For City Council Meeting March 25, 2025
TO: Honorable Mayor and City Council
APPROVAL: Tanya Williams, City Manager
FROM: Scott Williams, Director of Finance
Title
Request City Council to Receive a Mid-Year Budget Presentation on General Fund Fiscal Year 2024-2025 and Provide Direction on General Fund Reserve Balance.
POWERPOINT
(RECEIVE AND FILE)
Body
RECOMMENDATION
Staff recommend the City Council:
Receive a Presentation on General Fund Revenue and Expenditures for Mid-Year of Fiscal Year 2024-25 and Provide Direction on the Restriction of General Fund Balance Reserves
BACKGROUND
On June 25, 2024, the City Council adopted the Fiscal Year 2024-2025 (FY24-25) Annual Budget, which included reasonable estimates of revenues, expenses, transfers, and ending reserves.
The Mid-Year Budget Report summarizes the overall financial performance of the City for the period of July 1, 2024, through December 31, 2024. The report was developed and presented to the Council to offer the most up-to-date information on the City’s financial health, enabling accurate and well-informed decision-making. Additionally, these reports assist City departments in communicating their financial operations throughout the fiscal year including any program changes, significant impacts to their annual budgets, as well as gauging the City’s budget plan as compared to actual revenue and expenditures.
The financial information included in this report is preliminary, unaudited, and subject to revision upon completion of the City's audit. However, at this time no material changes are expected for the financial results. The full audit report for Fiscal Year 2024 is anticipated to be completed and brough to the City Council in May 2025.
ANALYSIS/DISCUSSION
The City’s FY24-25 General Fund adopted budget includes total revenues of $151.3 million and expenditure appropriation of $150.8 million.
General Fund Balance:
Following the close out of Fiscal Year 2024, the general fund reserves after all revenues and expenditures were accounted for, including transfers out, is just over $68 million. This does not account for transfers that occurred during the current fiscal year, such as the $30 million that was transferred to the Rialto Utility Authority in July of 2024. These reserve funds are currently unrestricted, however, the City Council can provide direction to staff to restrict these funds for future one-time expenditures.
Staff recommends that the City Council consider restricting the currently unassigned general fund reserves in the following ways:
• $5 million toward the future development of City Hall
• $10 million toward future CIP project costs and needs in the Capital Projects Fund
The allocation of these funds toward restricted projects would still preserve the existing nearly $60 million in restricted reserves that are restricted and for economic uncertainty. The City Council can also provide further direction on the restriction of these funds. A subsequent item will be brought forward by City staff following this direction to formally adopt a budget resolution with direction that is provided by City Council.
General Fund Revenues:
The table below highlights the General Fund revenues through December 31, 2024 for the current fiscal year. For those areas that are below 50%, the actual numbers may be a matter of timing depending on when the City receives revenue. Generally, the city’s revenues remain on track for the fiscal year.
General Fund Expenses:
The table below highlights the General Fund expenditures through December 31, 2024 for the current fiscal year. All expenditures, including personnel remain on track for the year.
New Personnel Requests:
Customer service is the bridge between the City and the public, which plays a crucial role in building and maintaining trust. In order to strengthen, streamline and create more effective customer service, personnel requests were made by the following departments:
o Fire Department (10105173-51001)
§ Add (1) Plans Examiner
o Public Works (10107150-51001)
§ Add (1) Public Works Supervisor
o Parks, Recreation and Community Services (10108150-51001)
§ Add (1) Deputy Director of Parks, Recreation and Community Services
§ Eliminate (2) Part-Time Field Service Assistant
o Police Department
§ Add (1) Lead Police Records Assistant * (10106284-51001)
• This position is State mandated and funded (to reimburse the General Fund)
§ Add (1) Crime Analyst Assistant (10106152-51001)
Fire Department:
The addition of the Plans Examiner position in the Fire Department aims to improve the efficiency and effectiveness of the plan review process for all development types. As the City continues to see an increase in development, the fire plan review plays a critical role in the approval of projects. This position is essential to improving the expected timeline for complete reviews.
Public Works:
The Public Works Supervisor position will address day-to-day operations, job assignments, quality control oversight, customer interactions, training, employee evaluations, and personal matters. Currently, the span of control for the Deputy Director exceeds supervising 35 staff positions. This is a clear imbalance of the division of labor, resulting in a higher transaction cost for the city. The oversight between resident concerns, staff actions, and available supervision far exceeds industry norms, creating inefficiencies in allocating resources where they can better create value, and organizational effectiveness is suffering. The new supervisor role will address challenges and improve response times to customer service and safety concerns.
Parks and Recreation:
The proposed Deputy Director of Parks, Recreation and Community Services will play a critical role in effectively managing the expanded range of responsibilities in this department. It will further provide enhanced accountability in operations, maintenance and new project development within our parks.
Police Department:
There are two new positions requested out of the Police Department. One position will address providing service to the community for access to records seven days a week. The other position will continue to prepare for the Real Time Crime Center in the new police station that is expected to be fully completed in 2026. The police records assistant position will be fully reimbursed through state grant funds.
The total cost for all personnel requests is approximately $605,483. However, for this fiscal year the cost will be absorbed through salary savings.
ENVIRONMENTAL IMPACT
The request is not a Project as defined by Section 15378 of the California Environmental Quality Act (CEQA).
GENERAL PLAN CONSISTENCY
Complies with the following Rialto General Plan Guiding Principle:
Our government will lead by example, and will operate in an open, transparent, and responsive manner that mees the needs of the citizens and is a good place to do business.
LEGAL REVIEW
The City Attorney has reviewed this staff report.
FINANCIAL IMPACT
Operating Budget Impact
Approval of this item has no direct impact on the City’s operating budget. If recommended for approval, a subsequent item will be brough forward with the budget resolution and appropriation for the costs associated with the new positions.
Capital Improvement Budget Impact
No financial impact to the Capital Improvement Budget.
Licensing
A Business License is not required as part of this action.