HomeMy WebLinkAboutStaff Report 6986
City of Palo Alto (ID # 6986)
Finance Committee Staff Report
Report Type: Action Items Meeting Date: 6/21/2016
City of Palo Alto Page 1
Summary Title: 3rd Quarter FY 2016 Financial Report
Title: Third Quarter FY 2016 Financial Report
From: City Manager
Lead Department: Administrative Services
Motion
Staff recommends that Finance Committee review and approve the Third (3rd) Quarter financial
report.
Background
The purpose of this report is to provide the Finance Committee with information on the
financial status of the City’s General Fund and Enterprise Funds as of the end of the 3rd Quarter
of fiscal year (FY) 2016, which includes the nine-month period from July 1, 2015 through March
31, 2016.
As reported in the FY 2017-2026 General Fund Long Range Financial Forecast and the FY 2017
Operating Budget, the City’s major tax revenue streams continue to exceed expectations. As a
result, the mid-year budget changes for FY 2016 included a $4.3 million upward adjustment in
revenues, a 2.6 percent increase over the FY 2016 Adopted Budget. Expenses were also
adjusted and, after subtracting Budget Amendments authorized by Council, the net projected
surplus for FY 2016 was estimated at $3.1 million. Based on updated projections subsequent to
the mid-year budget, FY 2016 may yield an additional $3.4 million to $4.5 million in surplus
funds as a result of increased property and utility user tax revenue, and receipt of one-time sale
proceeds from the former City Manager’s house. The FY 2017 City Manager’s Proposed Budget
conservatively accounts for $3.4 million of this potential additional surplus in the General Fund
Budget Stabilization Reserve (BSR) as outlined on page 80 of the FY 2017 Proposed Operating
Budget, and includes these projections in the estimated FY 2017 BSR balance.
Attachment A contains a line by line report of major revenues and expenditures for 3rd Quarter
year-to-date (YTD), as well as a comparison to the FY 2016 Adopted Budget and Adjusted
Budget as of March 31, 2016. As part of closing the FY 2016 Budget, staff will bring forward
recommendations to allocate surplus funds. As detailed in the Proposed FY 2017 Operating
Budget, $4.9 million is recommended to be drawn from the BSR to balance the FY 2017 Budget.
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Attachment B is a revenue and expenditures report for 2nd Quarter YTD, which was
inadvertently omitted from the mid-year budget CMR #6756.
Discussion
GENERAL FUND
Revenue Highlights for FY 2016 3rd Quarter Year to Date (YTD)
Following is a table which highlights the City’s major revenue sources for the 3rd Quarter YTD,
compared to the same period of the prior year. Revenue for each period is expressed as a
percentage of Adjusted Budget.
FY 2016 FY 2015 % change FY 2016 %FY 2015 %
Inc (Dec)
Property tax 22,453$ 20,715$ 8%35,967$ 62%32,556$ 64%
Sales tax 13,143 17,703 (26%)1 28,430 46%29,238 61%
Charges for services 13,654 18,052 (24%)2 24,700 55%24,863 73%
Utility user tax 8,690 8,070 8%10,489 83%10,895 74%
Transient occupancy tax 13,794 9,400 47%21,991 63%15,901 59%
Documentary transfer tax 3,854 4,744 (19%)7,052 55%6,500 73%
Permits and licences 5,515 6,288 (12%)8,280 67%7,738 81%
Rental income 11,794 11,110 6%15,226 77%14,207 78%
Charges to other funds 8,956 8,006 12%11,929 75%10,647 75%
All other revenue sources 6,149 4,114 49%5,464 113%5,203 79%
Total General Fund Revenues 108,002$ 108,202$ 0%169,528$ 64%157,748$ 69%
1 Adjust for timing of triple flip
sales tax receipts 4,979 3,375
One-time adjustment to true-up
FY15 sales tax accrual (2,918)
2 Adjust for 2nd and 3rd Quarter
Stanford fire revenue 3,765
GF Revenues - Normalized 116,746$ 108,659$ 7%
3rd Quarter YTD Actuals
City of Palo Alto
General Fund Revenues
FY 2016 3rd Quarter YTD
(000's)
Adjusted Budget Final Budget
After adjusting for the one-time sales tax adjustments and the Stanford fire revenue timing
difference, revenue is up $8.1 million, or 7 percent, from prior year as of the end of the 3rd
Quarter YTD. The increased revenue is due primarily to property tax and transient occupancy
tax increases. In total, receipts are at 64 percent of Adjusted Budget, which is typical for the
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end of the 3rd Quarter due to property tax receipts which spike in the last quarter of the fiscal
year. Each of the major revenue categories is discussed in more detail below.
