65C - MID YEAR BUDGET UPDATE - Laserfiche WebLink

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Fiscal Year 2018-19 Mid -Year Budget Update February 5, 2019 Page 5 Residential Project, Tiny Tim Plaza, Eight Eight 8, and Metro East Mixed Use Overlay have contributed to the increase plan check and permitting revenue(s). The current year budget estimate is aggressive compared to actual FY17-18 receipts, and at this time staff is not comfortable recommending a further increase of the estimated revenue for FY 18-19. Non -General Fund Revenues: Highway Users Fees (Gas Tax) As of January 2019, the League of California Cities fiscal policy consultant has revised statewide estimates related to the following Gas Tax Revenues: Section 2103 $2,616,930 $1,199,846 <$1,400,000> RMRA $5,668,325 $5,363,588 <$305,000> The estimated spendable fund balance at June 30, 2019 will decrease from $14.5 million to $12.8 million for the Special Gas Tax Fund, because of the reduction in revenue (noted above) in the amount of $1.7 million. Staff will continue to monitor any revisions to the projections related to Gas Tax and adjust the current year Capital Improvement Program (CIP) accordingly. General Fund Expenditures Overall General Fund expenditures through December 31, 2018 (July 2018 through December 2018) total $126.0 million, which is a $7.2 million increase from the prior year (Exhibit 3). The increase is largely because of increase of the City's payment to CalPERS for the unfunded liability. Specific expenditures are discussed below. If there is no discussion, then there is no significant variance expected for a budgeted expenditure. Department Expenditure Analysis Police Department overall is under budget (48%) through the second quarter. However, for the first half of the year, the Department has incurred $1.0 million in overtime expenditures that exceed the budget. This is consistent with prior years, where overtime expenditures exceed the budget and staff vacancy savings are used to pay for it. The budget for vacant police officer positions is $2.8 million, which appears to be sufficient to pay for expected overtime in excess of budget during FY18-19 of roughly $2 million. The Police Department expects to hire staff prior to June 30, 2019, and will have the remaining $0.8 million of the $2.8 million available. A majority of departments are trending at or below expenditure norms of forty-nine percent (49%) through the second quarter (July 2018 — December 2018) with the exception of the Fire suppression/EMS Services; City Council; and City Attorney. The current expenditures for the Fire suppression/EMS Services represent seven months of payments during the first half of the year as required by the Orange County Fire Authority contract. Both City Council and City Attorney departments have experienced increases in Salary and Contractual Services during the first quarter respectively. Staff will monitor expenditures in the upcoming quarter. However, at this time, no budget adjustments are proposed. 65C-5