QUARTERLY FINANCIAL REPORT 2nd Qtr FY14-15 PERFORMANCE AT A GLANCE GENERAL FUND REVENUE Economic Indicators General Fund Revenue Quarterly Analysis General Fund Revenue Category Analysis Sales Tax (& collection detail) Franchise Fees Primary Property Tax Revenue Detail by State Shared Revenue Category Licenses & Permits Charges for Services Other Revenues GENERAL FUND EXPENDITURE YEAR TO DATE COMPARED TO HISTORICAL % REFERENCE POSITIVE Page 2 Page 3 POSITIVE Page 3 POSITIVE Page 4 POSITIVE Page 5 POSITIVE Page 5 POSITIVE Page 6 POSITIVE Page 6 WARNING Page 7 NEGATIVE Page 7 YEAR TO DATE COMPARED TO BUDGET % General Fund Expenditure + Enc. Analysis by Function and by Expenditure Category Mayor & Council City Clerk City Manager Law City Magistrate Expenditure Communications & Public Affairs Detail by Management Services Department Non-Departmental Transportation & Development Community Services Police Fire (includes Citywide Fleet) OTHER FUNDS POSITIVE POSITIVE POSITIVE POSITIVE POSITIVE POSITIVE POSITIVE POSITIVE POSITIVE POSITIVE POSITIVE POSITIVE YEAR TO DATE COMPARED TO BUDGET % POSITIVE Water Fund Analysis Wastewater Fund Analysis Solid Waste Fund Analysis Airport Fund Analysis System Development & Impact Fee Analysis Highway User Revenue Fund Analysis Grants POSITIVE WARNING POSITIVE POSITIVE POSITIVE INFORMATIONAL REFERENCE Page 8 Page 8 Page 9 Page 9 Page 10 Page 10 Page 11 Page 11 Page 12 Page 12 Page 13 Page 13 Page 14 Page 14 REFERENCE Page 15 Page 15 Page 16 Page 16 Page 17 Page 18 Page 18 PERFORMANCE INDICATORS POSITIVE = Variance < 2% compared to historical trends or positive variance > 0% for % to budget. WARNING = Variance of 2 - 5% compared to historical trends. NEGATIVE = Variance of > 5% compared to historical trends or negative variance < 0% for % to budget. 1 2/6/2015 THE QUARTERLY FINANCIAL REPORT Report Objectives * Provide historical comparisons to identify trends or deviations from trends. * Develop performance benchmarks to measure positive and negative results. * Create an executive level report to highlight potential issues or concerns. What is Included in the Report The report emphasizes General Fund, with analysis of its revenue and each category of revenue, and the expenditures by department. Also included is a summary and analysis of Enterprise Funds, System Development Fee and Impact Fee Funds, the Highway User Tax Fund, and Grants. How to Read the Report * Page 1 serves as a table of contents and quick view of performance issues. * The benchmarks are Positive (navy colored), Warning (grey colored), and Negative (maroon colored), providing an initial indicator to determine if the category needs to be monitored closely in the upcoming period. * Performance indicators for General Fund revenue are comparing the percent of year-to-date actuals collected to total budget AND the budget prorated based on the historical trend (last four years) of average actual year-to-date collections. * Performance indicators for General Fund expenditures are based on whether they are within budget for the percent of year-to-date actuals expended plus encumbrances compared to the total budgeted expenditures. * Performance indicators for Enterprise Funds focus on the relationship between Operating Revenues and Operating Expenses (including debt service and indirect cost allocation) and the percentage of budget received/expended. ECONOMIC INDICATORS GROSS DOMESTIC PRODUCT (GDP) INTEREST RATES Real gross domestic product - the output of goods and services produced by labor and property located in the US. This table reflects the four most recent changes to the Federal Funds Rate by the Federal Reserve Board. The change to the GDP is an indicator of the general direction of the economy. Slow or negative growth will likely mean lower revenues for the City. Lowering the Federal Funds Rate is a way for the Federal Reserve Board to make it less expensive for banks to borrow money for loans and investments and (in theory) pumping additional dollars into the economy. Recent announcements state this rate will remain low through 2015. 2.0% April 30, 2008 1.5% October 8, 2008 1.0% October 29, 2008 0% - 0.25% December 16, 2008 to date First Quarter 2014 (revised estimate) Second Quarter 2014 (third estimate) Third Quarter 2014 (revised estimate) Fourth Quarter 2014 (advance estimate) -2.1% 4.6% 5.0% 2.6% Source: US Department of Commerce Source: Federal Reserve Bank UNEMPLOYMENT National 5.9% 5.8% 5.8% 5.6% Sep-14 Oct-14 Nov-14 Dec-14 State of Arizona 6.9% 6.8% 6.8% 6.7% Phoenix Metro Area 5.8% 5.7% 5.9% 5.6% High unemployment rates are a reflection of a slow economy and the reduced demand for goods and services. The Phoenix Metro Area unemployment rate is typically lower than the national and state rates. Source: Arizona Department of Commerce, "Arizona Workforce" Newsletter CITY INVESTMENT PORTFOLIO BUILDING PERMITS Single-family building permits are an indicator of the general economy. The City splits its investment portfolio between two investment Higher numbers of permits indicate an active construction market and firms with a different mix of holdings at each firm to reduce risk. resultant home sales. Fiscal Year 2014-15 Rate of Return 2nd Quarter Fiscal Year State of Arizona Chandler Benchmark: 0.12% 0.15% Jul - Aug - Sep 2013 4,544 133 Wells Capital Management: 0.09% 0.12% Oct - Nov - Dec 2013 3,908 102 PFM: 0.12% 0.17% Jan - Feb - Mar 2014 4,079 87 Fiscal Year 2013-14 Rate of Return 2nd Quarter Fiscal Year Apr - May - Jun 2014 5,120 147 Benchmark: 0.05% 0.27% Jul - Aug - Sep 2014 4,506 126 Wells Capital Management: 0.09% 0.35% Oct - Nov - Dec 2014 3,850 105 PFM: 0.06% 0.32% The City's benchmark is the 0-3 year Merrill Lynch Treasury Index. Single family building permits are lower than the high-growth years, Rate of return includes interest earnings as well as both realized averaging 117 permits over the last six quarters. Fewer building permits and unrealized gains/(losses). generally equates to less new construction, lower permit fees revenues and lower sales tax revenues. Source: Investment Advisors Source: U.S. Census Bureau, City of Chandler Transportation & Development Department. 