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Fish and Wildlife Department, to work on retaining some land for a connector road, and preserving the area as a recreation area with access by the public. The Council directed staff to work aggressively on both those issues. MEMO 2/8/97 City Manager Everett said he would provide a report to the Council and Mr. Murphy detailing the impacts the sale of Bair Island will have on the GID-I-64. MEMO 2/8/97 ------------------------------------------------------------------------------------------------------------------------- 4. SUBJECTS A. Presentation of Financial Picture and Capital ProjectslBudget Information (501) 1. REPORT: Finance Director Ponty, February 8,1997 City Manager Everett distributed the Revised Report which included the latest data ITom the state and ITom local businesses. Finance Director Ponty said sales tax was the largest contributor to the General Fund, approximately 31 %. Using overheads, Finance Director Ponty described Sales Tax by Economic Categories: Miscellaneous, Construction, and Food Products are the smallest contributors and are the most stable; and General Retail, Transportation, and Business to Business are the largest contributors and are the most volatile. Finance Director Ponty described the growth in Business to Business sales, and how very difficult it is to project those figures. He said that although the substantial increase in the third quarter of 1995 was known, staff did not include that increase in the base projections for the 1996/97 budget because they did not know what had caused that economic spurt. The increase did not follow any accepted economic patterns and there was no way to predict where those sales would go in the future. "There was a good chance that it was the result of a one time only factor, or miscoding by the State Board of Equalization," Ponty said. Although the increase continued in the first two quarters of 1996, there was a slight decline in the third quarter. Director Ponty announced that the City received almost a $1 million in sales tax ITom the third quarter of 1995 to the third quarter of 1996 over and above the projections that were used as the base for the budget. He said that, unfortunately, there was no way to project what will happen in the future. City Manager Everett described the extensive research done "to see if there is any correlation. There is none that we can fmd.... We looked at some of our major contributors and looked at their fluctuations ITom quarter to quarter.... and the 2nd and 4th quarters are huge, and the 1" and 3M quarters are small. And the difference between ADJOURNED REGULAR COUNCIL MEETING MlNU~E BOOK NO. 55 FEBRUARY 8,1997 MINUTES Page No. l32 PAGE 2