Informational Memo Management Services - Memo No. 25-035 Date: September 18, 2024 To: Mayor and Council Thru: Joshua H. Wright, City Manager Dawn Lang, Deputy City Manager/CFO DLL From: Matt Dunbar, Assistant Director of Budget & Policy MD Subject: Fiscal Year End (FYE) 2023-24 Fourth Quarter Financial Report Attached is the FYE 2023-24 Fourth Quarter Financial Report, summarizing budget to actual performance of General Fund operating revenue and expenditures and additional summaries and analysis of Enterprise, System Development Fees, Highway User Revenue, and Grant funds. The FYE Quarterly report is typically released in August/September of each year due to the extended fiscal year end accounting process, which ensures all revenues and expenditures are thoroughly reviewed and properly reflected. The analysis included in this report provides the year-end details of FYE 2023-24 by reflecting budget to actual compared to historical trends and the prior year. These historical comparisons are based on actual results compared to budget over the last four years (FY 2019-20 to FY 202223), and an explanation has been provided in those areas where there are significant deviations from the historical trend or the prior year’s results. When reviewing revenue trends, all General Fund revenue performance indicators are showing as positive with the exception of License Fees and Franchise Fees. The General Fund FYE reflected overall revenue growth of 7.6% above adopted budget with 107.6% of budgeted revenues received compared to a 115.5% historical average received. Overall, General Fund revenue, led by continuing Sales Tax collections, is performing well due to higher local consumer spending with related inflation, and a slower stream of development activity in Chandler. The over $20B expansion of Intel continues to be the largest development during this time and is a significant driver of revenues coming in over budget in addition to the impacts of inflation. It is anticipated that once the development is completed, revenues will stabilize in various categories, classifying a large majority of these additional revenues as onetime. This activity has generated additional one-time revenue in the current year in numerous categories. Memo No. 25-035 September 18, 2024 Page 2 During the preparation of the FY 2024-25 Budget, projected FY 2023-24 year-end revenues were updated based on actual collections reflected in this report from January 2024 and other information available at that time. This allowed for the estimating of the fiscal year end General Fund balance used to calculate available one-time funds for use in the FY 2024-25 Budget. The final net impact of the additional one-time funds, (i.e. revenues, expenditures and carryforwards) is being calculated in the new year. Additionally, General Fund expenditures are at 91.9% of budget at FYE compared to 89.6% for the prior fiscal year. This includes an increased one-time Public Safety Personnel Retirement System (PSPRS) unfunded liability payment of $73M, which was $23M more than the prior year payment. Should you have additional questions regarding this information, please contact me at x2256 or Dawn Lang at x2255. Attachment: FYE 2023-24 Fourth Quarter Financial Report c: Tadd Wille, Assistant City Manager Andy Bass, Deputy City Manager Quarterly Financial Report 4th Qtr FY 2023-24 Performance at a Glance General Fund Revenues Year to Date Compared Historical % Reference POSITIVE Page 2 Report Overview and Economic Indicators Revenue Analysis Overall General Fund Revenues Quarterly Analysis Overall General Fund Revenue by Category Analysis Revenue Detail by Category Performance Indicator* Positive Warning Positive Positive Negative Positive Positive Page 3 Page 3 Page 4 Page 5 Page 5 Page 6 Page 6 Page 7 Page 7 Year to Date Compared Budget % Reference Positive Positive Positive Positive Positive Positive Positive Positive Positive Positive Positive Positive Positive Positive Positive Positive 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 Page 15 Page 15 Page 16 Page 16 Year to Date Compared Budget % Reference Positive Positive Positive Positive Positive Positive Informational Informational Page 17 Page 17 Page 18 Page 18 Page 19 Page 19 Page 20 Page 21 Positive Sales Tax - Overall & by Taxable Activity Franchise Fees Primary Property Tax State Shared Revenues Licenses & Permits Charges for Services Other Revenues General Fund Expenditures General Fund Expenditure + Encumbrance Analysis by Function and by Expenditure Category Mayor & Council City Clerk Law City Magistrate City Manager & Organizational Support Communications & Public Affairs Cultural Development Expenditure Community Services Detail by Information Technology Department Management Services Neighborhood Resources Non-Departmental Development Services Public Works & Utilities Fire Police Enterprise / Other Funds Water Fund Analysis Wastewater Fund Analysis Reclaimed Water Fund Analysis Solid Waste Fund Analysis Airport Fund Analysis Highway User Revenue Fund Analysis System Development Fee Analysis Grants PERFORMANCE INDICATORS (At year-end, revenues performance indicators default to positive when 100% or more of budget is collected and expenditures performance indicators default to positive when total spending is less than adjusted budget) * Positive Warning Negative = Rev: Variance is above or <2% below historical trend. Exp: Variance <= 2% compared to historical trend. = Rev: Variance of 2 - 5% below historical trends. Exp: Variance of 2 - 5% above historical trends. = Rev: Variance of > 5% below historical trends. Exp: Variance > 5% above historical trend. 1 8/27/2025 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 or if it is deviating from trends. * Performance indicators for General Fund revenues 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 to budget. * 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 This table reflects the four most recent changes to the Federal Funds Rate labor and property located in the US. Reflects spending for households, by the Federal Reserve Board. business, government, and trade. The change to the GDP is an indicator of the general direction of the Lowering the Federal Funds Rate is a way for the Federal Reserve Board to economy. Slow or negative growth will likely mean lower revenues for the make it less expensive for banks to borrow money for loans and City. investments and (in theory) pumping additional dollars into the economy. Third Quarter 2023 (third estimate) Fourth Quarter 2023 (third estimate) First Quarter 2024 Second Quarter 2023 (second estimate) Source: U.S. Department of Commerce 4.9% 3.4% 1.4% 3.0% 4.50%-4.75% 4.75%-5.00% 5.00%-5.25% 5.25%-5.50% February 2, 2023 March 23, 2023 May 4, 2023 July 27, 2023 Source: Federal Reserve Bank Unemployment National State of Arizona Phoenix Metro Area* Mar-24 3.9% 2.9% Apr-24 3.5% 2.6% 2.6% 2.3% May-24 3.7% 3.2% 2.9% 3.9% 3.5% 4.3% Jun-24 High unemployment rates typically result in a reduced demand for goods and services. *Source: Arizona Office of Economic Opportunity Monthly Employment Report (not seasonally adjusted) City Investment Portfolio Building Permits The City splits its investment portfolio between two investment firms with a Single-family building permits are an indicator of the general economy. different mix of holdings at each firm to reduce risk. Current Earning Higher numbers of permits indicate an active construction market and Benchmarks are as follows: resultant home sales. Fewer building permits generally equates to less new construction, and permit fees and construction sales tax revenues. Allspring benchmark is ICE BofA 0-3 year U.S. Treasury Index PFM's benchmark is ICE