HomeMy WebLinkAbout2001-02-13; City Council; 16054; 2000-01 2nd Quarter Financial Status Reporti.2 B E %
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d CITY OF CARLSBAD - AGENDA BILL
AB# 1 T’TLE: 2000-01 SECOND QUARTER DEPT HD.‘b----
MTG. 02/l 3/01 FINANCIAL STATUS REPORT, BUDGET
DEPT. FIN AMENDMENTS
RECOMMENDED ACTIONS:
1. Adopt Resolution No. 200 1 - q2. increasing the revenue estimates and appropriations for
fiscal year 2000-01.
2. Accept the Second Quarter Financial Status Report for 2000-01.
ITEM EXPLANATION:
Staff has completed a mid-year update of the revenues and expenditures for the City as of
December 31, 2000. The attached document (Exhibit 2) summarizes the results of the financial
review for the General fund, the Water and Sanitation Enterprise funds, and the Redevelopment
Agency. As a result of the review, several adjustments to the current budget are being
recommended. They will be discussed throughout the remainder of this report.
Financial Update
General Fund
To-date, General fund revenues exceed projections by $3 million or 9%. Sales tax revenues are
ahead of projections by $592,000, or 6%, and transient occupancy taxes (T.O.T.) are $490,000,
or II%, ahead of projections.
Development-related revenues are slightly above expectations and include engineering fees,
planning fees, building permits and building fees. Although engineering revenues are below
expectations, both building permits and planning fees are above expectations.
Other Funds
Revenue for the Water Operations fund, at $9.7 million, is $800,000 greater than the previous
year at this time. The majority of the increase, $555,000, is the result of recording property tax
revenues in the Water Operations fund in 2000-01 versus the Capital Replacement fund in 1999-
00. Also, an increase in the number of water customers resulted in an increase in water sales as
well as in the cost of purchased water. Through December, the Water Enterprise has an operating income of $496,000.
Revenues for the Sanitation Enterprise fund total $3 million for the first half of the fiscal year. This is a 14.1% increase over the prior year and is mainly due to an increase in the customer base.
To-date, the Sewer Operations fund has an operating income of $428,000.
Revenues for the Redevelopment Agency total $830,000, which is $101,000 higher than last year
and is due to the 12% increase in property values in the Redevelopment area. Expenses are as expected through December.
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PAGE TWO OF AGENDA BILL NO. 1.b 0s 9
BUDGET REVISIONS
General Fund Revenues Based upon the financial results through December, staff recommends an increase in the revenue
estimates for the General fund totaling $3,623,000 as detailed below and in Schedule A of Exhibit
1.
Total General Fund I $74.428.955 1 $78.052.000 1 $3.623.045 1
The majority of the increases are due to the continued strong economy especially in areas of
consumer purchases and tourism. Tax revenues are expected to end the year at almost $57
million; a 14% increase from the previous year. The change in the estimate is due to sales tax
growth in the first half of the year of 1 I%, rather than the expected 8%. TOT also had a much
higher growth rate than anticipated showing an 18% increase due mainly to the opening of two new
hotels; the Courtyard by Marriott and the Carlsbad Beach Hilton.
One unexpected potential increase is in the franchise taxes from SDG&E. SDG&E pays franchise
taxes based on a percentage of their net sales revenues. Since the costs of gas and electricity
have skyrocketed, the City’s franchise taxes are also expected to grow. Although it is difficult to tell
what will happen to rates in the next six months, we have increased our estimate by $328,000 to a
projected total of $1590,000. The remainder of the increase in the tax revenue estimate is for
slightly higher estimates for transfer taxes.
Intergovernmental revenues are estimated to increase $543,000 over what was originally
estimated. This is mainly due to the distribution of the state budget appropriation of $200 million which has been allocated to cities and counties for fiscal relief. Carlsbad’s share is expected to be
$320,000. In addition, car sales have continued to grow boosting the vehicle license fee revenues.
The changes in the Licenses and Permits and Charges for Services categories are due to higher
than expected development fees, mainly for building plan checks and inspections. Permit issuance
has not tapered off as fast as expected.
Other increases are recommended in the estimates for interest and other revenues. Interest
income is directly correlated with the amount of cash on hand in the General fund. With the
increasing revenues, interest income has also increased. Other revenues also include a $111,000
insurance reimbursement for the water damage at the Senior Center. Further detail on all of the
General fund revenues can be found in the attached Financial Status Report (Exhibit 2).
PAGE THREE OF AGENDA BILL NO. 1 !@;osq
Appropriations A total of $4.6 million in additional appropriations are requested. Additional detail for these
requests can be found below.
General fund $ 1,142,950
Water Enterprise fund 2,757,700
Recycled Water Enterprise fund 25,300
Sewer Operations Enterprise fund 431,400
Solid Waste fund 1.000
Workers Comp. Internal Service fund 4,800
Risk Management Internal Service fund 5,000
Vehicle Maintenance Internal Service fund 155,800
Information Technoloav Internal Service fund 17.800
Street Maintenance Assessment District fund 3,800
Median Maintenance Assessment District fund 3,800
Street Lighting Assessment District fund 4,500
Sister City fund 2,500
Capital Projects - Park In Lieu 50,000
TOTAL APPROPRIATIONS: $4,606,350
General fund
l Utility costs $559,850: The cost of power over the past six months has greatly exceeded
our budget projections. Request is based on our usage and our best estimate of what we
think our rates will be the next six months. This is a 33% increase over what was budgeted.
