HomeMy WebLinkAboutQ2 2023 Financial Report CITY OF J
A iii AGENDA BILL APPROVAL FORM
rim
WASHINGTON
Agenda Subject: Date:
2nd Quarter 2023 Financial Update (Thomas) (20 Minutes) August 1, 2023
Department: Attachments: Budget Impact:
Finance Financial Report through June 2023
2023 02 Financial Update Presentation
Administrative Recommendation:
For discussion only.
Background for Motion:
Background Summary:
The financial report summarizes the general state of Citywide financial affairs and highlights
significant items or trends that the City Council should be aware of. The attachment provides
year-to-date financial activity through June 30, 2023.
Reviewed by Council Committees:
Councilmember: Baldwin Staff: Thomas
Meeting Date: September 11, 2023 Item Number:
Page 32 of 68
.i
AuBUT
Quarterly Financial Report Through June 2023 WASHINGTON
This report provides an overview of the City's overall financial position for the fiscal period ending
June 30, 2023, reflecting financial data available as of August 15, 2023. References to budget,
actual and prior year amounts reflect year-to-date numbers, unless explicitly stated otherwise.
Year-to-date budget expectations are generally based on the two prior years of data.
General Fund Overview
Coming off a robust 2022 fiscal year, the City embraces a new biennial budget cycle starting in
2023. As we have seen in prior years, General Fund revenues have generally exceeded budget
expectations and largely recovered from the impact of the COVID-19 mitigation measures. The
current annual budgeted revenue amount is $94.8 million and an annual budgeted expenditure
amount of$104.3 million; a planned decrease in General Fund balance of$9.5 million.
Last year the City implemented a citywide Business and Occupation (B&O) tax, wherein
businesses are taxed based on the value of gross receipts or square footage of occupied
warehousing space, subject to certain exceptions. This new revenue stream achieved a total of
$3.0 million in 2022 and has already provided $5.2 million year-to-date in 2023. The City
anticipated that the B&O revenue stream will remain consistent throughout the year, significantly
surpassing budget expectations. Due to a change in the renewal schedule for business licenses
designed to spread revenue collection more evenly over the year, the City has also seen
increased business license revenue compared to last year by roughly $206,000 or 193%.
Additionally, the City offers a wide range of recreational classes and access to the Auburn Golf
Course. Green fees at the Auburn Golf Course have remained a staple revenue source for the
City, comprising roughly 45% of the total culture and recreation revenues. Recreational classes
have significantly increased by 31% from 2022 collections, a hopeful indication that the City is
returning to pre-pandemic activity levels.
Overall, General Fund revenues collected through Q2-2023 totaled $55.2 million as compared to
a year-to-date budget of$47.3 million, and were $6.5 million, or 13.4% above budget
expectations. General Fund expenditures through Q2-2023 totaled $43.5 million compared to a
year-to-date budget of$48.8 million; resulting in a $5.3 million or 10.8% underspend.
