Translate[Archived] Question #61: Provide a summary of revenue re-estimates and technical adjustments for add/delete.
Question:
Provide a summary of revenue re-estimates and technical adjustments for add/delete.
Response:
The purpose of this memorandum is to inform City Council of the technical budget adjustments proposed by staff as part of the add/delete process. This presents the final revenue and expenditure update before the add/delete process. The sum of revenue re-estimate and technical adjustment expenditure changes provides a net gain of $1,260,942 for add/delete. The major changes from the proposed budget are reflected in the chart below and discussed on the following pages.
Revenue Changes
Annually, at the beginning of April, City staff re-estimates current fiscal year and subsequent fiscal year revenues based on additional months of collection data. The result of those projections shows an overall increase of $953,352 compared to the amount estimated in the City Manager’s Proposed Budget.
The following table below includes the FY 2019 revenue estimation changes from February to April. Most of these changes reflect the proposed State budget (HB5002), still under consideration by the General Assembly, which is expected to increase revenues to the City by $158,209 for FY 2019, an increase in State street & highway maintenance assistance, and an increase in bank franchise taxes.
The revenue re-estimate described in detail below reflect current tax rates and revenue policies continued or already reflected in the FY 2019 Proposed Budget.
The FY 2019 revenue estimates in the FY 2019 Proposed Budget were based on revenue collections and trends through December 2017. The latest estimates are based on revenue collections through March 2018, with exceptions as noted below. Based on actual receipts and trends through March, the FY 2019 revenue estimates have been changed as detailed below. These technical revenue adjustments will be reflected on the preliminary and final Add/Delete list.
The FY 2019 Proposed Budget includes various fee increases for Planning and Zoning. One category, vacations, must be removed from the list of fee increases because the City is already at the state maximum for this fee. This results in a decrease of $4,000 of proposed revenue. In addition, the department identified $81,200 revenue associated with medium sized CDD Concept plan fees which had not been included in the original revenue estimate. After speaking with the development community, administration recommends that this additional revenue be used to reduce other proposed increases to various small development and non-development fees which would have generated $50,075. For all changes related to Planning and Zoning fee increases, the net impact is an additional $27,125 in revenue with fewer fee increases than originally included in the Manager’s Proposed Budget.
Expenditure Changes
Community and Human Services Technical Correction Adjustments
Aging Meals Grants: Title III C-1 Congregate Meals and Title III C-2 Home Delivered Meals are two grants that are awarded annually to the City to provide meals, nutrition education and additional support services to individuals aged 60 and older. The FY 2019 Proposed Budget included only the personnel associated with these grants, which is automatically loaded during the salary and benefits process. The non-personnel expenditures associated with these two grant programs were unintentionally omitted. The financial impact of excluding the non-personnel expenses for these items in the FY 2019 Proposed Budget requires a technical adjustment to the General Fund in the amount of $330,143 for the required General Fund transfer.
Victim Advocacy Overtime: Overtime funding in the amount of $31,478 for victim advocacy was unintentionally omitted in the General Fund due to a data entry oversight. This is the same level of funding that has been provided for the last three fiscal years (FY 2016 through FY 2018).
Dental Care Services: The FY 2017 budget included $57,914 in contingent reserve funding for dental care services. The funding was re-appropriated to DCHS during FY 2017, but the amount was not reprogrammed to DCHS in the FY 2018 budget and therefore also not included in the base budget for FY 2019. This issue will be resolved in FY 2018 through budget transfers and requires a technical adjustment to the budget for FY 2019.
WMATA Operating Subsidy Reduction: The FY 2019 budget includes the following adjustments due to changes in the WMATA operating:
After proposing its budget, WMATA increased the City share of its operating subsidy by $851,617 due to changes in the subsidy allocation formula calculation such as miles and hours of service and ridership. This $851,617 cost increase and $700,000 of FY 2019 General Fund WMATA proposed operating costs can be covered by the use of $1,551, 617 of State transit aid available through NVTC. Given that the City now knows within a close range what costs it will have to bear in reduced NVTA funding and the new “state required local capital contribution to WMATA”, staff is comfortable that these NVTC funds can be allocated towards WMATA operating costs for FY 2019. A separate memo will be forthcoming on how those General Assembly likely fiscal decisions can be handled in FY 2019 within existing capital fund and transportation dollars without any reductions in planned capital projects.
General Fund Cost Redistribution
The Non-Departmental General Fund budget includes savings from the adjustment in the calculation of lower health insurance ($1.25 million) and retirement costs ($1.78 million) that will be redistributed to departments in the approved budget appropriation. There is no net new cost to the budget as these are zero-sum cost neutral transfers.
Special Revenue Funds
Community and Human Services Aging Meals Grants: Title III C-1 Congregate Meals and Title III C-2 Home Delivered Meals are two grants that are awarded annually to the City to provide meals, nutrition education and additional support services to individuals aged 60 and older. The FY 2019 Proposed Budget included only the personnel associated with these grants, which is automatically loaded during the salary and benefits process. The non-personnel expenditures associated with these two grant programs were omitted. The financial impact of excluding the non-personnel expenses for these items in the FY 2019 Proposed Budget requires a technical adjustment to the in the amount of $800,299 in the Grants Fund
Community and Human Services Elderly Virginians Program Grant: The Care Coordinator for Elderly Virginians Program (CCEVP) is a new grant award that was approved on September 12, 2017 (FY 2018). Due to the timing of the award and acceptance of the funding, the corresponding FY 2019 grant accounting structure was not added to the financial system until later in the budget process, and the associated funding was inadvertently omitted from the FY 2019 budget submission. The financial impact of excluding these two grant items in the FY 2019 Proposed Budget requires a technical adjustment to the All Funds budget in the amount of $57,823 in the Grants Fund. These grants do not require additional General Fund support.
Library Equipment Replacement Transfer: The proposed budget did not include an appropriation of equipment fund balance for the cost of a Library vehicle that was not replaced and was offered as general fund savings. This technical adjustment recognizes the $39,427 of special revenue funding and the associated transfer.
Employee Pension Administration System: The Proposed Budget did not include a $300,000 transfer from Pension to the CIP for the Employee Pension Administration System project. This technical adjustment recognizes the additional special revenue funding and the associated transfer.
Capital Projects Fund
King Street Metrorail Station: This technical adjustment updates the amount of state grants being received by the project in FY 2019. The Proposed CIP included $308,000 of additional state grants for this project, however the correct funding amount is $300,706. This is a $7,294 reduction in the grant amount.