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HomeMy WebLinkAboutFY2017 2ndQuarter S � �' Cr OFFICE OF THE MAYOR 9th Floor, City Hall � 124 W.Michigan Avenue r Lansing, Michigan 46933-1694 � (517)483-4141 (voice) (517)483-4479 (517)483-6066((a) 1 Virg Bernero, Mayor TO: City Clerk Chris Swope FROM: Mayor Virg Bernero DATE: January 31, 2017 RE: FY 2017 2nd Quarter General Fund Status Report Pursuant to Section 7-110 of the City Charter, attached please find the General Fund Status Report for the second quarter of Fiscal Year 2017, "Equal Opportunity Employer" General Fund Status Report— FY 2017 2'd Quarter Please see accompanying summary detail(page 3) Revenues In total, General Fund revenues collected in the first half of Fiscal Year 2017 (July—December) were higher than the average of the past three years' second quarter collection rates, as a percentage of year- end amounts, at 57.6% compared to 56.5%. • The vast majority of Property Taxes are collected in the first month of the fiscal year. At the end of the second quarter of the fiscal year, they were higher as a percentage of budget, at 100.7%, compared to the average of the past three year's second quarter collection rates of 98.5%. Part of the difference was due to a change in timing recognition of certain infrastructure fee agreement receipts. Additionally, State reimbursement of phased-out personal property taxes for the current and two previous years was received in the second quarter and exceeded purposefully-conservative budget estimates. It should be noted that property tax collections exceed budget at this time of year, but are subject to tax appeals and other adjustments throughout the year. • As a percentage of budget, Income Tax collections were higher than the average collection rate for the past three years, at 33.9% of budget, compared to 323%. It should be noted that income tax revenues fluctuate from previous trends due to timing differences in remittances; however, the trend is consistent with that of the past several quarters. • State Revenue Sharing were on target as of the second quarter, and Fire Protection/Bad Driver Fees, received once per year, were $413,000 higher than anticipated. State Revenue Sharing and Fire Protection/Bad Driver fees are dependent on State revenue collections. • Charges for Services were somewhat lower than collection rates from the average of the same period for the last three years, at 39.5% of budget compared to 42.9% in prior years, due mainly to timing of grant administration revenues. Licenses and permits make up only 7% of General Fund revenues. In total, Licenses and Permits revenues were also on par with the average collection rate of the same period for the last three years as a percentage of year-end totals, at 24.4% of budget, compared to 24.2%. Licenses and permits make up only 1.5% of General Fund revenues. Collection rates for Fines and Forfeiture for the second quarter were lower as a percentage of year-end totals for the average of the last three years, at 31.1% of the budget compared to 41.6%, due to reductions in traffic tickets and penal case revenues. • The City's Return on Equity payment from the Board of Water and Light (BWL) for the first half of the year exceeded budgetary expectations at 53%of the budget, compared to 50%. • As �Barry, Interest and Rents were behind previous years' trends due to a change in the timing of cell tower revenue payments from previous years. Interest revenue is posted as investments mature, the timing of which varies from year-to-year. 1/31/2017 Page 1 of 3 • Other Revenues were lower as of the second quarter-end, at 29.1%, compared to previous years' averages of 38.2% because of small one-time grants received in previous years. Expenditures In total, taking into account the vacancy factor, expenditures for General Fund operating departments (excluding debt service and transfers to other funds) were within the budgetary target-- at 47.6% as of December 31, compared to a budgetary target(taking into account the timing of payroll dates) of 48.9%. All departments were within budgetary targets as of December 31, with the exception of Human Relations& Community Services, resulting from work involved from the announcement of the closing of the Magnuson Hotel; the City Clerk's Office, due to timing of elections; and the Financial Empowerment Center, due to supplies for events. Budget adjustments may be needed for the three departments, depending on reimbursements and grant amounts received. Summary For the first half of the fiscal year,total General Fund revenues were ahead of budgetary expectations, and expenditures were, with three exceptions, within budgetary expectations. 1/31/2017 Page 2 of 3 General Fund Status Report- FY 2017 (as of December 31, 2016) Avg, Percent of Year-End Actuals as of Revenues Annual Actual Percent December 31 Budget as of 12/31/16 of Budget FY 2014-2016 Property Taxes $ 38,952,000 39,228,991 100.7% 98.5% Income Taxes 33,150,000 11,202,610 33.8% 32.3% Revenue Sharing 15,655,900 4,192,670 26.8% 24.6% Licenses& Permits 1,652,500 403,574 24.4% 24.2% Charges for Services 9,153,500 3,618,550 39.5% 44.9% Fines& Forfeitures 2,960,100 920,963 31.1% 41.6% Interest& Rent 38,500 16,004 41.6% 53.5% Return on Equity 22,000,000 11,651,819 53.0% 50.6% Other Revenue 437,500 127,325 29.1% 38.2% Total Revenues $ 124,000,000 $ 71,362,506 1'1 57.6% 56.5% Less:Addition to Reserves (500,000) $ 123,500,000 Expenditures Annual Actual Percent 12/31/16 Budget as of 12/31/16 of Budget Budgetary Target Council $ 675,800 $ 285,540 42.3% 47.7% Internal Audit 202,200 60,001 29.7% 47.0% Courts 6,247,400 2,720,349 43.5% 47.6% Mayor's Office 1,050,200 491,399 46.8% 47.3% Media Center 415,600 175,051 42.1% 47.0% Financial Empowerment Center 182,100 121,940 67.0% 48.0% Clerk's Office 1,018,700 589,624 57.9% 54.2% Planning & Neighborhood Development 1,091,600 498,126 45.6% 49.6% Finance 6,063,800 2,069,863 40.9% 47.6% Human Resources 2,139,000 1,027,307 48.0% 48.1% Attorney's Office 1,880,700 748,588 39.8% 46.9% Vacancy Factor (800,000) Police 38,952,900 18,612,547 47.8% 49.0% Fire 33,612,300 16,436,116 48.9% 49.3% Public Service 10,867,100 5,246,418 48.3% 49.7% Human Relations & Community Service 1,249,200 632,420 50.6% 47.2% Parks & Recreation 7,893,900 3,600,826 44.3% 48.5% Subtotal- Departmental Budgets $ 111,742,400 $ 53,215,115 47.6% 48.9% Human Services & City Supported Agencies $ 1,868,900 $ 794,456 42.5% Library Lease 165,000 72,228 43.8% Debt Service 1,046,200 74,815 (2) 7.2% Transfers 8,678,500 8,518,047 98.2% Subtotal- Non-departmental Budgets 11,757,600 9,459,545 Total General Fund $ 123,500,000 $ 62,674,660 Please see Pages 1 and 2 for an explanation of revenues and expenditures. Note: Year-to-date revenue is greater than expenditures at this time of year,as property taxes, accounting for 31% of General Fund revenues, are collected at the beginning of the year, property taxes include delinquent amouts that will-be-rLtrttb-urse-d-bythgcounties-upon-settlement.-Property-tax-collections-exceed budget at this time of year, but are subject to tax appeals and other adjustments throughout the year. czf The majority of General Fund debt service is paid in the fourth quarter of the fiscal year. Page 3 of 3