BofAML 1-5 year U.S. Treasury Index Chandler's quarterly average for single family building permits is 70 for FY Rate of Return is net of fees and includes interest earnings as well as both 2023-24, up from the 14.5 average permits per quarter in FY 2022-23. FY realized and unrealized gains/(losses). Rate of Return is typically negative in 2021-22 averaged 115 per quarter. a rising rate environment. Fiscal Year 2023-24 Rate of Return Benchmark Allspring Global Investments Benchmark PFM Asset Management, LLC Fiscal Year 2022-23 Rate of Return Benchmark Allspring Global Investments Benchmark PFM Asset Management, LLC 4th Quarter 0.94% 1.03% 0.82% 0.89% 4th Quarter -0.14% 0.20% -0.86% -0.45% Fiscal Year 4.69% 5.09% 4.16% 4.45% Fiscal Year 1.49% 1.75% -0.43% 0.27% Quarter Apr - May - Jun 2022 Jul - Aug - Sep 2022 Oct - Nov - Dec 2022 Jan - Feb - Mar 2023 Apr - May - Jun 2023 Jul - Aug - Sep 2023 Oct - Nov - Dec 2023 Jan - Feb - Mar 2024 Apr - May - Jun 2024 State of Arizona 10,929 7,735 5,339 6,525 8,799 9,858 9,164 11,192 10,967 Chandler 80 11 12 11 24 110 87 29 55 Source: Investment Advisors 2 8/27/2025 General Fund Revenue Analysis: Overall General Fund Revenues FY 2023-24 3r FY 23 Actual Revenue FY 24 Actual Revenue FY 24 FY 24 % of *% of Adopted Actual Budget Budget Budget Revenue Rec'd Hist. Rec'd 83,454,062 $ 89,865,450 24.0% 23.9% 2nd Qtr Oct - Dec 23 93,617,173 99,064,020 26.5% 29.2% 3rd Qtr Jan - Mar 24 95,117,971 100,915,340 27.0% 28.8% 4th Qtr Apr - Jun 24 101,868,076 111,747,754 29.9% 33.6% 374,057,282 $ 401,592,564 107.4% 115.5% Jul - Sep 23 Total $ $ Dollars in Millions 1st Qtr Historical Trend Actual to Budget 120 100 80 60 40 20 * Pro-rated based upon a four year historical trend of actual year-to-date collections 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Positive General Fund revenue collections for FY 2023-24 are $27.5M (7.4%) above the adopted budget, and $27.9M (7.5%) higher than actual collections for FY 2022-23. Overall, General Fund revenue, led by continuing strong Sales Tax and Licenses collections, is performing well due to higher local consumer spending including related inflation, and development activity (although slowing in residential housing) in Chandler. The continued $20B expansion of Intel, the largest development during this time period, continue to cause revenues to come in over budget in various categories. It is anticipated that once the development is complete, revenues will stabalize in various categories, classifying much of this additional revenue as one-time. The performance indicator is positive as actual overall collections exceeded the amount budgeted at year-end. The following charts provide more detail regarding the various sources of General Fund revenues and provide more detail on the performance indicators. Overall General Fund Revenues by Category FY 2023-24 FY 24 % of Budget Adopted Actual Rec'd to Budget Revenue Date FY 24 Revenue Categories Sales Tax $ Franchise Fees 196,858,400 $ 210,737,044 3,471,000 3,383,051 80% 97.5% 8,731,611 8,626,641 98.8% State Shared Sales Tax 127,100,000 134,888,147 106.1% Licenses & Permits 6,864,900 5,095,759 74.2% Charges for Services 13,932,139 17,799,915 127.8% Other Revenues 9,121,050 13,083,825 143.4% Indirect Cost Allocation 7,978,182 7,978,182 100.0% 374,057,282 $ 401,592,564 107.4% $ 100% Other Revenues 107.1% Primary Property Tax Total General Fund Collection History by Category % Indirect Costs 29% 28% 29% 34% Charges for Services Licenses & Permits 60% 40% 55% 57% 55% 52% 20% Local Sales Taxes 0% FY21 $281M Positive Voter Authorized Local Revenue Primary Property Taxes Franchise Fees FY22 $315M FY23 $373M FY24 $402M This chart summarizes General Fund revenue collections by revenue category for FYE 2023-24. The graph helps us visualize what percentage each revenue category is to the total General Fund. The percentage spread of revenue sources are relatively consistent over the years with local sales taxes and State Shared Sales Tax 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, Reclaimed Water, Solid Waste, and Airport Enterprise Funds to the General Fund for City services provided for their operations). The performance indicator is positive as actual collections continue to come in higher than budget. 3 8/27/2025 General Fund Revenue Analysis (continued): Sales Tax Revenue FY 2023-24 FY 23 Actual Revenue Jul - Sep 23 FY 24 % of *% of Adopted Actual Budget Budget Budget Revenue Rec'd Hist. Rec'd 47,367,452 $ 51,878,813 26.4% 29.4% 2nd Qtr Oct - Dec 23 48,492,852 50,941,491 25.8% 30.0% 3rd Qtr Jan - Mar 24 50,362,272 53,016,708 27.0% 31.2% 4th Qtr Apr - Jun 24 50,635,824 54,900,033 27.9% 31.6% $ 196,858,400 $ 210,737,044 107.1% 122.1% Total $ FY 24 Actual Revenue Historical Trend Actual to Budget 60 Dollars in Millions 1st Qtr FY 24 50 40 30 20 10 * 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 FYE 2023-24 are $13.9M (7.1%) above adopted budget and $5.7M (2.8%) higher than FYE 2022-23 actual collections. The performance indicator is positive as actual collections exceeded the amount budgeted at year-end. Sales Tax Collection History FY 24 FY 24 % of Adopted Actual Actual to from Budget Revenue Budget Prior Yr. 4 Years Actual Sales Tax by Category (in millions) % Chg Retail/Mfd. Bldg/Jet Fuel $ Contracting 93,000,000 $ 97,766,534 105.1% 6.1% FY 20-21 22,000,000 25,281,079 114.9% Utilities 18,100,000 18,510,764 102.3% -8.4% FY 21-22 9.8% Real Property Rentals 23,100,000 24,628,962 106.6% 6.2% Restaurants & Bars 17,000,000 18,453,260 108.5% 4.9% FY 23-24 Telecommunications 1,550,000 2,045,904 132.0% 16.0% Personal Prop. Rentals Hotels/Motels 5,000,000 7,244,167 144.9% 38.9% 5,700,000 6,740,884 118.3% -1.1% Publishing/Printing/Adv. Amusements 200,000 174,842 87.4% -19.2% 1,300,000 1,691,668 130.1% 13.4% Use Tax 8,000,000 4,079,296 51.0% -40.2% Total Sales Tax $ 194,950,000 $ 206,617,359 106.0% 3.5% 75 14 85 FY 22-23 92 19 13 8 17 16 21 16 7 28 17 23 18 25 98 0 15 70 19 25 18 7 4 140 210 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 for FYE 2023-24 were $11.7M (6.0%) above the adopted budget and $6.9M (3.5%) higher than FYE 2022-23 actual collections. It should be noted that most of the categories are positive, reflecting higher consumer spending, added tourism spending, and continued strong local economy as Intel continues thier project. Contracting/development collections are slightly down as residential construction slumped, but is picking back up based on the permits issued. Use tax is a highly fluctuating revenue category and significant swings in collection percentage are not abnormal. 