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Home My WebLink About11/02/2020 04B 2020 3rd Quarter Financial Report 't..an,gtntj ka '744#1,, aY BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT Item No. 4.B. For Meeting of: November 2, 2020 ITEM TITLE: 2020 3rd Quarter Financial Report SUBMITTED BY: Steve Groom, Director of Finance and Budget SUMMARY EXPLANATION: The Third Quarter Financial Report for 2020 is attached and consists of the following: 1. Summary Narrative 2. Financial Reports • Cash Balance Trend • Material Revenue Performance Charts • Fund Balance Summary • Revenue and Expenditure Comparison to Budget and Actual Year-to-Date • General Government Revenue Historical Year-to-Date Detail • General Government Expenditure Historical Year-to-Date Detail • Other Funds - Revenue, Expenditure and Fund Balance Summary ITEM BUDGETED: NA STRATEGIC PRIORITY: Public Trust and Accountability APPROVED FOR SUBMITTAL BY THE CITY MANAGER RECOMMENDATION: Review only. Submitted for routine transparency and accountability. ATTACHMENTS: Description Upload Date Type C remark 10/ I20 0 a r Me 0 2 o �y...4‘,,,�rtic FINANCE DEPARTMENT i-.** • 1,4 0#,-... „. : ,:, . _. ic): .4,,,,,,' car, '*,,4.'-......•-**s.st, f 1''‘kC"'pO H ATEl)8 __ _ To: Mayor and City Council Bob Harrison From: Steve Groom Kathy Miles Date: October 20,2020 Subject: 2020 3rd Quarter Financial Update This financial update is an unaudited report for the 3rd quarter ended September 30,2020, three quarters, or 75%of the year,intended to inform and assist governance decisions for future planning. In total,city revenues are at 61.5% of budget and expenditures are at 54.2%of budget. The timing of Property Tax Revenue,coming in, and the timing of Capital Fund Expenditures, going out, are normally the biggest reason that revenues and expenditures are below 75%at this point in the year. This year,the economic impact of the COVID-19 was substantial on Sales Tax,which rebounded and on Lodging Tax and Building Permit fees,discussed further below. Cash position and revenue charts on the following pages provide insight into the monitoring of revenue and the management of expenses. The Quarterly Treasury report,a separate report also available on the City's website,provides further cash and investment analysis. All invoices are not yet received and complete accrual analysis is done at year-end,not quarterly,so this report is intended as a progress report. General Fund's Performance to Budget General Fund Revenues in total are at 63.3%;the largest components are: • Property Tax is at 58.4%. • Sales Tax is at 73.8%. • Utility and Franchise Taxes are at 67.0%. General Fund Expenditures in total are at 63.5%;the largest components are: • Police expenditures are at 65.2%. • Fire Expenditures are at 71.4%. • Information Technology expenditures are at 62.5%. 