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PRESENTATION OF FISCAL YEAR 2017-18 FIRST AND SECOND QUARTER MEASURE W REVENUES AND EXPENDITURES
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RECOMMENDATION
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Summary
The Measure W Fiscal Year (FY) 2017-18 First and Second Quarter Budget Update is attached for review.
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. The resolution documents included program guidelines for the initiative which stipulate an independent citizen oversight committee will be established and “meet at least annually to review revenues and expenditures” in order to verify spending would be in compliance with the ordinance.
Voters approved Measure W, Stockton Safe Neighborhood Gang and Drug Prevention Police/Fire Response initiative in November 2004, and the City implemented both the ordinance and the guidelines. Additionally, the City Council later adopted Council Policy 500-2, which directs the City staff to submit quarterly financial reports to the Committee for its review.
Present Situation
Attached for review by the Measure W Independent Citizen’s Oversight Committee is a quarterly financial report, FY 2017-18 Measure W Budget Update for the three months ended September 30, 2017 and the six months ended December 31, 2017. The FY 2017-18 Adopted Budget was increased by approximately $37,000 for encumbrances rolled from FY 2016-17 to the current year for items ordered that had not been received prior to the end of that fiscal year. Total approved budgeted expenditures for FY 2017-18 are $10.4 million.
The City records tax revenue when it is received from the California Department of Tax and Fee Administration. Receipt typically follows the month earned by 60 to 90 days. Revenue receipts were $738,000 at September 30, 2017 and $2.3 million at December 31, 2017, which reflect one and three months tax revenue received, respectively.
Over 90% of the City’s Measure W expenses are for employee compensation and equipment rent, and are therefore incurred very evenly throughout the year. In FY 2017-18, 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. The Police Department expended 47% of its budget and the Fire Department expended 48% of its budget at the midway point in the fiscal year. Most expense categories are consistent with the associated budget as of the end of the second quarter. In general, the departments purchase supplies later in the fiscal year as inventories need to be replenished. Tax collection costs are paid on a quarterly basis with the first payment in FY 2017-18 not occurring until January 2018. At this time, management knows of no significant events that have occurred that would affect the sufficiency of the Measure W appropriations for the current year.
Attachment A - FY 2017-18 Measure W Budget Update for the 3 and 6 Months Ended September 30, 2017 and December 31, 2017