4 8/27/2025 General Fund Revenue Analysis (continued): Franchise Fee Revenue FY 2023-24 Jul - Sep 23 FY 24 % of *% of Actual Budget Budget Budget Revenue Rec'd Hist. Rec'd 42,244 $ (26,103) -0.8% 1.3% 2nd Qtr Oct - Dec 23 725,873 760,529 22.0% 22.9% 3rd Qtr Jan - Mar 24 1,517,478 1,346,986 38.8% 48.0% 4th Qtr Apr - Jun 24 1,185,405 1,301,639 37.5% 37.5% 3,383,051 97.5% 109.6% Total $ $ 3,471,000 $ Actual Revenue FY 24 Actual Revenue 3r Historical Trend Actual to Budget Dollars in Thousands 1st Qtr FY 24 Adopted FY 23 1,800 1,500 1,200 900 600 300 - * Pro-rated based upon a four year historical trend of actual year-to-date collections 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Warning 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 Western Broadband (5% of gross sales). Franchise fee collections for FYE 2023-24 are $87,949 (2.5%) less than the adopted budget and $247,457 (6.8%) less than FYE 2022-23 actual collections. The negative revenue in the first quarter of FY 2023-24 reflects revenues accrued to the prior year when they were earned. Changes to the cable TV industry are having a slight impact on franchise fees in this area. The performance indicator is a warning as the percentage of budget received through FYE is between two and five percentage points below the historical budget received at year-end. Primary Property Tax Revenue FY 2023-24 1st Qtr Jul - Sep 23 $ FY 24 % of Adopted Actual Budget Budget Budget Revenue Rec'd Hist. Rec'd 51,582 $ *% of 53,780 0.6% 0.6% 2nd Qtr Oct - Dec 23 4,476,012 4,451,969 51.0% 51.6% 3rd Qtr Jan - Mar 24 837,974 821,743 9.4% 9.7% 4th Qtr Apr - Jun 24 3,366,043 3,299,149 37.8% 38.8% 8,626,641 98.8% 100.7% Total $ 8,731,611 $ Actual Revenue FY 24 Actual Revenue Historical Trend Actual to Budget 5 Dollars in Millions FY 24 FY 23 4 3 2 1 - * 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 2023-24, Chandler is collecting a primary tax rate of $0.2226 per $100 of assessed valuation and a secondary tax rate of $0.87 per $100 of assessed valuation for a total rate of $1.0926, representing a $0.01 cent decrease from the rates adopted in the prior year. This reduction helps offset some of the City's assessed valuation increase of 5.3% (majority was new property), which resulted in a small net tax increase for the median value homeowner. Primary property tax collections for FYE 2023-24 are $104,970 (1.2%) less than the adopted budget and $106,632 (1.2%) less than FYE 2022-23 actual collections. The majority of collections come in the second and fourth quarters since the first half of the property tax bills are due in October and the second half are due in March. The performance indicator is positive as the percentage of budget received for FYE is less then two percentage points below the historical budget received at year-end. 5 8/27/2025 General Fund Revenue Analysis (continued): FY 24 FY 24 % of *% of Adopted Actual Budget Budget Revenue Rec'd Hist. Rec'd Budget 1st Qtr Jul - Sep 23 $ 28,690,718 $ 30,724,399 24.2% 25.4% 2nd Qtr Oct - Dec 23 31,207,188 33,822,085 26.6% 28.2% 3rd Qtr Jan - Mar 24 32,707,284 33,634,512 26.4% 28.7% 4th Qtr Apr - Jun 24 34,494,809 36,707,151 28.9% 32.5% $ 127,100,000 $ 134,888,147 106.1% 114.8% Total Dollars in Millions State Shared Sales Tax Revenues FY 2023-24 * Pro-rated based upon a four year historical trend of actual year-to-date collections FY 23 Actual Revenue FY 24 Actual Revenue Historical Trend Actual to Budget 45 40 35 30 25 20 15 10 5 1st Qtr Positive 2nd Qtr 3rd Qtr 4th Qtr -- State Shared Sales Tax Revenue: 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 Revenue. Collections for FYE 2023-24 were $3.4M (8.6%) above adopted budget and $1.0M (2.6%) higher than FYE 2022-23 actual collections. -- Smart and Safe (State Shared Revenue): Prop 207 was approved by voters in 2020 and created a 16% excise tax on the sale of recreational marijuana effective 2021. Fire and Police departments receive 31.4% of the revenue based on the number of enrolled employees in PSPRS. The tax is distributed December and June of each year. Collections for FYE 2023-24 were $403,202 (36.7%) above adopted budget and $15,356 (1.0%) less than FYE 2022-23 actual collections. -- Public Safety State Allocation (State Shared Revenue): State Senate Bill 1720 provides for revenues to local public safety jurisdictions of cities and towns, for costs associated with human smuggling, drug trafficking, and other illegal activity. Proceeds are to be distributed to the city on a quarterly basis. Collections for FYE 2023-24 were $2.25M. -- Vehicle License Tax: Cities and towns receive 25% of the net revenues collected for vehicle licensing within their county from the State, as well as surcharges from vehicle rentals. The respective city share's are determined by the proportion of city population to total incorporated population of the county. Collections for FYE 2023-24 were $1.4M (10.7%) more than adopted budget and $521,614 (3.8%) higher than FYE 2022-23 actual collections. -- Urban Revenue Sharing: Eighteen percent (18%) of the 2021 State income tax collection is distributed to cities and towns as urban revenue sharing based upon estimated population. A known one-time revenue increase will be reflected this fiscal year as the flat tax will go into full effect over the next two years. Collections for FY 2023-24 were $386,039 (0.5%) above adopted budget and $21.4M (40.3%) higher than FYE 2022-23 actual collections. The overall State Shared revenue performance indicator revenue performance indicator is positive as actual collections exceeded the amount budgeted at year-end. Licenses & Permits Revenue FY 2023-24 % of Adopted Actual Budget Budget Budget Revenue Rec'd Hist. Rec'd Jul - Sep 23 $ 962,056 $ 569,574 8.3% 15.8% 2nd Qtr Oct - Dec 23 1,606,465 943,399 13.7% 26.3% 3rd Qtr Jan - Mar 24 2,140,344 1,351,676 19.7% 35.1% 4th Qtr Apr - Jun 24 2,156,035 2,231,110 32.5% 35.3% 5,095,759 74.2% 112.5% Total $ 6,864,900 $ * Pro-rated based upon a four year historical trend of actual year-to-date collections Dollars in Thousands 1st Qtr FY 23 Actual Revenue FY 24 Actual Revenue Historical Trend Actual to Budget *% of FY 24 FY 24 3,000 2,500 2,000 1,500 1,000 500 1st Qtr Negative 2nd Qtr 3rd Qtr 4th Qtr This category includes revenue for various licenses: transaction privilege (sales) tax, alcoholic beverages, transient merchants, peddlers and solicitors, secondhand and junk dealers, amusements, business registrations, 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 for FYE 2023-24 are $1.8 M (25.8%) less than adopted budget and $3.6M (41.7%) less than FYE 2022-23 actual collections. Lower collections for FY 2023-24 was anticipated as large industrial permits inflate the historical comparison, however, we are seeing a slowing of other permit related revenues and therefore the performance indicator is negative as the percentage of budget received through FYE is more than five percentage points below the historical budget received at year-end. 6 8/27/2025 General Fund Revenue Analysis (continued): Charges for Services Revenue FY 2023-24 Jul - Sep 23 FY 24 % of *% of Actual Budget Budget Budget Revenue Rec'd Hist. Rec'd 2,420,572 $ 3,064,866 22.0% 19.4% 2nd Qtr Oct - Dec 23 3,073,445 3,634,896 26.1% 24.7% 3rd Qtr Jan - Mar 24 3,295,373 5,275,367 37.9% 26.5% 4th Qtr Apr - Jun 24 5,142,749 5,824,786 41.8% 41.3% 17,799,915 127.8% 111.9% Total $ $ 13,932,139 $ Actual Revenue FY 24 Actual Revenue 3r Historical Trend Actual to Budget Dollars in Millions 1st Qtr FY 24 Adopted FY 23 6 5 4 3 2 1 - * Pro-rated based upon a four year historical trend of actual year-to-date collections 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Positive Charges for Services includes revenue from various engineering, recreation, and library fees, police and fire miscellaneous service reimbursements, and public school reimbursements. Charges for services collections for FYE 2023-24 were $3.9M (27.8%) above adopted budget and $465,905 (2.7%) higher than FYE 2022-23 actual collections. The performance indicator is positive as actual collections exceeded the amount budgeted at year-end. Other Revenue FY 2023-24 1st Qtr Jul - Sep 23 FY 24 % of *% of Adopted Actual Budget Budget Budget Revenue Rec'd Hist. Rec'd 1,924,890 $ 1,605,574 17.6% 24.1% 2nd Qtr Oct - Dec 23 2,040,795 2,515,107 27.6% 20.5% 3rd Qtr Jan - Mar 24 2,262,699 3,473,802 38.1% 36.5% 4th Qtr Apr - Jun 24 2,892,666 5,489,343 60.2% 67.5% 13,083,825 143.4% 148.6% Total $ $ 9,121,050 $ Dollars in Millions FY 24 FY 23 Actual Revenue FY 24 Actual Revenue Historical Trend Actual to Budget 9 8 7 6 5 4 3 2 1 - * Pro-rated based upon a four year historical trend of actual year-to-date collections 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Positive Other revenue captures interest income, fines and forfeitures, court