title
ACCEPT THE FISCAL YEAR 2024-25 SECOND AND THIRD QUARTER BUDGET STATUS UPDATE AND AUTHORIZE BUDGET AMENDMENTS
recommended action
RECOMMENDATION
It is recommended that the City Council adopt a resolution to:
1. Accept this budget status report on the unaudited results through the third quarter of Fiscal Year (FY) 2024-25.
2. Authorize the continuation of up to $12,233,179 in FY 2024-25 budget appropriations to FY 2025-26 for the completion of identified programs.
3. Authorize a FY 2024-25 budget amendment increasing expenditure and revenue appropriations in the Downtown Marina Fund by $86,350.
4. Authorize a FY 2024-25 budget amendment increasing expenditure and revenue appropriations in the Boat Launch Fund by $46,275.
It is further recommended that the City Manager be authorized to take appropriate and necessary actions to carry out the purpose and intent of the resolution.
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Summary
City staff analyzes the City’s expenditures and revenues quarterly and provides reports to the City Council and the public to increase transparency, make financial recommendations in response to financial activities, and perform routine financial operations that require Council’s authority to complete.
At the end of the third quarter, it would be expected that actuals would be at around 75% of the budget. As of March 31, 2025, General Fund revenues are at approximately 64% of the anticipated budget. This is due to the timing of receipts. Tax remittances are usually remitted from the collection agencies to the City any time from 60 - 90 days after the period closes.
Expenditures are largely at 57% utilization, with $223.5 million of the $390.7 million General Fund budget being spent down. The main factors driving this level of underutilizations are salary savings from vacant positions and project expenditures not yet being fully allocated to the funding source - project expenditures for the year are usually fully allocated by the fourth quarter.
DISCUSSION
Background
One of the strategic initiatives developed to support the City’s long-term fiscal sustainability was to provide regular analysis and reporting of the City’s financial status. As a result, the Council and the public should anticipate quarterly reports. The mid-year quarters are not fully closed or audited, so it is expected that these numbers may change in the fourth quarter report as departments and Accounting reconcile their books and complete closing entries.
Present Situation
General Fund Revenues
The General Fund Revenues are detailed in Attachment B. Overall, Revenues are coming in at approximately 64% of budgeted revenues, which is generally consistent with previous third quarter results due to the timing of receipt of certain revenue streams.
General Tax Revenues make up 90% of the budgeted revenues in the General Fund. Staff expect that remittances from the collection agencies can take up to 90 days to post to the General Fund; as such, only sales tax revenues through January 2025 are reflected in this report. Taking this into consideration, the sales tax appears to be coming in slightly over budget, at 62.5% utilization. Property taxes are remitted to the City each year by San Joaquin County in January and April. Receipts for the first nine months are about 55.4% of the annual estimate. These timing issues are normal and expected and will be adjusted by the fourth quarter report.
The other revenues are largely proceeding as expected or slightly higher. These amounts generally do not contribute to the low utilization, as they make up only 9% of General Fund revenues. Overall, revenues are coming in as expected. After higher-than-expected revenues in the past several years, the City, under the advice of its tax consultants, is anticipating some cooling in tax revenue.
General Fund Expenditures
The General Fund Expenditures are detailed in Attachment A, with summary revenue amounts populated from Attachment B, for an estimated ending fund balance based on staff’s understanding of the City’s current fiscal climate. Expenditures are currently at 57% budget utilization; this is due to several factors.
Salary Savings Across the Board have resulted in mild-to-moderate savings in most program expenditures. Several departments continue to experience staff vacancies. At March 31, 2025, 1,553 out of 1,776 authorized positions had been filled Citywide, with 57 sworn and 47 civilian public safety positions vacant. The city has made comprehensive efforts to recruit and retain positions in a highly competitive environment, including expanding benefits and wellness efforts for employees.
Timing with Multi-Year Program and Capital Improvement Expenditures has resulted in those items being understated in the third quarter. Economic Development and Capital improvement lines both show underutilization due to new contracts that have not been fully spent down yet. Capital Improvement expenditures will not be allocated to the funding sources until year-end close, resulting in what appears to be only a 9% utilization. In addition, much of the Capital Improvement budget of approximately $48.3 million is reserved for future years’ expenditures.