Following is a chart which depicts the three-year trend for major sources of General Fund tax
revenue, comparing FY 2014 and FY 2015 full year actuals with FY 2016 Adjusted Budget. As
detailed in the City’s most recent Long Range Financial Forecast, sales and property tax revenue
streams are expected to continue their upward growth trends, while other tax streams will
advance at a slower rate or remain flat. The chart is followed by a more detailed discussion of
each major revenue category.
Property Tax Sales Tax Tr Occ Tax Doc Tsf Tax UUT
FY 2014 Actual $30,587 $29,424 $12,255 $8,143 $11,008
FY 2015 Actual 34,117 29,675 16,699 10,384 10,861
FY 2016 Adj Budget 35,967 28,430 21,991 7,052 10,489
$0
$10,000
$20,000
$30,000
$40,000
General Fund Tax Revenues
FY 2014 and 2015 Actuals Compared to FY 2016 Adjusted Budget
(000's)
Property tax revenue at the close of 3rd Quarter YTD was $22.5 million, an increase of 8
percent over the same period prior year. Property tax is received from the County of Santa
Clara during the 2nd, 3rd and 4th quarters of the year, and receipts at 62 percent of full-year
budget is typical for this line item through March 31. The FY 2016 Adjusted Budget is $35.9
million, 5.4 percent higher than the prior year’s actual revenue of $34.1 million. Staff expects
property tax revenue will exceed FY 2016 Adjusted Budget by $0.7 million based on year-to-
date receipts. It should be noted that both FY 2015 and FY 2016 budget forecast include a non-
recurring receipt of $0.9 million and $1.0 million, respectively, for excess Educational Revenue
Augmentation Fund (ERAF) distributions from the County of Santa Clara. ERAF is the fund used
to collect and disburse property taxes that are shifted to/from cities, the county and special
districts prior to their reallocation to K-14 school agencies.
Property tax increases are driven by high demand in the residential sector and robust activity in
the commercial property market, which is expected to continue into FY 2017. The continued
growth in assessed values will, in turn, translate into higher property tax revenue.
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Sales tax revenue as of the end of the 3rd Quarter is flat year over year (FY 2016 - $18,122 vs FY
2015 - $18,160), after factoring out the one-time accrual change in FY 2015 and equalizing the
timing of triple flip receipts. Based on the City’s sales tax consultant updated forecasts, staff
expects this revenue will exceed the FY 2016 Adjusted Budget by $0.6 million. While sales tax
has fully recovered from its Great Recession low of $17.9 million in FY 2010, there are concerns
over future growth due to the continued erosion of brick and mortar receipts that is resulting
from steady growth in on-line retail sales. Completion of Stanford Hospital construction
projects will also reduce future sales tax revenue.
Transient occupancy tax (TOT) revenue reached $13.8 million through the end of the 3rd
Quarter, an increase of $4.4 million from prior year. Staff expects TOT will be slighty above the
FY 2016 Adjusted Budget by $0.3 million. Average daily room rates increased 9 percent from
prior year - $245 per day to $267 per day - while average occupancy rates fell slightly from 75
percent to 74 percent. The increase in number of rooms available as a result of newly opened
hotels has kept occupancy rates lower than 85 percent, which is considered full occupancy.
Two new hotels on San Antonio Road have been proposed, in addition to the expansion of an
existing hotel. These potential new revenues will be incorporated into future budgets.