fees, sale of land and fixed assets, and other miscellaneous items. Revenue streams in this category are not constant. Other revenue collections for FYE 2023-24 are $4.0M (43.4%) above adopted budget and $373,823 (2.9%) higher than FYE 2022-23 actual collections. The performance indicator is positive as actual collections exceeded the amount budgeted at year-end. 7 8/27/2025 General Fund Expenditure Analysis: General Fund Expenditures + Encumbrances for FY 2023-24 by Function Dollars in Millions * Dept. Operating General Government FY 24 FY 24 % of % of Adjusted YTD Budget Budget Budget Exp+Enc Exp'd Prior Yr. 10 34 76,576,206 $ 67,729,704 88.4% 84.0% Community Services 35,941,987 33,700,788 93.8% 92.6% 9 31 5 Development Services 11,455,329 9,930,098 86.7% 84.2% Public Safety 154,624,241 149,032,031 96.4% 94.3% 56 Public Works & Utilities 12,286,372 10,953,045 89.1% 93.1% Neighborhood Resources Non-Dept. Pers. & O&M 10,205,930 8,356,001 81.9% 56.7% $ 85,453,157 Subtotal $ 386,543,222 Non-Dept. Reserves $ Non-Dept. Contingencies Total $ 75,401,110 88.2% 88.4% 355,102,776 91.9% 89.6% 3,209,616 $ - 0.0% 0.0% 50,658,927 - 0.0% 0.0% 80.6% 80.1% $ 440,411,765 $ 355,102,776 * Excluding Interfund Transfers 8 68 75 52 Development Services Community Services Neighborhood Resources General Government Non-Dept. Pers. & O&M 149 134 11 11 FY 23 YTD Exp+Enc FY 24 YTD Exp+Enc Public Safety Public Works & Utilities Total General Fund operating expenditures and encumbrances are reflected by City function, along with budgeted non-departmental reserves (encumbrance and unencumbered carryforward, utility, fuel, and downtown redevelopment) and contingencies (15% of revenues and Council Contingency). 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. The chart reflects actual spending and encumbrances at FYE 2022-23 and FYE 2023-24. Non-Dept. Personnel and O&M (maroon category) increase mainly reflects the difference in the amount of the prior year's payment of $50M towards the Public Safety Personnel Retirement System (PSPRS) unfunded liability paydown, to the current year's payment of $73M. Public Safety's (blue category) increase mainly reflects higher personnel related costs. FYE 2023-24 operating expended and encumbered at year end reflects 91.9% of the adjusted budget compared to 89.6% of adjusted budget spent and encumbered in the prior year. As shown on the following pages, departments (excluding non-departmental) have expended between 81.9% and 98.3% of their General Fund adjusted budgets for FY 2023-24. General Fund Expenditures + Encumbrances for FY 2023-24 by Category FY 24 *Dept. Operating Personnel FY 23 % Change Adjusted YTD YTD from Prior Budget Exp+Enc Exp+Enc Yr. Actual 300,378,837 $ 281,814,521 $ 237,470,304 18.7% Operations & Maint. 86,164,385 73,288,255 19.1% Reserves/Contingencies 53,868,543 Total $ FY 24 $ 440,411,765 $ 355,102,776 61,525,041 - FY 2023-24 General Fund Actual Expenditures + Encumbrances Operations & Maint. 21% 0.0% $ 298,995,345 18.8% Personnel 79% * Excluding Interfund Transfers Total General Fund operating expenditures and encumbrances are reflected by spending category. Personnel spending for FYE 2023-24 is 18.8% more than spending for FYE 2022-23. The majority of the increase is due the $73M payment to the Public Safety Personnel Retirement System (PSPRS) unfunded liability, versus $50M in the prior year and also includes other citywide personnel cost increases and additional FTEs. Operations and maintenance for FYE 2023-24 is 19.1% more than spending for FYE 2022-23. Some of the increase reflects higher spending and encumbrances for Fire, IT, and Public Works contracted services. 8 8/27/2025 General Fund Expenditure Analysis (continued / department summaries): FY 24 Operating Only 1st Qtr Jul - Sep 23 % of Budget *Hist. Adjusted Actual Expended Trend % of Budget Exp+Enc by Qtr Budget 338,777 $ 256,418 19.7% 23.0% 2nd Qtr Oct - Dec 23 312,718 250,515 19.2% 21.7% 3rd Qtr Jan - Mar 24 325,748 300,847 23.1% 22.6% 4th Qtr Apr - Jun 24 325,749 384,865 29.5% 22.7% 1,192,645 91.5% 89.9% Total $ FY 24 $ 1,302,992 $ Dollars in Thousands Mayor & Council Expenditure FY 2023-24 Comparison FY 23 Actual Exp+Enc FY 24 Actual Exp+Enc Historical Trend Actual to Budget 400 350 300 250 200 150 100 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 Mayor and Council division spent 91.5% of their FY 2023-24 adjusted budget and has historically spent 89.9% of their adjusted budget for the fiscal year. Higher spending in the third quarter of FY 2022-23 reflects a fully staffed department and personnel increases related to the class and compensation study. Higher expenses in the forth quarter of FY 2023-24 compared to FY 2022-23 reflect higher personnel related costs. The performance indicator is positive as expenses are less than the adjusted budget. FY 24 Operating Only 1st Qtr Jul - Sep 23 $ FY 24 % of Budget *Hist. Adjusted Actual Expended Trend % of Budget Exp+Enc by Qtr Budget 307,046 $ 288,178 26.6% 25.7% 2nd Qtr Oct - Dec 23 228,572 212,222 19.6% 19.1% 3rd Qtr Jan - Mar 24 235,096 268,925 24.9% 19.7% 4th Qtr Apr - Jun 24 311,265 233,633 21.6% 26.1% 1,002,958 92.7% 90.7% Total $ 1,081,978 $ Dollars in Thousands City Clerk Expenditure FY 2023-24 Comparison FY 23 Actual Exp+Enc FY 24 Actual Exp+Enc Historical Trend Actual to Budget 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 The City Clerk spent 92.7% of their FY 2023-24 adjusted budget and has historically spent 90.7% of their adjusted budget for the fiscal year. Higher spending in the first quarter of FY 2022-23 was due to the General Election costs. Higher spending in the second and third quarter of FY 2023-24 reflects higher personnel related costs. The performance indicator is positive as expenses are less than the adjusted budget. 9 8/27/2025 General Fund Expenditure Analysis (continued / department summaries): Law Expenditure FY 2023-24 Comparison Operating Only 1st Qtr Jul - Sep 23 FY 24 % of Budget *Hist. Adjusted Actual Expended Trend % of 1,600 Budget Exp+Enc by Qtr Budget 1,400 1,199,179 $ 1,246,641 25.8% 24.4% 2nd Qtr Oct - Dec 23 1,210,740 1,115,277 23.1% 24.6% 3rd Qtr Jan - Mar 24 1,182,934 1,284,885 26.6% 24.0% 4th Qtr Apr - Jun 24 1,238,287 1,103,944 22.8% 25.2% 4,750,747 98.3% 98.1% Total $ $ 4,831,140 $ Dollars in Thousands FY 23 FY 23 Actual Exp+Enc FY 24 Actual Exp+Enc Historical Trend Actual to Budget 1,200 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 98.3% of their FY 2023-24 adjusted budget and has historically spent 98.1% of their adjusted budget for the fiscal year. The performance indicator is positive as expenses are less than the adjusted budget. City Magistrate Expenditure FY 2023-24 Comparison Operating Only 1st Qtr Jul - Sep 23 FY 24 % of Budget *Hist. Adjusted Actual Expended Trend % of Budget Exp+Enc by Qtr. Budget 1,424,296 $ 1,356,538 24.1% 21.7% 2nd Qtr Oct - Dec 23 1,422,668 1,147,365 20.4% 21.6% 3rd Qtr Jan - Mar 24 1,351,839 1,002,762 17.9% 20.6% 4th Qtr Apr - Jun 24 1,419,011 1,144,542 20.4% 21.6% 4,651,207 82.8% 85.5% Total $ $ 5,617,814 $ FY 23 Actual Exp+Enc FY 24 Actual Exp+Enc Historical Trend Actual to Budget 1,600 Dollars in Thousands FY 23 1,400 1,200 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 City Magistrate spent 82.8% of their FY 2023-24 adjusted budget and has historically spent 85.5% of their adjusted budget for the fiscal year. Higher spending in the third quarter of FY 2022-23 reflects personnel increases related to the class and compensation study and vacation payouts. Higher spending in the first quarter of FY 2023-24 reflects encumbrances recorded at the beginning of the year for court security and temporary staff. Higher expenses in the forth quarter of FY 2023-24 compared to FY 2022-23 reflect higher personnel related costs, increase cost for public defenders, and onetime costs for office furniture. The performance indicator is positive as expenses are less than the adjusted budget. 