GENERAL FUND
REVENUES VS. EXPENDITURES THROUGH JUNE 2023
YTD Actuals $435 M
Experd it a res
YTD Budget$48,7 M
YTD Actuals$55,2 M
Reverues
YTD Budget$47,3 M
$0 $10 $20 $30 $40 $50 $60
$MILLIONS
Page 33 of 68
Quarterly Financial Report Through June 2023 2
Revenue: The following factors had the most significant impacts on the budget vs. actual revenue
collected:
• Retail Sales Tax: The sales tax report through Q2-2023 (which is provided as an
attachment to this report) reflects amounts remitted to the City of Auburn based on
sales from November 2022 through April 2023. Collections through June 2023 totaled
$11.2 million, a 1.0% increase from last year. Likewise, compared to the year-to-date
budget, sales tax has a favorable variance of$1.4 million or 13.9%. The increase
resulted from multiple categories, particularly wholesale trade and automotive. [pages
5-7]
• Utility Tax: As mentioned in previous reports, in 2022 there was a notable change in
how the interfund utility taxes were transferred between the General Fund and the
City's pass-through King County Metro Sewer sub-fund. Utility tax revenues through
Q2-2023 were $232,000 unfavorable to budget. Factoring in an accounting adjustment
in late 2022, collections are favorable by $541,000 against prior year-to-date
revenues. [pages 7-8]
• Building permits: Q2-2023 revenues collected totaled $322,000 which was $167,000
unfavorable to the year-to-date budget. While the number of permits received are higher
than in 2022, the valuation of individual permits, especially in construction permits, have
decreased considerably. [page 12]
• Intergovernmental revenue: Collections through Q2-2023 were $504,000 unfavorable
to budget. The City has not collected any 2023 compact revenue as the current request
is still pending approval which is the main contributor to the unfavorable variance. Higher
liquor and marijuana excise taxes as well as fire insurance taxes help mitigate a portion
of the unfavorable variance. [page 13]
• Culture and recreation: Revenues collected through Q2-2023 totaled $1.8 million and
were $475,000 higher than budget expectations. Recreational classes, which saw an
increase of$114,000 from 2022 totals, was the main contributor to this increase. Green
fees at the Auburn Golf Course and Auburn Theater tickets sales provide additional
support to the variance against the budget. [page 15]
Expenditures: Almost all departments operated within budget expectations through the first
quarter of 2023, with some variances due to the timing of professional services payments, as well
as expenses related to operating supplies. Of the favorable variance to budget mentioned above,
$1.3 million of that is comprised of underspend professional services and charges, as well as
$1.8 million underspend in personnel costs largely due to position vacancies across the City. As
of the compilation of this report, there were 31 vacant regular full-time positions in the City.
Page 34 of 68
Quarterly Financial Report Through June 2023 3
Enterprise Funds Overview
The City's enterprise funds account for operations with revenues primarily provided from user
fees, charges, or contracts for services. Significant for 2023, the City's cash and investment
balance increased significantly compared to the same period last year. As a result, interest
earnings across all funds increased materially, totaling $1.0 million more in the enterprise
operating funds than through Q2-2022. Another key factor contributing to higher interest earnings
was increased interest rates and yields to maturity for the City's investment accounts compared
to last year.
The Water Fund ended Q2-2023 with operating income of about $1.98 million, which was
approximately $467,000 above the same period last year. Nearly one-fourth of the increase in
operating revenue was due to increased interest earnings. [page 21]
The Sewer Fund ended Q2-2023 with operating income of about $2.1 million versus $706,000 in
the same period last year. Service charge and interest revenues increased, while operating
expenses decreased $761,000, largely due to the cessation of charging interfund utility tax
against the pass-through King County Metro Sewerage revenue. [page 22]
The Stormwater Fund ended Q2-2023 with operating income of about $1.6 million compared to
$1.3 million in the same period last year. The increase in revenues (primarily from charges for
storm service and interest earnings) were higher than the increase in expenditures, resulting in a
19% higher operating income this quarter than the same quarter last year. [page 22]
The Solid Waste Fund ended Q2-2023 with an operating loss of about $569,000. An increase of
$2.4 million in operating revenues over the same period last year was offset by an increase of
operating expenditures of$3.4 million due to increased tax expenditures and payments to the
City's solid waste vendor. Note that reported expenditures include a $1.3 million payment to the
City's solid waste vendor for service through June, which was paid in July. [page 22]
Internal Service Funds Overview
Internal service funds provide services to other City departments and include functions such as
Insurance, Worker's Compensation, Facilities, Innovation & Technology, and Equipment Rental.
