Finance Presentation

Tuesday, June 18th, 2013

Finance DepartmentChristopher M. Quinn, MACC, CPA, CFE, CGFO, CGMAFinance Director

OverviewRegulatory AuthoritiesFund Accounting• What is fund accounting?• What is a fund?• Examples of funds

Revenues• Classifications• Total City Revenues• Unrestricted & Restricted

Tentative Budget Calendar

Regulatory Authorities Governmental Accounting

Standards Board – GASB Exposure Drafts Statements Technical Bulletins Accounting and Financial

Reporting Guidance Federal Government

Payroll taxes Debt issuance Grant compliance 1099 reporting

Yellow Book State Government (Statutes,

Department of Revenue, Rules of the Auditor General) Truth in Millage (TRIM) Grant compliance Annual reporting requirements

FUND ACCOUNTING

Fund AccountingWhat is fund accounting? Fund accounting is a system for segregating financial resources to ensure and demonstrate legal compliance with restrictions or other special purposes.

The City is prohibited from using funds legally restricted for a specific purpose in general operations.

What is a fund?A fund is a fiscal and accounting entity with a self-balancing set of accounts recording cash and other financial resources, together with all related liabilities and residual equities or balances and changes therein, which are segregated for the purpose of conducting specific activities or attaining certain objectives in accordance with special regulations, restrictions, or limitations. Funds are divided into various types according to the legal restrictions imposed upon them or by their uses.

Fund AccountingRestrictions:Must Comply with Legal and External Requirements

Some Examples: Infrastructure Surtax (Capital Projects) Utility Revenues (Operation and Expansion of

Utility System) Impact Fees (Infrastructure Capacity

Improvements related to Growth) Grants (Specific Programs/Projects)

DO NOT TOUCH Restricted Fund

Fund AccountingFunds

Governmental◦ General fund◦ Special revenue funds◦ Capital projects funds◦ Debt service funds◦ Permanent funds

Proprietary◦ Enterprise funds◦ Internal services funds

Fiduciary◦ Trust funds◦ Agency funds

Fund Balance (reserve)• Excess revenues over

expenditures• Emergencies or one time

expenditures • Not meant to fund

continuing operations

Fund Balance Policy• General Fund• Utility Fund• Other Funds

Governmental Funds General Fund

City Council Administration

• City Manager, Community Relations, Purchasing and Contracts Management, Economic Development, City Clerk, Human Resources

Financial Services Community Development

• Planning, Code Enforcement Fire & Rescue Services Law Enforcement

Contract with Sheriff

Public Works• Streets & Drainage, Facilities

Maintenance, Parks Facilities Engineering Recreation/Athletics Non-Departmental

Governmental Funds Capital Projects Fund Special Revenue Funds

CDBG Fund Police Education Fund Police Automation Fund Disaster Reserve Fund Special Events Fund Streets Improvement Fund Park Impact Fee Fund Fire Impact Fee Fund Transportation Impact Fee Fund

Development Special Projects Fund Neighborhood Stabilization Fund Old Kings Road Special Assessment

Fund SR100 Community Redevelopment

Fund BAC Fund

Proprietary Funds Internal Services Funds

Fleet Management Fund Health Insurance Fund

Enterprise Funds Information Technology & Communications Fund Tennis Center Fund Golf Course Fund Building Permits & Inspection Fund Stormwater Management Fund Solid Waste Fund Utility Fund

• Utility Capital Projects Fund

Fiduciary Funds Agency Funds

Coquina Coast Cooperative Fund

Trust Funds Volunteer Firefighters’ Pension Fund

REVENUE

Revenue Classifications

Taxes Permits, Fees and

Special Assessments Intergovernmental

Revenue Charges for Services

Judgments, Fines and Forfeits

Miscellaneous Revenues

Other Sources

Total City Revenues Fiscal year 2013

Taxes Ad Valorem (Property)

Tax Local Option Fuel Tax

• Currently $.07 per gallon Insurance Premium Tax

• Volunteer Firefighters’ Pension

Discretionary Sales Surtaxes• Local Government

Infrastructure Surtax• Small County Surtax

Public Service Taxes(Not in use)• Electricity• Water• Natural Gas• Propane

Communications Services Tax• 5.22%

Local Business Tax

Permits, Fees and Special Assessments Franchise Fees

• Solid Waste• Natural Gas• Utility (not in use)

Engineering Permits Impact Fees• Water and

Wastewater• Transportation• Parks

• Fire• School (remitted to

Flagler County Schools)

Special Assessments• Old Kings Road• Code Nuisance

Intergovernmental Revenue

Grants State Revenue Sharing Local Government Half-Cent Sales Tax

Program County Business Tax Receipts Alcoholic Beverage License tax

Charges for Services Utility Fees• Water and Sewer• Solid Waste• Stormwater

Annual Fire Inspections Building Permits & Inspections Fees

State Road

Maintenance Recreation Fees Planning Fees

Judgments, Fines and Forfeits

Traffic Citations Red Light Camera Violations Local Ordinance Violations• Parking Tickets• Code Fines• Animal Control

Other Revenue Sources Interfund Transfers• Payment-In-Lieu-of-Taxes (PILOT)• Tax Increment for the CRA

Debt Proceeds Miscellaneous

Unrestricted Revenue Sources

Ad Valorem TaxAlcoholic Beverage LicenseBusiness Tax Receipts (Local

Business Tax)Communication Services TaxNatural Gas Franchise FeeHalf-Cent Sales TaxSolid Waste Franchise FeeState Revenue Sharing (a)

73.37%

Code Enforcement Red Light– This revenue source has been

allocated by City Council to the Streets Improvement Fund to be used for safety improvements.

Public Service (Utility) Tax– This revenue source is currently

not in use by the City.

Unrestricted revenue can be used for general purpose and at the discretion of the governing body.

Revenue Source Restriction

Fire Insurance Premium Tax Volunteer Firefighters pension

Fuel Tax Refund Construction & maintenance of roads

Police Automation/Education Law Enforcement

Building Permit & Inspection Fees Applied solely to BPI costs

Infrastructure Surtax Finance, plan, construct infrastructure

Local Option Fuel Tax Transportation expenditures

State Revenue Sharing (b) 26.63% Transportation expenditures

Tax Increment Revenue (CRA) Per CRA plan

Impact Fees Capacity improvements

Special Assessments Purpose of assessments

Restricted Revenue SourcesState Restricted

Restricted Revenue SourcesOther

Type Restricted by Use Water & Sewer Charges Bond Covenants Maintain system & debt

& City Council service

Small County Surtax Flagler County Ordinance Construction & improvement of public facilities, operating expenses etc…

Stormwater Loan Covenants Maintain system & debt Management Fee & City Council service

Disaster Reserve City Council Costs related to a disaster

July 2nd Presentation on Property Taxes & Millage Rate History

July 9th

Budget Workshop - General Fund July 16th

Establish proposed Millage Rate (TRIM rate) July 30th

Budget Workshop - Proprietary Funds August 13th

Budget Workshop - Special Revenue & Capital Funds August 27th

Final Proposed budget presentation September 4th & 18th (Wednesdays at 5:05pm)

Public hearings to adopt millage rate resolution and budget resolution

Tentative Budget Schedule

QUESTIONS & DISCUSSION