FIN 2018-01-17 Item 2 - Report - November 2017 General Fund Update

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TO: CC: City of Tukwila INFORMATIONAL MEMORANDUM Councilmembers Mayor Ekberg FROM: Peggy McCarthy, Finance Director BY: Vicky Carlsen, Deputy Finance Director DATE: January 10, 2018 SUBJECT: 2017 November General Fund Update Summary Allan Ekberg, Mayor The purpose of the 2017 Financial report is to summarize for the City Council the general state of Departmental expenditures and to highlight significant items or trends. The following provides a high-level summary of the Departmental financial performance. The 2017 November YTD report is based on financial data available as of January 4th, 2018, for the reporting period ending November 30th, 2017. Additional details can be found within the attached financial report. Allocated budgets through the reporting period are calculated by analyzing spend patterns in the previous year and allocating the current year budget using the same spend pattern. If a line item had no expenditures in the prior year but a budget in the current year, the allocated budget for the current year would be zero. It should be noted that budget amendments, as approved by Council on November 20, 2017, have been included in this report. Departmental Expenditures General fund expenditures totaled $52.3 million as compared to the allocated budget of $56.8 million, which is $4.4 million below budget. Notable variances are as follows: • While the fire department is below the allocated budget by $378 thousand, salaries are over budget by $21 thousand and the firefighters bargaining unit is still in negotiations. If the contract is settled prior to closing out 2017, retro pay could be paid in 2018 but transferred back to 2017. It should be noted that a budget amendment of $400 thousand is included in the budget figures. • TIS department has exceeded budget by $118 thousand. The primary reason is a timing difference in the way the allocated budget is calculated for Professional Services. Year to date spend is 82% compared to 91.67% of the year expired. It is anticipated that by the end of the year, the TIS budget will be within budget. • Transfers from the general fund into capital projects funds through November have not been recorded. Rather than transferring funds automatically, we will be transferring funds into the capital projects funds as needed. It is anticipated that a transfer of $1.8 million to the arterial street fund will be necessary due to the additional expenditures related to the Interurban Avenue South project. • Salaries and benefits are $1.6 million lower than budget through November due to ongoing negotiations with the bargaining units. It should be noted that the budget reflects 2% COLA as a place -holder when the budget was drafted. 1