AgdaPkt 2007-12-17 - Laserfiche WebLink

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M��G��'r's D�SC�ss�o��A��,�s�s At June 30, 2007, the City's governmental funds reported combined fund balances of $123.4 million, which is a decrease of$2.1 million from the beginning year balance of$125.5 million. This decrease was primarily due to the continued spending of the proceeds of bonds the Redevelopment Agency issued in FY 2003/04 in connection with downtown revitalization efforts, in addition to increased expenditures in the capital outlay fund. Governmental fund revenues increased $6.3 million this year to $108.2 million. Increases in the general fund, capital outlay fund, and redevelopment agency fund revenues were offset by decreases in the transportation grants fund and the grants fund. Expenditures,including capital outlay, decreased$6.7 million this year to $108.9 million. Most of the decrease was attributable to higher capital outlay expenditures in FY 2005/06 for public underground parking garage and the courthouse fa�ade renovation, along with a decline in the Shores Transportation Improvement District capital outlay expenditures as this project nears completion. This decrease was partially offset in FY 2006/07 by increased capital outlay expenditures for the Courthouse Plaza project along with the Redwood Shores Library. The general fund is the primary operating fund of the City. At June 30, 2007, unreserved fund balance of the general fund was $40.8 million of which $23.9 million is available for subsequent years' expenditures while total fund balance increased to $45 million from a beginning fund balance of$43.1 million. As a measure of the general fund's liquidity, it may be useful to compare both unreserved fund balance and total fund balance to total fund expenditures. Unreserved fund balance represents 58% of total fund expenditures, while total fund balance represents 64% of that same amount. The City's general fund balance increased by $1.9 million during the current fiscal year. The following are the maj or funds that qualified under the reporting criteria for maj or funds selection: General Fund - General fund revenues increased approximately $5 million this fiscal year primarily due to increases in property taxes and sales and other taxes. Property taxes increased $2.5 million reflecting the discontinued state takeaway in which property taxes were shifted from cities and counties to the state during fiscal years 2004/OS and 2005/06. The elimination of the state takeaway created a property tax increase of$1.5 million. The remaining increase in property taxes resulted from growth in assessed valuation of 7.54% resulting from continued development in the City and increased prices for existing residential properties. These increases in property tax were offset by a decline in the amount of reimbursement from San Mateo County for prior year payments to the Education Revenue Augmentation Fund (ERAF). The general fund received $2.6 million from the county as its share of the ERAF rebate in FY 2006/07, a decline of$800,000. ERAF, which was created by state law in the early 1990's, allowed the state to shift on an ongoing basis a portion of each city, county, and special district's property taxes to school districts. This shift allowed the state to decrease the state's general fund support to schools throughout the state and concomitantly reduced state funding of schools. Within each county, ERAF revenues are allocated to schools based upon a formula that considers, among several factors, the average daily attendance and the amount of each school district's own property tax revenue. Within San Mateo County, the outcome of applying this formula was that the school districts did not require all of the funds shifted from the cities, county, and special districts. Consequently, these funds were returned to each entity in proportion to the amount that was initially collected. General fund revenues also increased due to a$1.3 million combined increase in building permits,plan checking, and planning services fees related to increased construction activity in the City, such as the planned Costco expansion, Sequoia Hospital, and Stanford projects. General fund expenditures increased $3 million as a result of a $639,000 increase in planning expenditures related to the increased construction activity noted above. Additionally, law enforcement increased $412,000 due to increased staffing for gang suppression, and parks and recreation increased $455,000 due to enhanced programs which were offset by increased user fees. Information services increased $406,000 primarily due to increased expenditures for literacy programs. Also, policy, development, and implementation expenditures increased $479,000 due to increases in retiree health costs,increases in professional services related to negotiations regarding the potential use of the Century 12 Theater site as an automall, increases in county property tax administration costs, and an increase in sales tax audit services(offset by an increase in sales tax revenue). 9