HomeMy WebLinkAbout0460.091October 17, i9~1
THE HONORABLE CITY COUNCIL
Palo Alto, California
Attention~ Finance committee
1990-,.1 yEAR .... Eh=n J'INAN'CIA!. StJKltiAR'f/CAPITAL -.l!ll?ROYEXENT PROGRAM:
leI?) FlXAHC+AL STAT OS REPOR~ AND BUDGET CLOSING
Members of the Council:
Report ill Brief
The followinq report compares the results of the City's General
Fund and Enterprise Funds operations to the adjusted budget for the
1990-~'n fiscal year. The Comprehensive Annual Financial Report
(CAFR), which will be published in December 1991, will contain all
the actual financial results for fiscal year 1990-91~ The focus of
this report is only on budget-to-actual variances, a,d is prepared
on a slightly different basis than the CAFR. The CAFR ~ill also
reflect any subsequent changes made by the City's external
auditors.
Staff recomEends that Council adopt the attached ordinance
officially closing the 1990-91 budget.
General Fund operating results for tne 1~90-~1 fiscal year ~ere
more favorable than had been anticipated at the time of the Midyear
Report. Whereas t.he midyear budget projections anticipated an
operating aeficit of $2.3 million, total cevenues exceeded total
expenditurp,s on a budgetary basis by approximately $300,000.
CMR:46D:91
•
k
I
o o
The Rsserve for CapLtal Projects will be dr8~n d~~n by $1,136,O~O
in order to fund all required General Fund reserves (ReServes for
Advances to Other Funds, Inventories/Notes Receivable). Offsetting
this draw are the sale of the Seale Well site ($607~50D) and the
closure of several capi tdl improveIn€:nt projects {$949, (l00) . The
res~ltin9 balance of th~ Reserve for capital Projects, $5.4
million, is virtually unchanged from a year ago.
Genera,l Fund revenues ~£re highEr than expected bj $500,000, or 1
percent, mostly in fines and penalties, and service fees and
pe:n\its. Expenditures 'Were $1. 9 million (3 percent) lower tt~an
projected, due in great part to one-time factors that are not
likely to recur: a $1.2 million favorable variance in general
liability expenF.ie J and a reversion of $700,000 in the unspent
BUdget Advance Reserve.
Utility user tax revenues 'Were originally expected to exceed
expenditures; however. actual revenues were lower than had been
anticipated.. Due to the cloSing of completed projects, the
unappropriated fund balance in the Reserve tor streets anc:1
Sidewalk Project.s increased by $267,000 to $634, oeo ..
Enterprise Fund revenues 'Were $3.1 mill.ion short of budget
projections. However, savings in every expenditure: category
totalled $12.4 million, and serve.d to increase reserve balances
where decreases had been anticipated. The large savings were
experienced in utility Purchases ($4 .. 3 million), General Expenses
{$2 .. 4 million), unspent Contingency Reserves ($2.4 million) and a
reduced Utilities administrative expense allocation ($1..4 million).
CMR:460: 91
,,--.-.,.---. ---'~-
"" ,.#~
OOoJRTH QlJARTER FtNANCIAl SUMJ:JV
GENERAL FUND
GENERAl. FUNO REVENUE A.ND EXPENDITURE SUMMARY
(in thousands of dOnars)
Other financial sources {uses}:
Operatifl9 Transfers in:
Street improV€l:-,lenl Fund
Federal RelolSElue Fund
Specja~ Oistrict Fund
Enlerprise Fur.ds
Other
Total Operating Tran srers In
Operating Transfers out"
Debt Servfc& Fund
Capital ImprOvtlmenl Fund
Total' Operating Transfers Out
Net operati ng transfers
Excess of Re~n ue & Ot.>'er
Fll1a1lcing Sot! rees
over (~nder) expencltures
& other financing uses
Transfer 10 (From) Reserves:
Reserve for Capiia: prOjects
Reserve 'Of Stre~tSlSidewalk 5
Reserve for General COl:iingencie
YE'acEnded June 30 19S'
Adjust€d Actual +
~sm Enc,'-~:.
15 135
81 81
-110 110
13,651 13,E52
41 24
13,898 14,002
946 889
7491 7.173
8,437 B,~2
5,461 5,940
(2,539) 328
(2,683) (1,''')
129 2£7
(650) 0
Res. for lnventoryfNotes Receivable 626
Acrvances to Other Funds 665 571
Total to (fr<;;m) Reselves (2,539) J28
CMR:460:91 4
Variance
Favorab~e
rUn'aVOf.l
120
0
(
1
M
104
57
318
375
479
2,867
1,547
138
6S0
626
(94)
2,867
Year Ended'
6/30:90
~
84
51
273
14,471
lQQ
14,979
978
9001
9,979
5,000
1,599
(L050)
2,000
(153)
415
2,811
..
I
i
o
Banlta} Fun4 .av'nu' 4p4 lap,sOftu;. B~
Rl!VmIUEB
70000
Revenues and Other Sources of funds
Budget to Actual Comparison
General Fund
fiscal'... Ended 6/30/1'_
CMR:460: 91 5
-" . c .. ....
co-.. I .... c~ VIe
Sal.. Tax
&djuste~ Budget
$14,100
,-
/
~ot"al
$14,140
,~
.j
varianoe
$ 40
Adjusted projections for sales tax were jus~ oye~ one quarter of
one percent below actual receipts. The origlnal projection 'Was
revised downward at midyear Que to the recessio~, and lo~er than
expected receipts for the first two quarters of the year. The
actual increase from 1989-90 to 1990-91 is 2 percent.
