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CITY OF SAN LEANDRO MEMORANDUM DATE: September 8, 2009 TO: Finance Committee FROM: Perry H. Carter, Interim Finance Director ~ifi SUBJECT: Preliminary Financial Results for the General Fund for 2008-09 Attached for your review (Schedule A), is an analysis of preliminary results of operations for the General Fund for 2008-09. As can be seen in Column (1) Adopted Budget 2008-09 the General Fund was budgeted to end the year with an Ending Designated Fund Balance of approximately $14.8 million. Reducing this amount by the Emergency Reserve of $5.0 million leaves a Fund Balance Available in Column (1) of $9.8 million (bottom of Column (1)). This is the amount that was budgeted to be available to Council for future use and the amount recommended by staff to subsidize future tazgeted deficits as the City implemented the three year deficit "work out" plan. Up through April of last year, staff updated the Finance Committee on the financial progress of the General Fund and the continued deterioration of certain revenues. More specifically Sales Tax and Property Tax revenues were not meeting expectations. Accordingly, staff reduced these revenues and in April of 2009 estimated that the General Fund would realize a net reduction to fund balance of approximately $8.0 Million (as opposed to the originally budgeted reduction of $4.4 million). Refemng to the Fund Balance Available line (bottom of the column) shows Fund Balance Available declining from $9.8 million (Column (1)) to $6.245 million (Column (2)). Finally, there is some good financial news. As can be seen in Column (3) Preliminary Actuals at the bottom of the page in the Fund Balance Available line, the preliminary close for 2008-09 shows an ending fund balance of approximately $10.1 million. An improvement over Estimated 2008-09 of some $3.9 million. There are two major azeas that contribute to the improved ending fund balance. The brief schedule at the bottom of Schedule A lists the components of the positive variance. First, the Net Revenue/(Expenditures) line shows a positive variance of about $2.3 million. Both revenues and expenditures contributed to the positive variance, as shown on Column (4). In addition, the General Fund received a "payoff ' of a loan that had been made several years earlier (sale of waste management equipment). This is shown on the Loan Repayment/Other line with a positive variance of $1.587million -Column (4), Variance Positive (Negative). G:IFINCOMM~2009-10~Staff Report~Preliminary Financial Results for the General Fund for 2008-09 9-08-09.docx