Finance Highlights 2011 0909 - Laserfiche WebLink

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2010 -11 Year -End Review and Budget Amendment September 9, 2011 Property Taxes ( +$316,000) Property taxe revenues declined in 2009 -10 as a direct result of the economy and real estate downturn. The 2010 -11 Adopted Budget reflects a conservative estimate based on this decline. Staff received a statement from the Alameda County Auditor - Controller in February 2011 that provides updated 2010 -11 projections for property tax receipts. Based on this new information, the year -end projection for property tax revenues is projected to increase by $316,000 or 2 %. based on anticipated County corrections and delinquent payments. Sales Tax ( +$2,500,000) Sales taxes represents San Leandro's largest General Fund revenue source. The State significantly reduced the City's sales tax Triple Flip' backfill amount last year to reconcile overpayments in prior years. The current year budget projected these revenues at the lower 2009 -10 level. Recent data from the State Board of Equalization regarding a true -up of the City's Triple Flip backfill revenue adjusts this portion of the sales tax revenue back to the normal base. This results in an increase in 2010 -11 of $1.6 million (a one -time adjustment of $660,000 and a recurring base increase of about $1 million). Therefore, staff is now adjusting Sales Tax projections for the current year from $19.5 million to $22.2 million (10 %). This reflects a $2.5 million increase over the mid -year estimate of $19.5 million. Sales tax revenue from the passage of Measure Z received to date total $869,000 with a further payment adjustment due in September. The new .25 cent transaction and use tax rate commenced on April 1, 2011. Staff has included Measure Z actual revenue received to date in the revised projections. Utility Users Tax (UUT) ( +$298,000), 911 Tax & Other Taxes ( +$639,000) UUT revenues are comprised of taxes on energy and cable /telecom usage. San Leandro experienced a decline in these revenues in 2009 -10 and the Adopted Budget reflected a lower revenue estimate. Revenues for 2010 -11 are $298,000 over the adopted revenue projections. Based on current trends, staff is also projecting an increase in annual revenue from the 911 Tax of $193,000 and an increase of $446,000 in other tax revenues including an increase in franchise fees of $185,000. General Fund Expenditures The adopted General Fund expenditure budget totals $69.98 million. The 2010 -11 Adjusted Budget totals $73.36 million and represents a $3.4 million increase over the Adopted Budget due to encumbrance carryovers from the prior fiscal year (funded by dedicated fund balance), and the year -end adjustments as described in this report. As summarized below, staff is projecting net expenditure savings over the Adjusted Budget of $376,000. ' The State modified the structure of city sales tax revenues, effective July 1, 2004, when they enacted legislation from a voter - approved deficit financing bond measure. This measure included a reduction of the local Bradley -Burns sales tax share from I % to. 75%, routing the .25% to other State funding needs. The .25% was fully replaced with property tax revenues (sales tax back -fill) to make cities whole. This shuffle of revenues is commonly referred to as the "Triple Flip. " 3