Full Text
OFFICE OF THE ALBANY CITY TREASURER DATE: July 6, 2020 TO: Hon. Kathy M. Sheehan Members of the Common Council FROM: Hon. Darius Shahinfar CC: Rachel McEneny, Mike Wheeler RE: 1st quarter 2020 Performance The following is a summary of the unaudited results for the 1st Quarter 2020. Overall, fiscal performance was stable and within budgetary expectations for 2020, with the exception of expenditures related to overtime. Revenue in the first quarter of 2020 totaled $78.6 million which was a decrease of 8.0% or $6.9M from last year at this time (most of this decrease is related to not billing NYS for the 19a funds until April this year compared to January last year). Expenses totaled almost $36.3M which was an increase of 3.8% or $1.3M compared to the first quarter of 2019. REVENUE (Thousands) The chart above summarizes the City’s sources of revenue through March 31, 2020. MAR MAR % MAR Annual % REVENUE YTD 20 YTD 19 Variance YTD 20 Budget Variance Budget PROPERTY TAX 58,866 58,560 306 1% 58,866 58,550 316 101% SALES/USE TAX 8,867 8,486 381 4% 8,867 36,546 (27,679) 24% PILOTS/19-a 3,301 11,585 (8,284) -72% 3,301 20,004 (16,703) 17% OTHER LOCAL SOURCES 393 421 (28) 393 3,133 (2,740) 13% LANDFILL 1,566 1,900 (334) -18% 1,566 6,170 (4,604) 25% OTHER DEPARTMENTS 723 638 85 13% 723 6,442 (5,719) 11% INTER GOVERNMENT 116 130 (14) -11% 116 694 (578) 17% FINES 1,030 1,205 (175) -15% 1,030 5,475 (4,445) 19% LICENSES AND PERMITS 1,613 853 760 89% 1,613 3,859 (2,246) 42% STATE AID 0 11 (11) -100% 0 30,161 (30,161) 0% SALE P/COMP/LOSS 26 877 (851) -97% 26 356 (330) 7% MISCELLANEOUS 2,116 847 1,269 150% 2,116 9,022 (6,906) 23% OTHER 9 14 -36% 9 2,022 (2,013) 0% TOTAL REVENUE 78,626 85,527 (6,901) 78,626 182,434 (103,808) 43% ---PAGE BREAK--- 2 1. Property Tax revenue increased by $306K from last year and is over budget at the end of the first quarter as a result of paying a small number of assessment reductions by the end of the quarter. 2. Sales Tax revenue the first quarter sales tax revenue was higher than last year and totaled almost $8.9M and under budget at 24% for the year in first quarter. While this was good news, the governor’s stay at home directive began in the middle of March, so most of the retail activity was normal up to that time. The second quarter will most likely see a sharp decrease in sales tax revenue, early indications are of up to 30%. 3. PILOTS/19-a revenue was lower than the same period last year. Most of the year-to-year decrease is the result of billing the 19a properties to NYS in April this year compared to January last year. 4. Other Local sources revenue decreased from the first quarter of 2019. Penalties on property taxes decreased from receiving payments sooner, but is expected to rebound over the next 3 months. 5. Landfill revenue decreased 18% compared to the same period last year. Coupon sales decreased by $373K which is the primary reason for the decrease although revenue is on budget for the year at 25%. 6. Other Departmental revenue was 13% ($85K) higher than last year at this time. Most of the difference is the result of billing $294K in waste collection late fees. DGS fees increased $39K while APD Event Security revenue decreased by almost $87K. 7. Fines and Forfeitures revenue decreased by 15% ($175K) from last year. The decrease is due to traffic court fines which were lower by $68K and parking violation fines which were lower by $95K. Most of this decrease is a timing issue because the March parking revenue report was not available when this report was prepared. 8. Licenses and Permits revenue increased 89% ($760K) compared to the same period last year. Stabilization and demolition fees increased by $530K and street openings revenue increased by $307K. Safety inspection permits saw a decrease of $51K. 9. State aid – decreased $11K by the end of the first quarter. Most of this revenue is derived from state grants and various state payments. The timing of these payments varies from year to year. 10. Miscellaneous revenue increased 150% ($1.3M) compared to the same time last year. This category is made up of refund of prior year expenses, special events revenue and reimbursements from ACDA. Refund of prior ---PAGE BREAK--- 3 year expenses are made up of fees and charges from last year that are included on the property tax bills. These charges can vary from year to year and adjustments for these charges can vary. 11. Other revenue decreased by $5K compared to the same period last year. Most of this revenue is derived from federal government grants and the timing of these payments varies from one year to the next. DISBURSEMENTS Total disbursements increased by over $1.8M or 5.3% compared to the same period last year. Spending overall is well within 2020 budgetary expectations, but spending was up in all categories (Personal Benefits, Fringe Benefits and Non-Personal Services) compared to 1Q 2019. 1. Salary expense increased by 0.2% compared to the same period last year. Most departments are showing similar totals from last year at this time. This category includes overtime which is $61K higher than 2019. 