2 2/6/2015 GENERAL FUND REVENUE ANALYSIS: OVERALL GENERAL FUND REVENUES FY 2014-15 2nd Qtr Jul - Sep 14 $ 43,033,811 2nd Qtr Oct - Dec 14 48,275,977 3rd Qtr Jan - Mar 15 49,151,636 4th Qtr Apr - Jun 15 54,954,636 Total $ 195,416,060 FY 15 Actual Revenue $ % of Budget Rec'd *% of Budget Hist. Rec'd 45,719,281 23.4% 22.1% 50,744,354 26.0% 26.3% Actual Revenue FY 15 Actual Revenue Historical Trend Actual to Budget 70 Dollars in Millions FY 15 Adopted Budget FY 14 60 50 40 30 20 $ 96,463,635 49.4% 48.4% 10 - * Pro-rated based upon a four year Historical Trend of Actual Year-to-date Collections 2nd Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE General Fund revenue collections through the second quarter of FY 2014-15 are $5.2M (5.6%) above the budget based on historical trend and $2.9M (3.1%) higher than actual collections through the second quarter of FY 2013-14. Overall, General Fund revenue, led by continuing strong Sales Tax and License and Permit collections, are performing well due to higher consumer confidence and a steady stream of new development activity in Chandler. The following charts provide more detail regarding the various sources of General Fund revenues. GENERAL FUND REVENUES BY CATEGORY FY 2014-15 General Fund Collection History by Category % Revenue Categories Sales Tax Franchise Fees Primary Property Tax State Shared Revenue Licenses & Permits Charges for Services Other Revenues Indirect Cost Allocation FY 15 Adopted Budget $ 99,261,000 2,979,000 6,964,900 57,907,000 3,580,400 11,003,060 6,141,800 7,578,900 FY 15 Actual Revenue $ 52,138,374 778,012 3,620,009 26,678,747 2,210,227 4,924,399 2,324,417 3,789,450 Total $ 195,416,060 $ 96,463,635 % of Budget Rec'd to Date 52.5% 26.1% 52.0% 46.1% 61.7% 44.8% 37.8% 50.0% Indirect Costs 100% 4% 3% 7% 3% 4% 4% 6% 2% 4% 3% 6% 3% 25% 26% 28% 4% 4% 4% 80% 60% 2% 1% 2% 4% 2% 5% 2% 28% 4% 1% Other Revenues Charges for Services Licenses & Permits State Shared Revenue 40% 52% 52% 52% 54% Primary Property Taxes 20% Franchise Fees 49.4% 0% FY12 $188M FY13 $196M FY14 $201M FY15 Q2 YTD $96M Local Sales Taxes POSITIVE This chart summarizes General Fund revenue collections by category for FY 2014-15. The graph helps us visualize what percentage each revenue category is to the total General Fund. As you can see, the percentage spread of revenue sources are relatively consistent over the years with local sales taxes and state shared revenues being the largest General Fund revenue sources. The next several pages provide an analysis of each revenue category except Indirect Cost Allocation (payments by the Water, Wastewater, Solid Waste, and Airport Enterprise Funds to the General Fund for City services provided for operations). 3 2/6/2015 GENERAL FUND REVENUE ANALYSIS (continued): SALES TAX REVENUE FY 2014-15 1st Qtr Jul - Sep 14 $ 24,633,529 2nd Qtr Oct - Dec 14 23,737,389 3rd Qtr Jan - Mar 15 25,134,218 4th Qtr Apr - Jun 15 25,755,864 FY 15 Actual Revenue $ % of Budget Rec'd *% of Budget Hist. Rec'd 26,750,744 26.9% 27.1% 25,387,630 25.6% 26.3% Actual Revenue FY 15 Actual Revenue Historical Trend Actual to Budget 30 Dollars in Millions FY 15 Adopted Budget FY 14 25 20 15 10 Total $ 99,261,000 $ 52,138,374 52.5% 53.4% 5 * Pro-rated based upon a four year Historical Trend of Actual Year-to-date Collections 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE Figures above include General Fund Local Sales Tax Collections and the related revenues of License Fees, Audit Assessments, Penalties, and Interest. Sales tax collections for the second quarter of FY 2014-15 are $3.8M (7.8%) above the budget based on historical trend and $1.4M (2.8%) higher than FY 2013-14 actual collections through the second quarter. It should be noted that HB2111 required the State of Arizona to begin licensing and collecting sales tax for all non-program Cities beginning 1/1/15, which the City anticipated to have a negative impact on sales tax revenue collections during FY 2014-15. This deadline was extended one year by the State to 1/1/16. SALES TAX COLLECTION HISTORY 4 Years Actual Sales Tax by Category (in millions) Retail Contracting Utilities Real Property Rentals Restaurants & Bars Telecommunications Personal Prop. Rentals Hotels/Motels Publishing/Printing FY 15 Adopted Budget $ 46,500,000 9,450,000 12,500,000 10,000,000 9,000,000 3,500,000 2,100,000 2,000,000 250,000 Amusements Use Tax TOTAL SALES TAX FY 15 Actual % of Actual Revenue to Budget $ 22,949,416 49.4% 4,648,769 49.2% 7,631,598 61.1% 5,641,727 56.4% 4,707,250 52.3% 1,719,726 49.1% 1,528,953 72.8% 1,067,151 53.4% 129,826 51.9% 700,000 1,000,000 $ 97,000,000 $ % Chg from Prior Yr 2.8% -8.6% 5.9% 5.2% 4.6% 2.2% 22.4% 7.4% 6.1% 360,091 428,134 51.4% 42.8% 1.9% -24.3% 50,812,641 52.4% 2.8% 39 FY 10-11 FY 11-12 43 FY 12-13 45 6 11 11 10 10 47 FY 13-14 0 20 40 8 4 9 12 10 12 11 12 60 9 4 9 4 11 10 4 80 100 120 Retail Contracting Utilities Real Property Rentals Restaurants & Bars Telecommunications Personal Prop. Rentals Hotels/Motels Publishing/Printing Amusements Use Tax The above figures reflect General Fund Sales Tax Collections by category and exclude the related revenues of License Fees, Audit Assessments, Penalties, and Interest. Sales Tax collections through the second quarter of FY 2014-15 were $3.6M (7.5%) above the budget based on historical trend and $1.4M (2.8%) higher than FY 2013-14 actual collections through the second quarter. Lower contracting and use tax collections reflect a slowdown of development through the second quarter of FY 2014-15 compared to through the second quarter of the last fiscal year. 4 2/6/2015 GENERAL FUND REVENUE ANALYSIS (continued): FRANCHISE FEE REVENUE FY 2014-15 1st Qtr Jul - Sep 14 $ 2nd Qtr Oct - Dec 14 58,142 $ 715,482 3rd Qtr Jan - Mar 15 1,000,149 4th Qtr Apr - Jun 15 1,205,227 Total FY 15 Actual Revenue $ 2,979,000 $ % of Budget Rec'd *% of Budget Hist. Rec'd 59,573 2.0% 2.0% 718,439 24.1% 24.4% 778,012 26.1% Actual Revenue FY 15 Actual Revenue Historical Trend Actual to Budget Dollars in Thousands FY 15 Adopted Budget FY 14 26.4% 1,400 1,200 1,000 800 600 400 200 - * Pro-rated based upon a four year Historical