10 8/27/2025 General Fund Expenditure Analysis (continued / department summaries): Operating Only 1st Qtr Jul - Sep 23 FY 24 % of Budget *Hist. Adjusted Actual Expended Trend % of Budget Exp+Enc by Qtr Budget 7,268,705 $ 6,779,403 31.0% 28.1% 2nd Qtr Oct - Dec 23 5,311,503 3,705,019 17.0% 20.6% 3rd Qtr Jan - Mar 24 4,397,672 4,010,317 18.4% 17.0% 4th Qtr Apr - Jun 24 Total $ FY 24 4,870,725 $ 21,848,604 $ 3,987,656 18.2% 18.8% 18,482,395 84.6% 84.5% Dollars in Millions City Manager & Organizational Support Expenditure FY 2023-24 Comparison FY 23 Actual Expend FY 24 Actual Exp+Enc Historical Trend Actual to Budget 7 6 5 4 3 2 1 1st Qtr * Historical Trend represents the average of the past 4 years % of actual to budget 2nd Qtr 3rd Qtr 4th Qtr Positive City Manager & Organizational Support includes the following divisions budgeted in the General Fund: Administration, Buildings & Facilities, Diversity, Equity, & Inclusion, Economic Development, Fleet Services, Human Resources, Transportation Policy, as well as Cultural Development which is shown separately. As of FY 2022-23, a reorganization occurred transferring a portion of the Community Development Cost Center, which was renamed to Diversity, Equity, & Inclusion (DEI) to City Manager & Organizational Support. Combined, these divisions spent 84.6% of their FY 2023-24 adjusted budget and have historically spent 84.5% of their adjusted budget for the fiscal year. Higher spending in the first quarter of FY 2023-24 reflects encumbrances recorded at the beginning of the year for contract services, machinery and equipment, and buildings maintenance as well as increased utility expenses. Higher expenses in the forth quarter of FY 2023-24 compared to FY 2022-23 reflect higher personnel related costs and increase costs for professional contracts. The performance indicator is positive as expenses are less than the adjusted budget. Communications & Public Affairs Expenditure FY 2023-24 Comparison Operating Only 1st Qtr Jul - Sep 23 % of Budget *Hist. Adjusted Actual Expended Trend % of Budget Exp+Enc by Qtr Budget 1,380,570 $ 1,574,176 36.6% 25.9% 2nd Qtr Oct - Dec 23 988,052 593,292 13.7% 18.6% 3rd Qtr Jan - Mar 24 888,492 823,348 19.1% 16.7% 4th Qtr Apr - Jun 24 1,047,677 641,766 15.0% 19.7% 3,632,582 84.4% 80.9% Total $ FY 24 $ 4,304,791 $ Actual Expend FY 24 Actual Exp+Enc Historical Trend Actual to Budget Dollars in Thousands FY 24 FY 23 1,600 1,400 1,200 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 Communications and Public Affairs (CAPA) spent 84.4% of their FY 2023-24 adjusted budget and have historically spent 80.9% of their adjusted budget for the fiscal year. Higher spending in the first quarter of FY 2023-24 was for planned one-time expenses for marketing/promotional and talent recruitment campaigns. The performance indicator is positive as expenses are less than the adjusted budget. 11 8/27/2025 General Fund Expenditure Analysis (continued / department summaries): Cultural Development Expenditure 2023-24 Comparison Operating Only 1st Qtr Jul - Sep 23 % of Budget *Hist. Adjusted Actual Expended Trend % of Budget Exp+Enc by Qtr Budget 1,461,677 $ 1,462,261 30.0% 27.8% 2nd Qtr Oct - Dec 23 1,120,618 1,021,346 21.0% 21.6% 3rd Qtr Jan - Mar 24 1,120,617 1,089,023 22.3% 21.5% 4th Qtr Apr - Jun 24 1,169,341 1,197,230 24.6% 22.5% 4,769,860 97.9% 93.4% Total $ FY 24 $ 4,872,253 $ Actual Exp+Enc FY 24 Actual Exp+Enc Historical Trend Actual to Budget 1,600 Dollars in Thousands FY 24 FY 23 1,400 1,200 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 Cultural Development includes the following cost centers: Administration, Center for the Arts, Downtown Redevelopment, Museum, and Special Events, and is considered part of City Manager, Organizational Support. The department spent 97.9% of their FY 2023-24 adjusted budget and have historically spent 93.4% of their adjusted budget for the fiscal year. Higher expenses in the forth quarter of FY 2023-24 compared to FY 2022-23 reflect higher personnel related costs and one-time costs for professional contracts. The performance indicator is positive as expenses are less than the adjusted budget. Community Services Expenditure 2023-24 Comparison FY 24 % of Budget *Hist. Adjusted Actual Expended Trend % of 14 Budget Exp+Enc by Qtr Budget 12 12,939,115 $ 12,221,223 34.0% 33.3% 2nd Qtr Oct - Dec 23 7,547,817 7,488,742 20.8% 20.0% 3rd Qtr Jan - Mar 24 6,828,979 6,956,214 19.4% 17.8% 4th Qtr Apr - Jun 24 8,626,076 7,034,609 19.5% 22.3% 33,700,788 93.8% 93.4% Operating Only 1st Qtr Jul - Sep 23 Total $ $ 35,941,987 $ Dollars in Millions FY 24 FY 23 Actual Exp+Enc FY 24 Actual Exp+Enc Historical Trend Actual to Budget 10 8 6 4 2 - * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Positive Community Services includes the following divisions budgeted in the General Fund: Administration, Aquatics, Library, Nature & Recreation Facilities, Park Maintenance & Operations, Recreation, and Sports & Fitness Facilities. The department spent 93.8% of their FY 2023-24 adjusted budget and have historically spent 93.4% of their adjusted budget for the fiscal year. The performance indicator is positive as expenses are less than the adjusted budget. 12 8/27/2025 General Fund Expenditure Analysis (continued / department summaries): FY 24 Operating Only 1st Qtr Jul - Sep 23 % of Budget *Hist. Adjusted Actual Expended Trend % of Budget Exp+Enc by Qtr Budget 7,252,906 $ 9,465,709 39.2% 2nd Qtr Oct - Dec 23 4,351,744 2,453,717 10.0% 16.2% 3rd Qtr Jan - Mar 24 4,593,507 3,136,003 13.0% 17.0% 4th Qtr Apr - Jun 24 7,978,195 6,843,009 28.4% 28.1% 21,898,438 90.6% 88.1% Total $ FY 24 $ 24,176,352 $ 26.8% Dollars in Millions Information Technology Expenditure 2023-24 Comparison * Historical Trend represents the average of the past 4 years % of actual to budget FY 23 Actual Exp+Enc FY 24 Actual Exp+Enc Historical Trend Actual to Budget 10 9 8 7 6 5 4 3 2 1 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Positive Information Technology spent 90.6% of their FY 2023-24 adjusted budget and have historically spent 88.1% of their adjusted budget for the fiscal year. Higher spending in the first quarter of FY 2023-24 is related to encumbrances for planned contracted services dedicated to various projects, which was not typical in the first quarter of the historical trend. The performance indicator is positive as expenses are less than the adjusted budget. Management Services Expenditure FY 2023-24 Comparison FY 23 $ 2nd Qtr Oct - Dec 23 FY 24 % of Budget *Hist. Actual Expended Trend % of Budget Exp+Enc by Qtr Budget 2,606,750 $ 2,090,985 24.5% 26.9% 1,954,414 1,608,930 18.7% 20.2% 3rd Qtr Jan - Mar 24 1,981,017 1,842,610 21.7% 20.5% 4th Qtr Apr - Jun 24 1,998,101 1,806,347 21.1% 20.6% 7,348,872 86.0% 88.2% Total $ 8,540,282 $ 3 2,500 Dollars Millions Dollars in in Thousands Operating Only 1st Qtr Jul - Sep 23 FY 24 Adjusted Actual Exp+Enc FY 24 Actual Exp+Enc Series1 Series2 Series3 Historical Trend Actual to Budget 2,000 2 1,500 1,000 1 500 0- * 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, Accounting, Budget, Central Supply, Purchasing, Tax & License, and Utility Services (reimbursed by the Public Works & Utilities Department, Water/Wastewater/Solid Waste, through the Indirect Cost Allocation). These divisions spent 86.0% of their FY 2023-24 adjusted budget and have historically spent 88.2% of their adjusted budget for the fiscal year. The performance indicator is positive as expenses are less than the adjusted budget. 