This are the questions I had coming into this meeting,
The comments are based on both on the November cash flow and the reports available for Aug/Sept/Oct
Comments
I am deeply concerned about the revenue for other services and the ever-deepening gap. We will be under restrictions at a minimum through the first quarter of next year. Why was this not caught sooner? It appears to me that it has worsened another 200k in the last month while the action was not taken.
Questions
- What made November’s sales tax so high?
- Why was there a large number on the Financing costs line this month that had not been there before? Shouldn’t finance costs be predictable?
- Why is payroll being predicted at 2242 when the actuals have been 2593, 2462, 2389 all of which are higher?
- Do the payroll predictions for Jan include the police cola that as of now is issued beginning of January?
- Will there be payouts of any type for the two retired police and one retired fire person? I know often they get paid out accrued vacation etc.
- Does FAB think the ending balance is ok given the Tran payment that will have to come out of it?
- What is the line for transfers out and why is there now a number in it?
- Can FAB ask the Finance Director for written assumptions for predictions?
- Are the sales tax predictions accurate since we have not met them except for this month (and we did exceed them this month)?
- The starting number in August project was 8471 and then it went to 9278. Can it be explained as to why that happened?
There are two new members William Ktsanes and Debra Saunders. Debra attended as a member of the public since her employer had not yet approved her membership.
Mayor Pro-Tem Fadelli attended the meeting which was appreciated. He stated that he wants more feedback from FAB to the council. Dick Patterson, the chair, stated they would be happy to take more direction from the council.
The Finance Director reviewed the reports found here
Utility Taxes are a guesstimate per Mark. He has looked at the past three years in making this guesstimate.
The transfer tax predictions seem to have been done conservatively, which is good. This is also one month behind. This line item has been doing very well.
Regarding recreation, most of the money earned is made in the few months before summer and then that flattens. The Recreation Director will be making a presentation to Council next week in regards to this. Typically they bring in 5-6 million a year in revenue. The line item for Fees for Services are not just for Recreation but also for Community Development.
Sales Taxes– The state has allowed some businesses to delay paying the taxes so the payments have been delayed. The large number in November indicated some of these late taxes catching up. These sales taxes are often two months behind this year. The Finance Director subtracted 10% from the projections. The County pool (which collects sales on online items) has increased by 30% which has mitigated some of the damage in regards to sales tax. This is a change due to a Supreme Court decision (Wayfair) which allows us to collect online sales taxes for out of state purchases. This is a change for this fiscal year.
Personnel line-This includes payroll, benefits, workers comp insurance payments, payments when someone left. One of the issues with the personnel is that the State Fire Department owes the city over 800K in reimbursement. This should be made in Spring and it has inflated the payroll numbers as the city has to pay the firefighters and then later get reimbursed. The Finance Director stated that any COLA’s are in the budget.
Regarding the starting number for July Mark said it is not finalized yet and will not be until the CAFR is done. He thinks it might even improve due to late monies coming in this year that will be credited to last year.
Debra Saunders asked questions about the pension liability. Mark referred her to a 5 year plan. I created a pdf of that section of the February 2, 2020 meeting.
For the next agenda there will be a deeper dive into the finances and Debra also really pushed for a new look at the 5 year plan.
El Cerrito Committee for Responsible Government (ECCRG) 