SALES TAX VS. CPI LEVEL
15000 ~------------------------------rl'O
14000
130
nooo
120
12000
---0--SAUS TAX
11000 110 --+---CPI
10000
j 100
9QO()
8000 .!2;:=;==;:::::;:::::;:::::;::::::;:::::::;:::::::;==:;=}-90
fJSCAl YE4R
CHR:460:91 6
,
..J
i
Prcpertl' 'I'&JC
Adjusted Budget
$7,921
Ac.~
$8,109
var_tance
$ 1SS
Property tax revenu~s in 1990-91 showed an increase of 2 percent
over the midyear adjusted projections. At midyear an increase of
$35,000 was projected~ This included an increase in unsecured
property tax, and a decrease in secured property tax to ccmpensate
for the fees beinq charged by the county for the processing of
property taxes. The increase over projection -was primarily in
secured property taxes.
Utility Users Tax
Adjusted Budget
$5,200
Actual
$4,969
Variance
($231)
Utility user tax is received from city 'Water, qas and electric
users and from the telephone companies who collect it from their
customers. Actual revenut:::i ... era 4 percent belo,", the revised
projections and 3 percent above last year actual revenues. This is
in keeping with lower sales in ...... ater. gas and electric 'Wpen
compared to budget. In addition, no increase in telephone receipts
were re_alized, although a 3 percent H'!crease "",as projected ..
Transient oeeup.n~y Tax
AdjusteQ __ Budget
$3,161
Actual
$2,969
Variance
($192 )
Revenues from th is source ..... ere down 6 percent tro:rt"t the budget
pZ'ojection and 2 percent from last year ~ In tr.e third quarter
revenues fell 11 perce"t belo..., the 1989-90 third quarter as
occupancy ra~es in March ~ell 9 percent from the previous March ..
Bot_h the recession and fear of terrorism due to the international
situation reduced business travel signi~icantly ..
other Taxes
Ad.iJJ..sted Budget
$2,45B
ActUM
$2,41S
Variar:Lc..E
($43)
Revenue from other taxe~ was 2 percent belo~ the midyear projec~ion
even though the projection had been reduced by $100,000. The main
component of other taxes is the motor vehicle in lieu ta~1 which is
CMR:,,60:91 7
,
i
•
o
based on automobile registration. The 641e of new automobiles ~as
down due to the recession and as a result registration fees were
lowoer tha.1 expected. Document transfer tax and cigarette tax -were
also slightly less than projected.
7i~ ••• D~ Pen<ies
Adjusted Budget
$989
.,;..r-tu31
$1,222
Variance
$233
projections for police fines ~er~ reduced by $200,000 at midyear
bec2llse actual revenues were falling far short of budget. staffing
shortages and transition problems associated with a cr."nge in
vendors for collection of parking violation receipts resulted in
the d~wnward re-estimate. In the second half of the fiscal year,
however, processing of the parking fines by the vendor, West
Computil, improv~d somewhat, and staffing in the Police Department
came up to full strength. As a result, fines were within $40,000
of the original .budget amount.
Fire protection and Emerqency ccmmunicaticn service.
Adjusted BUdget
$3,444
Actual
$3,561
The favorable variance in Service Contracts is due to the city's
receiving a prior year adjustment from Stanford for fire services.
Stanford pays a percentage of actual expenditures, and Fire
expenditures were higher in 1989-90 than originally budgeted,
primarily in Employee Services.
Interest Income
,Adjusted Budg.et
$2,000
Actual
$1,919
Variance
($ 81)
Interest income for the General Fund fell short cf adjusted budget
due to a change in the accounting me.thodology for 3.11ocating
interest earnings from tl.1e City's portfolio to the various fund
cash balances. council may recall that the City's self-insurance
program and related reserves "Were reclassified from the General
Fund to a separate Internal service Fund in fiscal year 1999-90.
This r02sul ted in a higher allocation of interest income to the
Internal Service Fund (and concomitant decrease in General Fund
interest earnings) than had been incorporate.d in the 1990-91
:budget.
CMR:460:91 8
service F •••• n4 Permits
A...djusted~~
$5,908
Actual
$6,169
variance
$ 261
service Fees and Permits revenue · ... as 4 percent oyer projections~
Positive var-ian<:es occurred in the Fire ($205,000), Information
R~sources ($79,OOO)~ and Plan~ing ,$135,000) Departments. A
short.fall in projected revenue in C011l1!lunity Services of $228,000
offset these variances:
'" Paramedics Revenue. -Actual revenue was $lr;O,OOO over the
budge.t of $535,000. An in-::-rease in the m1mber of transport.s
~as th~ largest contributor to the reven~e increase. When
stafiinq levels were available, the Fire DepartmerJt ran a
second paramedic unit which ans't.·ered transport calls normally
serviced by the county.
o Cable eranchise Fee -The $79,000 increase over budget is due
to the renegotiation in February 1991 of the Cable Co-Op
franchise which reinstated the q:uart-;,rly payment and franchise
fee..
o
o
Planning Department -Inspection Ser-vices revenue was flat
compared to 1989-90 actuals but vas $283,000 over the 1~90-91
~udget. Because building inspection is a cyclical business
and c!ependent upon the ecor.o1llY, actuals can swing from year-to
year -hence the conservative budget projection. Planning
Division's revenue was lower by $148,000 indicating a leveling
off in discretionary ~uilding activity.