Continuation of FY 2024-25 Appropriations
Pursuant to Section 1908 of the City Charter, operating budget appropriations lapse at the end of each fiscal year if not expended or encumbered. With this requirement in place, programs lose funding at year end unless Council takes action to continue the appropriation into the following fiscal year. Following a review of budgets and activities in FY 2024-25, departments have identified funded programs that could not be encumbered or completed prior to the end of the fiscal year on June 30, 2025. To complete these programs, it is recommended that the FY 2024-25 budgets identified in the table below be continued to FY 2025-26 to complete the specific programs listed in the following table. Budget balances for each program will be reviewed and only available balances will be continued to FY 2025-26.
|
Description |
Department |
Fund |
Not to Exceed Amount |
|
Mayor Discretionary Funds |
City Council |
General Fund |
17,214 |
|
City Council Discretionary Funds |
City Council |
General Fund |
71,092 |
|
Gospel Center Rescue Mission |
Non-Departmental |
General Fund |
150,000 |
|
Animal Shelter Play Yard |
Non-Departmental |
General Fund |
65,000 |
|
Civic Auditorium VFW Reno |
Non-Departmental |
General Fund |
90,000 |
|
Gym Floor & Community Center Maintenance |
Community Services |
Strong Communities |
55,000 |
|
Gym Floor & Community Center Maintenance |
Community Services |
Strong Communities |
54,700 |
|
Gym Floor & Community Center Maintenance |
Community Services |
Strong Communities |
15,000 |
|
Gym Floor & Community Center Maintenance |
Community Services |
Strong Communities |
15,000 |
|
Gym Floor & Community Center Maintenance |
Community Services |
Strong Communities |
5,000 |
|
Gym Floor & Community Center Maintenance |
Community Services |
Recreation Fund |
15,000 |
|
Gym Floor & Community Center Maintenance |
Community Services |
Recreation Fund |
10,505 |
|
Gym Floor & Community Center Maintenance |
Community Services |
Recreation Fund |
5,100 |
|
Gym Floor & Community Center Maintenance |
Community Services |
Recreation Fund |
5,208 |
|
Maya Angelou Library Refresh |
Community Services |
Strong Communities |
288,517 |
|
Linden Library Refresh |
Community Services |
Library Fund (County Funded) |
172,707 |
|
Community Needs Assessment |
Community Services |
Strong Communities |
145,000 |
|
Community Needs Assessment |
Community Services |
Strong Communities |
107,500 |
|
Youth Services Grant |
Community Services |
Recreation Fund |
242,665 |
|
Stockton Arts Foundation |
Community Services |
Recreation Fund |
64,500 |
|
Stockton Arts Foundation |
Community Services |
Recreation Fund |
2,000 |
|
Stockton Arts Foundation |
Community Services |
Recreation Fund |
1,800 |
|
Consulting Services for Ambulance Provider RFP |
Fire |
General Fund |
157,740 |
|
Paramedic Training Tuition for EMS Program |
Fire |
General Fund |
52,000 |
|
Portable gas monitors for front-line apparatus |
Fire |
General Fund |
15,000 |
|
Professional Services for configuration and installation of Traffic Core Replacement |
Information Technology |
Technology ISF |
300,000 |
|
Cisco Traffic Signal Infrastructure |
Information Technology |
Technology ISF |
300,000 |
|
New City Hall - Building 2 Router |
Information Technology |
Technology ISF |
100,000 |
|
Microsoft Enterprise Agreement Contract |
Information Technology |
Technology ISF |
250,000 |
|
Oak Park Ice Rink Repayment to HUD |
Economic Development |
General Fund |
462,500 |
|
Broken Windows |
Economic Development |
General Fund |
165,562 |
|
Augment Real Estate/Asset Management - Real Property |
Economic Development |
