2012 04-17 CCP - Laserfiche WebLink

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MEMORANDUM Date: April 17, 2012 To: Gem Lake City Council From: Jessie Hart, Treasurer Re: 1st Quarter 2012 Financial Reports 2011 The 2011 audit is expected to get underway soon and should be substantially complete by the end of April. The 2011 audit report will be presented at a future meeting. Based on the unaudited financial information, the General Fund ended the year with revenues and expenditures as follows: 2011 2011 2011 Budget Actual Variance Revenues $326,156 $313,333 ($ 12,823) Expenditures $411,755 $328,019 ($ 83,736) Revenues were lower than budgeted by approximately $12,823 in total and can be accounted for in several areas including delinquencies in tax collections, settled tax petitions, intergovernmental, charitable gambling contributions and lower facility rentals due to the re-establishment of the sheriff sub -station later in 2011 than had been budgeted. However, revenue exceeded projections in business licenses, building related permits, administrative fines and interest earnings. Expenditures were under budget by $83,736 and was due primarily to not spending monies budgeted for council contingencies, other professional services for planning and included some storm water planning projects not undertaken in 2011. The revenue shortfall combined with spending less than budgeted in expenditures resulted in a decrease to fund balance of $14,687. The 2011 Adopted General Fund operating budget had incorporated "deficit" budgeting and anticipated the use of $85,599 of fund balance in an attempt to bring the balance down to 50 — 60% of the next year's operating budget. The fund balance at the end of 2011 was $397,394 and represents over 100% of the 2012 operating budget. The standard amount deemed necessary to carry in fund balance is approximately 45% to 50% of the next year's operating budget. The 2012 Adopted General Fund operating budget again incorporated "deficit" budgeting and included the use of $151,095 of fund balance to meet 2011 budgetary needs. The Council anticipates continuing using methods to bring the General Fund fund balance down to 50 — 60% of the next year's operating budget and hopes to achieve this in two to three years. This is being done by keeping tax levies lower and continuing to fund improvement funds for future road improvements that may be financed internally, emerald ash borer treatment and prevention on city rights -of -way and building improvements or replacements at Heritage Hall. A total of $70,000 was transferred to these improvement funds in 2011 and the 2012 budget includes an additional $60,000.