ADMINISTRATION - Joe Huss, Finance Director
Title
2019 BUDGET AMENDMENTS
Background
As part of the 2019 budget process, appropriations were made that were consistent with the best information available at the time of budget adoption in December 2018. As 2019 has unfolded, there are certain areas wherein circumstances have led the need to implement budget amendments for 2019. These adjustments are associated with events that occurred in 2019 that were not anticipated at the time the General Fund Budget was adopted in 2018:
• Building Inspections/Community Development. While higher than normal budgets were adopted in the two previous years for the Building Inspections Division due to the need to allocate additional resources to cover the additional work brought about by the June 2017 storm, the 2019 budget anticipated a return to normal operations. However, during 2019 a fairly heavy hailstorm hit the City, again requiring additional staff time to handle the increased permitting activity. Staff is proposing an adjustment to salaries and wages of $230,000 to cover the additional staff time needed to handle the additional workload. The additional permitting activity did bring about additional permit revenue that will be sufficient to cover the additional expenses. Staff is proposing a budget adjustment in the same amount in the Building Permit Fees revenue account.
• As a result of heavy snowfall/precipitation events in the first four months of 2019, staff is requesting a budget adjustment for additional overtime and deicing chemicals needed to manage the snow removal. The additional costs affect the Streets Maintenance, Parks Maintenance, and Fleet Maintenance divisions. Because a good amount of the funding for additional snow management costs are available within these three divisions, only a relatively small amount of reserves is required to cover these expenses. Most of the funding will be made available through a re-appropriation of funds from within the Public Works Department.
• In 2019 the City’s Forestry Division began a concentrated effort to address the mounting emerald ash borer (EAB) infestation that has hit Blaine over the past six to nine months. In Workshop discussions, the City Council has been supportive of amending the budget to allocate additional funding for EAB containment and management. Staff is proposing an additional $25,000 be appropriated to the Forestry Division for increased EAB efforts.
• Year-end re-appropriation of unrestricted General Fund reserves. Annually, once the accounting books are closed for the prior year and the City’s annual financial audit is complete, Council will authorize the transfer of available unrestricted reserves to certain programs. For 2019, Council authorized the transfer of $2,200,000 in Unrestricted General Fund Reserves to the Capital Equipment Fund for the purchase of capital and equipment in 2019. With this transfer, roughly $350,000 of unrestricted reserves would remain in the General Fund.
Recommendation
Approve the following resolution.
Body
WHEREAS, Sound budgeting principles promote appropriating necessary funds required to accomplish approved objectives; and
WHEREAS, Sound budgeting principles also promote providing for contingencies and unforeseen emergencies so as to not prevent objectives from being met; and
WHEREAS, Appropriations were made in 2019 sufficient for anticipated activity; and
WHEREAS, actual activity and evolving priorities have exceeded what was originally anticipated resulting in expenditures exceeding budgeted appropriations in the certain divisions within the General Fund; and
WHEREAS, revenue from additional building activity has also exceeded projected revenue in 2019; and
WHEREAS, contingency funds are on-hand and available for use in 2019;
NOW THEREFORE BE IT RESOLVED that the City Council of Blaine amends the 2019 General Fund Budget, and authorizes the City Manager to implement these amendments in the budget as follows:
• REVENUE: Building Permits, 101.70.760.761-3204, in the amount of $230,000
• EXPENDITURES:
• Community Development Department, Building Inspections Division
o $230,000 - Salaries, benefits, 101.70.760.761-41XX
• Public Works Dept., Streets Maintenance Division, Snow Management
o $20,000 - Salaries, benefits, 101.50.530.533.5304-41XX
o $60,000 - Chemical supplies, 101.50.530.533.5304-4208
• Public Works Dept., Streets Maintenance Division
o $40,000 - Contractual maintenance 101.50.530.533.5305-4345
• Public Works Department, Parks Maintenance Division
o -$30,000 - Salaries, benefits, 101.50.530.534-41XX (reduction)
o -$85,000 - Contractual services, 101.50.530.534-43XX (reduction)
• Public Works Department, Vehicles Maintenance Division
o $80,000 - Salaries, benefits, 101.50.530.536-41XX
o -$80,000 - Supplies, 101.50.530.536-42XX (reduction)
• Public Works Dept., Forestry Division
o $25,000 - Contractual maintenance 101.50.530.535-4399
• For Transfer of Available Unrestricted Reserves
o $2,200,000 - Operating transfer 101.00.000.000-4914 to Equipment Fund (410.00.000-3911)
PASSED by the City Council this 2nd day of December 2019.