Effective January 1, 2015, the TOT rate increased from 12 percent to 14 percent. The entire 14
percent rate from new hotels, plus the 2 percent increase from existing hotels, has been
allocated to the Infrastructure Plan pursuant to prior City Council direction. Following is a
comparative breakdown of the allocation of transient occupancy tax receipts:
3rd Quarter YTD FY 2016 3rd Quarter YTD FY 2015
General Fund: $ 9,227,158 $ 8,334,456
Infrastructure Plan: (8 months of receipts) (3 months of receipts)
New hotels – 12% 2,559,402 691,305
All hotels – 2% 2,007,788 373,992
4,567,190 1,065,297
Total TOT Receipts 3rd Qtr YTD $ 13,794,348 $ 9,399,753
Documentary transfer tax revenue for the nine months ended March 31 totals $3.9 million,
down $0.9 million or 19 percent from the prior year. FY 2015 YTD revenue included an
unusually large receipt for $1.3 million which was not replicated in FY 2016. Staff expects full
year revenue in the range of $6.4 million, which is $0.7 million less than was forecasted in the
Mid-Year Budget document. This revenue source is difficult to forecast because the volume
and mix of commercial and residential transactions can vary significantly from year to year.
Utility user tax (UUT) revenue for the nine months ended March 31 totals $8.7 million, an
increase of $0.6 million, or 8 percent, from the prior year. It was expected that this revenue
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stream would decrease due to the telephone UUT rate reduction from 5 percent to 4.75
percent, less water revenue due to lower consumption, and less gas revenue due to lower
prices. The declines in water and gas are partially offset by elimination of the large utility user
discount. While receipts from water, gas and electric services are in line with expectations, that
is not the case with the telephone UUT. These revenues have surged past projections.
Unfortunately, the City does not receive detailed information from telephone service providers,
making it difficult to explain this result. The Mid-Year Budget decreased UUT budgeted revenue
from $11.2 million to $10.5 million, however based on receipts through March 31 the full-year
forecast is now estimated at $12.1 million, an increase of $1.6 million from the Mid-Year
Budget.
Charges for services revenue through the first three quarters of FY 2016 is down $0.6 million
from the same period last year, after adjusting for the timing difference in billings to Stanford
University for fire and emergency services. The decrease is due to $0.3 million less revenue
from Stanford and $0.3 million less revenue for plan checking fees.
Permits and licenses revenue for 3rd Quarter YTD is down $0.8 million from the same period
prior year due to a lower number of new construction permits. FY 2015 new construction
permit revenue was higher due to VMWare and construction at various Stanford facilities. This
revenue category will be adjusted at year-end to defer a portion of revenue to FY 2017 for
those permits that are in progress at June 30.
Expense Highlights for FY 2016 3rd Quarter YTD
Following is a table which highlights the City’s expenses by function for the 3rd Quarter YTD,
and compares expenses to the same period prior year. In addition, the expense for the period
is expressed as a percentage of budget for each of the years.
City of Palo Alto Page 6
City of Palo Alto
General Fund Expenses
FY 2016 3rd Quarter YTD
(000's)
FY 2016 FY 2015 % change FY 2016 %FY 2015 %
Inc (Dec)
Police 26,790$ 25,563$ 5%36,725$ 73%34,655$ 74%
Fire 20,499 20,209 1%26,774 77%28,801 70%
Community services 17,591 16,688 5%26,521 66%24,274 69%
Public works 10,924 9,777 12%15,807 69%14,458 68%
Development services 7,530 6,852 10%12,282 61%10,895 63%
Planning and community env 6,480 5,297 22%11,139 58%9,039 59%
Library 5,794 5,802 0%8,974 65%8,641 67%
Administrative services 5,892 5,341 10%7,987 74%7,399 72%
All other departments 15,006 14,042 7%24,537 61%25,469 55%
Total General Fund Expenses 116,506$ 109,571$ 6%170,746$ 68%163,631$ 67%
3rd Quarter YTD Actuals Adjusted Budget Final Budget
Actual expenses through the first three quarters of the fiscal year total $116.5 million, a 6
percent increase over prior year. The expenses are right in line with the Adjusted Budget at 68
percent of full-year budgeted amounts.
