in 2006:
1. $ 8,500.00 land use defense payment to LMCIT.
2. $10,000.00 for LMCIT insurance deductible for residential property damage
claim as a result of lift station failure due to lightning strike.
3. $33,189.00 for the LMCIT insurance reimbursement payment for the Ryan
conditional use permit litigation.
4. $90,000.00 dump clean-up restitution to Scott County.
· On an aggregate basis all Contingency expenditures totaledjust over S140, 000 when
compared to the Contingent Reserve appropriation of S200, 000.
Expenditure Summary:
Total unaudited 2006 General Operating Budget expenditures are projected to be
$10,586,074 when including outstanding encumbrances. This amount represents 98% of
the approved 2006 City of Prior Lake Operating Budget ($ I 0,840,734). These totals
compare with actual budgetary performance of 95%, 98%, and 100% for the preceding
years of 2005, 2004, and 2003.
Revenues:
· Current property tax collections resulted in a 95% collections rate. This low
collections rate is the result of the non-payment by the State of Minnesota of the
market value credit aid. When adding in delinquent receipts of past years the City
realized 97% of its 2006 property tax levy.
. License & Permit fees were slightly above revenue projections at 102%. Even though
the City experienced a marked slowdown in residential housing starts the potential
loss in building permit revenue was offset by several large construction projects Le.,
Jeffers Elementary School, Shepherd's Path project, Deerfield Industrial Park
activity, etc.
. Intergovernmental revenue was slightly above revenue projections at 102% basically
due to an increase in our municipal state aid construction (MSA) funds.
. Charges for services exceeded expectations at 114% as a result of the implementation
of franchise fees and an increase in facility rental attributed to additional antennae
leases.
. Fine revenue of 128% was the result of higher prosecution restitution payments and
increased county court fines.
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· Miscellaneous Revenue was significantly above budget at 399% due to an increase in
development contract revenue which was the result of very active development
activity in the annexation area by Pulte Homes, Toll Bros. and Tollefson. We do not
expect this level of development to carry over into 2007. Also, the City benefited
from the receipt of $122,000 plus of conduit fee finance charges that were not
programmed because these requests (Shepherd's Path) rarely occur.
· Other Financing Sources normally consists of the $250,000 enterprise fund
contribution transfer. However, this year the City did recognize one-time real estate
sale transactions related to the downtown Hastings Avenue property and the former
TJ Towing site that pushed the performance outcome to 270%.
Revenue Summary:
Total 2006 General Operating Budget revenues are projected to be $11,916,678. This
amount represents 110% of the City of Prior Lake's $10,840,734 General Operating
Budget. These totals compare with actual budgetary performance of 103%, 104%, and
104% respectively for the preceding years of 2005,2004 and 2003.
4th QUARTER BUDGET RECAP:
Overall, the majority of the 2006 budgetary financial performance was very close to
expectations on both the revenue and expense side, as the City's General Fund balance
will have increased by an estimated net amount of nearly $831,000 (includes $500,000
Building Fund contribution authorized by RS 06-064) to a preliminary unaudited
position of $5.128 million as the results of revenues exceeding expenditures. This
general fund balance amount represents a reserve of 44% based upon the current annual
budget. The above figures are not final. As soon as the City's 2006 financial audit is
completed in May, Staff will report the actual General Fund balance increase.
Virtually the entire General Fund balance increase was directly attributed to the
following three revenue sources:
1.) $122,181.00 - conduit/bank qualification financing charges (Shepherds Path)
2.) $411,428.00 - city real estate sales transactions (Hastings Ave, TJ site,)
3.) $436,127.00 - contract revenue associated with new development.
All three occurrences are extraordinary in nature and not likely to repeat themselves. We
anticipate that the regional building slowdown will continue into at least 2008. Because
of this market uncertainty and the fact that the City is committed to an appropriation of
approximately $400,000 in 2008 for the county-wide 800 megahertz emergency radio
communication system it is important that the City of Prior Lake maintain its financial
strength through a healthy general fund balance.
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