3 REVENUE FORECAST The City Council's current top strategic objective is improving the General Fund's fund balance. To accomplish that goal,the City is monitoring revenues and managing expenses. Due to the economic effects of COVID-19, Cash &Investments As a current over-all indicator, the 4-year historic city-wide cash and investments balance trends, inclusive of all funds,shows September at$97.7 million. Each month is best compared to the same month in previous years to account for seasonality and other annual events. CASH AND INVESTMENTS HISTORY $100,000,000 - $75,000,000 - $50,000,000 - $25,000,000 - $0 i i i I i I i i i i I i I i 19 o\3,1\.'1�6y\3,y\,1,k\�o�,1)#03..��o\3y\>y\,�.y0p\3o�11�\3\yo\3,y�.y0\,y\.y00- \o\y�\,r o\3y�yy\3,y�.LO�\�o�.'1�0�\3,i• Sales Tax This is the largest single funding source for the city. The 3rd quarter cumulative$22.7 million falls short of budget by$213,000 or 0.9%and is less than prior year by$105,000. The city receives sales tax from the State on a 2-month lag from the actual point-of-sale transactions so these figures are for sales transactions through July. SALES TAX REVENUE $40,000,000 - EEE 00 - $0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Budget Cumulative —411 Current Year Cumulative Prior Year Cumulative Finance Quarterly Report-Page 2 4 Property Tax The 3rd quarter cumulative revenue,still awaiting September actual,is roughly on track with budget. The October payment activity will reveal any delays due to COVID however Property Tax is expected to be ultimately collectable. The 2020 budget increased by$3 million due to assessed valuations (a combination of existing capped at 1% and new growth);preliminary receipts are slightly favorable to budget however the first primary installments are paid in April. PROPERTY TAX REVENUE $30,000,000 $20,000,000 $10,000,000 -. . $0 i i i i i i i Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Budget Cumulative Current Year Cumulative Prior Year Cumulative Water The 3rd quarter cumulative revenue of$7.9 million through September is down$78,000 under budget. WATER REVENUE $15,000,000 n $10,000,000 $5,000,000 $0 i i i I I I i i Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Budget Cumulative Current Year Cumulative Prior Year Cumulative Finance Quarterly Report-Page 3 5 Refuse The 3rd quarter cumulative revenue of$4.7 million is up$224,000 over budget and $73,000 over prior year. REFUSE REVENUE $7,500,000 $5,000,000 4 $2,500,000 1 $o Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Budget Cumulative Current Year Cumulative Prior Year Cumulative Lodging Tax The 3rd quarter cumulative revenue of$648,000 is down $462,000 under budget and down$482,000 compared to prior year. In the coming months we expect to see continued revenue shortfall due to the COVID-19 Emergency,with an expected variance from budget by($728,000). Expenses are being managed to compensate. LODGING TAX REVENUE $2,000,000 $1,000,000 $o Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Budget Cumulative Current Year Cumulative Prior Year Cumulative Finance Quarterly Report-Page 4 6 Airport The 3rd quarter cumulative revenue of$1,123,000 is down $10,000 under budget and up$41,000 over prior year. In the coming months we expect to see a material decrease due to the COVID-19 Emergency. This measure indudes all airport revenues which include airline landing fees, commercial rents,parking lot revenue,car rental and general aviation. AIRPORT REVENUE $2,000,000 - $1,500,000 $1,000,000 4 $500,000 -� $0 