Recreation and Golf Course fees -Golf Course revenue W'as
$21,000 below budget trom lower rounds of golf played due to
the effects of the drought on the gel! course greens.
Recreation revenue ~as $160,000 belQ~ budget, due in part from
staffing changes, but a ::;Jore significant factor may be the
recE'.ssion.
OPERATING EXPENDITURES
The discussion and analysis which folloW' include encumbrances and
reappropriations in the actual amounts shown on the Fourth Quarter
Financial Summary i0r the Ceneral Fund. It is important to note
that thi~ is a different mode of presentation than that used in the
CAF'R 1 since the CAFR does not recognize encumbrances or reappropri
ations as expenditures. Howeyer~ their inclusion is neces$ary for
an accurate budgetary analysis.
=:460:91
• i
i ..
70000
60000
soooo
40000
o
Expenditures and Othe r Uses of Fund 5
Budget to Actual Comparison
General fund
FiscaT Year Ended' 6/30/19_
CKR:460:91 10
'.
----Go--Budgeted Expenciture:s
~ AcWOliI Expenciturl!S
,
~ ,
r
Salaries , Benefits
l\djusted Budget
$39,185
Actu?!l
$40,283
.. --~-'
Variance
($1,098)
Actual e>ependituras for Employee Services were 3 percent over
budget. As discussed and adjusted in the Mid-Year Rsport,
vacancies were projected to save $530,000 through the end of the
l"ear due to a selective hiring freeze. The actual savings from
such vacancies was $106,ODO, resulting in a $424,000 unfavorable
v&ria~e from budget4 Another $128,OOQ variance resulted from the
adoption of the 3 percent variable management compensation instead
of the 2 percent which ~as included in the budget. The remaining
overage in benefits is due to larger increases in health, dental
and lite insurance costs. While a 14 percent increase in these
benefits -was bUdgeted, a 28 percent increase ..... as realized over
1989-90 actuals.
Adjusted Budget
$ 6,993
Actll.Jtl
$ 6,483
Variance
$ 5~0
The favorable 7 percent variance in Contract services includes a
$100,000 savings in the Public Works department tree line trimming
contract. The City is completing a three-year cont~act for line
clearing, ~hich ..... ill be adjusted to reflect the efficiencies of a
cQmputerized inventory system, and fewer trees and less gro~h due
to the five-year drought. An additional $87,000 savings in Public
Work's Storm Draina.ge program reflects less usage of emergency
repair services due to the drought conditions.
Legal Services in the City Attorney's Office was under budget by
$182~700 as tha new City Attorney restricted the use of outside
legal counsel in order to assess the: ""orkload capacity of his
office. This type of savings is a one-time occurrence. outside
litigation expenses, which were 10. in F~ 1990-91, can vary
dramatically year to year.
Supp~iea and K4terials
Adjusted Bugget
$ 2,381
-'II'ariance
$l:n
Supplies and Mate:rials expense was lo~er than budgeted in Public
Works by $60,000 due: to fewer necessary sidewalk and storm drain
CMR:46Q:91 11
•
·!....--------..... ~ ... --.------_. __ .
repalrs; and in community Se4vicas by $76,000, because of a
reduction in the use of planting material due to the drought.
General Expenses
l!...<liust~d Budget
$ 8,643
Actutl
$ 7,125
$1.2 million of t.he favorable 18 percent variance in General
Expenses is due to the citywide decrease in general liability
costs. Lower liability claims and a decrease in the esti~ated
prior year liability ~ere reported in the 1991 actuarial r~view of
the city's self-insurance program. Other savi~gs in this category
were realized on the Palo Alto Unified School District (PAUSD)
lease ($94,OOO), the Cable co-Op rcyalty revenue write-off which
did not occur due to Cable Co-op's r~financing ($71,500), and lo~er
County jail booking charges than were anticipated ($68,000).
contin.gencies
Adjusted. Budget
$ 700
Actual Variance
$ 0 -$700
The balance in the Contingency account reflects $650,000 in the
Budget Advance Reserve 'Wh.ich was not utilized in 1990-91 and
$50,000 remaining in the City Manager's non-salary contingency.
In setting up the Budget Advance Reserve the City intended to
facilitate the achieveme.nt of two year goals~ objectives, and
programs by allowing departments to pull forward their appropria
tion from the second year of the two-year budget to the first year
with the approval of the City Manager. No budget Advance Reserve
funding we:s used, however. After assessing this year's perfor
mance, staff may recom..~end eliminating this contingency reserve
from the next t...,o-year budget.
RESERVES
Th;a Reserve for General contingencies remained unchanged at $5
million as of June 30. As mentioned previouslYt the Reserve for
Streets and Sidewalks increased by $267,000. Advances to Other
Funds in the General Fund increased as a result of advances made to
the Storm Drain Fund ($1.3 million) and Gas Tax Fund ($500,000), as
discussed in the Midyear Report. Both are scheduled to be rE'.paid
to the General Fund in the 1991-92 fiscal year. In addition, the
Water Fund repaid the 1987-88 General Fund advance of $1,155,000.
CMR:460!91 12
1
"--" ~/~1'
'~.