No significant variances were reported in these funds during Q2-2023. [page 22]
Page 35 of 68
Quarterly Financial Report Through June 2023 4
General Fund Details
The following chart is a detailed breakdown of the General Fund's different sources of revenue
and expenditures, broken down by department:
General Fund 2023 2022 2023 YTD Budget vs.Actual
Summary of Sources and Uses Annual YTD YTD YTD Favorable(Unfavorable)
Budget Budget Actual Actual Amount Percentage
Operating Revenues
Property Tax $ 24,016,247 $ 12,551,800 $ 12,841,702 $ 12,627,152 $ 289,902 2.3 %
Retail Sales Tax 20,344,500 9,810,400 11,176,169 11,066,712 1,365,769 13.9 %
Affordable Housing Sales Tax Credit 174,963 63,200 49,055 52,582 (14,145) (22 4) %
Sales Tax-Rerce County Parks 125,000 59,900 64,361 65,285 4,461 7.4 %
Criminal Justice Sales Tax 2,441,300 1,140,700 1,507,826 1,428,451 367,126 32.2 %
Brokered Natural Gas Tax 150,000 81,500 222,268 110,090 140,768 172.7 %
City Utilities Tax 6,776,697 3,424,700 2,971,326 3,295,916 (453,374) (13.2) %
Business&Occupation Tax 5,480,960 4,110,720 5,160,718 568,689 1,049,998 25.5 %
Admssions Tax 308,740 167,100 178,844 126,745 11,744 7.0 %
Electric Tax 4,357,031 2,309,000 2,310,929 2,144,208 1,929 0.1 %
Natural Gas Tax 1,638,857 906,200 962,197 809,712 55,997 6.2 %
Cable Franchise Fee 897,035 448,518 437,138 456,739 (11,379) (2.5) %
Cable Utility Tax 949,064 474,532 465,238 483,230 (9,294) (2 0) %
Cable Franchise Fee-Capital 52,484 26,242 27,710 26,723 1,468 5.6 %
Telephone Tax 500,974 262,240 171,047 284,515 (91,193) (34.8) %
Solid Waste Tax(external) 60,462 18,422 141,515 28,897 123,093 668.2
Leasehold Excise Tax 246,514 216,100 236,969 209,022 20,869 9.7
Gambling Excise Tax 293.300 131.876 170.220 130.037 38.344 29.1 %
Taxes sub-total $ 68,814,128 $ 36,203,150 $ 39,095,235 $ 33,914,706 $ 2,892,085 8.0 %
Business License Fees $ 450,000 $ 138,300 $ 312,274 $ 106,628 $ 173,974 125 8 %
Building Permits 933,364 488,800 322,061 477,106 (166,739) (34.1) %
Other Licenses&Permits I 1,128,000 668,000 714,169 1 566,471 46,169 6.9 %
Intergovernmental(Grants,etc.) 6,551,831 3,131,695 2,628,012 2,600,936 (503,683) (16.1) %
Charges for Services
General Government Services 4,563,272 2,265,835 2,225,731 1,728,339 (40,104) (1.8) %
Public Safety 910,000 455,000 551,101 439,528 96,101 21.1 %
Development Services Fees 1,130,517 562,500 530,435 681,920 (32,065) (5.7) %
Culture and Recreation 2,481,335 1,295,409 1,770,365 1,413,393 474,957 36.7 %
Fines and Penalties 422.975 216.465 274.060 183.627 57.594 26.6
Fees/Charges/Fines sub-total $ 18,571,294 $ 9,222,005 $ 9,328,208 $ 8,197,950 $ 106,203 1.2 %
Interest and Investment Earnings $ 366,700 $ 183,350 $ 541,990 $ 156,679 $ 358,640 195.6 %
Rents and Leases 1,109,234 462,300 617,461 537,347 155,161 33.6 %
Contributions and Donations 21,000 3,629 4,164 7,654 535 14.7 %
Other Miscellaneous 247,110 144,700 261,987 365,020 117,288 81.1 %
Transfers In 5,630,978 2,433,602 5,159,722 818,861 2,726,120 1120 %
Insurance Recoveries-Capital&Operating 62.500 31.250 206.023 90.659 174.773 559.3
Other Revenues sub-total $ 7,437,522 $ 3,258,830 $ 6,791,347 $ 1,976,220 $ 3,532,516 108.4%
Total Operating Revenues $ 94,822,944 $ 48,683,985 $ 55,214,789 $ 44,088,876 $ 6,530,804 13.4%
Operating Expenditures
Council&Mayor $ 1,415,188 $ 698,000 $ 758,950 $ 745,006 $ (60,950) (8.7)1%
Administration 1,265,262 666,200 606,555 I-531,229 59,645 9.0 %