i I Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Budget Cumulative Current Year Cumulative Prior Year Cumulative Building Permits The 3rd quarter cumulative revenues of$476,000 are down $329,000 below budget and $212,000 below prior year. This revenue was one of the first indicators of the COVID-19 Emergency's impact. BUILDING PERMIT REVENUE $1,500,000 $1,000,000 $500,000 - $0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Budget Cumulative Current Year Cumulative Prior Year Cumulative Finance Quarterly Report-Page 5 7 CITY-WIDE FUND BALANCE SUMMARY CHANGE IN FUND BALANCE 2020 As of September 30th Beginning 2020 2020 Ending Balance Actual Rev. Actual Exp. Balance General Fund $ 10,757,521 $ 46,686,906 $ 46,590,970 $ 10,853,457 Parks and Recreation 666,337 2,549,670 3,141,460 74,547 Street&Traffic Operations 179,146 5,476,622 5,679,323 (23,555) General Government Subtotal 11,603,004 54,713,198 55,411,753 10,904,449 Other Governmental Operating Funds 5,708,398 8,105,168 9,009,113 4,804,453 Government Capital Funds 13,888,067 17,408,252 10,469,045 20,827,274 Enterprise Operating Funds 20,534,604 42,270,607 36,674,669 26,130,542 Enterprise Capital Funds 35,972,784 5,358,686 6,547,353 34,784,117 Internal Service Funds 3,956,891 5,191,149 5,978,459 3,169,581 Employee Benefit Reserve 4,742,177 10,767,572 10,289,076 5,220,673 Risk Management Reserves 2,643,898 3,142,630 2,926,957 2,859,571 Debt Service&Agency Funds 2,269,854 12,178,464 11,117,479 3,330,839 Total $ 101,319,677 $ 159,135,726 $ 148,423,904 $ 112,031,499 This table shows fund balances by fund at this point in time,however due to seasonal fluctuations such as Property Tax revenues that come in twice a year,and dept payments made periodically,as well as other seasonal factors,this is intended to provide transparency and accountability but it not a reliable measure of predicted year-end. Finance Quarterly Report-Page 6 8 CITY WIDE REVENUES & EXPENDITURES BY FUND GROUPING REVENUE COMPARISON (Budget vs. Actual) 2019 2020 Annual Actual % Amended Actual as of 9/30 Rec'd Budget as of 9/30 Rec'd General $ 48,716,609 72.2% $ 73,776,093 $ 46,686,906 63.3 % Parks and Recreation 3,492,108 66.4% 5,531,468 2,549,670 46.1 % Street&Traffic Operations 3,373,510 58.3 % 8,661,450 5,476,622 63.2% General Government Subtotal 55,582,227 70.8 % 87,969,011 54,713,198 62.2% Other Government Operating Funds 9,181,863 54.1 % 17,980,148 8,105,168 45.1 % Government Capital Funds 7,655,065 18.0 % 27,283,760 17,408,252 63.8 % Enterprise Operating Funds 44,120,251 72.9 % 66,779,346 42,270,607 63.3 % Enterprise Capital Funds 7,591,430 38.2% 13,009,100 5,358,686 41.2% Internal Service Funds 4,335,168 70.3 % 8,396,714 5,191,149 61.8 % Employee Benefit Reserves 10,929,257 66.7% 16,480,664 10,767,572 65.3 % Risk Management Reserve 3,169,713 72.9 % 5,037,870 3,142,630 62.4% Debt Service&Agency Funds 4,316,644 57.3 % 15,766,788 12,178,464 77.2% Total $ 146,881,618 58.1 % $ 258,703,401 $ 159,135,726 61.5 % EXPENDITURE COMPARISON (Budget vs. Actual) 2019 2020 Annual Actual % Amended Actual as of 9/30 Exp'd Budget as of 9/30 Exp'd General $ 47,654,303 70.2% $ 73,333,398 $ 46,590,970 63.5 % Parks and Recreation 