Trend of Actual Year-to-date Collections 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE Franchise Fees are paid by Arizona Public Service (2% of Commercial and Residential Sales), Southwest Gas Corporation (2% of Commercial and Residential Sales), Cox Communications (5% of Gross Revenue), Air Products (2% of Gross Sales), and Centurylink Cable Services (5% of Gross Sales). The historical trend (FY 2010-11 through FY 2013-14) reflects Qwest's exit from the cable business in FY 2010-11 and reentry in the market in FY 2012-13 as Centurylink. Franchise fee collections through the second quarter of FY 2014-15 are $4,389 (0.6%) above the budget based on historical trend and $7,629 (-1.0%) lower than FY 2013-14 actual collections through the second quarter. PRIMARY PROPERTY TAX REVENUE FY 2014-15 1st Qtr Jul - Sep 14 $ 2nd Qtr Oct - Dec 14 49,033 FY 15 Actual Revenue $ 3,498,525 3rd Qtr Jan - Mar 15 511,411 4th Qtr Apr - Jun 15 2,905,931 % of Budget Rec'd *% of Budget Hist. Rec'd 32,045 0.5% 0.7% 3,587,964 51.5% 51.2% Actual Revenue FY 15 Actual Revenue Historical Trend Actual to Budget 4 Dollars in Millions FY 15 Adopted Budget FY 14 3 2 1 Total $ 6,964,900 $ 3,620,009 52.0% 51.9% - * Pro-rated based upon a four year Historical Trend of Actual Year-to-date Collections 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE This presentation only includes primary property taxes (supporting General Fund operations) and does not include secondary property taxes (supporting debt service on capital projects and recorded in the General Obligation Debt Service Fund). Property tax collections are due starting October 1st and March 1st each year. For FY 2014-15, Chandler will collect a primary tax rate of $0.2992 per $100 of assessed valuation and a secondary tax rate of $0.88 per $100 of assessed valuation for a total rate of $1.1792, representing a decrease of $0.0922 from the rates adopted for FY 2013-14. There is a two-year lag between the market value and recording assessed valuations, therefore, the City's primary assessed valuation increased 5.6% in FY 2014-15, the first year of increases in assessed valution since FY 2009-10. Primary property tax collections through the second quarter of FY 2014-15 are $72,451 (2.0%) above the budget based on historical trend and $180,494 (-4.7%) lower than FY 2013-14 actual collections through the second quarter. The majority of collections come in the second quarter since property tax bills are due in October. The reduction in the property tax rate helped offset the increased valuations to relieve citizen property tax bills to the City. 5 2/6/2015 GENERAL FUND REVENUE ANALYSIS (continued): STATE SHARED REVENUE FY 2014-15 1st Qtr Jul - Sep 14 $ 12,057,349 2nd Qtr Oct - Dec 14 13,880,616 3rd Qtr Jan - Mar 15 14,780,982 4th Qtr Apr - Jun 15 17,188,053 Total $ 57,907,000 FY 15 Actual Revenue $ $ % of Budget Rec'd *% of Budget Hist. Rec'd 12,041,196 20.8% 21.0% 14,637,551 25.3% 24.4% 26,678,747 46.1% Actual Revenue FY 15 Actual Revenue Historical Trend Actual to Budget Dollars in Millions FY 15 Adopted Budget FY 14 18 16 14 12 10 8 6 4 45.3% 2 - * Pro-rated based upon a four year Historical Trend of Actual Year-to-date Collections 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE -- State Shared Sales Tax: The state sales tax rate is currently 5.6%, of which a portion of the various categories of sales tax are distributed to cities and towns based on population as state shared sales tax. Collections through the ssecond quarter of FY 2014-15 are $184.806 (2.2%) above the budget based on historical trend and $346,547 (4.3%) higher than FY 2013-14 actual collections through the second quarter. This revenue category reflects a small but steady growth in Arizona's overall economy. -- Vehicle License Tax: Cities and towns receive 25% of the net revenues collected for vehicle licensing within their county from the state. The respective city shares are determined by the proportion of city population to total incorporated population of the county. Collections through the second quarter of FY 2014-15 are $550,040 (16.2%) above the budget based on historical trend and $502,523 (14.6%) higher than FY 2013-14 actual collections through the second quarter. -- Urban Revenue Sharing: Fifteen percent (15%) of the 2012 State income tax collection is distributed to cities and towns as urban revenue sharing based upon population and is known for budget purposes since there is a two year lag in distribution. Collections through the second quarter of FY 2014-15 are $5,936 (less than 0.01%) below the budget based on historical trend and $1.1M (8.6%) higher than FY 201314 actual collections through the second quarter. LICENSES & PERMITS REVENUE FY 2014-15 1st Qtr Jul - Sep 14 $ 2nd Qtr Oct - Dec 14 534,126 $ 869,232 3rd Qtr Jan - Mar 15 931,678 4th Qtr Apr - Jun 15 1,245,364 Total FY 15 Actual Revenue $ 3,580,400 $ % of Budget Rec'd *% of Budget Hist. Rec'd 1,169,528 32.7% 18.7% 1,040,699 29.1% 30.4% 2,210,227 61.8% 49.1% * Pro-rated based upon a four year Historical Trend of Actual Year-to-date Collections Actual Revenue FY 15 Actual Revenue Historical Trend Actual to Budget Dollars in Thousands FY 15 Adopted Budget FY 14 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE This category includes revenue for various licenses: transaction privilege sales tax, alcoholic beverages, peddlers and solicitors, secondhand and junk dealers, amusements, and professional/occupational licenses, as well as cable license application fees. In addition, revenue from building, alarm, and fiber optic permits are included. License and permit collections through the second quarter of FY 2014-15 are $806,869 (57.5%) above the budget based on historical trend and $209,919 (10.5%) above FY 2013-14 actual collections through the second quarter. Budgeted amounts have been kept at moderate levels since it is difficult to predict the timing of new development, but this category has started the year very strong and exceeded expectations. 