Finance Highlights 2006 0503 - Laserfiche WebLink

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f; 04 5AN-1.E41�. City of San Leandro Quarterly Perforniance Report EXECUTIVE SUMNIARY GENERAL OVERVIEW AND ECONOMIC OUTLOOK Ending March 31, 2006 AlthouLh Better Than Anticipated, Still Deficit Spending ... • Year-to-date General Fund operations end the quarter utilizing $2.5 million of available reserves. However, the City projects a reduced year-end operating shortfall of approximately $1.3 million as opposed to the $3 million estimated about a year ago. • The City received $1.38 million from 2003-04 vehicle license fee money borrowed by the State, which was repaid a year in advance and will be used to offset the current operating deficit. • Additional sales tax of 1.3% is anticipated by year-end and will assist with restoring the City back to the level of sales tax revenue experienced during the 2000-01 fiscal year. • The County's Office of the Assessor reported that recorded property assessed valuations have increased 6.9% from 2004-05 to 2005-06, slightly better than the City's conservative growth projection of 5.5% but below the 9.2% Alameda County growth rate. • The local economy continues to show improvement but at a rate that still lags behind the rest of the economy. The 2005 Bay Area annual average CPI of 2.9% is lower than both the national index of 3.4% and the Los Angeles regional index of 4.5%. • LAIF's investment yield as of March 31, 2006 is at 4.03% as compared to 2.38% a year ago. The City invests approximately 34% of its idle cash in LAIF and 66% with Chandler Asset Management. Forecast Crystal But Not Clear ... • City has proposed a June 2006 ballot measure to increase the current business license tax rates, which is anticipated to generate an additional $2 million in annual revenue. • The City's proposal to collect a franchise fee on Oro Loma recycling & disposal services is projected to generate $500k in new revenues annually. The amount of the City's ongoing structural shortfall will be impacted by the following: ongoing revenue growth compared to the increase of ongoing expenditures, outcome of the business license tax ballot measure and current employee negotiation processes, postponed maintenance needs/ongoing deferrals that have reached necessary replacement status, and the success of future proposed revenue enhancements. • As a result of Proposition IA, which provides additional safeguards to City revenues from State take -away, the City is obligated to make its final $1.2 million property tax revenue contribution to the State this fiscal year.