Budget In Brief

A Summary Look at the 1st Quarter of the FY21-22 Budget

As we move into fiscal year 2022, the following report represents the activity for the first quarter of the fiscal year in comparison with prior years and budgets on a prorated basis. One thing to note is that revenues are not realized on a equal basis amongst the quarters. In fact, most of the revenues are realized during the later half of the fiscal year. As we review the 1st quarter activity, I encourage readers to keep the above in mind and look more closely at the actual revenues and expenditures on a historical basis as a guage on whether the City's financial position is on track in meeting its goals and objectives. The comparative charts are presented for the General Fund, the Parks & Tourism Fund and the Stormwater Fund, which are the three major operational funds of the City.

I encourage readers to drill down into any the follwing charts and graphs which will lead you to the City's transparency portal, where the reader will find prorated budget comparisons and the ability to filter down into more detail of the City's operations.

FY 2022 1st Quarter Revenues

Overall revenues for the 1st quarter of $3.1M in comparison with the September 2020, presents a $2,042,165 decrease. That decrease represents bond proceeds of $2,644,093 received in the 1st quarter of fiscal year 2021 that is not applicable in fiscal year 2022. Taking that into consideration, overall revenues for 1st quarter 2022 are 24% greater than the same period of fiscal year 2021.

FY 2022 1st Quarter Expenditures

Overall expenditures for the 1st quarter of $5.7M in comparison with the prior fiscal year at the same period is $1.2M more than the prior year but in line with the prorated budget through 1st quarter, indicating planned costs.

FY 2022 1st Quarter Revenues over (under) Expenditures

The chart summarizes the total revenues less total expenditures for the net change. It is not unusual during the 1st quarter of each year for the expenditures to be greater than the revenues across all funds as noted when looking at compartative periods in prior years.

Personnel Costs for 1st Quarter

Personnel costs consist of salary and benefit transactions. Besides the budgeted salary increases of 2% there was also one additional payroll during the 1st quarter of fiscal year 2022 than there was in the 1st quarter of fiscal year 2021. However, in comparison with the prorated budget for FY 2022, actual salary costs are 7.9% less than budgeted.

Benefit Costs for 1st Quarter

Benefits represent approximately 25% of the total personnel costs and are 19.8% below the prorated budget.

General Fund Overall

The General Fund is the main operating fund of the City and consists of the activity of public works, fire, police, community & economic develoment, municipal court, city council. city manager, finance, and human resource departments.

Overall the General Fund's revenues are below expenditures, which is not unusual as comparated to historical quarterly activity and appears to be in line with expectations.

General Fund Expenditures by Function

Total general fund expenditures are $361,861 greater than 1st quarter 2021 but $465,194 less than 1st quarter fiscal year 2020. Law enforcement is $81K less than the prior year; fire & emergency services is $124,262 greater than the prior year; general government is $246,238 greater than the prior year; debt service is $11,265 less than the prior year; other is $58K more than prior year and public works is $25,554 more than the prior year.

General Fund Expenditures by Expense Type

Most of the increases are the result of one additional payroll during 1st quarter 2022 as compared to 1st quarter 2021.

However, overall expenditures of the General Fund are less than what they have hsitorically been prior to the pandemic.

General Fund Revenue Comparison

General Fund revenues are $291,310 greater than 1st quarter 2021. Licenses & permits makes up 49% of that increase in revenues followed by a 7% increase in property tax revenues with the balance of the increase a result of property sales during the 1st quarter 2022 that did not occur in fiscal year 2021.

Parks & Tourism Fund Overall

The Parks & Tourism Fund reports the activity of the public works division on parks, the proportionate share of police services dedicted to protecting tourists, tourism and tourism related activities and the operations of downtown services including parking, marina, waterfront park and other activities related to maintianing a vibrant downtown.

Overall, the parks and tourism fund revenues are greater than expenditures by $56,595. This is $65,394 less than 1st quarter 2021 and $207,823 less than 1st quarter 2020. During the onset of COVID in fiscal year 2020, expenditure activity was slowed to ensure the financial viablity of the fund.

Salary and benefit costs allocated to the fund were more closely aligned in fiscal year 2022 to match the level of effort of those personnel who's duties cross functions.

Park & Tourism Revenue Comparison

The overall revenues of the fund are $222K greater than what was reported in the 1st quarter of fiscal year 2021. Hospitality taxes reports $105,791 more than the prior fiscal year and accommodations taxes reports $116,212 greater thant the prior year. Both provide strong economic indicators to the vibrancy of tourism in the City as recovery from the pandemic occurs.

1st Quarter Expenditures by Function

Parks and Tourism Expenditures are $351,444 greater than the 1st quarter 2021. Salary and benefits represent 57% of the increase which includes one additional payroll in the 1st quarter 2022 than in the prior fiscal year 1st quarter along with a change in the allocation of personnel costs of public works and police personnel based on the level of effort dedicated to fund activites.

1st Quarter Expenditures by Expense Type

With the increase in hospitality tax revenues comes an increase allocation under ordinance to the city's convention & visitors bureau of $20K, increase to property insurance of $7K, event expenses as the city resumed responsibility for the Shrimp Festival adding $49K to operational costs. These costs are offset by event revenues that did not occur until the subsequent quarter.

Stormwater Fund Overall

The Stormwater Fund accounts for the operations of the Stormwater division of the Public Works department, overseeing the maintenance of the stormwater system as well as repairs and major enhancements to the system. This fund is supported through stormwater user fees that are applied to property owners annual tax bill.

During fiscal year 2021, stormwater revenue bonds were issued to support the major enhancements to the stormwater system in many of our more prone areas to flooding in the City. The bond proceeds are maintained in the Stormwater Fund and released through transfers to the capital projects fund as project costs are incurred.

1st Quarter Expenditures

During fiscal year 2021, the City refunded the 2018 general obligation bonds and issued stormwater revenue bonds to continue the major improvements to the stormwater system. That accounts for the reason why the September 2020 quarter expenditures of the fund are significantly greater than the 1st quarter 2022. Actual expenditures for the quarter are $75K than the prorated budget primarily a result of bond funds that were transferred to the capital projects fund to cover current period costs to the system improvements.

1st Quarter Revenues

It is not unusual to see minimal revenues in the stormwater fund during the 1st quarter, as tax bills for the upcoming tax year are not yet issued. Therefore, the revenues planned for the fund are not realized until the 2nd and 3rd quarters of the fiscal year.