Public Safety comprises the largest portion of General Fund expenditures – 41 percent of
actuals as of March 31. Following is the detail for Public Safety overtime expenses through the
3rd Quarter of the current fiscal year:
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Public Safety
Salaries and Overtime Expense
FY 2016 3rd Quarter YTD
(000's)
FY 2016 FY 2015 % change FY 2016 %FY 2015 %
Inc (Dec)
Police - Salaries 11,633$ 11,509$ 1%17,007$ 68%15,749$ 73%
Police - Overtime 1,536 1,497 3%1,539 100%1,500 100%
Total Police 13,169 13,006 1%18,546 71%17,249 75%
Fire - Salaries 8,330 8,400 (1%)11,918 70%12,440 68%
Fire - Overtime 1,940 1,708 14%1,560 124%1,609 106%
Total Fire 10,270 10,108 2%13,478 76%14,049 72%
Total Public Safety
Salaries & Overtime 23,439$ 23,114$ 1%32,024$ 73%31,298$ 74%
3rd Quarter YTD Actuals Adjusted Budget
Police overtime has increased $39 thousand, or 3 percent, over the same period last year. On a
combined basis, salaries and overtime are at 71 percent of budget through the first nine
months of the fiscal year. Overtime cost is primarily due to vacancies. The Department’s
overtime analysis is included in Attachment C.
Fire overtime has increased $0.2 million, or 14 percent, from the same period last year. On a
combined basis, salaries and overtime are at 76 percent of budget through the first nine
months of the fiscal year. Overtime cost is driven by vacancies. The Department’s overtime
analysis is included in Attachment C.
General Fund Budget Stabilization Reserve (BSR) Balance
The General Fund BSR balance as of July 1, 2015 was $48.2 million, of which $13.6 million was
set aside for specific purposes such as capital projects, funding of FY 2016 one-time
expenditures, and potential establishment of a Pension Trust Fund. Staff anticipates the City
could end the current year with a surplus if revenue trends continue upward through the 4th
Quarter. However, as noted earlier in this report, during the development of the FY 2017
Proposed Budget, staff closely monitored revenue and expense projections, and assumptions
for this surplus are included in the FY 2017 Proposed BSR balance. Details can be found in the
General Fund section of the FY 2017 Proposed Operating Budget on page 80. A conservative
estimate of the potential surplus has been factored into the estimated June 30, 2016 BSR
balance and it is from that balance ($40.5 million as outlined in the budget document) that the
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staff proposed a $4.9 million reduction for a $35.6 million FY 2017 beginning BSR balance.
Based on these most recent estimates, it is estimated that the June 30, 2016 balance could
reach $41.8 million compared to the $40.5 million used in the development of the FY 2017
Proposed Operating Budget. As part of closing the FY 2016 Budget, staff will bring forward
recommendations to allocate any surplus funds not already accounted for in the development
of the FY 2017 Proposed Budget, including a transfer to the Infrastructure Reserve and a
placeholder to balance the FY 2017 Operating Budget.
Following is a table that summarizes actual and projected changes in the BSR balance from June
30 2015 through June 30 2016.
FY 2016 Budget Stabilization Reserve (BSR) Summary
(000’s)
BSR Balance, June 30 2015 Comprehensive Annual Financial Report $ 48,198
Actions approved in FY 2015 year-end close CMR #6251
- Operating transfer to Capital Improvement Fund for Roth TDAs (1,000)
- Operating transfer to Capital Improvement Fund Infrastructure
Reserve (6,000)
- Operating transfer to Technology Fund for radio replacements (1,000)
- FY 2016 one-time expenditures (Ordinance 5329) (2,123)
- FY 2016 Budget Amendment Ordinances (BAOs) approved to date (2,130)
- Establishment of a Pension Trust Fund (retained in BSR) (1,305)
BSR Balance, per FY 2015 Adopted Budget 34,640 18.7%
FY 2016 Mid-Year Budget Changes approved in CMR #6756
- Budget Amendment Ordinances (various CMRs) (2,855)
- Less: BAOs approved in FY 2015 year-end close 2,130
- FY 2016 excess revenues ($4.4 M) offset by expenditures ($1.4M) 3,055
BSR Projected Balance as of FY 2016 Mid-Year 36,970
- April 2016 updated FY 2016 projections for excess revenues and
additional expenditure savings (as outlined and assumed in the FY
2017 Proposed Operating Budget balancing, page 80)
3,541
- June 2016 revised FY 2016 projections for excess revenues and
expenditure savings 1,270
BSR Projected Balance, June 30 2016 41,781 22.5%
ENTERPRISE FUNDS
Following is a summary of operating revenues and expenses for each of the Enterprise Funds
for the nine months ended March 31, 2016, including a comparison of results from the same
period last year.
