The Finance Committee met on May 18th and unanimously recommended that the City Council accept the Staff’s proposed 3rd Quarter results and adjustments to the budget for the Fiscal Year ending June 30, 2021. Revenues are projected to increase by $1.1 million while expenses are essentially flat, which improves the General Fund Contingency Reserve to $3.3 million or 83 days of operating expenses.
This is good news driven by two important developments.
Operating revenues also contributed to the projected revenue increase for the fiscal year with Parking Meter revenue up by $150,000 and Planning Services up by $130,000. The City has also been able to hold down costs with no significant net increases to Operating Expenses or Project costs being recommended for the remainder of the fiscal year.
This improvement in cash flow allowed the City to recover a portion of the General Fund Contingency Reserves depleted by the pandemic. The Contingency Reserve increased by $967,850 for the 3rd Quarter. At the same time the City was able to eliminate the planned loan from the Measure Q Fund to the General Fund in the amount of $283,620. Staff also recommended increasing the Measure Q revenues by $511,650 bringing the projected Measure Q Reserve balance to almost $3 million by June 30, 2021. Council also approved the first underground district for the Tewa area, which included a budget allocation of $635,000 from the Measure Q Reserves.
These results put the City on better footing as they begin the Budget Workshop for FY22 and FY23. However, while these one-time revenues help, the City will still be addressing the financial challenges presented by the ongoing revenue impacts of the pandemic, prioritization of City services within a tight budget and the replenishment of Reserves back to target levels.