The General fund portion of this is $490,850.
l Management incentive pay $532,100: Staff requests that the City Council appropriate
$532,100 for management compensation plan incentive awards to be distributed at the
beginning of fiscal year 2001/2002. The General fund .portion of this is $449,200. This
recommendation assumes that employees who achieve their goals at the “Optimum” level
will receive an incentive payout of 6% of base salary, and employees who achieve their
goals at the “Target” level will receive an incentive payout of 4% of base salary. As was
done last year, the $532,100 appropriation covers the maximum exposure under the
incentive pay program by assuming that each management employee achieves his/her
goals at the highest performance level (Optimum) and is thereby eligible for an incentive
award of 6% of base salary.
l Aquatics part time salaries $3,000: The request is based on the aquatics salary survey
done in September of 2000 which shows that the City of Carlsbad is not competitive with
surrounding agencies. Based on the survey, staff recommends that the Lifeguard and
Instructor/Lifeguard pay rates be increased by .75 per hour, from $8.75 to $9.50 per hour.
l Recreation postage $8,600: In order to improve the quality of the Community Services
brochure, it was decided to upgrade the inside pages to glossy paper. Although the
publisher agreed to provide the glossy paper at no additional cost to the City, the heavier
paper raises the cost to mail each brochure from .I 14 cents to approximately .22 cents.
This request will fund this increase in cost.
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PAGE FOUR OF AGENDA BILL NO
l Recreation part time personnel $8,000: Additional funds are requested to provide staffing
at Poinsettia Park from 2:30pm - 10:OOpm Monday through Friday, and 8:OOam - 6:OOpm on Saturday and Sunday. This increased supervision is needed to reduce vandalism, deal
with the numerous problems encountered with the operation of the ball field lights, and
improve customer service to park users. Currently there is only funding to provide
supervision of the park three hours per day.
l Poinsettia Park tables and benches $10,000: Poinsettia Park has 11 rubber coated
picnic tables in its recreational areas. As a result of this park being relatively close to the
Pacific Ocean, the picnic tables have corroded and are jagged in some areas because of
the salt air climate. Staff feels the tables are an unsafe condition to the public. In addition to
the picnic tables, the expanded metal benches located along the sidewalk and adjacent to
the lawn picnic area are also corroding due to the salt air. Staff is requesting to replace the
corroded picnic tables with 11 new concrete tables (5 handicapped accessible and 6
standard), as well as replacing the 6 metal benches with 6 new concrete benches. The
concrete material is more resistant to coastal climate and will not corrode. Staff feels it
would be prudent to replace these park amenities in this fiscal year both from a
maintenance standpoint as it relates to frequent replacement costs, and from a safety risk
to our customers who use the tables and benches on a daily basis.
l Routine building maintenance $50,000: This account has been depleted due to
unforeseen expenditures .in routine building maintenance. Expenditures such as the floor
covering at Fleet, HVAC maintenance at Dove, Faraday and the Senior Center, and the
remodeling of the Arts Office all contributed to the depletion of this account. Some of the
projects left to complete this year include Fire Station 5 carpeting, Fire Station 5 pigeon
abatement, and upgrades to the safety center lighting.
l Custodial services $13,000: To cover additional costs associated with the Senior Center
flood damage from a broken water pipe.
l Health Insurance fund $74,000: At the end of the last fiscal year the Health Insurance
fund had a deficit. Due to the transition of management to PERS health on January 1,
2001, a review was done of the fund mid year to determine how much of an adjustment will
be needed for the rest of the year. In order to have the fund break even at the end of the
year, staff is requesting that $74,000 be transferred from the General fund to this fund.
l PERS two years additional service credit $36,300: In 1999, Council adopted the one to
four years additional service credit for eligible employees retiring from City service credit
and appropriated $734,452 to pay PERS which was based on an estimate done at that time
using averages. Since then PERS has calculated the amount due based on actuals and the
amount, which is due by February 28, 2001, is $770,735. Therefore, an additional $36,300
is needed from the General fund to fund this amount. .
Other funds
l Gasoline and oil $115,000: Fleet operations from around the County are experiencing an
increase in the cost of fuel. Due to the large fluctuation in fuel cost, staff is projecting a 7%
price increase over the average cost to-date this fiscal year. In addition to the increase in
gas prices, fuel consumption is projected to increase by 3% from 333,000 gallons in fiscal
year 1999-2000 to 340,000 gallons in fiscal year 2000-2001, which is mainly due to a 2% increase in the fleet.
PAGE FIVE OF AGENDA BILL NO. 1 b j 059
l Additional fuel budget expenditures $25,000: (i.e., oil, fluids, credit card fuel, UST fees,
permits, testing. etc.) also fluctuate and are projected to increase by an additional $25,000.
These are just projections, and due to the high volatility of the market, there is no way to tell
how high the gas prices will go in the upcoming months.
l Hazardous waste $10,000: This account pays for the removal of hazardous waste that is
dropped off at the used oil drop-off center. Recently, the City is experiencing large
accumulations of hazardous waste being dropped off at the center late at night. Due to the
health and safety of these materials being left on public property, the City has a
responsibility to remove such materials. The excess materials being dropped off in recent
months have depleted this account and there is only about $12,000 left of the $35,000
budget.
l Water enterprise purchased water $2,709,000: The increase in this account reflects the
estimated amount calculated by staff sufficient to fund future water purchases to June 30,
2001. The increase is due to the continuing growth in customer base and a relatively dry
winter.
l Encina services $400,000: Request is to fund Carlsbad’s share of the Encina costs. This increase is the result of increases in electricity and natural gas costs. Based on a review of
the Sewer rate model, staff feels there will be no immediate impact on sewer rates.
l Sister City donations $2,500: Appropriate the unappropriated balance in the Sister City
donations account to be used for the upcoming tour to Karlovy Vary as well as other events
in 2001.
Capital Proiects
l Larwin Park (CIP) $50,000: Request is to appropriate funding from Park In Lieu for the
North East (NE) Quadrant to begin park planning and development for Larwin Park within
the next few years. This will allow us to meet the immediate Growth Management need in
the NE Quadrant. This will be scheduled in the next Capital Improvement Program budget.
FISCAL IMPACT:
Staff is recommending increases in the General fund revenue estimates of $3,623,000, and
additional appropriations of $1,143,000. This results in an increase to the General fund balance of
$2,480,000. Staff is also recommending an increase in appropriations for the other funds of
$3,413,400 and additional appropriation for the Capital Improvement Program of $50,000. There
are sufficient balances available in each of the individual funds to support these appropriations.