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Enterprise Funds Operating Revenue
Adjusted
3rd Quarter YTD Actuals % Change Budget
FY 2016 FY 2015 Inc(Dec)FY 2016 %
Electric 92,020$ 90,832$ 1%121,966$ 75%
Water 27,029 27,040 (0%)39,117 69%
Gas 23,639 23,995 (1%)37,162 64%
Refuse 23,759 23,293 2%30,475 78%
Wastewater treatment 17,463 16,701 5%23,261 75%
Wastewater collection 12,362 11,743 5%17,757 70%
Storm Drainage 4,868 4,662 4%6,325 77%
Fiber Optic 3,523 2,783 27%4,842 73%
Airport 706 413 71%948 74%
Operating Revenue YTD 205,369$ 201,462$ 2%281,853$ 73%
Electric revenue increased slightly from prior year due to a $1.5 million increase in service
connection charges, offset by a slight decrease in kilowatt consumption. Staff anticipates that
Electric Fund reserves may have to be drawn down in FY 2016 to offset lower revenue
projections. Electric rates will increase 11 percent effective July, 2016.
Water revenue is flat for the nine months ended September 30. Rates were increased 8
percent effective July 1, 2015 and a further 4 percent on September 1, 2015, however
consumption declined 16 percent year over year which offset revenue from the rate increase.
Water rates will increase an average of 6 percent effective July, 2016.
Gas revenue decreased slightly from prior year. While consumption actually increased by 7
percent over the same period prior year, revenue from customers decreased due to lower
commodity prices, resulting in lower overall revenue. Gas rates will increase 8 percent effective
July, 2016.
Refuse rates increased 9 percent for only residential customers on July 1, 2015. Further refuse
rate changes are scheduled to take effect July, 2016.
Fiber Optic revenue increased $0.7 million due to the timing of an invoice to a commercial lease
customer - February 2016 versus May 2015. This difference will be neutralized in the 4th
Quarter.
Airport Fund 3rd Quarter YTD revenue increased $0.3 million from prior year due to increased
rental and tie-down revenue. The City took over operation of the Airport from County of Santa
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Clara during the 1st Quarter of FY 2015, so the prior year includes only seven months of
operations, compared to nine months in the current year.
Enterprise Funds Operating Expenses
Adjusted
3rd Quarter YTD Actuals % Change Budget
FY 2016 FY 2015 Inc(Dec)FY 2016 %
Electric 75,970$ 78,604$ (3%)115,409$ 66%
Water 20,134 19,366 4%32,778 61%
Refuse 19,859 18,687 6%29,697 67%
Gas 14,911 15,676 (5%)29,515 51%
Wastewater treatment 14,972 13,569 10%20,430 73%
Wastewater collection 9,479 9,237 3%14,750 64%
Storm Drainage 1,952 1,856 5%3,169 62%
Fiber Optic 1,345 1,052 28%1,989 68%
Airport 767 835 (8%)1,535 50%
Operating Expenses YTD 159,389$ 158,882$ 0%249,272$ 64%
Electric Fund expenses have decreased $2.6 million, or 3 percent, from same period prior year.
The volume of market purchases has increased due to delayed solar projects and lower delivery
of hydroelectric purchases due to the ongoing drought, while commodity market prices were
lower than expected.
Water Fund expenses increased $0.8 million primarily due to per unit commodity cost increase
from $2.93 to 3.75, offset by reduced consumption.
Refuse Fund expenses increased $1.2 million, or 6 percent, over prior year due to costs
associated with the new food scraps collection program.
Gas Fund expenses decreased due to labor credits resulting from assignment of staff to the
Water Fund, reduced customer incentives and reduced contract services expense.
Wastewater Treatment Fund expenses have increased 7 percent over the same period last year
due to overtime expense for plant bypasses and emergency work, and higher costs for
chemicals and electrical work.
