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PRESENTATION OF FISCAL YEAR 2019-20 SECOND QUARTER MEASURE W REVENUES AND EXPENDITURES
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RECOMMENDATION
Information item only.
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Background
On August 3, 2004, the Stockton City Council approved Resolution 04-0595 that authorized a special transaction and use tax for public safety services be put before voters. In November of that year, voters approved Measure W, Stockton Safe Neighborhood Gang and Drug Prevention Police/Fire Response Initiative, and the City established an ordinance and guidelines. The guidelines for the initiative stipulated an Independent Citizen Oversight Committee be created that would meet at least annually to review revenues and expenditures and verify spending complied with the ordinance. The City Council later adopted Council Policy 3.04.060, which directs the City staff to submit quarterly financial reports for the Committee to review.
Present Situation
In compliance with Council Policy 3.04.060, attached for review by the Measure W Independent Citizen’s Oversight Committee is a financial report for the six months ended December 31, 2019. The FY 2019-20 expenditure appropriation in the Adopted Budget of $10,892,881 was increased by $199,098 for encumbrances rolled from the prior year for items ordered that had not been received before the close of that year. Total approved expenditures for FY 2019-20 are $11,091,979 as of December 31, 2019.
During the year, tax revenue is recorded when it is physically received from the California Department of Tax and Fee Administration and typically follows the month paid by 60 to 90 days, whereas most expenses are incurred evenly throughout the year and are recorded when paid. Revenue received as of December 31, 2019, of $3.9 million reflected four months of tax receipts, or 36% of annual estimated revenue, whereas expenditures totaled $5.4 million, the equivalent to 49% of budget.
Employee, automotive, and radio costs comprise 89% of the annual budget and are spent relatively evenly throughout the year. In FY 2019-20, Measure W expenditure appropriations are sufficient to cover the cost of 25 sworn staff in the Fire Department and 24 sworn staff in the Police Department. In the first six months of the fiscal year, the Police Department expended 48%, and the Fire Department spent 49%, of their respective budgets. The State of California charged for one quarterly payment for sales tax collection administration in the first half of the fiscal year. Measure W expenses are projected to be close to the budgeted amounts at year-end as presented in the FY 2020-21 Proposed Budget agenda item. The labor agreement with the Stockton Police Officers Association approved on May 19, 2020 will change the year-end projections provided with the FY 2020-21 Proposed Budget.
Attachment A - FY 2019-20 Measure W Budget Update for the Six Months Ended December 31, 2019