EXHIBITS:
1. Resolution No. do0 1 - 9. Increasing the revenue estimates and appropriations for fiscal
year 2000-01.
2. Second Quarter Financial Status Report for 2000-01
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RESOLUTION NO. 2000-42
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF CARLSBAD, CALIFORNIA, INCREASING THE
REVENUE ESTIMATES AND APPROPRIATIONS FOR FISCAL YEAR 2000-01
WHEREAS, the financial results through December reflect
revenue receipts which are $3 million ahead of the estimate; and
WHEREAS, staff has identified unanticipated expenditures for
the first half of the year which require additional appropriations; and
WHEREAS, total appropriations for each fund many only be
increased or decreased by authorization of the City Council.
NOW, THEREFORE, BE IT RESOLVED by the City Council of
the City of Carlsbad, California, as follows:
1. That the above recitations are true and correct
2. That estimated revenues will be increased by $3,623,045 as shown on Schedule A.
3. That budgeted appropriations for the General fund will be
increased by $1,142,950, and Non-General funds by
$3,463,400, as shown in Schedule B.
PASSED, APPROVED AND ADOPTED at a regular meeting
of the City Council on the 13th day of February , 2001, by the following
vote, to wit:
AYES: Council Members Lewis, Kulchin, Finnila, Nygaard and 1 11.
NOES: None
ABSENT: None
ATTEST:
WOOD, City Clerk
(SEAL)
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EXHIBIT 1
SCHEDUL
GENERAL FUND
REVISED REVENUE ESTIMATES FOR 2000-2001
‘AXES
PROPERTY TAX
SALES TAX
TRANSIENT TAX
FRANCHISE TAX
BUSINESS LICENSE TAX
TRANSFER TAX
TOTAL TAXES
UTERGOVERNMiNTAL
VEHICLE LICENSE FEES HOMEOWNERS EXEMPTIONS
OTHER
TOTAL INTERGOVERNMENTAL
CURRENT REVISED CHANGE
REVENUE REVENUE IN
ESTIMATE ESTIMATE ESTIMATE
20,291,000 $20,291,000 $0
20,483,800 21,100,000 616,200
8,795,OOO 9,500,000 705,000
2,642,OOO 2,970,ooo 328,000
1,924,ooo 1,924,ooo
990,000 1 ,I 00,000 110,000
55,125,800 56,885,OOO 1,759,200
3.777,ooo 4,000,000 223,000 297,000 297,000 -
592,000 912,000 320,000
4,666,OOO 5,209,ooo 543,000
,lCENSES AND PERMITS
BUILDING PERMITS 1,962,OOO 2,200,000 238,000
OTHER LICENSES & PERMITS 999,000 1,200,000 201,000
TOTAL LICENSES & PERMITS 2,961,OOO 3,400,000 439,000
:HARGES FOR SERVICES
PLANNING FEES 450,000 750,000 300,000
BUILDING DEPT. FEES 1,337,ooo 1,500,000 163,000
ENGINEERING FEES 1,260,OOO 960,000 (300,000:
AMBULANCE FEES 1,160,OOO 1 ,I 80,000 RECREATION FEES 1,05 1,000 1,051,000 -
OTHER CHARGES OR FEES 546,535 546,535 -
TOTAL CHARGES FOR SERVICES 5,804,535 5,96i,535 163,000
INES AND FORFEITURES 840,000 840,000
-
JCOME FROM INT & PROPERTY 2.325.500 2,800,OOO 474,500
tiTERDEPARTMENTAL CHARGES 2,100,465 2,100,465
ITHER REVENUE SOURCES 605.655 850,000 244,345
OTAL GENERAL FUND 74.478.955
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EXHIBIT 1
SCHEDULE B
GENERAL FUND
REVISED APPROPRIATIONS
CURRENT REVISED
APPROPRIATIONS APPROPRIATIONS INCREASE/
)EPT DESCRIPTION FY 2000-2001 FY 2000-2001 (DECREASE)
‘OLICYILEADERSHIP GROUP
CITY COUNCIL
CITY MANAGER
CITY CLERK
CITY ATTORNEY
CITY TREASURER
TOTAL POLICY/LEADERSHIP
rDMlNlSTRATlVE SERVICES
ADMINISTRATION
FINANCE
PURCHASING
HUMAN RESOURCES
RECORDS
TOTAL ADMINISTRATIVE SERVICES
‘UBLIC SAFETY
POLICE
FIRE
TOTAL PUBLIC SAFETY
IOMMUNITY DEVELOPMENT
COMMUNITY DEVELOPMENT ADMIN
HIRING CENTER
GEOGRAPHIC INFORMATION
ECONOMIC DEVELOPMENT
COMMUNITY PROMOTION (CCVB)
PLANNING
BUILDING
TOTAL COMMUNITY DEVELOPMENT
OMMUNITY SERVICES
PARK PLANNING & RECREATION
SENIOR PROGRAMS
LIBRARY
CULTURAL ARTS
TOTAL COMMUNITY SERVICES
UBLIC WORKS
PUBLIC WORKS ADMINISTRATION
ENGINEERING
PARKS
STREETS & TRAFFIC SIGNALS
FACILITIES
TOTAL PUBLIC WORKS
ON-DEPARTMENTAL 8 CONTINGENCY
OTHER NON DEPARTMENTAL (a)
OPERATING TRANSFERS OUT
CONTINGENCY
TOTAL NON-DEPT & CONTINGENCY
OTAL GENERAL FUND
$251 .a51 $255.382 $3,531
1,34Q.561 1,365.962 16.401
155,526 155,526 0
759,042 779,373 20,331
147,548 147,548 0
2.663.528 2.703.791 40,263
588,504 628,812 40,308
1.607.785 I .633,200 25.415
566,493 573,683 5.190
1.720.605 1.747.869 27,264
1,511,809 1.519.623 7,814
5,997,196 6,103,187 105,991
14.119,700 14.276,559 158.859
9,656,314 9,704.866 46,552
23,776,014 23,983,425 207,411
509,094 555.966 46,872
65,849 85,849 0
28 1.248 286.029 4.781
210.263 215,946 5,663
496.176 496,176 0
2.590.771 2.630,140 39,369
I ,848.49I 1.854.193 5,702
6,021.692 6,124,299 102,407
39752.455 3,797,694 45,239
417,695 457,841 39,946
6.395,658 6,623.980 226,322
681,293 692.760 11,467
11,247,301 11,572,275 324,974
607,742 688.668 60,926
5.065.826 5.130.992 65.166
2.604.674 2.645.485 40,811
2,720.408 20727.227 6,819
2,296.734 2.390,916 94.182
13,295,384 13,583,280 267,904
715,212 715,212 0
8,732.400 8,806,400 74,000
3.327.658 3.327.658 0
12,775,270 12.849,270 74,000
t75,776,585 $76,919,535 $1,142,950
EXHIBIT 1
SCHEDULE B
OTHER FUNDS
REVISED APPROPRIATIONS
CURRENT REVISED
APPROPRIATIONS APPROPRIATIONS INCREASE/
EPT DESCRIPTION FY 2000-2001 FY 2000-2001 IDECREASE)
ON-GFNFlU.UUQ
SISTER CITY
STREET TREE MAINTENANCE DISTRICT
MEDIAN MAINTENANCE DISTRICT
STREET LIGHTINTG DISTRICT
WATER OPERATIONS
RECYCLED WATER
SEWER OPERATIONS
SOLID WASTE
