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THE CITY OF <br />PLEASANTON, <br />MEMORANDUM <br />Date: November 19, 2024 <br />To: Mayor and City Council <br />From: Gerry Beaudin, City Manager r <br />Pamela Ott, Assistant City Manag <br />Re: Council Meeting November 19, 2024, Items 15 and 16 — supplemental <br />The following additional information is provided as context regarding agenda items 15 <br />and 16. The City is required to achieve a balanced budget every year, but to do so in <br />the context of a budget deficit means that many critical funding needs are omitted from <br />the budget due to lack of funding. <br />• Actual property tax and sales tax revenues were close to what was budgeted. <br />• When financial results, it is important to look at revenues, expenditures, and the <br />financial trend. Historical growth does not always reflect future growth. <br />• According to the City's property tax and sales tax consultants, property tax is <br />projected to grow by only 4% in the current fiscal year, lower than the growth in <br />the prior fiscal year, and sales tax is projected to grow by only 1.2%. <br />• The General Fund budget does not reflect all the City's funding needs; the limited <br />available resources can only help proving funding in some, not all, program <br />areas. <br />• All the financial transactions need to be properly recorded before the City can <br />release the year-end financial report. The timing for publishing the fiscal year <br />2024 year-end report is consistent with prior fiscal years. <br />The purpose of the year-end report is to provide the Council and the community an <br />overview of the City's financial results and condition. As outlined in detail in the report to <br />the City Council, property tax revenue was 0.1 % higher than budgeted, while sales tax <br />revenue was 2.3% lower than budgeted. At the same time, expense growth outpaced <br />revenue as projected, in which expenses were nearly 7% higher than prior year, while <br />revenues were about 1 % lower than prior year. The net positive financial results were <br />mainly due to higher than budgeted hotel and business license tax, revenue recognized <br />from the implementation of new accounting standards, the use of Rainy Day and <br />