A.fter the transfer cf $1.1 million to the General Fund" the
remaining balance in the Reserve for Capital Projects in the
CapItal Projects ~~nc is $5.41 million:
Balance 7jl/90
Additional CIP Appropriations:
Traffic Siqnal Upgrade eEl Camino/Los Robles)
Infor.mation Systems Development
Demolition cf Middlefield well Site
Sale ot Seale Well Site
Projects Funded Fron Other Sources
Transfer to General FUnd
(See page 2)
closed c~p Projects
Balance 6/3CJ191
C-"fR: 460: 91 13
$5,)97,807
(10,405)
(9{S40)
(30,000)
607,500
(356,758)
0.136.000 1
948.648
$5. ill. 252
\
1 'l!.RI
.:'"'\ r-, ~TH QUARTER FlNANCtAl SUMMIo.RW
ENTERPRISe FUNPS
REVENUE ANO EXPENDlT'JRE SUMMARY
R.e\lM\J~S:
70iaJ Sales
{merest Income
Oth6r Income
Bond Psvsnue
'Total ReveO\J9
Plus Reappropr1atians &
cl1cumb t'om PliOI' Year
Expemfrtures:
'Utility Purchases
Salaries &. Benefits
Contract services
Supplies & Materials
G'9neral Expen ses
Rents. &. Leases
Facirnies &. Equtpr.'o<6nt
Contingencies
AIlX8.too Charqes
Bad Debt Expense
Tral's{ecs:
Operating iran:.;~ers-GF
Operating Transfers-Cl?
Total Transfers
Tota,\ Expenditures
Capita,l Expenditures
CMR:460:91
On t/'lousar\dS of dOllars)
Year End(Jd Juf'le 3a,.1i.~
19~O-91
Adjusted Actual1E.ncum
~ Reappro:J
115,005 110,113
6,342 6,551
3,33B 4,282
l.lli Q
12£,005 121,546
12,660 12,58'J
56,477 52,254
11,073 Hl,732
5,836 5,304
I,R5S 1,~S4
11,913 9,524
380 52
36<l 31)4
2,351 0
12,213 10,713
ill ill
102,791 90,566
14,504 14,542
om ~
15,427 15,337
118,218 105,923
24,295 24,098
(3,B28) 4,205
14
Vanance
favorable
(Unfavcr,)
(4,292)
209
944
lJ..,~2m
(4,459)
()
4,22$
281
582
501
2,389
328
62
2,357
1,440
g
'2.205
(3B)
w
90
12,295
197
(16,951)
Year e"ded
6130190
~
105,624
6,<2'l
<,5B3
Q
116,aSS
51,605
10,510
3,327
1,381
4,055
sa
122
0
13,531
1§g
B4,731
14 ,470
~
14,99B
99,729
8,446
a,661
I
1
REVDn1ES
Utility 811.1e.
Adiusted Budget
$115 J OOS
Actual
$110,713
Variance
(4,292)
Utility sales ~ere 1.7 percent lower than projected, however there
was an overall inc.rea'5e of 4.6 percent over 1989-90 ~ctuals.
Actual sales by fund were as fol1o~s:
Sales
Adjusted 1990-91 Sales
Fund Budget liOOO) Variai'l9~ 1989-:1£1
Electric $ 63,611 62 J 554 (1,047) 59~473
Water 10,950 9,146 (1,804) 9,572
Gas 16,877 16,994 117 17,425
Wastewa't.er 12,652 11,169 (1,483) 10,476
Refuse 9,"j,77 9,180 ( 97) 8,212
Stonn Drain 1.638 1. 660 _----ll.. ___ 666
Total $ 115,005 110,713 (4,292) 105,824
The water sales budget was increased in ~ ... ~ Mid-Year Report by $1.2
1!Iillior.. to reflect the first six months 't!onsumption pattern. The
unaxpected rainfall in the spring and the overall higher
conservation awareness among all customer classes resul ted in lower
revenues and purchase costs. Electric sales were less than two
percent lower than the original budget, in part due to the milder
tamperatures experienced in the last six months of the year which
redllced the demand for air conditioning. Wastewater sales were
lower due to larger adjustments of the TreatlT,ent Plant Partner
Citie~' billings at year-end. Wastewater Collections sales were
$451,000 under projection, due to lower co::runercial and industrial
water consumptio~.
Intereat Income
CMR:460:91
Adjllnsted Budget
$6,342
15
Actual
$6,551
Variance
$209
t , .)
.. --.:,~~--....... ----
'i'he favorable vaT lance in interest income is due to a higher yield
en portfolio earnings and higher than projected cash balances
(primarily in the Electric Fund). These cash balances were
experienced in part due to a reduction of the utility hi lling
backlog and higher net operating income~
Other Income
A;liusted Budget
$3,338
Actual
$-4 I 281
variance
$944
The favorable variance is due to the receipt of unbudgeted
revenues. Refuse FUnd reven'.1CS il"'.clude $300, oeo of non-budgeted
revenue paid directly to Palo Alto Sanitation Company (PASCO)
rather than being collected through the utility billing proce~s~
The Electric Fund re.venues include ~,300, 000 of underground district
connection charges which wgre paid in this current fiscal year when
the work actually cccur:r-ed rather than in last fiscal year .,hen the
W"ork 'Was budgeted to occur ~ The Wastewater Treatment Subfund
received $150,000 from fines levied against ~ater polluters, and
th~ sale of sludge ash was $108,000 higher than projected. Cas
connection charges were higher than budgeted due to the
commencement of cer-tain large projects not anticipated in the
original budget.
