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Receive and file the FY 2021-2022 General Fund - First Quarter Budget Update
<br />December 21, 2021
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<br />Partially restore funding for frozen employee
<br />positions. The estimated value of the FY21-22
<br />hiring freeze is $2,911,300.
<br />$400,000 $800,000
<br />Funding for one full-time Economic
<br />Development Specialist I position to the
<br />Community Development Agency
<br />$57,840 $115,680
<br />Funding for one full-time Records Manager
<br />position to the City Clerk’s Office
<br />$79,980 $159,960
<br />Funding for one full-time Employment Staff
<br />Attorney position to the City Attorney’s Office
<br />$94,080 $188,160
<br />Total Proposed Appropriations – Recurring $3,066,900 $6,083,800
<br />DISCUSSION
<br />The First Quarter Update covers activity posted to the general ledger during July 2021
<br />through September 2021 and the vacancy report for funded staff positions. First quarter
<br />revenue represents less than three months of receipts in many cases due to the lag time
<br />for remittance. Examples include Sales Tax, Hotel Visitors’ Tax, and Cannabis Tax.
<br />Therefore, when analyzing the revenue as of September 30, 2021, it is normal to see
<br />10%-15% revenue received to date. Whereas expenditures have much higher activity in
<br />the first quarter due to annual payments for insurance, the one-month advance for fire
<br />services, and the fact that 59% of the budget is for employee compensation paid twice
<br />per month.
<br />This update focuses on the General Fund, as it is the primary operating fund of the City.
<br />Only notable items for other funds are included in this report.
<br />General Fund Revenue
<br />During the first quarter FY21-22, the City received approximately $36.8 million in General
<br />Fund revenues, which is 10.8% of the annual estimate.
<br />Lookback to FY20-21 Sales Tax (Bradley-Burns and Measure X): Actual FY20-21
<br />sales tax exceeded the estimates reported in February 2021 by a total of $19.5 million.
<br />FY20-21 Estimate FY20-21 Actual Positive Variance
<br />Bradley-Burns $49,198,300 $54,999,505 $5,801,205
<br />Measure X 61,432,700 75,094,336 13,661,636
<br />Total $110,631,000 $130,093,841 $19,462,841
<br />The City’s sales tax consultant receives detailed data from the state, analyzes it, and
<br />provides estimates of future revenue. The pandemic and the Wayfair decision for out-of-
<br />state online vendors to collect California sales tax created an unprecedented
<br />environment, and the consultant understandably provided conservative estimates. Santa
<br />Ana is not alone, as many California cities experienced favorable sales tax results,
<br />including the state of California.
<br />EXHIBIT 4
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