WORKERS COMPENSATION
RISK MANAGEMENT
VEHICLE MAINTENANCE
INFORMATION TECHNOLOGY
DTAL NON-GENERAL FUND
L IMPROVFMFNT PROGRAM
LARWIN PARK (PARK IN LIEUI
OTAL CAPITAL PROJECTS
$3,604 $6,104 $2,500
595.826 599,628 3.800
539,816 543,616 3,800
770,732 775,232 4.500
16.978,956 19.736.656 2v757.700
1,608,304 1,631,604 25.300
5,822,228 6,253.628 431,400
325,478 326,478 1,000
954,043 958,843 4.600
2.233,809 -2,238,809 5,000
1,637,761 1,793.561 155,800
4.i28.2f3 4.146.013 I 7.800
0 50,000
53.413.400
50,000
$50,000
Financial Status Report
Prepared by the Finance Department
December 31,200O
This report summarizes the City of Carlsbad’s General fund revenues and expenditures through December
31, 2000. In addition, the financial status of the Water and Sanitation Enterprises and the Redevelopment
Agency will be addressed.
Carlsbad’s revenue trends seem to mirror the San Diego region, in general. Thus, on a monthly basis, this
report will also provide the most recent economic data for the area; the San Diego County economic
indicators. We feel this information will provide the reader some insight on where the local economy is
headed.
SAN DIEGO ECONOMIC INDICATORS
Building Permits Help Wanted Advertising
ment Insurance National Econom
Source: Univcrrity of Sun Diogo School ofBwiner* Admininration. USD hvhx 0fL~ndingEeononic hdieal0r.s lsnusry 5.2001
The University of San Diego’s Index of Leading Economic Indicators for San Diego County fell 0.5 percent
in November. As was the case in October, a sharp drop in local stock prices led the move to the downside.
Consumer confidence and help wanted advertising were also down moderately, while building permits and
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Financial Status Report 2
the outlook for the national economy decreased by smaller percentages. Initial claims for unemployment insurance declined slightly during the month, which registers as a positive for the Index.
With November’s decline, the USD Index of Leading Economic Indicators has now fallen for five months in
a row. In all five months, the decline has been broad, with at least five of the six components negative in
each of those months. The outlook for 2001 remains positive overall, but the local economy could
experience some turbulence during the middle of the year. This is similar to the outlook for the national
economy, where a forecast by UCLA indicates a 60% probability of a recession starting in the second
quarter of 2001. The recent cuts in interest rates by the Federal Reserve will likely reduce this probability
and cushion the impact if a national recession does occur. It is unlikely that these cuts in interest rates are
the last this year; another 0.50% decrease in interest rates is expected by the end of 2001.
The sharp decline in local stock prices continues to put a strong drag on the Index for San Diego. The Year
2000 was not a good one for stocks, in general, and technology stocks, in particular, with the NASOAQ
Composite Index down almost 40% for the year; its first yearly loss since 1994. This decline has negative
implications for the future of the local economy in a number of ways: (1) it indicates that the financial
markets are concerned with the future prospects of San Diego-based companies; (2) it will affect some
firms in terms of their ability to obtain capital through stock offerings; and (3) individuals have seen their
wealth reduced substantially. Many have credited a “wealth effect” due to rising stock prices with fueling
the expansion of the economy. It is possible that a “negative wealth effect” due to falling stock prices will
adversely affect the local economy in areas such as consumption and housing. This might be reflected in
the decline in consumer confidence locally, which was the second big drag on the Index in 2001. That
component was also likely affected by sharp increases in energy costs and a very tight local housing
market. The drop in consumer confidence is a concern because of the large role that consumption plays in
any economy, including the local one.’
TOP GENERAL FUND REVENUES
Cl Sales Taxes ($10.3 Million) - Although sales tax revenues were projected to grow at a slower
UP pace than the previous fiscal year (5.2% versus 13.8%) results through the first half
11% of the year indicate a growth rate of 11 percent. Based on the results of the second
calendar quarter of 2000, key gains could be seen in new auto sales, service stations
and leasing. During this same period of time, key declines were seen in recreation
products, miscellaneous retail and miscellaneous vehicle sales. The three largest
economic segments in the City are new auto sales, department stores and restaurants; together they
generate over 50% of the City’s sales tax revenues.
In order to comply with a Revenue and Taxation Code provision passed in 1991, a sales tax rollback of
0.25% went into effect on January I, 2001. This rollback was due to the state having back-to-back fiscal
years with a reserve fund of at least 4% of its total General fund. This reduction in the sales tax rate from
7.75% to 7.5% will not impact sales tax revenues received by the City.