Fiber Optics Fund expenses are 21 percent higher than the same period last year primarily due
to lower labor credits from Electric Fund. In the prior year, Fiber Optics received labor credits
due to their staff being reassigned to work on streetlight and traffic signal outages.
City of Palo Alto Page 11
Pension and Retiree Medical Liabilities
Long-term unfunded liabilities for pension and retiree medical continue to dominate any
discussion of the City’s long-range financial planning. City Council met in September 2015 and
again in November 2015 to discuss the unfunded pension liability. Staff had recommended
setting aside $1.3 million of the FY 2015 General Fund surplus to use as seed funding for a
Section 115 trust account. This account would be used to fund contribution gaps during
economic downturns. The Finance Committee and Council approved the recommendation.
The $1.3 million will be moved from the General Fund Budget Stabilization Reserve to the trust
account in FY 2017, and other funds will also contribute to the trust account. Staff will provide
Council with a funding and policy plan, with a goal of making annual contributions.
As of June 30, 2015 the City’s unfunded pension and retiree medical liabilities totaled $451
million, of which approximately $300 million is the General Fund share. Effective June 30, 2015
the pension liability was disclosed in the City’s government-wide financial statements as
required by the Governmental Accounting Standards Board (GASB). In addition, new
accounting standards for presentation of the retiree medical liability were enacted by GASB and
will be effective for FY 2018.
In order to slow the growth of pension costs over the long term, the City implemented a second
tier pension formula in 2011 (2% @ 60), and the California Public Employees’ Pension Reform
Act of 2013 (PEPRA) mandated a third tier pension formula of 2% @ 62 effective January 1,
2013. Following is a table which shows the employee count in each of the Miscellaneous and
Safety plans as of March, 2016. As of that date, 32 percent of the City’s full-time employees
were enrolled in Tier 2 and Tier 3 plans, compared to 29 percent as of November, 2015.
City of Palo Alto Page 12
Mar 2016 Nov 2015 Mar 2016 Nov 2015
Tier 1 6 6 Tier 1 70 74
Tier 2 2 2 Tier 2 7 7
Tier 3 3 3 Tier 3 10 8
Sub-total 11 11 Sub-total 87 89
Tier 1 106 112 Tier 1 5 5 *
Tier 2 49 48 Tier 2 0 0
Tier 3 35 34 Tier 3 0 0
Sub-total 190 194 Sub-total 5 5
Tier 1 352 369 Tier 1 4 4
Tier 2 64 67 Tier 2 0 0
Tier 3 125 101 Tier 3 0 0
Sub-total 541 537 Sub-total 4 4
Tier 1 45 44 Tier 1 59 63 **
Tier 2 0 0 Tier 2 4 3
Tier 3 2 1 Tier 3 10 11
Sub-total 47 45 Sub-total 73 77
Tier 1 6 7
Tier 2 1 1
Tier 3 0 0
Sub-total 7 8
Tier 1 1 1
Tier 2 0 0
Tier 3 0 0
Sub-total 1 1
Total Tier 1 509 531 Total Tier 1 145 154
Tier 2 115 117 Tier 2 12 11
Tier 3 165 139 Tier 3 20 19
Grand Total Misc Plans 789 787 Grand Total Safety Plans 177 184
%Tier 1 65%67%%Tier 1 82%84%
Tier 2 15%15%Tier 2 7%6%
Tier 3 21%18%Tier 3 11%10%
Tier 1 2.7% @ 55 Tier 1 3% @ 50
Tier 2 2% @ 60 Tier 2 3% @ 55
Tier 3 2% @ 62 Tier 3 2.7% @ 57
*4 @ 3%@50; 1 @ 2.7%@55
**Excludes police trainees (4/2)
Police Management
Association
Police Management
Fire Management
PAPOA
Service Employees
International Union
Utilities Management
