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REVIEW FISCAL YEAR 2017-18 THIRD QUARTER MEASURES A AND B REVENUES AND EXPENDITURES
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Information item only.
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Summary
City ordinance 2013-07-09-1601, Section 19-Citizen Oversight stipulates the Measure A Citizens Advisory Committee: “shall meet at least annually to review the expenditure of revenues generated by the tax imposed by this Ordinance and make recommendations to the City Council regarding those expenditures.”
Section 7 of the Committee’s bylaws (Informational Materials) also states: “At least quarterly, financial reports-including proposed Budgets and Actuals with detailed supporting schedules will be sent to each Committee member. The reports will show revenue generated by Measure A, detailed line-item expenditures as presented in the annual budget relative to Measure B (public safety), and all other uses of remaining Measure A funds and State Board of Equalization reports.”
Attached for review by the Measure A Citizens’ Advisory Committee is the third quarter financial report for Fiscal Year (FY) 2017-18.
Present Situation
The FY 2017-18 Amended Budget, as shown on Attachment A, includes encumbrance rollovers from FY 2016-17. Police and Office of Violence Prevention (OVP) expenditures in the Amended budget total approximately $22.4 million.
Total revenues included in the FY 2017-18 Amended Budget are approximately $31.0 million. Measure A revenues received as of March 31, 2018, totaled $18,650,785; reflecting payments for sales transactions occurring between July 2017 and January 2018. Also attached is the State Board of Equalization sales tax revenues report for the quarter ended March 31, 2018, showing $7,479,180 in gross revenues which does not reflect the quarterly true up. The report identifies Measure A revenues as add-on tax code 361.
The Police Department expended $15.7 million, and the OVP expended $595,297 through the third quarter of the fiscal year, for total Marshall Plan expenses of $16.3 million. Combined salary and benefit costs for Police sworn and non-sworn positions were at 76% of the budget including the budgeted vacancy savings. OVP salary and benefit expenses were at 64%, reflecting the savings accrued from one position (of the seven budgeted) having been vacated one month into the fiscal year. OVP subsequently filled the position on April 16, 2018. The Police Department continues to fill the positions funded by Measure A. As of March 31, 2018, the number of Measure A funded sworn officer vacancies was just 4 of the 120 authorized, and in the remaining quarter of the fiscal year, salary and benefit costs in the Police department are expected to increase and become closer to the full budgeted cost.
The costs for fuel in the Police Department are higher than expected. The Police Department filled 116 of the sworn vacancies resulting in an increased number of vehicles being deployed sooner in the fiscal year than originally anticipated. Increased vehicle usage coupled with rising gas prices resulted in fuel expenses exceeding budgeted amounts at the end of the third quarter. Vehicle and related equipment costs through mid-year are lower than budgeted although expenditures from a contract underway are expected to be realized during the final quarter of the year. Training costs are anticipated to end the year at or close to the budget.
OVP expenses are expected to increase in several categories in the last quarter of the year. The acquisition of a case management database that was anticipated for FY 2017-18 from Other Services will not occur until FY 2018-19. Other Expenses spending has not been as aggressive as there has been less demand for client services. It is anticipated that as caseloads grow with new clients, spending will increase in the last quarter.
Other uses of Measure A revenues budgeted in the General Fund Services and Reserves category total $8.6 million. In the quarter ending March 31, 2018, $150,640 was expended on audit and tax collection services as shown in the Revenue Collection and Audit Costs category. General Fund Services and Reserves are $2.2 million.
Consistent with the Amended Budget, revenues are projected to exceed expenses by year-end. Revenue Collection & Audit Costs reflect a normal time lag that is expected to correct and fully expend the budget by year-end.
Attachment A - Measure A FY 2017-18 Third Quarter Report
Attachment B - Measure A BOE Quarterly Revenue Report Jan.- March 2018