OPERATING EXPENDITURES
Utilities Purchase.
Mjusted Budget
$56,477
A.ctual
$52,145
y'E!lri~_nce
$4,332
A $3.3 million savings in Ut.ility Purchases · .. .as realized in the
Electric FUnd, due in large part to successful negotiations with
Northern california Power Agency (NCPA) and the Western Area Power
Association (WAFA) in revising cost allocations for demand
optimization. The sal~ of excess power capacity from Calavaras~
and lower wheeling rates due to a recent Federal Energ}' RegUlatory
Commission ruling, also contributed to the Electric savings~
Within the Water Fund, the adjusted budget ~as increased at midyear
to accommodate increased expenditures anticipated due to continuing
drought conditions. Ho~ever, increa::.ed conservation efforts by
industrial cU5tomers helped keep purchase costs below the adjusted
projections by $980,000.
CMR: 4 60: 91 16
•
i •
SAlariea and Benetits
actual
$10,792
Variance
$281
The favorable variance reflected in Salaries and Benefits is the
result of slightly larqer-than-projected vacancies~
COhtraet servioes
Ad1usted Budget
$ 5,886
Actual
$5,J04
variance
$582
contract Services sho'Wed a $39:2 1 000 savings due to a decrease in
the number of stucUes required by the Regional Wat.er Quality
Control Board. The Cas Fund decreased contract services by $47,000
through a reduction irl the scope of the block. books update, which
enabled associated drafting services to be provided in-house rather
than through contracted services. In addition, a Department of
Transportation consultant study and gas leak survey ($47,SOO) vere
canceled after a Federal review of City records found them to be
already in compliance vith Federal mandates.
Suppliea BAd Kat.rials
Adjuste-d Bud~
$.1,955
A£tual
$1,454
Yariltnce
$501
The favorable variance experienced in Supplies and Materials is
primarily duE' to continuing 'Water conse-rvation efforts, which
rE:.sultG-d in fewer treatment platlt pump replacements {$43, 000) and
less treatment chemicals purchased ($166,000). Purchases of top
soil and tounaation :rnateri~l at the landfill "",ere less than
expected ($153,000) due to the laCK of rain, ~hich resulted in less
erosion.
A,.diusted Budget
$11,913
Actual
$9,524
Variance
$2,3S9
The favorable variance in General Expenses was due in large part to
the advantageous interest rate achieved (5.7 percent actual vs~ 3.S
percent budgeted) on the bond refunding in the Waste ..... ater Fund
($281,000). Bond principal payments are included in the Wastewater
CMR:460:91 17
.;
---___ t ... »~'_·~.·· ... · ..... t$ •. ..-, ........ >< •. -' .... "-"·'-'~---.... r .. __ 1IIt
~.
"
:~ operating budget in order to calculate appropriate rates. While
these payments are made. only the lnterest is expensed to reflect
proper accountinq practices. As a result, yearend operating
reports shoW' a "saVings:' of $838. 000. NCPA Joint Agency debt
service costs ~ere $850,000 less than projected, partially due to
the sale of Calaveras capacity-share po'Wer to Roseville. Debt
service. principal and interest .... ere budgeted in Storm Drainage
based on the anticipated issuance of bonds, 'Which was postponed
until FY 19'91-92. This l"esulted in ~ savings of $115,500.
Finally, qeneral liability expense allocations were less than
projected by $544,307.
Rente and Leases
bdil.lsted B_udget
$380
".ctu<! 1
$52
Variance
$328
Savings in the Rents and Leases category were realized due to the
postponeme~t of the Utilities move.
continqeneies
Adjus_ted Budget
$2,357
Varian~
$2,357
The favorable var iance reflected in the Contingency category is due
to not using the Budget Advance Reserve. As WiLh the General ~~nd
Advance Reserve, the additional funding remained available at year
end.
Allocate4 Charges
Adjusted Budcret
$12,213
ActUal
$lU,812
Yariance
$1,-401
The favorable variance in Allocated Cilarges is attributable to a
decrease in the Utilities Administration actual expenditures~ 'Which
are spread to the various Enterprise Funds. These savings are due
to the delay of the Utility Eilling system (~193,OOOl: an RFP was
sent out in September 1991 and the procureme .. t is projected to be
completed in 1991-92. In addition, the Job Management Proj ect
($165,000) was canceled. Als0 1 there: 'Was less line clearing
activity charged by Public Works due to the continuing drought
conditions, saving the Elect.ric Fund $262 1 000 1 lo .... er treatment
charges to the Water fund ($83,0001 for a delayed water reclamation
project, lower utility charges at the wQCP resulting from the use
CMR:460:91 18
"'
\
of reclaimed yatez ($40:000) and lo~er electric consumption
($56,000) due to newly-installec equipment.
RESERVES
The chanqes in Enterprise Fund Reserves and Retained Earnings Yere
as follows (in thousands of dollars):
RESERVES
-: 11/90 Projected 6130/91
1l!!lQ Balance Reserves Res~Bal. Variance
Electric 51,849 51,559 58,2:20 6,661
water 2,713 2,677 3,088 4n
Gas 12,441 11,019 11,94a 929
WaEltewater 6,977 6,549 5,357 (1.192)
Refuse 8,828 4,448 6,096 1.6.18
storm Drain 677 --~ -.W~ .......llQ
Total 83,485 77,070 86,307 9,237
Enterprise Reserve increases were the net result of lower total
revenues of $3.1 million and expenditure savings of $12~4 million.