6 2/6/2015 GENERAL FUND REVENUE ANALYSIS (continued): CHARGES FOR SERVICES REVENUE FY 2014-15 1st Qtr Jul - Sep 14 $ 2,420,101 2nd Qtr Oct - Dec 14 2,363,036 3rd Qtr Jan - Mar 15 2,541,659 4th Qtr Apr - Jun 15 3,678,264 Total $ 11,003,060 FY 15 Actual Revenue $ $ % of Budget Rec'd *% of Budget Hist. Rec'd 2,618,345 23.8% 24.3% 2,306,054 21.0% 23.7% 4,924,399 44.8% Actual Revenue FY 15 Actual Revenue Historical Trend Actual to Budget 5 Dollars in Millions FY 15 Adopted Budget FY 14 4 3 2 48.0% 1 - * Pro-rated based upon a four year Historical Trend of Actual Year-to-date Collections 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr WARNING Charges for Services include revenue from various engineering, recreation, and library fees, police and fire miscellaneous service reimbursements, and public school reimbursement. Charges for services collections through the second quarter of FY 2014-15 are $141,262 (3.0%) above the budget based on historical trend and $143,591 (-2.8%) lower than FY 2013-14 actual collections through the second quarter. A warning indicator is reflected due to decreased collections in engineering and fire miscellaneous service reimbursements. OTHER REVENUE FY 2014-15 1st Qtr Jul - Sep 14 $ 1,386,806 2nd Qtr Oct - Dec 14 1,316,972 3rd Qtr Jan - Mar 15 1,632,776 4th Qtr Apr - Jun 15 1,805,246 Total $ 6,141,800 FY 15 Actual Revenue $ $ % of Budget Rec'd *% of Budget Hist. Rec'd 1,153,126 18.8% 24.0% 1,171,291 19.1% 21.0% 2,324,417 37.8% Actual Revenue FY 15 Actual Revenue Historical Trend Actual to Budget 2 Dollars in Millions FY 15 Adopted Budget FY 14 1 45.1% - * Pro-rated based upon a four year Historical Trend of Actual Year-to-date Collections 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr NEGATIVE Other revenue captures interest income, fines and forfeitures, sale of land and fixed assets, and other miscellaneous items. Revenue streams in this category are not constant. Other revenue collections through the second quarter of FY 2014-15 are $379,362 (-14.0%) below the budget based on historical trend and $217,490 (-8.6%) lower than FY 2013-14 actual collections through the second quarter. A negative indicator is reflected for this revenue category since the variance between the percentage of budget received and the percentage of budget historically received is greater than 5%. This is due to the timing of receipts between fiscal years from Bear Creek. 7 2/6/2015 GENERAL FUND EXPENDITURE ANALYSIS: GENERAL FUND EXPENDITURES + ENCUMBRANCES for FY 2014-15 by FUNCTION Dollars in Millions FY 15 Adjusted Budget * Dept. Operating General Government $ 52,260,664 FY15 Actual Exp+Enc $ % of Budget Exp'd % of Budget Prior Yr 26,907,053 51.5% 49.7% 55.5% 51.2% Comm. & Neigh. Services 20,331,173 11,286,041 Public Safety 95,214,818 49,625,405 52.1% 49.0% Transportation & Dev. 19,718,800 9,811,733 49.8% 41.6% 1,287,837 11.3% 36.7% 98,918,069 49.7% 48.3% - 0.0% 0.0% - 0.0% 0.0% 43.2% 42.7% Non-Dept. Pers. & O&M 11,395,032 Subtotal $ 198,920,487 $ Non-Dept. Reserves $ $ Non-Dept. Contingencies Total 2,498,000 27,452,016 $ 228,870,503 $ 98,918,069 * Excluding Interfund Transfers 1 10 2 8 Non-Dept. Pers. & O&M 50 45 Transportation & Dev. Public Safety 11 13 Comm. & Neigh. Services 27 22 General Government FY 14 2Q YTD Exp+Enc FY 15 2Q YTD Exp+Enc Total General Fund operating expenditures are reflected by City function, along with budgeted non-departmental reserves (encumbrance and unencumbered carryforward, utility, fuel, and downtown redevelopment) and contingencies (15% and Council). Since General Obligation debt and General Fund capital expenditures are reflected in the General Obligation Debt and General Capital Projects Funds, this presentation only includes General Fund operating expenditures to more clearly reflect the results of operations. FY 2014-15 operating spending through the second quarter is 49.7% of the adjusted budget compared to 48.3% of adjusted budget spent last fiscal year through the second quarter. As shown on the following pages, departments have expended between 44.3% and 66.1% of their General Fund adjusted budgets through the second quarter of FY 2014-15. GENERAL FUND EXPENDITURES + ENCUMBRANCES for FY 2014-15 by CATEGORY FY 2014-15 General Fund Actual Expenditures + Encumbrances *Dept. Operating Personnel Operations & Maint. Reserves Contingencies Total FY 15 Adjusted Budget $ 145,580,974 FY 15 Actual Exp+Enc $ 53,339,513 70,373,829 FY 14 Actual Exp+Enc $ 28,544,240 % Change from Prior Yr Actual 63,293,970 11.2% 27,057,744 5.5% 2,498,000 - - 0.0% 27,452,016 - - 0.0% $ 228,870,503 $ 98,918,069 $ 90,351,714 Operations & Maint. 29% 9.5% Personnel 71% * Excluding Interfund Transfers Total General Fund operating expenditures and encumbrances are reflected by spending category. Operating spending through the second quarter of FY 2014-15 is 9.5% higher than spending through the second quarter of FY 2013-14 mainly due to increases from labor negotiations and benefit changes in Personnel, and street improvements for Operations & Maintenance. 8 2/6/2015 GENERAL FUND EXPENDITURE ANALYSIS (continued / department summaries): MAYOR & COUNCIL EXPENDITURE FY 2014-15 COMPARISON Operating Only 1st Qtr Jul - Sep 14 $ 197,944 2nd Qtr Oct - Dec 14 197,944 3rd Qtr Jan - Mar 15 214,439 4th Qtr Apr - Jun 15 214,439 Total $ 824,766 FY 15 Actual Exp+Enc $ $ 185,082 22.4% 22.7% 185,845 22.5% 22.7% 370,927 44.9% FY 14 Actual Exp+Enc FY 15 Actual Exp+Enc Historical Trend Actual to Budget Dollars in Thousands FY 15 Adjusted Budget % of Budget *Hist. Expended Trend % of by Qtr Budget 250 200 150 100 50 45.4% * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE Mayor and Council spent 44.9% of their FY 2014-15 adjusted budget and has historically spent 45.4% of their adjusted budget through the second quarter of the fiscal year. CITY CLERK EXPENDITURE FY 2014-15 COMPARISON Operating Only 1st Qtr Jul - Sep 14 $ 281,495 2nd Qtr Oct - Dec 14 184,982 3rd Qtr Jan - Mar 15 160,854 4th Qtr Apr - Jun 15 176,939 Total $ 804,270 FY 15 Actual Exp+Enc $ $ 309,958 38.5% 31.2% 221,711 27.6% 20.2% 531,669 66.1% 51.4% FY 14 Actual Exp+Enc FY 15 Actual Exp+Enc Historical Trend Actual to Budget Dollars in Thousands FY 15 Adjusted Budget % of Budget *Hist. Expended Trend % of by Qtr Budget 350 300 250 200 150 100 50 - * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE The City Clerk has spent 66.1% of their FY 2014-15 adjusted budget and has historically spent 51.4% of their adjusted budget through the second quarter of the fiscal year. Spending through the second quarter in FY 2014-15 included expenditures for the primary and general elections held in the fall of 2014 that are not an every year expense. 