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REQUEST FOR COUNCIL ACTION Date: 12/12/11 ItemNo.: 7 •J (revised) Department Approval City Manager Approval e4 Z. /fi t °n'Thelti"tag‘d Item Description: 2011 3rd Quarter Financial Report 1 BACKGROUND 2 In an effort to keep the Council informed on the City's fiscal condition,a comparison of the 2011 revenues 3 and expenditures for the period ending September 30,2011 (unaudited)is shown below. This comparison 4 is presented in accordance with the City's Operating Budget Policy,which reads(in part) as follows: 5 6 The Finance Department will prepare regular reports comparing actual expenditures to 7 budgeted amounts as part of the budgetary control system. These reports shall be 8 distributed to the City Council on a periodic basis. 9 10 The comparison shown below includes those programs and services that constitute the City's core functions 11 and for which changes in fmancial trends can have a near-term impact on the ability to maintain current 12 service levels. Programs such as debt service and tax increment fmancing which are governed by pre- 13 existing obligations and restricted revenues are not shown. In addition,expenditures in the City's vehicle 14 and equipment replacement programs are not shown as these expenditures are specifically tied to pre- 15 established sinking funds. Unlike some of the City's operating budgets, these sinking funds are not 16 susceptible to year-to-year fluctuations. In these instances, annual reviews are considered sufficient. 17 18 The information is presented strictly on a cash basis which measures only the actual revenues that have been 19 deposited and the actual expenditures that have been paid. This is in contrast with the City's audited year- 20 end fmancial report which attempts to measure revenues earned but not collected,as well as costs incurred 21 but not yet paid. 22 23 It should be noted that many of the City's revenue streams such as property taxes,are non-recurring or are 24 received intermittently throughout the year. This can result in wide revenue fluctuations from month to 25 month. In addition,some of the City's expenditures such as capital replacements are also non-recurring and 26 subject to wide fluctuations. To accommodate these differences,a comparison is made to historical results 27 to identify whether any new trends exist. 28 29 Page 1 of 13