Human Resources 2,324,011 1,161,500 1,126,516 1,028,574 34,984 3.0 %
Municipal Court&Robation 3,038,838 478,519 537,758 428,751 (59,239) (12.4) %
Finance 5,088,323 2,560,000 2,253,537 1,773,579 306,463 12.0 %
City Attorney 7,314,952 3,177,900 2,846,334 2,099,947 331,566 10.4 %
Community Development 9,479,059 4,056,000 3,664,325 2,976,302 391,675 9.7 %
DEl 705,913 352,800 205,390 - 147,410 41.8 °A°
Jail-SCORE 5,600,000 2,800,200 2,519,519 1 2,023,815 280,681 10.0 %
Police 35,878,986 17,582,600 16,447,457 15,581,950 1,135,143 6.5 %
Public Works 4,735,592 2,303,000 2,146,293 1,734,678 156,707 6.8 %
Parks,Arts&Recreation 15,856,292 _ 7,236,000 7,341,589 6,562,370 _ (105,589) (1.5) %
Streets _ 4,769,219 2,332,900 1,948,391 1,815,652 384,504 16.5 %
Non-Departmental 6,834,788 3,341,876 1,101,063 1,147,090 2,240,812 67.1 %
Total Operating Expenditures $ 104,306,423 $ 48,747,495 1 $ 43,503,681 $ 38,448,944 $ 5,243,813 10.8 %
Page 36 of 68
Quarterly Financial Report Through June 2023 5
Revenue
The combined total of property, sales/use, utility, gambling, and admissions taxes provides over
70% of all resources supporting general governmental activities. Licenses, charges for services,
intergovernmental revenue (grants, state shared revenue, etc.) and fines contribute a further 17%
of total revenue to the General Fund. The remaining 12% is comprised of a combination of
different sources that are considered to be one-time resources. The following section provides
additional information on the most significant tax resource streams.
Property Tax collections through the second quarter of 2023 totaled roughly $12.8 million as
compared to a YTD 2023 budget of$12.6 million. Coinciding with the due dates for the County
property tax billings, the City collected 90.5% of the year-to-date 2023 revenues during the
months of April and May. As depicted in the chart below, the next influx of property tax revenues
is expected to occur during the fourth quarter. Since 2016, we have seen annual increases
versus the prior year totals and project the same will be true to end 2023.
Property Taxes
CI 2023 Budget —0-2023 YTD Actual —2022Actual
$30.0
$25.0
$20.0
0
$12.8 M
$15.0 •
i
$10.0
$5.0
SO.O
Feb Mar Apr May Jun Aug Sep Oct Noy Dec
Retail Sales Tax collections through Q2-2023 totaled $11.2 million, representing taxes remitted
to the City of Auburn based on sales from November 2022 through April 2023. Overall, these
revenues collected roughly $110,000 higher during 2023 than through the same period in 2022,
with strong performances in the automotive (+$118,300), wholesale (+$100,000) and services
(+$82,000) industries more than offsetting slight decreases in most of the remaining industries.
Within the retail trade sector, sales tax revenues generated from sporting goods, hobby, and
music retailers have seen an significant increase versus the same period last year, which exhibits
a correlation with the increase in culture and recreation revenues. The notable exception to the
trend of stable or increased collections is the manufacturing industry: due to a large one-time
contribution in Q1-2022, manufacturing collections are down $205,000 (42.4%). With a year-to-
date 2023 budget expectation of$9.8 million, sales tax revenues have a $1.4 million favorable
variance to the budget. The City assumes sales tax revenues will continue this upward trend as
we have seen in years prior.