9 2/6/2015 GENERAL FUND EXPENDITURE ANALYSIS (continued / department summaries): CITY MANAGER EXPENDITURE FY 2014-15 COMPARISON Operating Only 1st Qtr Jul - Sep 14 $ 9,655,379 2nd Qtr Oct - Dec 14 7,819,047 3rd Qtr Jan - Mar 15 7,041,198 4th Qtr Apr - Jun 15 7,558,164 Total $ 32,073,788 FY 15 Actual Exp+Enc $ $ 9,203,460 28.7% 27.9% 7,842,105 24.5% 22.6% 17,045,565 53.2% 50.5% FY 14 Actual Exp+Enc FY 15 Actual Exp+Enc Historical Trend Actual to Budget Dollars in Millions FY 15 Adjusted Budget % of Budget *Hist. Expended Trend % of by Qtr Budget 10 9 8 7 6 5 4 3 2 1 - * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE City Manager includes the following divisions budgeted in the General Fund: Administration, Buildings & Facilities, Cultural Affairs, Downtown Redevelopment, Economic Development, Human Resources, Information Technology, and Planning. Combined, these divisions spent 53.2% of their FY 2014-15 adjusted budget and have historically spent 50.5% of their adjusted budget through the second quarter of the fiscal year. Starting July 1, 2014, the Planning Division is reported in this Department instead of in the Transportation & Development Department (but is not part of this Department's historical trend). Starting October 1, 2014, the Office of Neighborhood Resources is reflected as part of the new Community and Neighborhood Resources Department and the Cultural Affairs Division is moved into the City Manager Department (this switch is also not part of this Department's historical trend). LAW EXPENDITURE FY 2014-15 COMPARISON Operating Only 1st Qtr Jul - Sep 14 $ 865,973 2nd Qtr Oct - Dec 14 829,890 3rd Qtr Jan - Mar 15 974,219 4th Qtr Apr - Jun 15 938,137 Total $ 3,608,219 FY 15 Actual Exp+Enc $ $ 767,810 21.3% 23.0% 887,668 24.6% 22.1% 1,655,478 45.9% 45.1% FY 14 Actual Exp+Enc FY 15 Actual Exp+Enc Historical Trend Actual to Budget Dollars in Thousands FY 15 Adjusted Budget % of Budget *Hist. Expended Trend % of by Qtr Budget 1,000 800 600 400 200 - * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE Law spent 45.9% of their FY 2014-15 adjusted budget and has historically spent 45.1% of their adjusted budget through the second quarter of the fiscal year. 10 2/6/2015 GENERAL FUND EXPENDITURE ANALYSIS (continued / department summaries): CITY MAGISTRATE EXPENDITURE FY 2014-15 COMPARISON Operating Only 1st Qtr Jul - Sep 14 $ 2nd Qtr Oct - Dec 14 1,028,967 $ 995,077 3rd Qtr Jan - Mar 15 1,098,513 4th Qtr Apr - Jun 15 1,119,674 Total FY 15 Actual Exp+Enc $ 4,242,231 $ 865,870 20.4% 22.2% 1,013,172 23.9% 21.4% 1,879,042 44.3% FY 14 Actual Exp+Enc FY 15 Actual Exp+Enc Historical Trend Actual to Budget Dollars in Thousands FY 15 Adjusted Budget % of Budget *Hist. Expended Trend % of by Qtr Budget 1,200 1,000 800 600 400 200 43.6% 1st Qtr * Historical Trend represents the average of the past 4 years % of actual to budget 2nd Qtr 3rd Qtr 4th Qtr POSITIVE City Magistrate spent 44.3% of their FY 2014-15 adjusted budget and has historically spent 43.6% of their adjusted budget through second quarter of the fiscal year. COMMUNICATIONS & PUBLIC AFFAIRS EXPENDITURE FY 2014-15 COMPARISON Operating Only 1st Qtr Jul - Sep 14 $ 647,688 2nd Qtr Oct - Dec 14 555,161 3rd Qtr Jan - Mar 15 578,293 4th Qtr Apr - Jun 15 532,028 Total $ 2,313,170 FY 15 Actual Exp+Enc $ $ 595,483 25.7% 23.8% 575,173 24.9% 20.3% 1,170,656 50.6% 44.1% FY 14 Actual Exp+Enc FY 15 Actual Exp+Enc Historical Trend Actual to Budget Dollars in Thousands FY 15 Adjusted Budget % of Budget *Hist. Expended Trend % of by Qtr Budget 700 600 500 400 300 200 100 - * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE Communications and Public Affairs (CAPA) also includes Video Production and Print, Mail, & Graphics. CAPA spent 50.6% of their FY 2014-15 adjusted budget and has historically spent 44.1% of their adjusted budget through the second quarter of the fiscal year due to increased spending in Postage and Freight. 11 2/6/2015 GENERAL FUND EXPENDITURE ANALYSIS (continued / department summaries): MANAGEMENT SERVICES EXPENDITURE FY 2014-15 COMPARISON Operating Only 1st Qtr Jul - Sep 14 $ 2,029,885 2nd Qtr Oct - Dec 14 1,667,406 3rd Qtr Jan - Mar 15 1,812,398 4th Qtr Apr - Jun 15 1,739,902 Total $ 7,249,591 FY 15 Actual Exp+Enc $ $ 1,759,101 24.3% 25.5% 1,866,452 25.7% 21.1% 3,625,553 50.0% FY 14 Actual Exp+Enc FY 15 Actual Exp+Enc Historical Trend Actual to Budget Dollars in Thousands FY 15 Adjusted Budget % of Budget *Hist. Expended Trend % of by Qtr Budget 46.6% 2,100 1,800 1,500 1,200 900 600 300 - * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE Management Services Department includes the following divisions budgeted in the General Fund: Administration, Budget, Accounting, Purchasing, Central Supply, Tax & License, and Utility Services (reimbursed by the Municipal Utilities Department through the Indirect Cost Allocation). These divisions spent 50.0% of their FY 2014-15 adjusted budget and have historically spent 46.6% of their adjusted budget through the second quarter of the fiscal year. NON-DEPARTMENTAL EXPENDITURE FY 2014-15 COMPARISON Operating Only 1st Qtr Jul - Sep 14 $ 2nd Qtr Oct - Dec 14 5,583,566 $ 455,801 3rd Qtr Jan - Mar 15 2,620,857 4th Qtr Apr - Jun 15 2,734,808 Total** FY 15 Actual Exp+Enc $ 11,395,032 1,659,342 (371,505) $ 1,287,837 14.6% 33.4% -3.3% 3.0% 11.3% FY 14 Actual Exp+Enc FY 15 Actual Exp+Enc Historical Trend Actual to Budget 5 Dollars in Millions FY 15 Adjusted Budget % of Budget *Hist. Expended Trend % of by Qtr Budget 4 3 2 1 36.4% - * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr ** Excludes Reserves and Contingencies POSITIVE Non-Departmental includes citywide costs that do not belong to a specific department (i.e., memberships, legal fees, studies, Strategic Economic Development, and miscellaneous Downtown Redevelopment). Spending in this category fluctuates due to the changing "onetime" needs from year to year. Spending for this category for FY 2014-15 and the prior year consists mainly of contract encumbrances for the Strategic Economic Development Continuum project, the Photo Red Light contract, and the Animal Control contract with Maricopa County. 