Miscellaneous Plans Safety Plans
Fire Chiefs Association
Employee Group
IAFFCity Council and
Council Appointed
Officers
Employee Group
Management and
Professional
# of Employees # of Employees
Attachments:
Attachment A: General Fund Third Quarter Financial Report (XLSX)
Attachment B: General Fund Second Quarter Financial Report (XLSX)
Attachment C: Third Quarter Public Safety OT Analysis (XLSX)
ATTACHMENT ACITY OF PALO ALTO
GENERAL FUND THIRD QUARTER FINANCIAL REPORT
FISCAL YEAR ENDING JUNE 30, 2016
(in thousands)
BUDGET ACTUALS (as of 03/31/2016)
Adopted Adjusted Pre % of Adj
Categories Budget Budget Encumbr Encumbr Actual Budget
Revenues & Other Sources
Sales Tax 27,630 28,430 - - 13,143 46%
Property Tax 35,067 35,967 - - 22,453 62%
Transient Occupancy Tax 18,791 21,991 - - 13,794 63%
Documentary Transfer Tax 6,852 7,052 - - 3,854 55%
Utility Users Tax 11,189 10,489 - - 8,690 83%
Motor Vehicle Tax, Penalties & Fines 2,180 2,180 - - 1,538 71%
Charges for Services 25,399 24,700 - - 13,654 55%
Permits & Licenses 8,211 8,280 - - 5,515 67%
Return on Investment 824 824 - - 778 94%
Rental Income 15,296 15,226 - - 11,794 77%
From Other Agencies 1,659 1,591 - - 1,902 120%
Charges To Other Funds 11,930 11,929 - - 8,956 75%
Other Revenues 323 869 - - 1,931 222%
Total Revenues 165,351 169,528 - - 108,002 64%
Operating Transfers-In 18,589 19,141 - - 13,332 70%
Encumbrances and Reappropriation 6,934 - - - -
Contribution from Budget Stabilization Reserve - -
As Assumed in the Adopted Budget 1,732 1,732 - - - -
Total Sources of Funds 185,672 197,335 - - 121,334 64%
Expenditures & Other Uses
City Attorney 3,101 3,730 10 414 2,144 69%
City Auditor 1,175 1,261 20 843 68%
City Clerk 1,328 1,374 77 731 59%
City Council 455 482 34 28 310 77%
City Manager 3,008 3,513 250 353 2,304 83%
Administrative Services 7,635 7,987 20 122 5,892 76%
Community Services 24,804 26,521 32 2,198 17,591 75%
Development Services 11,901 12,282 41 459 7,530 65%
Fire 26,532 26,774 8 296 20,499 78%
Library 8,555 8,974 47 199 5,794 67%
Office of Emergency Services 1,051 1,184 81 89 787 81%
Office of Sustainability 423 555 76 399 86%
Human Resources 3,555 4,090 13 329 2,672 74%
Planning and Community Environment 8,900 11,139 96 1,053 6,480 68%
Police 36,859 36,725 106 274 26,790 74%
Public Works 15,017 15,807 385 1,277 10,924 80%
Non-Departmental 8,662 8,348 4,816 58%
Total Expenditures 162,961 170,746 1,123 7,264 116,506 73%
Operating Transfers-Out 1,834 5,374 - - 1,876 35%
Transfer to Infrastructure 20,877 29,258 - - 15,658 54%
Total Use of Funds 185,672 205,378 1,123 7,264 134,040 69%
6/8/2016
ATTACHMENT BCITY OF PALO ALTO
GENERAL FUND SECOND QUARTER FINANCIAL REPORT
FISCAL YEAR ENDING JUNE 30, 2016
(in thousands)
BUDGET ACTUALS (as of 12/31/2015)
Adopted Adjusted Pre % of Adj
Categories Budget Budget Encumbr Encumbr Actual Budget
Revenues & Other Sources
Sales Tax 27,630 28,430 - - 6,909 24%
Property Tax 35,067 35,967 - - 12,294 34%
Transient Occupancy Tax 18,791 21,991 - - 9,051 41%
Documentary Transfer Tax 6,852 7,052 - - 2,951 42%
Utility Users Tax 11,189 10,489 - - 5,640 54%
Motor Vehicle Tax, Penalties & Fines 2,180 2,180 - - 1,007 46%
Charges for Services 25,399 24,700 - - 9,193 37%
Permits & Licenses 8,211 8,280 - - 3,755 45%
Return on Investment 824 824 - - 525 64%
Rental Income 15,296 15,226 - - 7,851 52%