13 8/27/2025 General Fund Expenditure Analysis (continued / department summaries): Neighborhood Resources Expenditure 2023-24 Comparison Operating Only 1st Qtr Jul - Sep 23 % of Budget *Hist. Adjusted Actual Expended Trend % of Budget Exp+Enc by Qtr Budget 2,959,720 $ 1,075,551 10.5% 19.4% 2nd Qtr Oct - Dec 23 3,061,779 3,209,992 31.5% 20.6% 3rd Qtr Jan - Mar 24 1,837,067 1,543,878 15.1% 12.5% 4th Qtr Apr - Jun 24 2,347,364 2,526,580 24.8% 15.3% 8,356,001 81.9% 67.9% Total $ FY 24 $ 10,205,930 $ Actual Exp+Enc FY 24 Actual Exp+Enc Historical Trend Actual to Budget Dollar in Thousands FY 24 FY 23 3,000 2,400 1,800 1,200 600 - * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Positive Neighborhood Resources includes the following cost centers budgeted in the General Fund: Administration, Housing & Redevelopment, Neighborhood Preservation, and Community Development. As of FY 2022-23, a reorganization occurred transferring a portion of the Community Development cost center to City Manager & Organizational Support. Historical spending for Community Development remains with Neighborhood Resources. The department spent 81.9% of their FY 2023-24 adjusted budget and have historically spent 67.9% of their adjusted budget through for the fiscal year. The second quarter actuals are higher due to large encumbrances that were spent over the remaining fiscal year. Higher expenses in the forth quarter of FY 2023-24 compared to FY 2022-23 reflect higher personnel related costs and one-time costs for professional contracts. The performance indicator is positive as expenses are less than the adjusted budget. Non-Departmental Expenditure FY 2023-24 Comparison FY 24 % of Budget *Hist. Adjusted Actual Expended Trend % of Budget Exp+Enc by Qtr Budget 62,612,547 $ 73,946,094 86.5% 67.0% 2nd Qtr Oct - Dec 23 2,090,980 904,190 1.1% 2.2% 3rd Qtr Jan - Mar 24 19,605,713 279,175 0.3% 21.0% 4th Qtr Apr - Jun 24 1,143,917 271,651 0.3% 1.2% 75,401,110 88.2% 91.4% Operating Only 1st Qtr Jul - Sep 23 Total** $ $ 85,453,157 $ FY 23 Actual Exp+Enc FY 24 Actual Exp+Enc Historical Trend Actual to Budget Dollars in Millions FY 24 70 60 50 40 30 20 10 - * Historical Trend represents the average of the past 4 years % of actual to budget 1st Qtr ** Excludes Reserves and Contingencies 2nd Qtr 3rd Qtr 4th Qtr Positive Non-Departmental includes citywide costs that do not belong to a specific department or are infrequent/unusual (i.e., memberships, legal fees, studies, strategic economic development opportunities, and miscellaneous downtown redevelopment expenses). Spending in this category fluctuates due to changing one-time needs from year to year. Non-departmental planned spending for FY 2023-24 is 88.2% of the adjusted budget and has historically spent 91.4% of the adjusted budget for the fiscal year. Higher spending compared to the historical trend in the first quarter of FY 2022-23 and FY 202324 is due to the payments towards the Public Safety Personnel Retirement System (PSPRS) unfunded liability reflecting the planned increased payment amount of $73M, which was $23M more than the prior year. The performance indicator is positive as expenses are less than the adjusted budget. 14 8/27/2025 General Fund Expenditure Analysis (continued / department summaries): Development Services Expenditure FY 2023-24 Comparison Operating Only 1st Qtr Jul - Sep 23 $ 2nd Qtr Oct - Dec 23 FY 24 % of Budget *Hist. Adjusted Actual Expended Trend % of Budget Exp+Enc by Qtr Budget 2,978,386 $ 2,577,892 22.5% 22.5% 2,749,279 2,142,308 18.8% 21.2% 3rd Qtr Jan - Mar 24 2,863,832 2,516,039 22.0% 21.9% 4th Qtr Apr - Jun 24 2,863,832 2,693,859 23.4% 22.2% 9,930,098 86.7% 87.8% Total $ 11,455,329 $ Actual Exp+Enc FY 24 Actual Exp+Enc Historical Trend Actual to Budget 3 Dollars in Millions FY 24 FY 23 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 Development Services includes the following cost centers: Administration, Building Safety, Transportation Engineering, Engineering, and Planning. The department spent 86.7% of their FY 2023-24 adjusted budget and have historically spent 87.8% of their adjusted budget for the fiscal year. Higher expenses in the forth quarter of FY 2023-24 compared to FY 2022-23 reflect higher personnel related costs and one-time costs for professional contracts. The performance indicator is positive as expenses are less than the adjusted budget. Public Works & Utilities Expenditure FY 2023-24 Comparison Operating Only 1st Qtr Jul - Sep 23 % of Budget *Hist. Adjusted Actual Expended Trend % of 7 Budget Exp+Enc by Qtr Budget 6 5,528,867 $ 6,006,794 48.9% 39.1% 2nd Qtr Oct - Dec 23 2,580,138 2,064,348 16.8% 18.7% 3rd Qtr Jan - Mar 24 2,825,866 1,295,725 10.5% 20.0% 4th Qtr Apr - Jun 24 1,351,501 1,586,178 12.9% 9.1% 10,953,045 89.1% 86.9% Total $ FY 24 $ 12,286,372 $ Dollars in Millions FY 24 FY 23 Actual Exp+Enc FY 24 Actual Exp+Enc Historical Trend Actual to Budget 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 Public Works & Utilities includes the following divisions budgeted in the General Fund: Administration, Capital Projects, Traffic Engineering, Streets, and Street Sweeping. The department spent 89.1% of their FY 2023-24 adjusted budget and have historically spent 86.9% of their adjusted budget through for the fiscal year. Higher spending in the first quarter of FY 2023-24 reflects an encumbrance recorded at the beginning of the year for landscape maintenance contracts. The performance indicator is positive as expenses are less than the adjusted budget. 15 8/27/2025 General Fund Expenditure Analysis (continued / department summaries): Fire Expenditure FY 2023-24 Comparison Operating Only 1st Qtr Jul - Sep 23 $ FY 24 % of Budget *Hist. Adjusted Actual Expended Trend % of Budget Exp+Enc by Qtr Budget 14,654,462 $ 14,097,044 27.9% 26.4% 2nd Qtr Oct - Dec 23 12,127,831 10,709,099 21.2% 22.3% 3rd Qtr Jan - Mar 24 12,127,832 13,141,964 26.0% 21.8% 4th Qtr Apr - Jun 24 11,622,505 11,448,519 22.7% 21.8% 49,396,626 97.8% 92.4% Total $ 50,532,631 $ Actual Exp+Enc FY 24 Actual Exp+Enc Historical Trend Actual to Budget 15 Dollars in Millions FY 24 FY 23 12 9 6 3 - * 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 the following cost centers: Administration, Health & Medical Services, Operations, Prevention & Preparedness, and Support Services. The department spent 97.8% of their FY 2023-24 adjusted budget and have historically spent 92.4% of their adjusted budget for the fiscal year. The performance indicator is positive as expenses are less than the adjusted budget. Police Expenditure FY 2023-24 Comparison Operating Only 1st Qtr Jul - Sep 23 2nd Qtr Oct - Dec 23 $ FY 24 % of Budget *Hist. Adjusted Actual Expended Trend % of Budget Exp+Enc by Qtr Budget 28,104,734 $ 29,354,958 28.2% 24.8% 26,022,905 22,636,010 21.7% 23.1% 3rd Qtr Jan - Mar 24 24,981,985 25,343,914 24.2% 22.3% 4th Qtr Apr - Jun 24 24,981,986 22,300,523 21.4% 22.3% 99,635,405 95.7% 92.6% Total $ 104,091,610 $ FY 23 Actual Exp+Enc FY 24 Actual Exp+Enc Historical Trend Actual to Budget 30 Dollars in Millions FY 24 25 20 15 10 5 - * 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 the following cost centers: Administration, Communications, Criminal Investigations, Detention Services, Field Operations, Forensic Services, Operational Support, Planning & Research, Professional Standards, Property & Evidence, Records, and Technology. The department spent 95.7% of their FY 2023-24 adjusted budget and have historically spent 92.6% of their adjusted budget for the fiscal year. Higher spending in the first quarter of FY 2023-24 reflects encumbrances recorded at the beginning of the year for detention services and for repair and maintenance of equipment, as well as an increase in operating supplies and higher personnel related costs. The performance indicator is positive as expenses are less than the adjusted budget. 