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BACKGROUND
<br /> Staff regularly monitors expenditures, cautiously forecasts revenues, and makes
<br /> recommendations to address changes as quickly as possible to maintain a balanced
<br /> Budget. The Midyear Budget report helps staff address budget variances in a timely
<br /> manner.
<br /> DISCUSSION
<br /> General Fund Overview
<br /> As described below, staff recommends increasing revenue estimates by $4.8 million,
<br /> using $1 million from Crisis Response and COVID reserves, and decreasing
<br /> expenditures by $313,699. As a result of these changes, staff expect that the General
<br /> Fund will have a $5.4 million surplus. Staff recommends that all of the surplus be
<br /> allocated to the CIPR to be allocated to capital projects as part of the FY 2022/23
<br /> Midterm CIP.
<br /> Table 1. General Fund Overview
<br /> FY 2021/22
<br /> FY 2020/21 Adjusted Recommended Mid-Year
<br /> Actual Budget Adjustments Budget
<br /> Revenues $125,351,125 $131,641,838 $4,848,000 $136,489,838
<br /> Use of Crisis Response Program Reserve - 400,000 (400,000)
<br /> Use of COVID Reserve - - 600,850 600,850
<br /> Net Transfers (8,585,925) (6,575,498) - (6,575,498)
<br /> Expenditures (114,986,314) (125,466,340) 313,699 (125,152,641)
<br /> Difference $1,778,886 $0 $5,362,549 $5,362,549
<br /> General Fund Revenues - Table 2 identifies the total recommended net revenue
<br /> increases of approximately $4.8 million based on revenues received to date. Major
<br /> revenue increases include Sales Tax ($2.5 million), Business License Tax ($700,000),
<br /> and Documentary Transfer Tax ($400,000). Property Taxes are only expected to
<br /> increase by $50,000 from the original estimate.
<br /> The $2.5 million increase to Sales Tax revenues primarily reflects increases in sales tax
<br /> receipts related to general consumer goods, restaurants and hotels, and fuel and
<br /> service stations that have recovered from the COVID related restrictions in FY 2020/21.
<br /> The $23.8 million in projected Sales Tax revenues exceeds FY 2018/19 actual Sales
<br /> Tax revenues by $800,000 suggesting all Sales Tax industries have recovered from the
<br /> COVID related shutdowns.
<br /> The proposed Business License Tax revenue increase of $700,000 is consistent with
<br /> actual Business License revenue receipts from FYs 2019/20 and 2020/21.
<br /> The proposed $400,000 increase in Documentary Transfer Taxes reflects actual
<br /> receipts through December 2021.
<br /> Staff are not expecting Transient Occupancy Taxes (TOT) to increase beyond the $3.3
<br /> million estimate in the budget, which is approximately half of the FY 2018/19 actuals of
<br /> $6.5 million. Similarly, Recreation Fees are not expected to increase beyond the
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