To: Honorable Mayor and Members of City Council
From: Bret Prebula, Finance Director
Prepared By: Jessie Gooch, Finance Analyst
TITLE:
Title
Fiscal Year 2019/20 Budget Adjustments and CIP Changes
LABEL
RECOMMENDED ACTION:
Recommendation
Adopt a resolution adjusting the Fiscal Year 2019/20 Budget by reducing the Civic Center project (FC15PW02) by $3,000,000 and the Dwight Murray Plaza project (PK15RA01GF) by $1,600,000, transferring $4,600,000 from the CIP Fund to the General Fund; reducing General Fund tax revenue by $10,500,000; and reducing General Fund expenditures by $829,000, as documented in Budget Adjustment No. BE2004502.
Body
DISCUSSION:
COVID-19 has affected numerous aspects of the financial and operational aspects of the City. From recent budget analysis of projected lost revenues, the City anticipates an approximately $10 million-dollar shortfall in the current fiscal year (2019/20) and if current trends continue into the early portion of fiscal year 2020/21, the net revenue reduction could be far greater. To provide some perspective, $10 million dollars equals 10% of the City's total General Fund budget.
The Executive Team has been working to identify one-time and ongoing cost reductions to balance the fiscal year budget. Due to the lack of time remaining for FY 2019/20 swift action is required in order to balance the budget. At this point and time, the $10 million projected shortfall reflects a large decrease in TOT through the remainder of the fiscal year, coupled with significant reductions in sales tax. Since City TOT estimates have been dramatically reduced the risk is that other tangential business activity could decrease more than anticipated impacting sales tax at a greater rate. Due to the timing of revenue collection, there would be no time remaining in this fiscal year to make additional expense reductions, thus additional General Fund reserves would have to be utilized to balance the budget (beyond the $4 million in Non-Reo...
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