After
the midpoint of each fiscal year, Yorba Linda Finance Director Dave
Christian compiles a report outlining how closely the city's actual
income and expenses match amounts anticipated at the beginning of the
budget year, providing a glimpse into the state of the city's
economy.
This
time, Christian's report is mostly positive for the current fiscal
year (July 1, 2014, - June 30, 2015), with higher-than-expected
income from property taxes – the city's largest revenue source –
and sales taxes, but less-than-expected income from building permits.
Overall,
Christian, who also serves as city treasurer and assistant city
manager, predicts the nearly $30 million operating budget will be
balanced with a $550,000 surplus, even including the almost $1.5
million in City Council-approved expenses added since the prior
fiscal year.
Property
tax revenue is expected to jump more than $1 million over estimates
“due mainly to the continuing strong recovery of the real estate
market, as well as the redistribution of the former property tax
increment as the result of redevelopment dissolution,” Christian
stated.
Dollars
once collected for the city's Redevelopment Agency, dissolved by
state mandate in 2012, will add $400,000 to general fund coffers.
The cash is part of increased property tax revenue from redevelopment
zones that previously financed projects and a housing fund.
Although
Christian last year lowered sales tax projections by $100,000 for
2014-15, he now sees “much better than expected results,” with
income exceeding the estimate by $150,000.
A
$520,000 drop in building permits and plan checks fees is due to
timing, Christian noted, since “building activity has begun to pick
up.” However, projects have been “delayed in the entitlement
process,” with the revenue “most likely” to be realized in the
next fiscal year.
Much
of the increased income is offset by nearly $1.5 million in added
expenses approved by the council in last year's midterm adjustment
($720,000), since the start of the current budget year ($247,000) and
this month ($517,500, including $194,000 in raises for city workers).
Cost
savings due to vacant positions total $590,000, including building
department slots at $307,000 and savings and credits in the county
Sheriff's Department contract for $283,000. (Temporary personnel
costing $184,000 were added to the building department budget.)
The
city has been operating on a two-year budget for 2013-14 and 2014-15.
The council is expected to start examining finances for the 2015-16
fiscal year within the next few months.
Also,
the City Council, as successor to the former Redevelopment Agency,
plans to spend nearly $4.7 million of redevelopment tax increment the
second half of this year, including some $3.3 million for Town Center
and about $1.2 million for lower-cost housing, upon state approval
The
city lists $112.7 million in outstanding debt or obligations from the
dissolved agency.