Finance Highlights 2011 0909 - Laserfiche WebLink

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CITY OF SAN LEANDRO MEMORANDUM DATE: September 9, 2011 TO: Finance Committee FROM: Lianne Marshall, Interim City Manager BY: Jim O'Leary, Interim Finance Director SUBJECT: 2010 -11 Year -End Preliminary Budget Review and Recommended Budget Amendment Adjustments SUMMARY AND RECOMMENDATION This report provides an update on the 2010 -11 budget performance for all City funds through June 30, 2011 and a revised year -end forecast for the General Fund and the City's other revenue funds. In addition, the report includes year -end budget amendment adjustments for 2010 -11. Additional expenditures are funded from new revenues or available fund balances. Staff recommends that the Finance Committee recommend the 2010 -11 year -end budget amendment. The total budget adjustment for all funds amounts to $1,890,000, although the net adjustment to the General Fund amounts to only $8,300. BACKGROUND The City Council adopted the 2010 -11 budget on June 6, 2010. At the time the City Council adopted the budget, it was balanced as the result of significant General Fund expenditure reductions. Even with the sizeable expenditure reductions, the budget projected a shortfall between revenues and expenditures of almost $3 million and an ending fund balance of $1.3 million. As reported to the City Council in February, revised revenue and expenditure projections at mid -year modestly improved the original forecast. Year -end estimates based on actual revenue received to date projects a $168,000 increase to the General Fund fund balance as compared to the original estimate of a $3 million shortfall. Economic conditions resulted in a slow paced recovery with continued high unemployment, and a weak housing market. Statewide, local governments continue to experience declining revenues. San Leandro's fiscal conditions have improved slightly over original projections, but the future remains uncertain, in part due to adverse impacts by the state. The state's balancing plan will harm San Leandro, particularly the issue before the Supreme Court related to redevelopment agencies. Staff will continue to monitor the State budget developments and provide City Council with updated information.