3,778,065 72.8 % 5,592,567 3,141,460 56.2% Street&Traffic Operations 4,096,928 53.5 % 8,694,368 5,679,323 65.3 % General Government Subtotal 55,529,296 68.7% 87,620,333 55,411,753 63.2% Other Government Operating Funds 9,167,202 53.6 % 17,779,100 9,009,113 50.7% Government Capital Funds 13,817,296 30.2% 26,952,088 10,469,045 38.8 % Enterprise Operating Funds 41,103,898 66.0 % 68,685,869 36,674,669 53.4% Enterprise Capital Funds 7,568,241 27.7% 25,268,221 6,547,353 25.9 % Internal Service Funds 4,092,083 42.3 % 10,410,280 5,978,459 57.4% Employee Benefit Reserves 10,274,740 63.7% 16,242,798 10,289,076 63.3 % Risk Management Reserve 3,093,715 71.9 % 5,047,422 2,926,957 58.0 % Debt Service&Agency Funds 3,824,882 50.9 % 15,759,931 11,117,479 70.5 % Total $ 148,471,353 54.8 % $ 273,766,042 $ 148,423,904 54.2% Finance Quarterly Report-Page 7 9 GENERAL GOVERNMENT REVENUE DETAIL GENERAL GOVERNMENT REVENUES 2020 Revenues as of September 30 Amended Percent General Fund 2018 2019 2020 Budget Rec'd Property Tax $ 7,477,446 $ 6,366,319 $ 6,198,695 $ 10,606,500 58.4 General Sales Tax 12,978,931 13,370,058 13,699,881 18,552,000 73.8 Crim.Justice Sales Tax 2,701,011 2,662,007 2,737,697 3,704,701 73.9 Utility&Franchise Taxes 12,820,985 13,633,317 12,825,788 19,141,920 67.0 Other Taxes 777,465 804,169 480,385 1,080,000 44.5 Licenses and Permits 1,284,407 1,382,086 1,154,048 1,905,970 60.5 Intergov't Revenues 2,709,326 2,746,000 2,967,296 7,585,142 39.1 Charges for Services 6,360,917 5,353,469 5,041,211 7,881,311 64.0 Fines and Forfeitures 1,304,023 1,249,413 825,060 1,812,000 45.5 Other Revenue 456,395 1,149,772 756,845 1,506,550 50.2 Total General Fund 48,870,906 48,716,610 46,686,906 73,776,094 63.3 Parks&Recreation Property Tax 1,601,982 1,464,645 1,626,061 2,826,147 57.5 Intergov't Revenues 68,452 46,656 46,893 69,330 67.6 Charges for Services 725,792 684,945 174,596 975,250 17.9 Other Revenue 1,042,520 1,295,862 702,119 1,660,740 42.3 Total Parks&Recreation 3,438,746 3,492,108 2,549,669 5,531,467 46.1 Streets Property Tax 1,782,962 1,785,794 2,311,760 4,016,314 57.6 Other Taxes 2,582 n/a Intergov't Revenues 1,162,679 1,115,342 953,504 1,513,000 63.0 Charges for Services 255,550 379,796 252,350 676,636 37.3 Other Revenue 14,416 92,578 1,959,008 2,455,500 79.8 Total Streets 3,218,189 3,373,510 5,476,622 8,661,450 63.2 Total General Government $ 55,527,841 $ 55,582,228 $ 54,713,197 $ 87,969,011 62.2 Finance Quarterly Report-Page 8 10 GENERAL GOVERNMENT EXPENDITURE DETAIL GENERAL GOVERNMENT EXPENDITURES 2020 Expenditures as of September 30 Amended Percent 2018 2019 2020 Budget Exp'd Police $ 21,145,841 $ 21,143,411 $ 20,068,139 $ 30,773,407 65.2 Fire 9,965,085 11,027,662 11,049,933 15,482,039 71.4 Information Technology 2,394,946 2,378,687 2,604,260 4,166,089 62.5 Code Administration 1,411,455 1,432,587 1,318,423 1,986,531 66.4 Legal 1,192,884 1,306,961 1,378,652 1,980,706 69.6 Finance 1,201,382 1,226,141 1,901,028 1,906,304 99.7 Interfund Distributions 2,688,292 1,765,911 1,112,518 1,879,760 59.2 Municipal Court 1,153,196 1,168,928 1,118,043 1,783,999 62.7 Firemen's Relief/Pension 857,177 910,660 953,960 1,176,041 81.1 Indigent Defense 672,882 