Proper-W Taxes ($8.7 Million) - In December 2000, the City began to see a much larger flow of property
tax revenues. Although at this point in time property tax revenues reflect a 12% increase over fiscal year
1999-2000, we expect the increase to be 18% by the end of June 2001.
According to the most recent County of San Diego Assessor’s Offtce reports,
assessed values in Carlsbad have increased 18% for fiscal year 2000-01. Once
again, this was the largest increase of any city in San Diego County.
’ University of San Diego School of Business Administration, USD Index of Leading Economic Indicators, “Leading Indicators Down
in November”, January 52001.
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Financial Status Report
A factor in this increase was the sale, and subsequent revaluation, of the Encina Power Plant. Previously, the plant was considered public utility property, and it was assessed a unitary tax of which the City received
a very small share. Now that it is privately owned, it will be locally assessed and taxed, giving the City an
estimated $250,000 more in property taxes.
Transient Occupancv Tax ($4.8 MillIon) - Transient occupancy taxes (TOT) are $716,000
more than the previous fiscal year. This increase in TOT is based on two factors.
First, according to PKF Consulting, the average room rate for coastal North County
increased 5.7% during the first seven months of 2000. Second, and a bigger factor
contributing to the increase in TOT revenues, includes the opening of the Courtyard
by Marriott Hotel and the Carlsbad Beach Hilton Gardens in June 2000.
Development-Related Revenues ($2.8 Million) - Development-related revenues, which include building
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permits, planning fees, building department fees and engineering fees, are up slightly as
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compared to the previous fiscal year. ,Although building permits, building fees
and planning fees were up for the first half of the fiscal year, there was also a 9% large decrease in engineering fee revenues in the same period. Staff is
monitoring development-related revenues, and will make any necessary
adjustments to the estimated revenues during the mid-year report in January
2001.
The most significant source of development-related revenue to-date is building permits, up 22%, as
compared to fiscal year 2000. Building permits are issued to cover the cost of regulating construction
activities. This allows the City the means to protect overall community interests. For the first six months of
the new fiscal year, 985 new homes were started, compared to 744 new homes in fiscal year 2000. In
December, homebuilding was most active in Ranch0 Carrillo, La Costa Valley and Calavera Hills, where
162 of the 230 new homes were permitted. Multi-unit development continued during the month, with an
additional 154 condominium units permitted in December. There was considerable industrial and
commercial activity in December. Over 423,000 square feet of commercial permits were issued. These
permits were for apartment, duplex and related common buildings in Zone 23, as well as the Inns of
America building in Zone 3. In addition, two industrial buildings were permitted in the Industrial Corridor in
December. After taking into consideration the activity in December, commercial/industrial development is
up over 105% compared to last fiscal year.
i Income From Investments and Proeertv 62.1 Million) - For the year, income
i from investments and property is up $942,000. The increase in interest revenue is
due to two factors. First, General fund revenues have increased significantly in the
current fiscal year. Combining this increase in revenues with the same expenditure
level as the previous year, the cash balance has increased by 31% this year.
Secondly, in previous fiscal years, the City adjusted the value of its investments to the fair market value of
the investments as of the end of the fiscal year. Beginning in fiscal year 2000-01, the City is now adjusting
the market value of their investments on a monthly basis. Due to this change, and the fact that the City has recovered a portion of the lower market value from last fiscal year, income from investments has increased
by an additional 43%.
Vehicle License Fees ($2.0 Million) - Vehicle License Fees (VLF) have
increased by $267,000 over 1999-2000 figures. Vehicle License Fees are
collected by the Department of Motor Vehicles and disbursed by the State
Controller to the City. The State taxes motor vehicles in lieu of local property taxes. Vehicle License Fees have increased this year due to the population
Financial Status Report 4
growth in the City and the Statewide increase in VLF received. Registered vehicles include automobiles,
trucks, trailers and motorcycles.
State Assembly Bill 858 went into effect on January 1, 2001. This bill provides a 67.5% VLF credit/refund
to licensed vehicle owners in the State. Vehicle owners will see a reduced VLF fee during the year, and also receive a refund check from the State. This reduction will be in place for the 2001 and 2002 calendar
years. This bill is double-joined with State Assembly Bill 511, which appropriated over two million dollars to
cover the reduction in VLF revenues. The City will not see any reduction in their VLF revenues at this time.
f-l UP’ 17%
Business License Tax ($1.1 Million) - Business license revenues have
increased by $160,000 over 1999-00 figures. The majority of this year’s increase
was due to the success of our recent public awareness campaign.
In an effort to create equity among the business community, as well as bring
businesses into compliance with the City’s business license ordinance, the City recently embarked on a
public awareness campaign. This campaign was designed to educate the business community on the
requirements and procedures for business licensing in the City of Carlsbad. Over 2,100 letters were mailed
to various businesses that were potentially doing business in the City without a license. The City also
implemented a temporary amnesty period through September 30, 2000, for newly licensed businesses.
During this amnesty period, all penalties for prior business license taxes were waived for newly licensed
businesses. The City saw 317 new organizations obtaining a business license as a result of this program,
bringing in over $102,000 in additional business license revenue.
Interdepartmental Charqes ($1.0 Million1 - Interdepartmental charges are $77,000, or 8%, 0s more than last year. Interdepartmental charges are generated through the Treasurer’s
UP portfolio management fee, engineering overhead charged to capital projects, and 8% miscellaneous interdepartmental charges charged to funds outside of the General fund,
for services performed by departments within the General fund. The majority of this
year’s increase is due to an increase in the monthly administrative overhead revenue generated through
charges to funds outside of the General fund.
Recreation Fees ($721,000) - Recreation fees are generated through
instructional classes, youth and adult sports, the triathlon and other special events, day trips, various aquatic programs, and lagoon permits. Year-to-date
recreation fee revenue is $234,000 more than the previous fiscal year. A large
portion of the current year recreational revenue represents fees paid in the prior
year, for programs in the current fiscal year. In fiscal year 1999-2000, these amounts were shown as
deferred revenues, and recognized as revenue in the current fiscal year.
c UP 3%
Franchise Taxes ($596,000) - Franchise tax revenues for the year are essentially
the same as the previous fiscal year. Franchise fees come from public utility
sources such as SDG&E, trash collection franchises, and cable franchises
conducting business within City limits.
