Yorba
Linda in 2016 continues on a strong recovery path from the 2009
low-point of the Great Recession, with even better economic news
forecast for the coming year, as reliably measured by the
higher-than-expected income the city is receiving in property and
sales tax revenue.
Other
income from fees and charges related to the city's economic activity
is also more than was estimated when a two-year budget was adopted by
the City Council in September 2015.
That's
the takeaway from a report Finance Director Scott Catlett presented
at a recent council meeting. Also, Catlett indicated he'd be back to
the governing body with recommendations for updating the city's “user
fees,” noting “significant increases are anticipated in some
fees.”
Here
are some highlights from Catlett's 11-page report:
--For
the just-completed fiscal year, sales taxes led the list of revenues
that increased over the amounts estimated several months previously,
bringing in $803,000 more than predicted. The income from property
taxes was $553,000 higher than expected.
Franchise
taxes, the dollars residents pay on utilities, including cable
television, brought in an extra $209,000, and engineering fees,
charges and permits added $197,000 more to receipts.
Only
permits issued for building activity brought in less than estimated,
with a $766,000 drop, due to several projects assumed to be ready
“not yet moving through the permitting process.”
For
the fiscal year that started July 1, property tax revenue is expected
to be $17.3 million, an increase of another $885,290, and sales taxes
are anticipated to total nearly $7.4 million, with an additional
$410,407 increase.
The
city's reserve fund is projected to total $25 million on June 30,
2017, about 80 percent of a typical year's operating budget.
--Usually,
the city budgets $100,000 yearly to pay workers compensation claims
outstanding from the time Brea provided the city's police services.
However, claims in 2015-16 jumped to
$365,000
due to the settlement of two cases.
After
several conversations with Brea officials, Catlett reported the city
has “gathered data regarding the remaining liability and expected
cash flows in future years.” He added, “The
current
estimated workers compensation liability amounts to $1.3 million (for
22 open cases).”
--User
fees and charges residents pay to the city or through contractors for
city services haven't been updated in many cases since 2005, and a
2013 review was delayed due to staff turnover and a need to
conduct further analysis.
Now,
Catlett plans to recommend “appropriate, and as needed gradual,
increases to fees to bring cost recovery levels up to what the City
Council determines to be an appropriate level.”
Catlett
also plans to introduce a five-year financial plan with five years of
income projections, a revised policy regarding the city's
substantial reserve fund and a presentation on the city's unfunded
needs.