785,431 807,274 1,050,000 76.9 Police Pension 616,607 601,808 574,836 867,197 66.3 Engineering 504,280 502,169 489,580 801,153 61.1 City Clerk/Records 343,642 337,429 408,398 779,047 52.4 Human Resources 513,589 557,489 538,908 770,739 69.9 Planning 453,222 516,194 602,441 856,262 70.4 Purchasing 439,183 456,431 357,655 686,784 52.1 City Hall Facility 371,424 400,988 240,521 604,700 39.8 City Management 1 320,006 435,656 396,384 4,266,136 9.3 Clean City Program 75,911 385,288 19.7 Parking 128,216 121,430 115,917 280,187 41.4 City Council 208,826 190,745 186,646 275,790 67.7 Economic Development 319,769 264,598 150,847 252,548 59.7 Intergovernmental 124,560 122,825 140,697 162,689 86.5 Contingency 500,000 160,000 n/a Total General Fund 47,526,464 47,654,141 46,590,971 73,333,396 63.5 Parks&Recreation Fund 4,152,207 3,778,065 3,141,460 5,592,567 56.2 Street&Traffic Ops. 3,824,743 4,096,928 5,679,323 8,694,368 65.3 Total General Government $ 55,503,414 $ 55,529,134 $ 55,411,754 $ 87,620,331 63.2 1 City Management expenditures include extraordinary expenses specific to CARES Act recovery and reimbursement. Finance Quarterly Report-Page 9 11 OTHER FUNDS DETAIL OTHER GOVERNMENT OPERATING FUNDS 2020 As of September 30th Beginning 2020 2020 Ending Fund Balance Actual Rev. Actual Exp. Balance Economic Development $ 54,454 $ 72,013 $ 82,952 $ 43,515 Neighborhood Development 703,369 262,913 829,199 137,083 Community Relations 799,493 581,145 448,813 931,825 Cemetery 149,216 196,736 252,027 93,925 Emergency Services 78,401 971,944 1,091,671 (41,326) Public Safety Communication 905,623 3,089,669 3,165,907 829,385 Police Grants 1,199,193 170,819 288,930 1,081,082 PBIA(Park/Bus Improvement Area) 57,284 143,047 90,463 109,868 Trolley 45,791 11,275 10,553 46,513 Front Street Bus Improvement Area 3,546 3,130 3,315 3,361 Convention Center(Tourist Promo) 287,722 667,738 939,116 16,344 Capitol Theatre 34,275 393,527 300,057 127,745 PFD-Convention Center 1,043,475 707,423 649,935 1,100,963 Tourism Promotion Area 80,263 297,873 299,847 78,289 PFD-Capitol Theatre 266,291 535,917 556,330 245,878 Total Other Gov't Operating Funds $ 5,708,396 $ 8,105,169 $ 9,009,115 $ 4,804,450 GOVERNMENTAL CAPITAL FUNDS 2020 As of September 30th Beginning 2020 2020 Ending Fund Balance Actual Rev. Actual Exp. Balance Arterial Street $ 2,254,826 $ 518,577 $ 911,854 $ 1,861,549 Central Bus District Capital 61,038 9,976 71,014 Capitol Theatre Construction 201,017 45,000 312 245,705 Yakima Redevelopment Area 1,566,930 551,883 659,434 1,459,379 Parks&Recreation Capital 395,207 1,135,746 1,131,389 399,564 Fire Capital 504,061 37,558 248,778 292,841 Law and Justice Capital 729,782 394,348 202,169 921,961 Public Works Trust Construction 3,120,163 888,278 779,090 3,229,351 REET 2 Capital 1,601,740 846,054 826,381 1,621,413 Street Capital 2,178,084 176,774 163,595 2,191,263 Convention Center Cap Improvement 713,946 12,804,058 5,545,053 7,972,951 Reserve for Capital Improvement 561,273 990 560,283 Total Gov't Capital Funds $ 13,888,067 $ 17,408,252 $ 10,469,045 $ 20,827,274 Finance Quarterly Report-Page 10 12 ENTERPRISE OPERATING FUNDS 2020 As of September 30th Beginning 2020 2020 Ending