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G.5 FY2019-20 Year-End Actuals & F2020-21 Year-End ProjectionCITY OF GRAND TERRACE YEAR-END REPORTS FY2019-20 ACTUALS / FY2020-21 PROJECTIONS March 9, 2021 2030 MISSION •To preserve & protect our community & its exceptional quality of life through thoughtful planning within the constraints of fiscally responsible government. PURPOSE OF REVIEW •To notify City Council of any significant variances in revenue and expense projections; •To provide City Council with year-end actuals and projections, and show how the variances affects Fund Balance; and •To propose adjustments to preserve the City’s reserves, if necessary. FY2019-20 YEAR-END ACTUALS JUNE 30, 2020 FY2019-20 ACTUAL REVENUES 2019-20 Year-End Proj. 07/28/2020 2019-20 Year-End Actuals 02/26/2021 Variance REVENUES Property Tax $2,041,758 $2,052,014 $10,256 Residual Receipts -RPTTF $1,911,591 $1,911,591 $0 Residual Receipts -Housing $1,440 $1,440 $0 Franchise Fees $469,286 $549,823 $80,537 Licenses, Fees & Permits $311,720 $389,162 $77,442 Sales Tax $714,470 $833,919 $119,450 Intergovt Revenue/Grants $35,937 $46,400 $10,463 Charges for Services $116,422 $132,507 $16,085 Fines & Forfeitures $69,653 $66,667 ($2,986) Miscellaneous $625 $4,346 $3,721 Use of Money & Property $73,939 $80,045 $6,107 Transfers In $0 $94,608 $94,608 Waste Water Receipts $318,349 $318,349 $0 TOTAL REVENUES $6,065,189 $6,480,871 $415,683 FY2019-20 ACTUAL EXPENDITURES 2019-20 Year-End Proj. 07/28/2020 2019-20 Year-End Actuals 02/26/2021 Variance EXPENDITURES Salaries $1,235,505 $1,255,047 $19,542 Benefits $809,160 $824,208 $15,048 Professional/Contractual Services $3,322,302 $3,410,511 $88,209 Materials & Supplies $246,099 $277,838 $31,739 Lease of Facility/Equipment $19,323 $13,392 ($5,931) Utilities $143,858 $130,555 ($13,303) Overhead Cost Allocation ($87,450)($56,558)$30,892 Transfers Out $125,800 $180,377 $54,577 TOTAL EXPENDITURES $5,814,597 $6,035,369 $220,772 REVENUE & EXPENDITURE SUMMARY REVENUES $6,065,189 $6,480,871 $415,683 EXPENDITURES ($5,814,597)($6,035,369)($220,772) NET -USE OF FUND BALANCE $250,592 $445,502 $194,910 ❖Revenue:$6.481m ❖Expense:$6.035m $ .446k ➢6/3/2020:$1.011M 17% ➢Net Inc:$ .346k $1.357m 22% REVENUE & EXPENSE FUND BALANCE FUND BALANCE –GENERAL FUND FY2020-21 YEAR-END PROJECTIONS CHANGE IN METHODOLOGY •On Dec. 30, 2020, SB County informed redevelopment agencies and affected taxing entities (ATEs) of a methodology change regarding the distribution of Residual Redevelopment Property Tax Trust Fund (RPTTF) monies. •The re-distribution was to take effect on January 1, 2021. CHANGE IN METHODOLOGY •This was based on the appellate court’s decision City of Chula Vista vs. Sandoval & Southwestern Community College District. •SB County stated that the effect may reflect a 13% reduction to City allocations. HDL’S SUMMARY 1.The trial court ruled in favor of Chula Vista; meaning the distribution of San Diego County’s RPTTF is the same method as SB County: If a taxing entity received 100% of its full share of tax increment from its pass- through agreement, it will not receive a portion of the Residual RPTTF. HDL’S SUMMARY 2.The appellate court ruled that the pass-through agreements are independent of one another: Pass-through amounts & residual RPTTF amounts are to be allocated without regard to one another. HDL’S SUMMARY Meaning, a taxing entity with a full (100%) pass -through agreement can still receive a share of the residual RPTTF. 