ADDITIONAL GENERAL FUND REVENUES
Although the top General fund revenues represent approximately 90% of all General fund revenues, the
City does have some other revenue sources, although much smaller in scale. Each month, we will highlight
a couple of the other revenue sources, to give you some insight as to how these revenues are derived, and how they are doing in the current fiscal year.
Financial Status Report 5
Ambulance Fees ($488,000) - The City bills any individual who is transported in one of the
City’s ambulances. Billing and collecting of these fees is done by an outside
company, which receives a percentage of the fees collected.
December 2000, ambulance fees are 4% or $20,000 higher than
1999-00, due to increased collection rates and an increase in
population.
Through fiscal year
the City’s
Down 0 3%
Fines and Forfeitures ($373,000) - Fines and forfeitures represent fees
collected for code violations, parking citations, overdue fines and returned
checks. Revenues are recognized by the City when the fine or forfeiture is paid
by the citizen, as opposed to when the fine is imposed.
Financial Status Report 6
GENERAL FUND
REVENUE ZOMPARISON
EXPECTED
BUDGET
AS OF 12/31100
‘AXES
PROPERTY TAX
SALES TAX
TRANSIENT TAX
FRANCHISE TAX
BUSINESS LICENSE TAX
TRANSFER TAX
TOTAL TAXES
9,423,858
9,692,9Ia
4,302,026
587,843
953,619
367,768
25,328,031
NTERGOVERNMENTAL
VEHICLE LICENSE FEES
HOMEOWNERS EXEMPTIONS
OTHER
TOTAL INTERGOVERNMENTAL
KENSES AND PERMITS
BUILDING PERMITS
OTHER LICENSES & PERMITS
TOTAL LICENSES & PERMITS
:HARGES FOR SERVICES
PLANNING FEES
BUILDING DEPT. FEES
ENGINEERING FEES
AMBULANCE FEES
RECREATION FEES
OTHER CHARGES OR FEES
TOTAL CHARGES FOR SERVICES
‘INES AND FORFEITURES
UCOME FROM INT 8, PROPERTY I ,162,750
UTERDEPARTMENTAL CHARGES I ,050,233
ITHER REVENUE SOURCES 302,626
‘OTAL GENERAL FUND
I ,765,451 1.773.359 2,040,231 266,872 15%
44,550 43,254 47,429 4,175 0%
363,612 504,417 650.632 146,215 29%
2,173,613 2,321,030 2,738,292 417,262 18%
904,189 993,863 1,207,567
450,693 525,252 740.568
I ,354,682 1,519,115 I ,948,I 35
159,907 200,193 375,577 I 75,384 88%
614,703 653,636 803,006 149,370 23%
795,145 703,577 401,521 (302,056) -43%
580,000 467,845 488,312 20,467 4%
576,205 487,103 721,385 234,282 48%
247,136 261,953 355,178 93,225 36%
2,973,096 2,774,307 3,144,979 370,672 13%
419,944
34,765,375
(1)
ACTUAL ACTUAL CHANGE FROM
FY 2000 FY 2001 YTD 00 TO PERCENT
AS OF 12/31/99 AS OF 12/31/00 YTD 01 CHANGE
7,784.884 8,700,777
9,224,189 10,284,554
4,076,137 4,792,i ai
576,669 596,221
923,639 i ,083,988
368,892 360,180
22,954,410 25,aI7,9oI
365,423 372,729
I ,148,640 2,091,129
956,436 I ,035,661
346,663 641,735
915,893 12% .
I ,060,365 11%
716.044 I 8%
19,552 3%
160,349 17%
uw3 -2%
2,863,491 12%
213,704 22%
215,316 41%
429,020 28%
(12,694) -3%
942,269 82%
77,225 8%
293,072 84%
32,410,224 37,790,561 5,380,337 17%
(1) Calculated General fund revenues are 9% over budget estimates as of December 2000.
Financial Status Report 7
Exoenditures
Total General fund expenditures and encumbrances through December 2000 are $40.4 million. This
leaves $35.4 million, or 46.8%, available through the fiscal year-end on June 30, 2001. At this point in time,
funds have been spent in the same proportion as the previous year. Excluding the operating transfers and contingencies, the percentage available at December 31, 2000 is 50.4%, compared to 53.5% available at
December 31, 1999.
Council has allocated $4.3 million out of the General fund budget to be available for unanticipated
emergencies or unforeseen program needs. Just under $1 million has been authorized out of the
contingency account to-date, as shown in the chart below.
CONTINGENCY ACCOUNT
USE OF FUNDS
EXPLANATION
iDOPTED BUDGET
JSES:
Police Department Salary Reclassifications
Regional Sand Retention Strategy
Out-of-State Travel for Purchasing
New Fire Association Contract
Carlsbad Convention and Visitors Bureau Contract Adjustment
Increase in Public Information Officer Contract
Management Base Pay Increase
New Computerized Fleet Maintenance Management System
RESOLUilOh
AMOUNT DATE NUMBER
$4,300,000 06127lOO 2000-20:
WOO) 07118l92 2000-254
(8,192) 08/I 5100 2000-265
W3-8 09/l 2100 2000-282
(370,900) 10/17/00 2000-317
(3,000) 10/17/00 2000-324
(140,000) 11114/00 2000-339
(407,600) 11121/00 2000-348
(32,400) 12/l 2100 2000-378
‘OTAL USES (972,342)
4VAILABLE BALANCE $3,327,656
A detailed schedule of General fund expenditures is provided on the following page.
