HomeMy WebLinkAboutFIN 2018-07-17 Item 2C - Report - 2018 1st Quarter Financial ReportCity of Tukwila
INFORMATIONAL MEMORANDUM
TO: Councilmembers
CC: Mayor Ekberg
FROM: Peggy McCarthy, Finance Director
BY: Jeff Friend, Fiscal Manager
DATE: July 5, 2018
SUBJECT: 2018 1st Quarter Financial Report
Allan Ekberg, Mayor
Summary
The purpose of the quarterly financial report is to summarize for the City Council the general state of City-
wide financial affairs and to highlight significant items or trends. The following provides a high-level
summary of the City's financial performance on cash basis reporting. Additional details can be found later
in the attached financial report.
The first quarter status report is based on financial data available as of July 5th, 2018 for the reporting
period ending March 31, 2018. Revenues are below allocated budget by $506K and expenditures are below
budget by $169K.
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.
Revenues
Expenditures
General Fund
2018 Revenues vs Expenditures
(Through March 2018)
Actual
Budget
13.67
Actual
Budget
$0
$5
$16.21
$16.38
$10 $15 $20
Millions
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General Fund
The general fund is the City's largest fund and accounts for most City resources and services, other than
those required by statute to be accounted for in another fund. Services include governance, public safety,
and administration.
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The above chart provides a look at revenues and expenses over the last 14 months. The trend lines are
calculated using a 2 -month average for both revenues and expenses. The revenue peaks in April/May and
October/November are the result of Property Tax revenue.
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Revenues
Property Taxes
Sales & Use Taxes
Admissions Tax
Utility Tax
Interfund Utility Tax
Gambling & Excise Tax
Licenses and Permits
Intergovernmental
Charges for Services
Fines & Penalites
Misc
Indirect Cost Allocation
Tukwila Village
Year -to -Date General Fund Revenues Compared to Budget
(Through March 2018)
lam$614
$567
111 $253
$232
MIS$1,128
$1,191
$685
$668
$984
$973
1,04
$1,9196
.113$543
I$36
$37
I$107
5104
$581
$581
$0
$0
$0
$2,300
$2,000
Year to Date Budget
$4,000
55,013
$5,385
Through March 2018, general fund revenues totaled $13.7M compared to an allocated budget of $14.2M
and were $130K higher than revenues collected for the same period in 2017. Notable variances to budget
for the first quarter include:
• Sales and use taxes, which includes local retail sales and use tax, natural gas tax, and criminal justice
sales tax, totaled $5M, which is below budget by $373K, however, it exceeds collections for the same
period last year by $108K.
• Business license fees, while below allocated budget by $55K, exceed prior year revenue by $223K.
Beginning in 2018, the business license fee was changed to $70 per full-time employee and $35 per
part-time employee and the RGRL fee was combined with the business license fee. The RGRL revenue
line is now reflected in the business license revenue line.
• Intergovernmental revenue is below budget by $356K. EMS levy funds of approximately $400K were
not received in the first quarter, but were received in the second.
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Expenditures
Year to Date Department Expenditures Compared to Allocated Budget
(Through March 2018)
City Council
Mayor
$101
Human ResourcesIn
! 34
8178
Finance
Attorney
Recreation
Community Dev
Municipal Court
Police
Fire
Tech. & Innovation
Public Works
Park Maintenance
Street Maint & Ops
Dept 20
5832
$898
1 $102
5308
$311
5435
S346
J390
$381
3895
$766
$1,049
5795
$889
3952
$1,040
9' 5
$929
5
$1,291
$4,904
33,098
$3,199
$0 $1,000 $2,000 $3,000 $4,000 $5,000
Year to Date •Allocated Budget
General fund expenditures through the end of March 2018 totaled $16.2M as compared to an allocated
budget of $16.4M, which is $168K below budget. Notable variances are as follows:
• Police is under budget by $272K. Salaries and benefits expenditures were under budget by $249K due
to vacancies.
• Fire is under budget by $101K. Total salaries and benefits are below allocated budget by $25K, and
supplies are below budget by $75K due to timing differences in spending.
Finance is currently under budget by $202K. Finance salaries and benefits were less than anticipated
due to several open positions and claims and judgements is below previous year spending by $55K.
• Technology and Innovation Services (TIS) exceeds allocated budget by $90K. Salaries and benefits
are above allocated budget by $22K. A position that was vacant most of 2017 is now filled. Additionally,
the professional services line is above allocated budget by $53K. At the January 2nd regular meeting,
Council authorized the Mayor to sign an agreement with Kronos to purchase and implement Telestaff.
As part of the financing, the TIS department was to pay $23K from their 2017 budget. Due to the timing
of the implementation, the $23K charge was incurred in 2018 instead of 2017. This item will be included
in a budget amendment request at the end of 2018. It is also worth noting that, while 25% of the year
has lapsed, TIS has only spent 21 % of their annual budget through the first quarter.
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Department 20 is above allocated budget by $663K. In 2017, transfers to capital projects funds were
not made until the latter part of 2017. Due to cash flow needs in the arterial street fund, transfers from
department 20 to the arterial street fund have been made in the first quarter.