3.Since the Supreme Court denied review of the case, the Appellate Court’s decision is final. Net Effect: 33% reduction in residual RPTTF for the City. FY2019-20 ACTUAL REVENUES 2019-20 Year-End Proj. 07/28/2020 2019-20 Year-End Actuals 02/26/2021 Variance REVENUES Property Tax $2,041,758 $2,052,014 $10,256 Residual Receipts -RPTTF $1,911,591 $1,911,591 $0 Residual Receipts -Housing $1,440 $1,440 $0 Franchise Fees $469,286 $549,823 $80,537 Licenses, Fees & Permits $311,720 $389,162 $77,442 Sales Tax $714,470 $833,919 $119,450 Intergovt Revenue/Grants $35,937 $46,400 $10,463 Charges for Services $116,422 $132,507 $16,085 Fines & Forfeitures $69,653 $66,667 ($2,986) Miscellaneous $625 $4,346 $3,721 Use of Money & Property $73,939 $80,045 $6,107 Transfers In $0 $94,608 $94,608 Waste Water Receipts $318,349 $318,349 $0 TOTAL REVENUES $6,065,189 $6,480,871 $415,683 RPTTF DISTRIBUTION: JAN2021 Grand Terrace Successor Agency (S/A) RPTTF Distribution (San Bernardino County), January-2021 No. Original Allocation % Actual Distribution %Variance RPTTF Allocation Cycle 20-21B 20-21B 1 RPTTF Deposits $7,026,859 $7,026,859 2 County Admin Deduction ($119,090)($119,090) 3 Pass Throughs (3,160,626)(3,160,626) Net RPTTF $3,747,143 $3,747,143 4 S/A ROPS $283,438 $283,438 5 Residual Revenue $3,463,705 $3,463,705 RPTTF DISTRIBUTION: JAN2021 Grand Terrace Successor Agency (S/A) RPTTF Distribution (San Bernardino County), January-2021 5 Residual Revenue $3,463,705 $3,463,705 6 City $1,022,046 29.51%$691,745 19.97%($330,301) 7 County General Fund $440,462 12.72% 8 Special Districts $568,160 16.40% 9 K-12 Schools $1,336,166 38.58%$918,954 26.53%($417,212) 10 Community College $208,251 6.01%$154,803 4.47%($53,448) 11 County Office of Education $22,617 0.65% 12 ERAF $897,242 25.90%$666,964 19.26%($230,278) Total $3,463,705 100.00%$3,463,705 100.00%($1,031,239) REVISED PROJECTIONS •Staff thoroughly reviewed all revenue & expense projections, taking into consideration the following: 1.Consistent revenues within the last 2 years; 2.Delays in receipts, yet being able to record the revenues in the appropriate fiscal year; 3.Meeting with the City’s property tax and sales tax consultants for revenue projections; 4.Reallocation of COVID-19 related revenues & expenditures into its own fund. FY2020-21 PROJECTED REVENUES Adopted Budget 6/23/2020 Proposed Adj. 7/28/2020 Approved Budget 7/28/2020 Proposed Revisions 3/9/2021 Proposed Budget 3/9/2021 REVENUES Property Tax $1,971,250 $111,343 $2,082,593 $90,000 $2,172,593 Residual Receipts -RPTTF $1,668,400 $129,763 $1,798,163 ($450,000)$1,348,163 Franchise Fees $445,000 $0 $445,000 $150,000 $595,000 Licenses, Fees & Permits $329,090 $0 $329,090 $15,000 $344,090 Sales Tax $725,000 $25,000 $750,000 $100,000 $850,000 Intergovt Revenue/Grants $160,000 $0 $160,000 ($125,000)$35,000 Charges for Services $100,300 $0 $100,300 $0 $100,300 Fines & Forfeitures $35,100 $34,900 $70,000 $0 $70,000 Use of Money & Property $67,500 $0 $67,500 $0 $67,500 Wastewater Receipts $318,349 $0 $318,349 $0 $318,349 TOTAL REVENUES $5,819,989 $301,006 $6,120,995 ($220,000)$5,900,995 FY2020-21 PROJECTED EXPENDITURES Adopted Budget 6/23/2020 Proposed Adj. 7/28/2020 Approved Budget 7/28/2020 Proposed Revisions 3/9/2021 Proposed Budget 3/9/2021 Salaries $1,083,626 $125,000 $1,208,626 ($30,000)$1,178,626 Benefits $1,066,209 $57,500 $1,123,709 ($100,000)$1,023,709 Prof/Contractual Services $3,337,646 $100,000 $3,437,646 ($50,000)$3,387,646 Materials & Supplies $211,351 $0 $211,351 $0 $211,351 Lease of Facility/Equipment $19,323 $0 $19,323 ($6,000)$13,323 Utilities $143,858 $0 $143,858 ($10,000)$133,858 Overhead Cost Allocation ($87,450)$0 ($87,450)$0 ($87,450) Transfers Out $135,800 $0 $135,800 $0 $135,800 TOTAL EXPENDITURES $5,910,363 $282,500 $6,192,863 ($196,000)$5,996,863 FY2020-21 PROJECTED EXPENDITURES Adopted Budget 6/23/2020 Proposed Adj. 7/28/2020 Approved Budget 7/28/2020 Proposed Revisions 3/9/2021 Proposed Budget 3/9/2021 REVENUE & EXPENDITURE SUMMARY REVENUES $5,819,989 $301,006 $6,120,995 ($220,000)$5,900,995 EXPENDITURES $5,910,363 $282,500 $6,192,863 ($196,000)$5,996,863 NET -USE OF FUND BALANCE ($90,374)$18,506 ($71,868)($24,000)($95,868) NEXT STEPS NEXT STEPS •The City Manager has reached out to the League of CA Cities; the League is communicating with other affected cities assessing all options as to how and when to proceed with engaging the State regarding the negative impact to the cities of the redistribution of residual RPTTF. NEXT STEPS •The City Manager will be contacting our Assembly and Senate representatives to discuss the negative impacts of the residual RPTTF redistribution and how to best engage the State. QUESTIONS?