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PRESENTATION OF FISCAL YEAR 2017-18 THIRD QUARTER AND YEAR END MEASURE W REVENUES AND EXPENDITURES
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RECOMMENDATION
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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 implemented an ordinance and guidelines. The guidelines for the initiative stipulated an independent citizen oversight committee be established, meet at least annually to review revenues and expenditures and verify spending complies with the ordinance. 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 nine months ended March 31, 2018, and the year ended June 30, 2018. The FY 2017-18 Adopted Budget of $10,399,475 was increased by $36,756 for encumbrances rolled from the prior year for items ordered that had not been received prior to the close of that year. Total approved expenditures for FY 2017-18 were $10,436,231 and total estimated revenue was $10,303,000.
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 earned by 60 to 90 days. At year end, however, a receivable is accrued pursuant to generally accepted accounting principles for receipts related to tax collected by the State of California on or before June 30, but remitted to the City of Stockton within 90 days. Revenue received as of March 31, 2018 of $6.3 million reflected seven months of tax proceeds and revenue received and accrued as of June 30, 2018 for the full year was $10.6 million, which was higher than the annual expectation by $334,256 or three percent. Proceeds from investments of $(203), as measured on a fair market value basis, fell short of the $15,000 projection, resulting in total revenue being $319,052 higher than budgeted.
Expenditures as of March 31, 2018 totaled $7.7 million, and for the year ended June 30, 2018 were $10.2 million, which were lower than projections by two percent. Measure W expenditure appropriations were sufficient to cover the cost of 25 sworn staff in the Fire Department and 24 sworn staff in the Police Department. The Police Department spent less on fuel because the vehicles assigned to Measure W were pulled off-line for replacement. The Fire Department also spent less on equipment due to an order that was not received by June 30. A draw-down of fund balance of $(133,031) was presented in the Adopted Budget. The higher revenue and lower-than-anticipated expenditures resulted in actual net annual activity of $392,990.
Attachment A - FY 2017-18 Measure W Budget Update for the Nine Months Ended March 31, 2018
Attachment B - FY 2017-18 Measure W Budget Update for the Year Ended June 30, 2018