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Item # 9
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
December 19, 2023
TOPIC: Fiscal Year 2022-23 General Fund Results
AGENDA TITLE
Fiscal Year 2022-23 General Fund Results
RECOMMENDED ACTION
1. Receive and file this informational report.
2. Approve proposed General Fund appropriation adjustment of $350,000 for
non-departmental litigation. (Requires five affirmative votes)
GOVERNMENT CODE §84308 APPLIES: No
DISCUSSION
The independent auditors have completed their fieldwork for the fiscal year ended June
30, 2023 and the City expects to issue its financial statements in December 2023. Staff
plans to provide the City Council with an informational staff report covering the audited
financial statements and related reports after the New Year.
The purpose of this report is to provide early information regarding General Fund
performance in FY 2022-23 and to request two appropriation adjustments.
On November 7, staff reported that for FY 2022-23, the City received revenue in excess
of estimates and had expenditure savings; and in December, staff would be able to
identify the increase of the General Fund balance available for one-time spending,
based on the positive FY 2022-23 variances.
FY 2022-23 General Fund Results
These positive variances have resulted in an estimated spendable General Fund balance
of $17.8 million. The spendable amount is in excess of the 18% General Fund Reserve
balance of $72.1 million. Although many of our General Fund revenues exceeded the
conservative estimates and all departments had expenditure savings, the most significant
contributors to the $17.8 million spendable balance follow.
•Rising interest rates leading to increased investment income of more than $1
million in excess of the adjusted budget of $5 million as presented with the Third
Quarter Report on May 16, 2023.
Fiscal Year 2022-23 General Fund Results
December 19, 2023
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•Increased federal reimbursement rates for emergency medical transports
generated additional revenue of $0.8 million more than the adjustment made with
the Third Quarter Report.
•More than $2 million in collections of delinquent adult-use Cannabis business tax
and hotel visitor’s tax.
•The Business Tax holiday resulting in increased compliance generated more than
$1 million of additional revenue.
•One-time rebates for LED lights of nearly $1 million.
•Staffing vacancies across all departments, which helped fund compensation
increases negotiated with the bargaining groups. Therefore, the Non-Departmental
section of the budget had $2.7 million of savings from the $5 million set aside for
labor negotiations. The Police Department had additional vacancy savings of $2
million.
•Once again, the Vehicle Incentive Program to rebate Measure X tax to residents
purchasing a vehicle in Santa Ana had budgetary savings. The budget included
$1.7 million for this program, and used less than $0.7 million.
Requested FY 2023-24 Appropriations
As reported on November 21, the City Attorney’s Office has a litigation budget of $600,000
yet has contracted outside legal service needs of $950,000 for FY 2023-24. Therefore,
staff requests an appropriation adjustment of $350,000 for non-departmental litigation.
In addition to the proposed $350,000 appropriation in this staff report, Public Works has
a separate staff report on this same agenda for Engineering Division Funding. The Public
Works staff report includes a recommended appropriation for $2.9 million from the
General Fund balance available for spending.
The following table includes both proposed appropriations totaling $3,250,000 and an
updated summary of the General Fund budget for the current fiscal year.
Fiscal Year 2022-23 General Fund Results
December 19, 2023
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FISCAL IMPACT
If the City Council approves the staff recommendation in both staff reports, the remaining
estimated General Fund balance available for one-time spending will be $14,644,472.
Staff expects to prepare recommendations for this one-time funding source for City
Council consideration during the FY 2024-25 budget process.
Staff recommends the following Appropriation Adjustments:
Submitted By: Kathryn Downs, FMSA Executive Director
Approved By: Tom Hatch, Interim City Manager
FY2023-24 General Fund Summary
FY23-24 1st
Quarter Budget
Update
FY22-23 Year-
End
Adjustments
Proposed
D ecember 19
Adjustments
Updated
Estimate
Esti mated Beginning
Balance at July 1, 2023 109,372,864 17,835,714 127,208,578
Revenue Estimate 400,408,670 400,408,670
Appropri ated Spending (413,614,484)(3,250,000)(416,864,484)
Pensi on Trust Set Aside (24,034,731)(24,034,731)
Esti mated Ending
Balance at June 30,
2024 72,132,319 17,835,714 (3,250,000)86,718,033
Less: 18% Reserve 72,073,561 72,073,561
Esti mated Spendable
Balance 58,758 17,835,714 (3,250,000)14,644,472
Fiscal
Year
Accounting Unit
– Account #
Fund
Description
Accounting Unit,
Account
Description
Amount
FY23-24 01105015-62300 General Fund
General Non-
Departmental,
Contract Services
$350,000