Financial Status Report
GENERAL FUND
EXPENDITURE STATUS BY DEPARTMENT
TOTAL AVAILABLE %I
BUDGET COMMITTED* BALANCE AVAILABLEn
)EPT DESCRIPTION FY 2000-2001 BASIS 12/31/2000 1 U31/2000
‘OLICYILEADERSHIP GROUP
CITY COUNCIL
CITY MANAGER
CITY CLERK
CITY ATTORNEY
CITY TREASURER
TOTAL POLICY/LEADERSHIP
iDMINISTRATIVE SERVICES
ADMINISTRATION
FINANCE
PURCHASING
HUMAN RESOURCES
RECORDS
TOTAL ADMINISTRATIVE SERVICES
‘UBLIC SAFETY
POLICE
FIRE
TOTAL PUBLIC SAFETY
:OMMUNITY DEVELOPMENT
COMMUNITY DEVELOPMENT ADMIN
HIRING CENTER
GEOGRAPHIC INFORMATION
ECONOMIC DEVELOPMENT
COMMUNITY PROMOTION (CCVB)
PLANNING
BUILDING
TOTAL COMMUNITY DEVELOPMENT
:OMMUNITY SERVICES
PARK PLANNING & RECREATION
SENIOR PROGRAMS
LIBRARY
CULTURAL ARTS
TOTAL COMMUNITY SERVICES
‘UBLIC WORKS
PUBLIC WORKS ADMINISTRATION
ENGINEERING
PARKS
STREETS &TRAFFIC SIGNALS
FACILITIES
TOTAL PUBLIC WORKS
ION-DEPARTMENTAL & CONTINGENCY
OTHER NON DEPARTMENTAL (a)
OPERATING TRANSFERS OUT
CONTINGENCY
TOTAL NON-DEPT 8 CONTINGENCY
‘OTAL GENERAL FUND
251,851 110,170 141,681 56.3%
1,349,561 743,551 606,010 44.9%
155,526 72,078 83,448 53.7%
759,042 363,582 395,460 52.1%
147,548 56.018 91,530 62.0%
2,663,526 1,345,399 1,318,129 49.5%
568,504 213,419 375,085 63.7%
1,607,785 747,332 860,453 53.5%
568,493 262,934 305,559 53.7%
1,720,605 611,934 1.108.671 64.4%
1,511,809 969,934 541,875 35.8%
5,997,196 2,805,553 3,191,643 53.2%
14,119,700 7,189,586 6,930,114 49.1%
9,656,314 4,765,925 4,890,389 50.6%
23,776,014 11,955,511 11,820,503 49.7%
509,094 240,100 268,994 52.8%
85,849 81,490 4,359 5.1%
281,248 130,936 150,312 53.4%
210,263 70,762 139,501 66.3%
496,176 494,258 1,918 0.4%
2.590,771 1,135,494 19455,277 56.2%
l&38,491 1,165,590 682,901 36.9%
6,021,892 3,318,630 2,703,262 44.9%
39752,455 1,700,270 2,052,185
417,895 206,466 211,429
6,395,658 33027,744 3,367,914
681,293 330.571 350,722
11,247,301 5,265,051 $982,250
54.7%
50.6%
52.7%
51.5%
53.2%
607,742 218,700 389,042 84.0%
5,065,826 2,375.128 2,690,698 53.1%
2,604,674 1,330,443 1,274,231 48.9%
2.720.408 1,569.738 1,150,670 42.3%
2,296,734 1,378,865 917,869 40.0%
13,295,384 6,672,674 6,422,510 48.3%
715,212 55,387 659,825 92.3%
8,732,400. 8,732,400 0 0.0%
3,327,658 0 3,327,658 100.0%
12,775,270 8,787,787 3,987,483 31.2%
75,776,585 40,350,805 35,425,780 46.8%
’ Total committed includes expenditures and encumbrances.
‘* Amount available would be 46.8% if funds were spent in the same proportion as the previous year.
3) Other non-departmental expenses include property tax administration fees, beach parking fees and other non-departmental items. 7
Financial Status Report 9
ENTERPRISE FUNDS
WATER ENTERPRISE
Revenues
up’,,
Cl
l Water sales are essentially equal to the previous year. The same holds true for the number
of water units sold.
9% l Increase in charges for current services is due to the net effect of a $31,000 decrease in plan
check revenue and a $85,000 increase in delivery charge revenue due to the increased
customer base.
l Increase in interest revenue due to the maintenance of a higher cash balance as compared
to the prior fiscal year, as well as an increase in the market value on investments.
l The decrease in fines, forfeitures and penalties is the result of allocating late charges to the various
utility services (water, sewer and trash) in the current fiscal year. In the previous fiscal year, all late
charges were reflected in the Water Enterprise.
l Majority of the increase in other revenues is the result of recording property tax revenues in the Water
Operations fund in 2000-01 versus the Capital Replacement fund in 1999-00.
Expenses
~
l Reduction in staffing costs is the result of moving utility engineering and utility billing staff to .
the General fund, and charging for their services through interdepartmental charges.
UP l 10% In total, staffing and interdepartmental charges are $120,000 higher than the previous year.
This is due to the maintenance and operations portion of the utility engineering and utility
billing charge backs, included in the interdepartmental charges.
l Although utility rates have increased during the current fiscal year, utilities charged to the Water
Operations fund have decreased from the previous fiscal year due to the allocation of charges between
Water Operations and Reclaimed Water Operations.
l Increase in depreciation/replacement expense represents operating transfer made to the Capital
Replacement fund to partially cover the annual capital replacement costs.
l Miscellaneous expenses are down due to several factors including one-time software related expenses
incurred in last fiscal year, as well as a reduction in customer mailings this year.