12 2/6/2015 GENERAL FUND EXPENDITURE ANALYSIS (continued / department summaries): TRANSPORTATION & DEVELOPMENT EXPENDITURE FY 2014-15 COMPARISON Operating Only 1st Qtr Jul - Sep 14 $ 6,112,828 2nd Qtr Oct - Dec 14 4,535,324 3rd Qtr Jan - Mar 15 4,732,512 4th Qtr Apr - Jun 15 4,338,136 Total $ 19,718,800 FY 15 Actual Exp+Enc $ $ 6,086,813 30.9% 28.6% 3,724,920 18.9% 21.6% 9,811,733 49.8% FY 14 Actual Exp+Enc FY 15 Actual Exp+Enc Historical Trend Actual to Budget 7 6 Dollars in Millions FY 15 Adjusted Budget % of Budget *Hist. Expended Trend % of by Qtr Budget 5 4 3 2 50.2% 1 - * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE Transportation and Development includes the following divisions budgeted in the General Fund: Administration, Development Services, Engineering, Capital Projects, Streets, Traffic Engineering, Transit Services, and Street Sweeping. Starting July 1, 2014, the Planning Division is no longer reported in this Department, but instead is in the City Manager's Department (but is part of this Department's historical trend). The department spent 49.8% of their FY 2014-15 adjusted budget and has historically spent 50.2% of their adjusted budget through the second quarter of the fiscal year. COMMUNITY & NEIGHBORHOOD SERVICES EXPENDITURE FY 2014-15 COMPARISON Operating Only 1st Qtr Jul - Sep 14 $ 8,742,404 2nd Qtr Oct - Dec 14 2,236,429 3rd Qtr Jan - Mar 15 4,269,546 4th Qtr Apr - Jun 15 5,082,794 Total $ 20,331,173 FY 15 Actual Exp+Enc $ 8,348,415 41.1% 41.0% 2,937,626 14.4% 11.0% FY 14 Actual Exp+Enc FY 15 Actual Exp+Enc Historical Trend Actual to Budget 9 Dollars in Millions FY 15 Adjusted Budget % of Budget *Hist. Expended Trend % of by Qtr Budget 8 7 6 5 4 3 $ 11,286,041 55.5% 2 52.0% 1 - * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE Community & Neighborhood Services includes Administration, Aquatics, Code Enforcement, Community Development, Housing, Parks Development & Operations, Neighborhood Resources, Recreation, Sports & Fitness Facilities, and Nature & Recreation Facilities. The department spent 55.5% of their FY 2014-15 adjusted budget and has historically spent 52.0% of their adjusted budget through the second quarter of the fiscal year. Starting October 1, 2014, the Office of Neighborhood Resources merged with this Department to reflect a new Community & Neighborhood Resources Department. The Center for the Arts, Library, and Museum have moved to report to the City Manager Department as a Cultural Affairs Division. These changes have not been reflected in the Department's historical trend. 13 2/6/2015 GENERAL FUND EXPENDITURE ANALYSIS (continued / department summaries): POLICE EXPENDITURE FY 2014-15 COMPARISON Operating Only 1st Qtr Jul - Sep 14 $ 18,715,803 2nd Qtr Oct - Dec 14 14,198,195 3rd Qtr Jan - Mar 15 15,488,940 4th Qtr Apr - Jun 15 16,134,313 Total $ 64,537,251 FY 15 Actual Exp+Enc $ 16,678,052 25.8% 28.7% 16,685,380 25.9% 21.3% FY 14 Actual Exp+Enc FY 15 Actual Exp+Enc Historical Trend Actual to Budget Dollars in Millions FY 15 Adjusted Budget % of Budget *Hist. Trend Expended % of by Qtr Budget 21 18 15 12 9 6 $ 33,363,432 51.7% 50.0% 3 - * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE Police includes Administration, Professional Standards, Property & Evidence, Forensic Services, Field Operations, Criminal Investigations, Planning & Research, Communications, Technology, Records, Detention Services, and Community Resources & Training. The department spent 51.7% of their FY 2014-15 adjusted budget and has historically spent 50.0% of their adjusted budget through the second quarter of the fiscal year. FIRE EXPENDITURE FY 2014-15 COMPARISON Operating Only 1st Qtr Jul - Sep 14 $ 8,910,215 2nd Qtr Oct - Dec 14 7,000,883 3rd Qtr Jan - Mar 15 7,637,327 4th Qtr Apr - Jun 15 8,273,771 Total $ 31,822,196 FY 15 Actual Exp+Enc $ 8,854,965 27.8% 28.0% 8,035,171 25.3% 21.4% FY 14 Actual Exp+Enc FY 15 Actual Exp+Enc Historical Trend Actual to Budget Dollars in Millions FY 15 Adjusted Budget % of Budget *Hist. Trend Expended % of by Qtr Budget 9 8 7 6 5 4 3 $ 16,890,136 53.1% 49.4% 2 1 - * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr POSITIVE Fire includes Administration, Emergency Services, Operations, Prevention & Preparedness, Support Services, and Citywide Fleet. The department spent 53.1% of their FY 2014-15 adjusted budget and has historically spent 49.4% of their adjusted budget through the second quarter of the fiscal year. 14 2/6/2015 ENTERPRISE FUNDS ENTERPRISE FUNDS ANALYSIS: WATER FUND ANALYSIS FY 2014-15 COMPARISON WATER FUND ANALYSIS WATER FUND Revenues $ Intel Rev/Receivable 61,314,834 FY 15 Actual Revenue/ Exp+Enc $ 2,106,093 32,254,268 - % of Budget Rec'd/Exp'd % of Budget to Date Prior Yr 53% 50% 0% 22% Total Revenues $ 63,420,927 $ 32,254,268 51% 48% Operating Expenses $ 30,916,630 $ 16,687,934 54% 53% 1,146,882 12% 30% 0% 22% Major Capital Expenses 9,644,470 Intel Exp/Payable 2,106,093 - Revenues 60 50 40 30 20 Debt Service 18,674,175 9,209,441 49% 14% 10 Transfers Out 3,625,521 1,862,204 51% 51% 0 44% 37% Total Expenses Net Rev / Exp POSITIVE $ 64,966,889 $ 28,906,461 $ (1,545,962) $ 3,347,807 Expenses 70 Dollars in Millions FY 15 Adjusted Budget FY14 Actual Q2 YTD FY15 Actual Q2 YTD FY15 Budget The performance indicator for Enterprise Funds focuses on the relationship between Operating Revenues and Operating Expenses (including debt service and indirect cost allocation) and the percentage of budget received/expended. The Water Operating Fund includes the following cost centers: Administration, Water Distribution, Water Treatment Plant, Environmental Resources, Water Quality, Water Systems Maintenance, San Tan Vista Water Treatment Plant, Meter Services, and Water Capital. The Water Operating Fund supports