General Fund |
55,000 |
|
Consulting services to assist the City with closing out of successor agency activities |
Economic Development |
Successor |
80,000 |
|
Civic Maintenance |
Economic Development |
General Fund |
170,000 |
|
New City Hall Moving Expenses |
Public Works |
General Fund |
15,000 |
|
Bell & Gosset Hot Water Pump #2 Replacement |
Public Works |
General Fund |
2,785 |
|
OCH Boiler Feed Tank Replacement |
Public Works |
General Fund |
154,855 |
|
PD OPS Cooling Tower Replacement |
Public Works |
General Fund |
99,399 |
|
SEB AC Repair |
Public Works |
General Fund |
34,614 |
|
SEB AAON Unit Controls Upgrade |
Public Works |
General Fund |
40,000 |
|
Civic Auditorium Cooling Tower |
Public Works |
General Fund |
17,570 |
|
SEB Hot Water Pump #3 Replacement |
Public Works |
General Fund |
23,000 |
|
SEB Backup Compressors for AC Units |
Public Works |
General Fund |
22,000 |
|
Condition & Feasibility Study for Corporation Yard |
Public Works |
General Fund |
100,000 |
|
Hauler Station Installation |
Public Works |
General Fund |
550,000 |
|
Debris & Homeless Cleanup |
Public Works |
General Fund |
150,000 |
|
Ready to Work |
Public Works |
General Fund |
117,000 |
|
Parks maintenance restoration 3-year project |
Public Works |
General Fund |
1,300,000 |
|
Urban Peace Institute |
City Manager's Office |
General Fund Measure A |
25,000 |
|
Bonterra |
City Manager's Office |
General Fund Measure A |
35,000 |
|
Crime Stoppers Reward Funds |
Police Dept |
General Fund Measure A |
236,700 |
|
Anti-illegal Dumping Reward Funds |
Police Dept |
General Fund Measure A |
225,000 |
|
Prepaid CCP |
Police Dept |
Other Special Revenue Fund |
560,651 |
|
Animal Shelter Satellite |
Police Dept |
General Fund |
2,800,000 |
|
Grants Pass - Homeless funding |
Police Dept |
General Fund |
305,196 |
|
Class and Comp Study |
Human Resources |
General Fund |
100,000 |
|
Recruitment and Retention |
Human Resources |
General Fund |
192,350 |
|
Contingency True Up for FY23-24 |
Administrative Services |
Debt Services Fund |
296,000 |
|
Willdan Financial Services |
Administrative Services |
Debt Services Fund |
12,549 |
|
Moving Expenses to New City Hall |
Multiple |
General Fund |
75,300 |
|
Moving Expenses to New City Hall |
Multiple |
Multiple |
1,036,900 |
|
Total |
|
|
12,233,179 |
FINANCIAL SUMMARY
This report provides an analysis of FY 2024-25 second and third quarter budget status results. The unaudited 9-month period review indicates General Fund revenue increases and expenditure savings are estimated to result in a year-end balance that can fully fund the Working Capital Reserve and mostly fund the Known Contingency Reserve.
Following are the budget amendments and transactions needed to complete the recommended actions:
1. Accept this budget status report on the unaudited results through the third quarter of FY 2024-25.
2. Authorize the continuation of up to $12,233,179 in FY 2024-25 budget appropriations to FY 2025-26 for completion of identified programs.
3. Authorize a FY 2024-25 budget amendment increasing expenditure and revenue appropriations in the Downtown Marina Fund.
|
|
Division/Fund |
Amount |
|
Increase Revenue Budget Downtown Marina |
6050-640-000 |
$ 86,350 |
|
Increase Expenditure Budget Downtown Marina |
6050-640-000 |
$ 86,350 |
4. Authorize FY 2024-25 budget amendment increasing expenditure and revenue appropriations in the Boat Launch Fund.
|
|
Division/Fund |
Amount |
|
Increase Expenditure Budget Boat Launch |
6050-100-140 |
$ 46,275 |
Attachment A - FY 2024-25 General Fund Second and Third Quarter Budget Update
Attachment B - FY 2024-25 General Fund Second and Third Quarter Revenues