Only the Wastewater Fund experienced a negative variance when
compared with projected reserve balances. Lower revenues in
commercial and. industrial customer classes ':Mere experienced in
Wastewater Collection due to drought-related ~ater conservation.
The resulting reserve balance proved to be insufficient to absorb
the capit~l reappropriations and operating encumbrances of
Wastewater Collections, necessitating a $300,000 advance from the
Wastewater Treatment Fund.
Recomm~_n(l.tion
staff recommends that the City Council adopt the attached ordinance
authorizing: 1} clcsir:.g of the 1990-91 Budget; :2) establishir:.g
reserves; 3) r~a~~opriatinq $1,895,695 into the 1991-92 Operating
Budget; 4) the transfer from the Reserve for Capital Projects to
the Ceneral Fund to fund the various required General Fund
reserves; 5) and closing various capital Improvement Project
balances, for projects ~hich have been completed, to the Reserve
for Capital Projects.
CMR:460:91 19
..
/
Also appended are:
.'tt~chment 1
Exhibi t A
EXhibit B
Ex.."'1ibit C
Budget Amendment Ordinance
Reappropriations from Fiscal Year 1990-91
Analysis of Reserve Balances by z.':,md
Capit~l Improvement projects Summary
Respectf41ly submitted,
CMrfr~
CARe L FERRELL
Ac~ounting Managey
/-1/ / '--------' (i, ' jel... t-. '-"\..~,'
EMILY HARRISON
Director of Finance hJQ i
WIL AM Z':;:;ER
City] Manager
CMR:46D:91
--------
20
.• . -...
-
ATTACHMENT I
ORDINANCE NO.
ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO
AUTHORIZING CLOSING ?F TKE BUDG!:T I'OR FISCAL yEAR 1>90-91
WHEREAS, pursuant to the provisions of section 12 of Arti:::le
III of the ~h.arter of the city of Palo Ai to and as set forth in
section 2.28.070 of the Palo Alto Municipal Code, the Ccuncil t:lr)
June 18, 1990 did adopt a budget for fiscal y-ear 1990-91; and
WHEREAS, fiscal year 1990-91 has ended and the financial
results, although subject to post-audit adjustment. are now
available and are herewith reported in summarized financial
exhihits prepared by the Director of Finance which are attached
hereto, and by reference made a part hereof; and
WHEREAS, pursuant to Section 2.28.080 vf the Palo Alto
M\lnicipal Code:, the City Manager did amend the budge'tary accounts
of t.he City of Palo Alto as sho'Wn on the attached exhibits to
reflect;
(A) Additional appropriations authorized by ordinance of the
City Council.
(8) Amendments to employee compensation plans adopted by the
City counciL
(el Transfers of apPLopriations from the contingent account
as authorized by the City ManaqeL.
(0) Redistribution of
programs, and objects within
the city Manager.
appropriations bet~een divisions,
various departments as authorized by
(E) Fiscal year 1990-91 appropriations which on July 1, 1991
_ere encumbered by properly executed, but uncompleted, purchase
orders or contracts; and
WHEREhS~ Article III, Section. 12 .. of the charter of the citr
of Palo Alto requires City COUncil approval of additional appropri
ations or transfers of appropriations from one departll1ent "to
another, and
WHEREAS, fiscal year 1990-91 appropriations in certain
department.'i and categories as sho ..... n on the attached Exhibit II'A",
while not obligated by purcrlase order or contract, at year-end are
nevertheless recornlllended for reappropriation in. the fiscal jrear
1991-92 budgp-t;
•
NOW, THEREFORE,
ORDAIN as follows:
the council of the City of Palo ~lto does
SECTION 1. 'the City }l!'anager is lliuthr-riz.ed and directed to
increase, if necessary, authori!ations in the utility funds by
a~ounts sufficient to provide for purchase of additional water#
qas, electric, and refyse collection services, in the event the
sales of said ut.ilities services exceed the original estimates
contained in the fiscal year 1990-91 budget.
SECTION 2. The fiscal yeJ..r 1990-91 appropriations for the
departments and categQries sho.n on Exhibit -A-shall be carried
forward and added to the fiscal year 1991-92 budget.
SECTION 3~
directed:
The City Manager is further authorized and
(A) To close the fiscal year 1990-91 budget accounts in all
funds and departments and to ~ake such interd~part~ental transfers
as required by the Charter of the City of Palo Alto, by ordinance~
or as set forth in the fiscal year 199Q-91 budget as adopted or
aID-ended.
(8) 'I'o close various completed capital Improvement Projects
and move the balances into the Reserve for Capital projects.
(C) To establish reserves 3S set forth on Exhibit -B" in the
amounts shown or as necessary to provide for:
(1, A reserve for encumbrances and reappropriations in
the vari~us funds, the purpose of which is to carry fo~ard and
continue in effect the unexpende~ bala~ce of appropriations for:
(a) OUtstanding purchase orders and contracts for
vhich goods or ser~ice5 have not been received or complet~ by the
last day of fiscal year 1990-91. Such appropriations shall be
carried forward and added to the fiscal year 1991-92 budget.