operating functions and major capital costs that can be paid without borrowing. The Net Revenue/Expense for FY 2014-15 reflects a budgeted $1.5 million drawdown of fund balance. Transfers Out include Indirect Cost Allocation to the General Fund of $3,528,594 and payment of $96,927 to the Technology Replacement Fund. Year-to-date Operating Revenues through the second quarter are 53% of budget compared to 50% through the second quarter of last year, while Operating Expenses through the second quarter are 54% of budget as compared to 53% through the second quarter of last year. Capital projects reimbursed by Intel are detailed separately under Revenues and Expenses to have no impact on the fund. WASTEWATER FUND ANALYSIS FY 2014-15 COMPARISON WASTEWATER FUND ANALYSIS WASTEWATER FUND Revenues $ Intel Rev/Receivable 46,956,231 FY 15 Actual Revenue/ Exp+Enc $ 35,836,801 Revenues % of Budget Rec'd/Exp'd % of Budget to Date Prior Yr 23,124,445 49% 49% 19,497,160 54% 79% 140 120 100 Total Revenues $ 82,793,032 $ 42,621,605 51% 70% Operating Expenses $ 19,201,408 $ 10,950,133 57% 49% 5,786,345 934,353 16% 23% Intel Exp/Payable 35,836,801 19,497,160 54% 79% 40 Debt Service 16,072,293 6,714,227 42% 16% 20 0 Major Capital Expenses Transfers Out Total Expenses Net Rev / Exp POSITIVE 1,238,022 51% 51% $ 79,332,356 2,435,509 $ 39,333,895 50% 66% $ 3,460,676 $ 3,287,710 Expenses 160 Dollars in Millions FY 15 Adjusted Budget 80 60 FY14 Actual Q2 YTD FY15 Actual Q2 YTD FY15 Budget The performance indicator for Enterprise Funds focuses on the relationship between Operating Revenues and Operating Expenses (including debt service and indirect cost allocation) and the percentage of budget received/expended. The Wastewater Operating Fund includes the following cost centers: Collection, Wastewater Lone Butte Treatment Plant, Wastewater Quality, Airport Water Reclamation Facility, Ocotillo Water Reclamation Facility, and Wastewater Capital. The Wastewater Operating Fund supports operating functions and major capital costs that can be paid without borrowing. The Net Revenue/Expense for FY 2014-15 reflects a budgeted $3.5M increase to fund balance. Transfers Out include Indirect Cost Allocation to the General Fund of $2,394,973 and payment of $40,536 to the Technology Replacement Fund. Year-to-date Operating Revenues through the second quarter are 49% of budget compared to 49% through the second quarter of last year, while Operating Expenses through the second quarter are 57% of budget as compared to 49% through the second quarter of last year. Capital projects reimbursed by Intel are detailed separately under Revenues and Expenses to have no impact on the fund. 15 2/6/2015 ENTERPRISE FUNDS ENTERPRISE FUNDS ANALYSIS (continued): SOLID WASTE FUND ANALYSIS FY 2014-15 COMPARISON SOLID WASTE FUND ANALYSIS SOLID WASTE Revenues $ Transfers In FY 15 Actual Revenue/ Exp+Enc 13,968,105 $ - 6,608,488 - % of Budget Rec'd/Exp'd % of Budget to Date Prior Yr 47% 46% 0% 0% Total Revenues $ 13,968,105 $ 6,608,488 47% 46% Operating Expenses $ 13,324,883 $ Major Capital Expenses Transfers Out Total Expenses $ 11,051,791 83% 84% 397,037 100,734 25% 90% 1,128,551 584,385 52% 52% 11,736,910 79% 81% 14,850,471 $ Revenues Expenses 15 Dollars in Millions FY 15 Adjusted Budget 12 9 6 3 - Net Rev / Exp WARNING $ (882,366) $ FY14 Actual Q2 YTD (5,128,422) FY15 Actual Q2 YTD FY15 Budget The performance indicator for Enterprise Funds focuses on the relationship between Operating Revenues and Operating Expenses (including debt service and indirect cost allocation) and the percentage of budget received/expended. The Solid Waste Operating Fund supports operating functions and major capital costs that can be paid without borrowing. The Net Revenue/Expense for FY 2014-15 reflects a budgeted $882,366 drawdown of fund balance. Transfers Out include Indirect Cost Allocation to the General Fund of $1,088,333 and payment of $40,218 to the Technology Replacement Fund. Year-to-date Operating Revenues through the second quarter are 47% of budget compared to 46% through the second quarter of last year, while Operating Expenses through the second quarter are 83% of budget as compared to 84% last year. A warning indicator occurs due to large encumbrances ($8.0M) recorded at the start of the fiscal year for the Solid Waste collections contract to support costs through the end of the fiscal year and then spent against for the remainder of the year, with revenues more equally apportioned throughout the year. AIRPORT FUND ANALYSIS FY 2014-15 COMPARISON AIRPORT FUND ANALYSIS AIRPORT FUND Revenues $ General Fund Subsidy 1,042,600 FY 15 Actual Revenue/ Exp+Enc $ 1,043,650 513,034 - % of Budget Rec'd/Exp'd % of Budget to Date Prior Yr 49% 49% 0% 33% Total Revenues $ 2,086,250 $ 513,034 25% 46% Operating Expenses $ 1,096,364 $ 521,609 48% 48% 856,568 210,393 25% 13% Debt Service 27,938 1,469 5% 7% Transfers Out 105,380 55,380 53% 53% $ 788,851 38% 44% $ (275,817) Major Capital Expenses Total Expenses Net Rev / Exp POSITIVE $ $ 2,086,250 - Revenues Expenses 2,400 2,100 Dollars in Thousands FY 15 Adjusted Budget 1,800 1,500 1,200 900 600 300 FY14 Actual Q2 YTD FY15 Actual Q2 YTD FY15 Budget The performance indicator for Enterprise Funds focuses on the relationship between Operating Revenues and Operating Expenses (including debt service and indirect cost allocation) and the percentage of budget received/expended. The Airport Fund supports operating functions and major capital costs that can be paid without borrowing. The Net Revenue/Expense for FY 2014-15 reflects no budgeted change in fund balance. General Fund Subsidy reflects budgeted transfers from the General Fund to help support operations. Transfers Out include Indirect Cost Allocation to the General Fund of $100,000 and a payment of $5,380 to the Technology Replacement Fund. Year-to-date Operating Revenues through the second quarter are 49% of budget compared to 49% through the second quarter of last year. Operating Expenses through the second quarter are 48% of budget as compared to 48% through the second quarter of last year. Major capital expenses are higher through the second quarter of FY 2014-15 as they perform pavement improvements to the taxiway and runway. 