From Other Agencies 1,659 1,591 - - 775 49%
Charges To Other Funds 11,930 11,929 - - 5,984 50%
Other Revenues 323 869 - - 392 45%
Total Revenues 165,351 169,528 - - 66,327 39%
Operating Transfers-In 18,589 19,141 - - 8,882 46%
Encumbrances and Reappropriation 6,934 - - - -
Contribution from Budget Stabilization Reserve - -
As Assumed in the Adopted Budget 1,732 1,732 - - - -
Total Sources of Funds 185,672 197,335 - - 75,209 40%
Expenditures & Other Uses
City Attorney 3,101 3,730 65 510 1,462 55%
City Auditor 1,175 1,261 - 24 548 45%
City Clerk 1,328 1,374 - 56 461 38%
City Council 455 482 4 42 207 52%
City Manager 3,008 3,513 250 195 1,516 56%
Administrative Services 7,635 7,987 15 203 3,974 52%
Community Services 24,804 26,521 242 2,830 12,042 57%
Development Services 11,901 12,282 - 418 4,804 43%
Fire 26,532 26,774 51 383 13,988 54%
Library 8,555 8,974 - 336 3,907 47%
Office of Emergency Services 1,051 1,184 50 165 494 60%
Office of Sustainability 423 555 - 58 277 60%
People Strategy and Operations 3,555 4,090 15 462 1,781 55%
Planning and Community Environment 8,900 11,139 167 1,252 4,202 50%
Police 36,859 36,725 57 430 17,971 50%
Public Works 15,017 15,807 381 977 7,431 56%
Non-Departmental 8,662 8,348 3,336 40%
Total Expenditures 162,961 170,746 1,297 8,341 78,401 52%
Operating Transfers-Out 1,834 5,374 - - 1,250 23%
Transfer to Infrastructure 20,877 29,258 - - 10,439 36%
Total Use of Funds 185,672 205,378 1,297 8,341 90,090 49%
6/8/2016
Attachment C
thru 3/31/16
2014 2015 2016
POLICE DEPARTMENT
Overtime Expense
Adopted Budget $1,500,000 $1,500,000 $1,500,000
Modified Budget 1,500,000 1,500,000 1,539,053
Net Overtime Cost - see below 593,565 946,558 707,020
Variance to Budget $906,435 $553,442 $832,033
Overtime Net Cost
Actual Expense $1,711,764 $1,893,220 $1,536,498
Less Reimbursements
Stanford Communications 54,552 62,000 33,208
Utilities Communications Reimbursement 29,845 36,614 18,204
Local Agencies (A)8,905 10,417 7,630
Police Service Fees 73,934 69,570 65,195
Total Reimbursements 167,236 178,601 124,238
Less Department Vacancies 950,963 768,061 705,240
Net Overtime Cost $593,565 $946,558 $707,020
Department Vacancies (number of days)4,251 3,223 3,242
Workers' Compensation Cases 14 16 7
Department Disabilities (number of days)776 502 229
FIRE DEPARTMENT
Overtime Expense
Original Budget $1,424,414 $1,424,414 $1,382,714
Modified Budget 1,750,956 1,608,710 1,559,598
Net Overtime Cost - see below 1,012,521 94,836 532,617
Variance to Budget $738,435 $1,513,874 $1,026,981
Overtime Net Cost
Actual Expense $2,562,549 $2,171,795 $1,940,133
Less Reimbursements
Stanford Fire Services (B)776,452 658,054 500,000
Cal-Fire/FEMA (Strike Teams)50,542 184,296 111,667
Total Reimbursements 826,994 842,350 611,667
Less Department Vacancies 723,034 1,234,609 795,849
Net Overtime Cost $1,012,521 $94,836 $532,617
Department Vacancies (number of days)2,618 3,712 2,870
Workers' Compensation Cases 18 10 10
Department Disabilities (number of days)489 249 248
NOTES:
(A)Includes Animal Services contract with Los Altos and Los Altos Hills.
(B )Stanford reimbursed 30.3% of Fire Services through FY 2015. Of the FY 2016 total flat amount, $6.5 million, $500,000 estimated for overtime.
Public Safety Departments
Overtime Analysis for Fiscal Years 2014 through 2016