(b) Fiscal year 1990-91 departmental ~xpenditures
which ~ere authorized to be carried forward in Section 2 above.
{2) Reserves for Advances to Other Funds and for Stores
Inventory in accordance with ordinance and policy 9uidelines~
(3) Reserves fer utilities plant replacement. transfer
stabilization, system improvement, and other reser· .... es in accordance
with Charter and policy guidelines~
(4) A reserve for gen~ral contingencies of such amount
tnat the City COUncil ~ay app~ove.
(5)
the remainder
revenues over
After providing for the foregoing reserves, transfer
of the fiscal year 1990-91 excess of General fund
expenditures to the Reserve for Capital Projects~
•
. ,--:_------...--------.ii
SECTION...i.. Upon completion of the independent l1\ldit,
detailed financial statements givir.g effect to all th9 above
sections shall :be p'lblished as part of the annual financial report
of the City as required by Article Ill, section 16, of the Charter
cf the city of Palo Alto and in accordance ~ith generally ac~epted
accountinq principles4
~.I.QlL...2. The Council of the city of Palo Alto hereby finds
that the eni!'.lctment of this ordinance is not a proj ect under the
California Environc:ental Quality Act and, therefore, no environmen
tal impact assessment is necessary.
SECTION 6. As provided in subsection (3) of Section 2.04.375
of the. Palo Alt.o Municipal Code, this ordinance shall become
effective upon adopti¢n.
INTRODUCED AND PASSED:
AYES:
NOES:
ABSTENT!ONS:
ABSENT:
ATTEST: APPROVED:
illy ClerJc Mayor
APPROVED AS TO FOR!(:
Asst. City At-torney
APPROVED:
city Manager
Director of Fin~nce 91-92.4
..
/
·~
I
EmIa!" A
~"O-'l REAPPROPRrATrON REQUESTS
PUlSION
GIDlERAL Ptnro
Attorney
Finance/Acccuntinq
Infonnation
Resources
Fire/Hazardous
Materials
PW Operations
PW Facilities
Par'ks and Golf
Recreation
Hwnan Services
EXPLANATION
Legal services contracts.
To document the fire
£ee/billing process for
system users~
CMR 104:91 Budqet Amendment
Ordinance #4015 for
payroll/Human Resources
Contract programmer.
Provide Toxic Gas ordinance
implementation.
Sidewalk Repair/Replacement
Contract.
street Resurfacing Contract.
Rinc~nada pool chlorination
system replacement.
Design and specifications
for irrigation installation
and Golf Course renovations.
Bicentennial Committee.
Final pa~ent for servic~s
for 1~9D-gl contract
extended thru July and
A~qust of 1991. Contract has
been extended, now monies
need reappropriation.
TOTAL GENERAL FUND:
1
. -
$30,000
10,000
63,450
30,375
:200~OOO
Hi2,000
59,000
75,000
8,100
9,720
$647,645
.....
LO'O-'i REAPPROPRIATION REQUESTS
DIVISION
EllTERPRlSE l'tnrDS
utilities
Administration
Enqineering
Engineering
Resource Planning
J:XPLANMION
FUnds have been earmarked to
help fina~~e a nev Utilities
Billing Sjstem.
Equipment and system for
dispatching collection and
reporting of field service
~ata to/by the customer
service field servicemen
resulting in more effective
direct service to the
customer.
provide users vith legal
versions of production
software and to comply ~ith
software publishers
cQPyrights.
Funds \iere to be used when
relocation of Engineering to
another fac_llity occurred.
Funds ~ere to be used when
relocati~n of Enqine~ring to
another facility occurred.
purchase of office furniture
for Engineering relocation.
Final evaluation of the
PARTNERS rebate program,
which we have operated for
six years but are now
closing out.
Final pa}"ments for two
customer projects under the
PARTNERS program after
project completion.
2
128,EOO
50,000
12,200
8,700
22,500
59,000
35,000
164,300
DIVASIOJ'
.--'.
1"0-'1 REAPPROPRIATION REQUESTS
EXPLANATION
In order to provide
personalize~ energy audits
f~r residents who we cannot
serve in person, we want to
set up a system to contract
out their energy ~udit
analysis and report writing.
Palo Alto's support for a
Fuel Cell demonstration
effort at the City of Santa
Clara.
Technical consulting
services related to the
production of the California
Energy Commission's (CEC}
Quarterly Fuel and Energy
report.
WGW Field Operations Additional storage space in
General Shop and expansion
required to house transfer
gas prover for testinq large
gas meters.
Water FUnd
Refuse Fund
Wastewater Master Plan~
Reimbursed 50' by the Water
Fund.
Payment of hazardous waste
disposal taxes and permit
fees.
Consultant Services for
Solid waste Facilities
Feasibility study.
Consultant Services for
Hazard communication program
training element
development.
Consultant Services for
implenentation of programs
mandated by Environmental
Protection Agency subtitle D
Regulations.
3
15,000
166,000
26,000
10,000
67,750
12,000
82,000
30,000
100,000
50,000
•
,
i
~'tO-'l REAPPROPRIATION REQUESTS
DrnatO"
Refuse Fund
Ilf'rERlIAL SERVICE FOlrID
PW{Equipm~nt
Management
contr~ct Construction and
consultant Services fer
construction of mandated
landfill controls required
b:)' Envirorunental protection
Agency, regulAtions.
Payment of permit fees for
Industrial Waste discharge
permit issued by PA Regional
Quality control Plant for
landfill leachat6 collection
system.