16 2/6/2015 OTHER FUNDS OTHER FUNDS ANALYSIS (continued): SYSTEM DEVELOPMENT FEE FUNDS ANALYSIS FY 2014-15 COMPARISON Water FY 15 Adjusted Budget $ Reclaimed Water Wastewater Total SDF Revenue $ 4,408,485 FY 15 Actual Revenue $ 3,672,420 % of Budget Rec'd to Date 83% 863,775 600,423 70% 4,165,730 3,795,034 91% 8,067,877 85% 9,437,990 $ FY 14 Actual Q2 YTD FY 14 Adjusted Budget FY 15 Actual Q2 YTD FY 15 Adjusted Budget 5 Dollars in Millions SYSTEM DEVELOPMENT FEE (SDF) FUNDS 4 3 2 1 0 Note: Budget and Actual amounts reflect SDF revenues and the interest earned on fund balances, and excludes loan transfers in/out or proceeds from bond sales. POSITIVE System Development fees (SDFs) are based on development and fluctuate quarterly as well as from year to year. The graph shows the FY 2014-15 budget and year-to-date collections as compared to the FY 2013-14 budget and year-to-date collections. Collections through the second quarter of FY 2014-15 were 85% of the budget as compared to the prior year's collections through the second quarter of 63% of the budget. Starting July 28, 2014, Water Resource SDFs are combined with Water SDFs in the same fund based on the recently adopted Infrastructure Improvements Plan (IIP). For comparative purposes, both years show Water and Water Resource SDFs combined. The modified SDFs effective July 28, 2014 resulted in an increase in Water SDFs of 13%, a decrease in Reclaimed Water SDFs of (-25%), and an increase in Wastewater SDFs of 7%. IMPACT FEE FUNDS ANALYSIS FY 2014-15 COMPARISON IMPACT FEE FUNDS Arterial Streets $ 54% 2,566,880 1,850,840 72% 53,170 39,135 74% Public Buildings 163,490 105,102 64% Police 279,120 276,125 99% Fire 607,340 411,599 68% 4,995,186 63% Library $ % of Budget Rec'd to Date 2,312,385 Parks 4,261,180 FY 15 Actual Revenue Dollars in Thousands FY 15 Adjusted Budget FY 14 Actual Q2 YTD FY 14 Adjusted Budget FY 15 Actual Q2 YTD FY 15 Adjusted Budget 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 Total Impact Revenue $ 7,931,180 $ 1,000 500 0 Note: Budget and Actual amounts reflect Impact Fee revenues and the interest earned on fund balances, and excludes loan transfers in/out or proceeds from bond sales. POSITIVE Impact fees are based on development and fluctuate quarterly as well as from year to year. The graph shows the FY 2014-15 budget and year-to-date collections as compared to FY 2013-14 budget and year-to-date collections. Collections through the second quarter of FY 2014-15 were 63% of the budget as compared to the prior year's collections through the second quarter of 107% of the budget. Impact fees were modified as of July 28, 2014, resulting in various changes to the fee categories depending on the land use type as noted in the recently adopted IIP. The change in single family fees for each fee category include a decrease of (-2%) for Arterial Streets, decreases of (-13%) to (-40%) depending on the service area for Parks, a decrease of (-19%) for Library, an increase of 13% for Public Buildings, an increase of 69% for Police, and an increase of 20% for Fire. 17 2/6/2015 OTHER FUNDS OTHER FUNDS ANALYSIS (continued): HIGHWAY USER FUND (HURF) ANALYSIS FY 2014-15 COMPARISON HIGHWAY USER FUND ANALYSIS Highway Users Tax $ Other FY 15 Actual Revenue/ Exp+Enc 13,000,000 $ 63,000 Total Revenues $ Operating Expenses $ 13,063,000 $ 9,275,739 $ 5,628,154 43% 39% 26,004 41% 273% 5,654,158 43% 40% 5,050,929 54% 70% Major Capital Expenses 2,698,037 379,001 14% 48% Debt Service 4,677,025 4,220,964 90% 0% 23,708 23,708 100% 100% 9,674,602 58% 0% Transfers Out Total Expenses $ 16,674,509 $ Revenues % of Budget Rec'd/Exp'd % of Budget to Date Prior Yr Expenses 18 15 Dollars in Millions FY15 Adjusted Budget 12 9 6 3 0 Net Rev / Exp $ (3,611,509) $ FY14 Actual Q2 YTD (4,020,444) FY15 Actual Q2 YTD FY15 Budget POSITIVE Highway Users Tax is collected by the state on all gasoline sales. It is combined with other state-level vehicle related revenues, and distributed to cities and towns by using two formulas based upon population. Funds are restricted for use on streets and related projects. The Net Revenue/Expense for FY 2014-15 reflects a budgeted fund balance drawdown of $3.6M. Transfers Out include payment of $23,708 to the Technology Replacement Fund. Operating Revenues received through the second quarter are 43% of budget, which is 4% higher than last year's second quarter percentage. Operating Expenses through the second quarter are 54% of adjusted budget, which is 16% lower than last year's second quarter percentage. GRANT FUNDS ANALYSIS FY 2014-15 COMPARISON GRANT REVENUES % of Budget Rec'd to Date 14 422,775 11% 12 1,900,000 593,070 31% 13,802,300 4,323,037 31% Public Safety 2,806,050 428,380 15% Community Services 2,301,132 258,722 11% General Government* $ General Govt - CDBG General Govt - HUD Municipal Utilities $ 100,000 T & D - Streets Total Grant Revenue 4,017,956 FY 15 Actual Revenue 6,858,485 $ 31,785,923 $ - 0% 2,321,124 34% 8,347,108 26% FY 15 Adjusted Budget FY 15 Actual Revenue 10 Dollars in Millions FY 15 Adjusted Budget 8 6 4 2 Gen Govt * Includes City Manager, Economic Development, Information Technology and Law Gen GovtCDBG Gen GovtHUD Public Safety Comm Svs MUD T & D-Streets Grants are an additional source of funds for major capital projects and certain operating programs. Grant sources include federal, state, and county governments as well as donations from businesses, organizations, or individuals to support particular programs. The adopted budget for grants is unique because it is developed before final approval on grant awards from other agencies is received in an effort to allow for adequate appropriation to spend anticipated grants. Additionally, grant revenues for many programs are received on a reimbursable basis, so the revenue on a large capital project may lag one to two fiscal years after the project is initiated. Actual collections through the second quarter of FY 2014-15 were $8.3M (26% of adjusted budget) as compared to $8.0M (23% of adjusted budget) collected through the second quarter of FY 2013-14. 18 2/6/2015