Financial Status Report 10
WATER OPERATIONS FUND
DECEMBER 31,200O
BUDGET
REVENUES
WATER SALES 11,200,000
CHARGES FOR CURRENT SERVICES 3,791,ooo
FINES, FORFEITURES & PENALTIES 209,000
INTEREST 162,000
OTHERREVENUES 1,472,OOO
TOTAL OPERATING REVENUE 16,834,OOO
EXPENSES
STAFFING
INTERDEPARTMENTAL SERVICES
PURCHASED WATER
MWD/CWA READY-TO-SERVE
UTILITIES
OUTSIDE SERVICES/MAINTENANCE
DEPRECIATION/REPLACEMENT
CAPITAL OUTLAY
MISCELLANEOUS EXPENSES
TOTAL OPERATING EXPENSES
1,845,121 1,232,616 956,327
1,809,982 504,142 900,132
8,857,OOO 5,059,557 5,077,358
889,800 349,263 354,188
128,400 74,370 51,940
428,523 209,905 116,629
2,193,ooo 650,000 1,543,ooo
63,500 14,300 32,153
738,531 301,297 210,647
16,953,857 8,395,450 9,242,373
OPERATING INCOME/LOSS (119,857
CHANGE FROM
YTD YTD 99-00 TO PERCENT
12/3111999 12/31/2000 YTD 2000-01 CHANGE
6,559,392 6,608,175 48,783 0.7%
1,768,194 1,828,921 60,727 3.4%
112,845 90,561 (22,284) -19.7%
196,856 351,856 155,000 78.7%
303,746 858,615 554,869 182.7%
8,941,033 9,738,128 797,095 8.9%
(276,289)
395,990
17,801
4,925
(22,430)
(93,276)
893,000
17,853
(90,650)
846,923
-22.4%
78.5%
0.4%
1.4%
-30.2%
-44.4%
137.4%
124.8%
-30.1%
10.1%
545,583 495,764 (49,828) -9.1%
Financial Status Report 11
SANITATION ENTERPRISE
Revenues
0.
l Increase in charges for current services is due to an increase in the customer base.
l Increase in interest revenue is attributable to the maintenance of a higher cash balance, as
UP well as an increase in the market value on investments. f4% l Other revenues include charges for engineering labor charged to capital projects, This new
revenue source is the result of charging engineering overhead on sewer capital projects.
This will partially offset the new utility engineering charge back expense.
Expenses
l
0
Reduction in staffing costs is the result of moving utility engineering staff to the General fund, and charging for their services through interdepartmental charges.
UP l In total, staffing and interdepartmental charges are $167,000 higher than the previous year.
7% This is due to the maintenance and operations portion of the utility engineering and utility
billing charge backs, included in the interdepartmental charges.
l Encina plant services are paid quarterly, and are based on the actual costs incurred at the
plant. Although higher than the previous year, the costs are on target with budgeted figures.
SEWER OPERATIONS FUND
DECEMBER 31,200O
CHANGE FROM
BUDGET YTD YTD YTD 99-00 TO PERCENT
FY 2000-01 12/31/I 999 12/31/2000 YTD 2000-01 CHANGE
iEVENUES
CHARGES FOR CURRENT SERVICES
INTEREST
OTHERREVENUES
TOTAL OPERATING REVENUE
5,131,ooo 2,459,4ia 2,676,022
170,500 123,255 194,837
21,000 30,661 110,996
5,322,500 2,613,334 2,981,855
216,604 8.8%
71.582 58.1%
80,335 262.0%
368,521 14.1%
EXPENSES
STAFFING
INTERDEPARTMENTAL SERVICES
ENCINA PLANT SERVICES
UTILITIES
OUTSIDE SERVICES/MAINTENANCE
DEPRECIATION/REPLACEMENT
CAPITAL OUTLAY
MISCELLANEOUS EXPENSES
TOTAL OPERATING EXPENSES
809,200 361,481 289,070
760,044 127,506 367,120
i,7ia,742 347,073 409,099
104,000 48,820 44,719
240,400 36,922 16,919
2,040,OOO i,384,i28 1,390,000
7,998 26,984 7,589
158,511 54,705 29,252
5,838,895 2,387,619 2,553,768
(72,411)
239,614
62,026
(4,101)
(20,003)
5,872
(19,395)
(25,453)
166,149
-20.0%
187.9%
17.9%
-8.4%
-54.2%
0.4%
-71.9%
-46.5%
7.0%
3PERATING INCOME/LOSS (516.395) 225,715 428.087 202,372 89.7%
am
Financial Status Report 12
REDEVELOPMENT AGENCY
Revenues
UP
0
l Assessed values within the Redevelopment area are up approximately 12%, thereby
causing an increase in property tax revenues. 14% l Higher interest revenues are due to the maintenance of higher cash balances in the
current fiscal year, as well as an increase in the market value on investments,
l The majority of the increase in miscellaneous revenues is due to a timing difference with
the receipt of a lease payment, between last fiscal year and this fiscal year.
Expenditures
/A
’ l Most rents are encumbered for the whole year in July of each fiscal year, thereby
reducing the available balance for rents.
l Second debt payment is due in March 2001.
CARLSBAD REDEVELOPMENT AGENCY
OPERATIONS AND DEBT SERVICE FUNDS
December 2000
BUDGET
FY 2000-2001
REVENUES
PROPERTY TAXES 1,370,000
INTEREST 47,500
MISCELLANEOUS REVENUES 182,500
TOTALREVENUE 1,600,OOO
BUDGET
FY 2000-2001
EXPENDITURES
STAFFING 166,200
INTERDEPARTMENTAL SERVICES 77,132
RENTALS & LEASES 123,905
DEBT EXPENSE 1,058,OOO
OUTSIDE SERV, MAINT & MISC 115,144
TOTAL EXPENDITURES 1,540,361
REVENUES OVER EXPENDITURES 59,619
YTD YTD $ %
12/31/99 12131/00 CHANGE CHANGE
618,431 683,403 64,972 11%
25,686 47,800 22,114 86%
84,810 98,656 13,846 16%
728,927 829,859 100,932 14%
TOTAL AVAILABLE %
COMMllTED BALANCE AVAILABLE
12/31/00 (1) 12131/00 12/31100 (2)
82,955 83,245 50%
37,606 39,526 51%
110,188 13,717 11%
683,964 374,036 35%
26,421 88,723 77%
941 ,I 33 599,247 39%
(111,274)
(1) Total committed includes expenditures and encumbrances.
(2) Excluding the Tyler Court purchase in 1999-2000, overall amount available would be 40%
if funds were spent at the same pace as last year.