Payment of local and state
agency solid 'Waste disposal
tax and fees.
TOTAL ENTERPRISE FUNDS:
New 4-reel ~ire trailer to
replace 1966 Totem 3-reel
traileL to string
replacement underground
cable.
TOTAL CITY REAPPROPRIA~ION REQUESTS
4
,.
•
NlOJ!1lT
48,.000
40,000
66,000
$1.213,050
35,000
.S;:
~ .. §"~"~~"~ .....-"' .... ;.
/
i ."
-"
I ,
I ,
!. e a N •• ~=
c _ ._. '~ __ '_< __ <
~c;l:;::~;:;;
«L .... ~ '" "" ~ -
0 .... <= __ c;>,.."
~~:1;;:!~.::;
f'..~ ",~" .. t",,·
3;:£~~'~ ~
~.
,r--",
","-"
-" • • ! ":
.; 0' · , · .
. . -. £ i
51 · . · .
o .
f •
s ~ g ~ g ~ § ~ g 5 ~ g g g g g ~ g § g g ~ ~ g ~
i~ii~~~~~~iii~fiiiiiiii~~ .~.~~~-~~~.--~-"~--.-~ .. ~ "" ... .... .... ..... ....
~ 0 g § 8 g g 8 8 g g 8 0 0 i 0 0 .: ",' ~ . ~. :i ~. '" ~ ~ o·
~ -~ ~. ~ -
~~GN~g~~-e~~~~~""~_o~~~~~~ ~~~~~~~~~N~~~g~~~~g~~~~~~
a~i;£i~ ii~iii~~~~iiii~i~ ........ N_~N ~ _~ _~~ __ .............. N --
I.I!§~IJIE~III§IIIIIII!II
':~~'iiiii~iii~iiiiiii~i~i ~~~~~~-~~~~N~C_~~~~ __ N~""'~
N..... N ....
-.."..,-.... -_.--_ •. _---.-'.
'.
u
H •
i
~ • .
~
.
i
l •
··,,,!~f
',h
...
.-' -'" 'r
j ,
I
\
"ru)~t Itdjulilt.a
Project Title lIudwor Qudl)tn to Oeta
Slr_t JnprllV-"t ,.net I>rojfU:t-fr
ECft traffic Sfngfll , .. " 154,000
1"."11: 5fQOolI EC:M/Htlttt IMT, 100,000
ECR/Klt/ldvro !ijglllll 19071 11.'S,DM
"InaI' Intara.".::tion I~. 1901iZ 216,0(10
/MiD,. Inrerlllwctfill'\ l~. ,.." 6";0,000
,,..Hie CQrlfrlll Corwlrl./\:. l?OI4 '44,000
QJ8rOT~l 1.42:i,OOO
nHIIIT C
~~luL IlItIrll~ ,.rllJlK:tI 5 ........ )"
""oJ~r. OftI' 5100,000
rourth QlMrtel' lI"vl..,. ,99(I'19P1
01' rf\ru
l./io/90
90/\11 no
Acw.1 .""'" •• {WlD.
10!4,";";9 1,441
90,000 '8,000
W,,,"" 19,000
276,000
$',214 29,302 539.""-
:2,601 95,685 32,514
UII,Ol5 Z:52,St.6 a94,419
........• ---. ----' ......... -
ItrQt MI;nt~. ,"70 ~·golf'9 50i,l'5.9
Str"' J","" Projecfs C~lettd In fY 9(1/91
EtR !JAy/lol IIObhle IIIpr'Q\I 1&1ll 141.4O"i 129,000 11,405 •
Ar.!ltI"Miero Rulld I~(>\I •• 19117'i ~O,OOll '5.0,000
Tn,fflc tontrol C<Ii!'Ililtruc. f8Sn ~O,OOO 10,000 10,OOCI
Othltr Clo~ St.ProJj. 41O,JJ9 ,,'a.MJ 4,611 l6,965
fota( Clmo!l'd $frht Proj~ta 70',144 5$7,76] 17.016 9(,,965
rorAl. Sf.J"". fLn:! J'r.,jact 1,126,144-865,1111 712,821 9Yl,~C14
FUlure Yr, ,-, 'LIllI'" 'taJ.
fI~lt ... r ..
',4.1i1
HI,IlOO.
19.CJOD
176,000
539.4M
]O!,S,.
119-(,,439
694,439
f.'.Tatel ,.,...j. fJIIP.
,~,QOQ
100,000
llS,OOO
Z76,OOO
650,000
144,000
1,425,000
-......... ,
1,4l!>,(lOO
., .......... --_. '-""-......
"'..l!I.,;:r\oZi!'!"_~~~·l<.!....
'\
r'
'" .
"\,"
i ~ , .'-'
·f
'-0;'
."
H c • •
:
I
l~!i~i
~·';fii£-i
..... ---...
c
~
~
~
~
:~
'i-·
~
~
~~
~
,.;
• ~ .!!-.-
~
N · ,.;
.~ ~
i ~-
'" .-
~
" Ie"!! c
0: II iii' ~ • J " ·
iI :: j " ~ ! o I " . .. & i-~ u ! · ~ • '~ " · i ... " Q • • : ~ • •
= ~ ~ I > 0
.
S
:
t
~ .~ " ~ . .
~ I :
] '~
y £ . .. • ~ §
•
c.