2. Benefits Expenses increased by 3.8% from the first quarter of last year but was below budget for the first quarter at 23%. Most of the increase in this category was related to increases in workers’ compensation expenses which increased ($155K) retirement expenses from NYS which increased ($62K) and retiree health insurance increased ($288K), an item that fluctuates year to year. 3. Non-Personal Service spending increased by 33.4% or almost $1.4M. Not including encumbrances this category was only 10% of budget by the end of the first quarter. This category includes utilities, contracted MAR MAR % Annual % YTD 20 YTD 19 Variance Budget Variance Budget Personal Benefits 19,183,097 19,147,253 35,844 0.2% 78,646,993 (59,463,896) 24% Fringe Benefits 11,663,045 11,235,974 427,071 3.8% 51,031,677 (39,368,632) 23% Non-Personal Service 5,447,766 4,082,643 1,365,123 33.4% 52,755,160 (47,307,394) 10% Total 36,293,908 34,465,870 1,828,038 5.3% 182,433,830 (146,139,922) 20% Number of weeks in period 13 13 0 52 25% ---PAGE BREAK--- 4 services, supplies, materials, small equipment, consulting fees and debt service. Most of the increase in this category is related to making the first debt service payments for the street light project ($1.7M) which is offset by a large decrease in utilities expenses related to street lights which decreased ($654K). Stabilizations and demolitions expense increased ($179K) while snow removal in the first quarter decreased ($507K) from the 2019. 4. Encumbrances (funds reserved for purchases) increased by $2.1M compared to the same period last year. Encumbrances total more than $7.0M at the end of the first quarter. OVERTIME General Fund overtime was over budget (33%) at the end of the first quarter. Excluding the Water Department (for which the City is reimbursed) and reimbursable Police overtime, overtime expense was 3% ($64K) higher than the same period last year. OT is consistently the largest over-budget expense. The Police department had the biggest increase in overtime payments which were up by almost $133K. The majority of departments have lower overtime expenses this year than last year. % of Department 2020 2019 Change % 2020 Budget Budget Police (non-reimbursable) 1,221,917 1,088,546 133,371 12% 1,221,917 4,195,090 29% Fire 274,680 303,923 (29,243) -10% 274,680 475,000 58% Communications 113,241 90,684 22,557 25% 113,241 225,000 50% Parks Maintenance 37,325 77,027 (39,702) -52% 37,325 185,000 20% Waste Collection 132,118 88,505 43,613 49% 132,118 225,000 59% Landfill 52,853 45,612 7,241 16% 52,853 150,000 35% Central Maint. 26,585 14,516 12,069 83% 26,585 70,000 38% Street Maintenance 56,959 139,045 (82,086) -59% 56,959 290,000 20% Recreation 0 1,005 (1,005) -100% 0 1,000 0% Traffic Engineering 7,926 10,687 (2,761) -26% 7,926 40,000 20% Capital Hills 3,965 9,901 (5,936) -60% 3,965 26,000 15% Fleet Maintenance 10,522 15,063 (4,541) -30% 10,522 25,000 42% Bleeker / Facility Operations 0 125 (125) -100% 0 14,000 0% Buildings 37,450 27,951 9,499 34% 37,450 128,800 29% DGS Administration 0 2,747 (2,747) -100% 0 2,500 0% Control of Animals 2,908 2,167 741 34% 2,908 12,000 24% Cultural Affairs 0 205 (205) -100% 0 12,000 0% General Fund 1,978,449 1,917,709 60,740 3% 1,978,449 6,076,390 33% Police (reimbursable) 322,364 258,746 63,618 25% 322,364 1,202,997 27% Fire (reimbursable) 0 0 0 0% 0 110,000 0% Traffic Eng. (reimbursable) 0 0 0 0% 0 0 100% Water 140,605 158,738 (18,133) -11% 140,605 527,109 27% Totals 2,441,418 2,335,193 106,225 5% 2,441,418 7,916,496 31% ---PAGE BREAK--- 5 CASH The City’s cash position was 20% higher than forecasted and $1.0M higher than the same period last year. Most of the increase is related to an increase in cash transfers from the Albany Water Board related to paying the expenses for the Long-Term Control Plan. There was also an increase in property tax collections during the first quarter compared to last year. CONCLUSION Thus far, there are no major surprises in the first quarter for 2020, as the City was largely moving forward as expected financially. The City saw a decrease in overall revenue in the first quarter compared to 2019, but this was more an issue of timing. However, the reduction in revenue is expected to get worse over the course of the year with the health care crisis impacting State and other revenue sources. Expenses were up in the first quarter of 2020 compared to last year at this time, mostly as the result of debt service payments, increases in retirement costs, higher OT, and increases in retiree health insurance costs, but overall, were still largely within budget expectations. The City must continue to watch expenses closely and try to control them as much as possible, while continuing to push for revenue increases where it can locally, and at the State level, where a permanent solution for the revenue gap caused by tax exempt properties must be found. JAN FEB MAR Receipts $77,034 $22,361 $9,561 Disbursements $(35,394) $(15,801) $(16,017) Cash on Hand $50,692 $57,252 $50,796 $(60,000) $(40,000) $(20,000) $20,000 $40,000 $60,000 $80,000 $100,000 Cash Flow (In Thousands) Receipts Disbursements Cash on Hand