Fund Balance Actual Rev. Actual Exp. Balance Airport Operating $ 231,667 $ 1,122,996 $ 1,064,611 $ 290,052 Stormwater Operating 1,300,461 2,413,286 2,503,442 1,210,305 Transit Operating 4,886,755 5,500,750 5,628,880 4,758,625 Refuse 2,074,433 5,971,383 5,658,963 2,386,853 Wastewater Operating 7,954,286 17,351,824 13,729,960 11,576,150 Water Operating 2,998,833 8,376,697 6,718,358 4,657,172 Irrigation 1,088,168 1,533,672 1,370,456 1,251,384 Total Enterprise Operating Funds $ 20,534,603 $ 42,270,608 $ 36,674,670 $ 26,130,541 ENTERPRISE CAPITAL FUNDS 2020 As of September 30th Beginning 2020 2020 Ending Fund Balance Actual Rev. Actual Exp. Balance Airport Capital $ 428,091 $ 431,160 $ 292,847 $ 566,404 Stormwater Capital 4,262,708 900,000 1,098,152 4,064,556 Transit Capital 6,759,981 10,875 16,315 6,754,541 Wastewater Facilities Capital 4,034,146 710,335 262,461 4,482,020 Wastewater Construction Capital 7,980,356 225,000 3,007,278 5,198,078 Wastewater Capital 4,567,644 391,396 214,303 4,744,737 Water Capital 3,265,844 1,425,000 457,422 4,233,422 Irrigation Capital 4,674,015 1,264,921 1,198,575 4,740,361 Total Enterprise Capital Funds $ 35,972,785 $ 5,358,687 $ 6,547,353 $ 34,784,119 INTERNAL SERVICE FUNDS 2020 As of September 30th Beginning 2020 2020 Ending Fund Balance Actual Rev. Actual Exp. Balance Equipment Rental $ 2,653,838 $ 2,969,676 $ 3,214,484 $ 2,409,030 Environmental 655,151 60,407 150,093 565,465 Public Works Administration 656,066 981,415 1,186,742 450,739 Utility Services (8,164) 1,179,650 1,427,140 (255,654) Total Enterprise Operating Funds $ 3,956,891 $ 5,191,148 $ 5,978,459 $ 3,169,580 Finance Quarterly Report-Page 11 13 EMPLOYEE BENEFIT RESERVES 2020 As of September 30th Beginning 2020 2020 Ending Fund Balance Actual Rev. Actual Exp. Balance Unemployment Comp Reserve $ 253,933 $ 162,579 $ 117,610 $ 298,902 Employees Health Ben Reserve 3,706,563 9,334,340 8,971,792 4,069,111 Worker's Comp Reserve 734,604 1,270,652 1,173,388 831,868 Wellness/EAP 47,077 26,287 20,790 Total Employee Benefit Reserve $ 4,742,177 $ 10,767,571 $ 10,289,077 $ 5,220,671 RISK MANAGEMENT RESERVE 2020 As of September 30th Beginning 2020 2020 Ending Fund Balance Actual Rev. Actual Exp. Balance Risk Management Reserve $ 2,643,898 $ 3,142,630 $ 2,926,957 $ 2,859,571 DEBT SERVICE &AGENCY FUNDS 2020 As of September 30th Beginning 2020 2020 Ending Fund Balance Actual Rev. Actual Exp. Balance GO Bond Redemption LID Guaranty $ $ 8,185,838 $ 7,765,700 $ 420,138 2002 GO Convention Center 162,617 2,846,639 2,859,940 149,316 2005 GO Various Bonds 11,939 11,939 1996 GO LTD-Convention Center 75,485 (6,362) 69,123 Total GO Bond Redemption $ 250,041 $ 11,026,115 $ 10,625,640 $ 650,516 Water/Sewer Revenue Bond Redemption WW Rev Bond&2008 Debt Service $ (17,465) $ 62,531 $ 8,984 $ 36,082 Irrigation Bond Debt Service (21,907) 318,760 57,660 239,193 WW Rev Bond Rsv&2012 Debt Svc 1,592,748 103,700 56,400 1,640,048 Total W/S Rev Bond Redemption $ 1,553,376 $ 484,991 $ 123,044 $ 1,915,323 Agency Funds Yakcorps (249,653) 656,276 368,794 37,829 Cemetery Trust 716,090 11,082 727,172 Total Agency Funds $ 466,437 $ 667,358 $ 368,794 765,001 Finance Quarterly Report-Page 12