16 8/27/2025 Enterprise Funds Enterprise Fund Analysis: Water Fund Analysis FY 2023-24 Comparison Revenues $ Transfers In FY 24 Actual % of Budget % of Revenue/ Rec'd/Exp'd Budget Budget Exp+Enc to Date Prior Yr. 55,655,073 $ 59,326,400 107% 110% 6,162,168 6,162,168 100% 100% Total Revenues $ 61,817,241 $ 65,488,568 106% 109% Operating Expenses $ 42,552,851 $ 39,993,821 94% 98% Major Capital Expenses 37,210,891 6,230,549 17% 62% Debt Service 15,749,298 14,196,681 90% 100% Transfers Out 5,874,358 5,874,358 100% 100% 65% 88% Total Expenses $ 101,387,398 $ 66,295,409 Net Rev / Exp $ (39,570,157) $ (806,841) Positive Water Fund Analysis Revenues Expenses 120 Dollars in Millions Water Fund FY 24 Adjusted 100 80 60 40 20 0 FY 23 Actual YTD FY 24 Actual YTD FY 24 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, Environmental Resources, Meter Services, San Tan Vista Water Treatment Plant, Water Capital, Water Distribution, Water Quality, Water Treatment Plant, and Water Systems Maintenance. The Water Operating Fund supports operating functions and major capital costs that can be paid without borrowing. The Net Revenue/Expense for FY 2023-24 reflects a $39.6M planned drawdown to fund balance due to increased pay as you go Capital spending, and also assumes all appropriated operating and capital funds are spent, which is typically not the case. The budgeted Transfers In totaling $6,162,168 includes $4,773,368 for System Development Fee (SDF) loan paybacks and $1,388,800 from Reclaimed Water to pay towards related capital costs. The budgeted Transfers Out totaling $5,874,358 includes indirect cost allocation to the General Fund of $3,781,500, payment of $214,501 to the Technology Replacement Fund, payment of $500,000 to the Insured Liability Self-Insurance Fund, payment of $31,288 to the Workers' Compensation Self-Insurance Trust, and a payment of $21,953 to the Uninsured Liability Self-Insurance Fund, as well as a subsidy of $1,325,116 to the Reclaimed Water Fund (reflects benefit received). Year-to-date Operating Revenues are 107% compared to 110% for FY 2022-23, while Operating Expenses are 94% compared to 98% for FY 2022-23. The performance indicator is positive as the percentage of operating revenues received to date (107%) exceeds the percentage of operating expenses (93%, when including the debt service and indirect cost allocation). Wastewater Fund Analysis FY 2023-24 Comparison Revenues $ Transfers In FY 24 Actual % of Budget % of Revenue/ Rec'd/Exp'd Budget Budget Exp+Enc to Date Prior Yr. 54,216,700 $ 54,037,952 100% 106% 11,200,392 11,200,392 100% 100% Total Revenues $ 65,417,092 $ 65,238,344 100% 105% Operating Expenses $ 25,180,727 $ 22,000,513 87% 96% Major Capital Expenses 195,529,604 96,246,962 49% 55% Debt Service 18,429,783 18,130,781 98% 100% Transfers Out 3,873,314 3,873,314 100% 102% 243,013,428 $ 140,251,570 58% 63% Total Expenses Net Rev / Exp Positive $ $ (177,596,336) $ (75,013,226) Wastewater Fund Analysis Revenues Expenses 300 Dollars in Millions Wastewater Fund FY 24 Adjusted 250 200 150 100 50 0 FY 23 Actual YTD FY 24 Actual YTD FY 24 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: Airport Water Reclamation Facility, Lone Butte Wastewater Treatment, Ocotillo Brine Reduction Facility, Ocotillo Water Reclamation Facility, Wastewater Capital, Wastewater Collection, and Wastewater Quality. The Wastewater Operating Fund supports operating functions and major capital costs that can be paid without borrowing. The Net Revenue/Expense for FY 2023-24 reflects an $178M planned drawdown (includes unspent capital carryforward from prior years) to fund balance due to increased pay as you go Capital spending, and also assumes all appropriated operating and capital funds are spent, which is typically not the case. The budgeted Transfers In totaling $11,200,392 includes $10M for System Development Fee (SDF) loan paybacks and $1,200,392 from Reclaimed Water towards related capital costs. The budgeted Transfers Out totaling $3,873,314 includes indirect cost allocation to the General Fund of $2,362,100, payment of $143,264 to the Technology Replacement Fund, payment of $20,881 to the Workers' Compensation Self-Insurance Trust, and a payment of $21,953 to the Uninsured Liability SelfInsurance Fund, as well as a subsidy of $1,325,116 to the Reclaimed Water Fund (reflects benefits received). Year-to-date Operating Revenues are 100% compared to 106% for FY 2022-23, while Operating Expenses are 87% compared to 96% for FY 2022-23. The performance indicator is positive as the percentage of operating revenues received to date (100%) exceeds the percentage of operating expenses (92%, when including the debt service and indirect cost allocation). 17 9/20/2024 Enterprise Funds Enterprise Fund Analysis (continued): Reclaimed Water Fund Analysis FY 2023-24 Comparison % of Budget % of Adjusted Revenue/ Rec'd/Exp'd Budget $ Exp+Enc to Date Prior Yr. Transfers In 1,725,500 $ 2,650,232 1,682,258 97% 90% 2,650,232 100% 100% Total Revenues $ 4,375,732 $ 4,332,490 99% 96% Operating Expenses $ 2,142,154 $ 2,111,969 99% 96% 2,716,946 100% 100% 99% 98% Transfers Out 2,716,946 Total Expenses $ 4,859,100 $ 4,828,915 Net Rev / Exp $ (483,368) $ (496,425) Positive Reclaimed Water Fund Analysis Revenues Expenses 5,000 Dollars in Thousands FY 24 Actual Budget Reclaimed Water Revenues FY 24 4,000 3,000 2,000 1,000 FY 23 Actual YTD FY 24 Actual YTD FY 24 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 Reclaimed Water Operating Fund supports operating functions and now a portion of related capital costs. The Net Revenue/Expense for the FY 2023-24 budget reflects a drawdown to fund balance. The budgeted Transfers In totaling $2,620,232 includes subsidies from Water and Wastewater Funds of $1,310,116 each to reflect the benefit each fund receives by reclaiming water. The budgeted Transfers Out totaling $2,716,946 include an indirect cost allocation to the General Fund of $123,800, payment of $3,070 to the Technology Replacement Fund, and $844 to the Workers' Compensation Self-Insurance Trust, as well as a payment of $1,388,800 to the Water Fund and $1,200,392 to the Wastewater Fund to reflect contributions to reclaimed capital costs. Year-to-date Operating Revenues are 97% of budget compared to 90% for FY 2022-23, while Operating Expenses are 99% of budget as compared to 96% for FY 2022-23. The performance indicator is positive as the percentage of operating revenues received to date (97%) is more than the percentage of operating expenses spent to date (91%, when including indirect cost allocation). Solid Waste Fund Analysis FY 2023-24 Comparison FY 24 FY 24 Actual % of Budget % of Adjusted Revenue/ Rec'd/Exp'd Budget Exp+Enc to Date Revenues 24 104% 100% 21 $ 19,039,994 $ 19,783,427 104% 100% $ $ 18,226,846 94% 93% Revenues $ Total Revenues Operating Expenses 19,039,994 19,407,284 $ Major Capital Expenses 3,370,919 772,691 23% 19% Transfers Out 1,068,549 1,068,549 100% 100% Total Expenses $ 23,846,752 $ 20,068,086 84% 86% Net Rev / Exp $ (4,806,758) $ Dollars in Millions Prior Yr. 19,783,427 Budget Solid Waste Positive Solid Waste Fund Analysis 18 15 12 9 6 3 FY 23 Actual YTD (284,659) Expenses FY 24 Actual YTD FY 24 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 2023-24 reflects a drawdown of $4.8M to fund balance. The budgeted Transfers Out totaling $1,068,549 include an indirect cost allocation to the General Fund of $985,600, payment of $67,985 to the Technology Replacement Fund, and payment of $14,964 to the Workers' Compensation Self-Insurance Trust. Year-to-date Operating Revenues are 104% compared to 100% for FY 2022-23, while Operating Expenses are 94% compared to 93% for FY 2022-23. The performance indicator is positive as the percentage of operating revenues received to date (104%) exceeds the percentage of operating expenses spent to date (94%, whenincluding indirect cost allocation). 