Fund Summary
The chart below is a summary of ending balances for each of the fund types as of March 31,2018.
Fund Summa rY
General/
Contingency
Special
Revenue
Capital
Projects
Enterprise
Internal
Service
Debt
Beginning Fund Balance
18,145,352
1,367,091
52,986,711
17,425,401
5,945,177
1,139,216
Revenues
13,692,371
139,987
11,005,336
7,112,376
5,316,154
705,208
Expenditures
(16,214,595)
(20,108)
(17,569,882)
(9,022,864)
(5,150,991)
(724,588)
Ending Fund Balance
15,623,127
1,486,969
46,422,165
15,514,913
6,110,340
1,119,836
General Fund
General
Contingency
Beginning Fund Balance
11,868,277
6,277,075
Revenues
13,671 ,561
20,810
Expenditures
(16,214,595)
-
Ending Fund Balance
9,325,243
6,297,885
Special Revenue Funds:
Special revenue funds account for revenue sources and expenditures that are legally restricted to a specific
purpose. The City has two special revenue funds: Lodging Tax and Seizure. The Lodging Tax fund receives
a special excise tax on lodging charges and is used to promote tourism. The seizure fund accounts for the
yearly accumulation of drug seizure funds and is used for seizure related expenditures. Through the end of
March 2018, revenues exceeded expenditures in the Lodging Tax fund. Expenditures for the Seizure fund
are greater than revenue by $7K. In 2018 expenditures in the Seizure fund will exceed revenues due to
amounts received in 2016 from the Motel raid in 2013.
Special Revenue Funds
Lodging Tax
Seizure
Beginning Fund Balance
1,139,775
227,316
Revenues
138,231
1,755
Expenditures
(11,240)
(8,869)
Ending Fund Balance
1,266,767
220,202
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Capital Projects Funds
The City has six capital projects funds. Revenue and expenditure details for the funds are as follows:
Capital Project Funds
Residential
Streets
Arterial
Streets
Land Acq, Rec.
& Park 0.v.
Facility
Replacement
Oen oov't
Improvements
Fre Impact
Fees
Public Safety
Plan
City
Facilities
Beginning Fund Balance
6,176,418
3,436 437
4.067,756
2,205,169
368,801
7,210
36,724,920
-
Revenues
120,216
2,416,140
244,580
11,322
51,025
22,442
139,610
8,000,000
Expenditures
(913,487)
(2,112,355)
(3,013,612)
(8,443)
(11,554)
-
(4,459,644)
(7,050,787)
Ending Fund Balance
6,383,147
3,740,222
1,298,724
2,208,048
408,273
29,662
32,404,886
949,213
Through the end of March, the major project in the residential street project is the 42nd Ave S Phase ID, with
expenditures of $849K. Work also continues on the 53rd Ave S project with $61 K in expenditures.
Several arterial street projects were under way during the first quarter including S 144th St Phase 11 and
Strander Blvd Extension Phase 3. Strander Blvd Extension project expenditures of $248K were offset by
$212K of revenue received. Expenditures of $1.5M for the Boeing Access Road Bridge Rehab were offset
with grant revenue of $1.2M. Major Maintenance on 3 Bridges was also under construction in the first
quarter.
Land Acq, Recreation & Parks Development transferred $3M to the City Facilities fund for land acquisition
for the PW Works shops facility.
Enterprise Funds
The City's four enterprise funds account for operations with revenues primarily provided from user fees,
charges, or contracts for services. The City has three utilities and one golf course. The following chart
summaries activity for the first quarter:
Enterprise Funds
Water
Sewer
Foster Golf
Surface
Water
Beginning Fund Balance*
5,690,592
8,696,675
602,269
2,998,807
Revenues
1,333,965
2,382,192
208,956
3,187,263
Expenditures
(2,217,678)
(2,577,107)
(438,761)
(3,789,317)
Ending Fund Balance
4,806,879
8,501,760
372,463
2,396,753
* Foster Golf Beginning Fund Balance is adjusted to remove effect of GASB 68 Net Pension Liability
Revenue for water consumption and the golf course is weather dependent and is typically lower during the
winter months while expenditures remain consistent throughout the year. Expenditures include a transfer
from Utilities to Public Works of $1.2M for land purchased for the new Public Works facility. Utility funds will
be reimbursed when bonds are sold.
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Internal Service Funds
Internal service funds provide services to other City departments and include functions such as employee
and LEOFF 1 retiree medical insurance as well as equipment rental and replacement. Through the end of
March, all internal service funds have sufficient funds to meet expenses. Expenditures include about $3.7M
for the purchase of new fire trucks which was reimbursed by a transfer from the Public Safety Plan fund.
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Self Insured
Self Insured
Internal Service Funds
Fleet
Healthcare -
Healthcare -
Actives
Retirees
Beginning Fund Balance
4,178,570
1,066,595
700,012
Revenues
3,787,854
1,465,093
63,208
Expenditures
(3,744,593)
(1,324,861)
(81,537)
Ending Fund Balance
4,221,831
1,206,827
681,682
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