18 9/20/2024 Enterprise / Other Funds Enterprise / Other Funds Analysis (continued): Airport Fund Analysis FY 2023-24 Comparison Revenues $ General Fund Subsidy FY 24 Actual % of Budget % of Adjusted Revenue/ Rec'd/Exp'd Budget Budget Exp+Enc to Date Prior Yr. 984,988 $ 5,870,142 1,261,856 128% 115% 685,617 12% 21% Total Revenues $ 6,855,130 $ 1,947,473 28% 35% Operating Expenses $ 1,662,674 $ 1,590,234 96% 86% 5,077,409 687,470 14% 21% 115,047 115,047 100% 101% $ 2,392,751 35% 41% $ (445,278) Major Capital Expenses Transfers Out Total Expenses $ Net Rev / Exp $ Positive 6,855,130 - Revenues Expenses 8,000 Dollars in Thousands Airport Fund Airport Fund Analysis FY 24 7,000 6,000 5,000 4,000 3,000 2,000 1,000 FY 23 Actual YTD FY 24 Actual YTD FY 24 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 2023-24 reflects no budgeted change in fund balance since the General Fund Subsidy of $5.9M is budgeted from the General Fund to make up the funding needed to support operations and/or Major Capital Expenses. The budgeted Transfers Out totaling $115,047 includes indirect cost allocation to the General Fund of $100,000 and a payment of $15,047 to the Technology Replacement Fund. Year-to-date Operating Revenues are 128% of budget compared to 115% for FY 2022-23, while year-to-date Operating Expenses are 96% of budget compared to 86% for FY 2022-23. The performance indicator is positive as the percentage of operating revenues received to date (128%) exceeds the percentage of operating expenses spent to date (96%, when including indirect cost allocation). Highway User Fund (HURF) Analysis FY 2023-24 Comparison FY 24 Actual % of Budget % of Adjusted Revenue/ Rec'd/Exp'd Budget to Date Prior Yr. Exp+Enc 17,000,000 $ 21,430,580 Total Revenues $ 17,606,000 Operating Expenses $ Other 606,000 Major Capital Expenses 126% 117% 1,057,172 174% 195% 22,487,752 128% 119% 9,949,080 $ 9,139,873 92% 90% 22,654,432 20,870,337 92% 89% $ Debt Service - - 0% 0% Transfers Out 123,665 123,665 100% 100% 92% 89% Total Expenses $ 32,727,177 $ 30,133,875 Net Rev / Exp $ (15,121,177) $ (7,646,123) Positive Revenues Dollars in Millions Budget $ Highway Users Tax Highway User Fund Analysis FY 24 Expenses 33 30 27 24 21 18 15 12 9 6 3 0 FY 23 Actual YTD FY 24 Actual YTD FY 24 Budget The performance indicator for this Special Revenue Fund focuses on the relationship between Operating Revenues and Operating Expenses (including debt service) and the percentage of budget received/expended. 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 2023-24 reflects a planned drawdown of $15.1M to fund balance. The budgeted Transfers Out totaling $123,665 include a payment to the General Fund of $2,082 for miscellaneous charges, a payment of $26,583 to the Technology Replacement Fund, and a payment of $95,000 to the Uninsured Liability Self-Insurance Fund for stormwater oversight. Year-to-date Operating Revenues are 126% of budget compared to 117% for FY 2022-23, while year-todate Operating Expenses are 92% of budget compared to 90% for FY 2022-23. The performance indicator is positive as the percentage of operating revenues received (126%) exceeds the percentage of operating expenses spent of 90%. 19 9/20/2024 Other Funds Other Funds Analysis (continued): Enterprise System Development Fee Funds Analysis FY 2023-24 Comparison FY 24 FY 24 % of Budget Development Fee Adjusted Actual Rec'd to Budget Revenue Date (SDF) Funds Water $ 6,303,000 $ 2,742,957 44% Reclaimed Water 2,726,300 557,235 20% Wastewater 7,907,000 2,578,778 33% 5,878,970 35% Total SDF Revenue $ 16,936,300 $ 10 Dollars in Millions Enterprise System Note: Budget and Actual amounts reflect SDF revenues and the interest earned FY 23 Adjusted Budget FY 24 Adjusted Budget FY 23 Actual FY 24 Actual 8 6 4 2 0 on fund balances, and excludes loan transfers in/out or proceeds from bond Water sales. Reclaimed Water Wastewater Enterprise (Water, Wastewater, and Reclaimed Water) System Development Fees (SDFs) are assessed on building permits based on the meter size. Enterprise SDF's are assessed on all residential, but may or may not be assessed on Commercial. Commercial properties are assessed if a Water Meter Permit (WMI) is needed. Enterprise SDFs are based on development and fluctuate quarterly as well as from year to year. The graph shows the FY 2023-24 budget and year-to-date collections compared to the FY 2022-23 budget and year-to-date collections. Collections for FY 2023-24 were 35% of the budget as compared to the prior year's collections of 32% of budget showing some increases to the number of permits being pulled, but still at a much slower pace then prior years. General System Development Fee Funds Analysis FY 2023-24 Comparison FY 24 Development Fee (SDF) Funds Arterial Streets % of Budget Adjusted Actual Rec'd to Budget Revenue Date 6,828,000 $ 2,611,897 38% Fire 553,000 159,066 29% Library 115,000 13,413 12% Parks 896,000 1,124,063 125% Police 316,000 85,653 27% Public Building 280,000 77,059 28% 4,071,151 45% Total SDF Revenue $ FY 24 $ 8,988,000 $ FY 23 Adjusted Budget FY 23 Actual FY 24 Adjusted Budget FY 24 Actual 8,000 7,000 Dollars in Thousands General System 6,000 5,000 4,000 3,000 2,000 1,000 0 Arterial Streets Note: Budget and Actual amounts reflect Impact Fee revenues and the interest Fire Library Parks Police Public Building earned on fund balances, and excludes loan transfers in/out or proceeds from bond sales. General (Arterial Streets, Fire, Library, Parks, Police, and Public Building) System Development Fees (SDFs) are charged on all commercial and residential building permits and is based on square footage and land use. General SDF fees are based on development and will fluctuate quarterly as well as annually. The graph shows the FY 2023-24 budget and year-to-date collections compared for FY 2022-23 budget and year-to-date collections. Collections for FY 2023-24 were 45% of the budget as compared to the prior year's collections of 93% of the budget, which included significant development at that time. 20 9/20/2024 Other Funds Other Funds Analysis (continued): Grant Funds Analysis FY 2023-24 Comparison Operating Grant Revenues $ FY 23 Actual Actual Revenue Revenue 7,876,917 $ FY 23 Actual Revenue 11,560,864 Community Services 263,819 268,818 Neighborhood Resources 653,921 4,920,880 Neighborhood Res. - CDBG & HOME 1,650,806 2,694,787 Neighborhood Res. - HUD 15,122,598 10,988,178 Public Safety 2,346,842 1,538,873 Total Operating Grant Revenue $ General Government* $ Community Services 28,056,181 $ 31,972,401 2,104,000 $ 966,248 1,389,182 Cultural Development Neighborhood Res. Public Safety - - 18,993 - 2,625,000 680,000 Public Works & Utilities Millions General Government* FY 24 - 7,862,976 FY 24 Actual Revenue 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 - 10,634,679 Total Capital Grant Revenue $ 12,036,158 $ 14,244,920 Total Grant Revenue $ 40,092,338 $ 46,217,321 * Includes Airport, CAPA, City Manager, Economic Development, Law, Magistrate, Transportation Policy, and Non-Departmental non-entitlement programs. 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. In most cases, grant revenues for many programs are received on a reimbursable basis, so the revenue on a large capital project may lag a fiscal year after the project is initiated. Actual collections for FY 2023-24 are $31.7M as compared to $46.2M for FY 2022-23. 21 9/20/2024