Page 37 of 68
Quarterly Financial Report Through June 2023 6
Retail Sales & Use Tax
$25.0 02023Budget —0-2023 YTD Actual —2022Actual
$20.0
$15.0
O $11.2 M
:::
30.0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Retail Sales & Use Tax
$25.0 $22.7
$21.6
$20.0 518.R 518.9
o $15.9
E $15.0
$11.2
$10.0
$5.0
$0.0
2018 2019 2020 2021 2022 2023
YTD
Note: The increase in sales tax revenue from 2018 to 2019 was primarily due to a policy change
whereby sales tax on construction revenue is retained in the General Fund;previously, a portion
was transferred to street funds. Of the year-over-year increase in sales tax revenue depicted in
the graphic above from 2018 to 2019, $2.2 million of the $2.9 million increase was due to this
policy change.
Page 38 of 68
Quarterly Financial Report Through June 2023 7
The following table breaks out the City's retail sales taxes by major business sector.
Comparison of Retail Sales Tax Collections by Group
Through June 2023
2022 2023 I Change from 2022
Component Group YTD Actual YTD Actual 1 I Amount Percentage
Construction $ 1,372,433 $ 1,426,126 $ 53,693 3.9
ok
Manufacturing 484,023 278,890 (205,133) (42.4)
Transportation & Warehousing 136,358 117,422 (18,937) (13.9) %
Wholesale Trade 725,599 825,585 99,986 13.8 %
Automotive 2,281,327 2,399,616 118,289 5.2 %
Retail Trade 3,277,070 3,265,511 (11,559) (0.4) %
Services 2,615,432 2,697,575 82,143 3.1 %
Miscellaneous 174,471 165,446 (9,025) (5.2) %
YTD Total $ 11,066,712 $ 11,176,169 $ 109,457 1.0 %
1
Utility Taxes consist of interfund taxes on City utilities (Water, Sewer, Storm and Solid Waste)
and taxes on external utilities (Electric, Natural Gas, Telephone and Solid Waste). Effective
January 1st, 2023, Council approved an increase of the City utility tax rate from 10.0% to 11.5%.
However, the additional revenue generated from this increase was dedicated to funding City
street projects, while the General Fund portion remained at its previous 9.0%.
Overall, utility taxes increased by $88,000 or 1.2% through Q2-2022, however, utility taxes are
currently unfavorable to budget by roughly $232,000. This is due to the City no longer applying
interfund utility tax to the pass-through revenue from King County Metro sewerage charges. The
City will reassess the annual budget during the budget amendment process and make any
adjustments as necessary.
Second, beginning in January 2023, external utility taxes are collected on either a quarterly or
annual basis, rather than monthly. Although there have been collections throughout the year, the
City anticipates a change to the timing of these revenues in 2023, which will affect year-over-year
performance comparisons for the remainder of the year and into 2024.
The table and below demonstrates the various utility tax revenues and shows actual revenues
compared to budget.
Utility Tax by Type
Through June 2023
2022 2023 2023 I 2023 vs. 2022 Actual 2023 vs. Budget
Utility Tax Type _ YTD Actual YTD Budget YTD Actual 1 I Amount Percentage Amount Percentage
City Interfund Utility Taxes $ 3,295,916 $ 3,424,700 $ 2,971,326 $ (324,590) (9.8) % $ (453,374) (13.2) %
'Electric 2,144,208 2,309,000 2,310,929 166,722 7.8 % 1,929 0.1 %
(Natural Gas 809,712 906,200 962,197 152,485 18.8 % 55,997 6.2 %
(Telephone 284,515 262,240 171,047 (113,469) (39.9) % (91,193) (34.8) %
'External Water, Sewer, SW 28,897 18,422 141,515 112,618 389.7 % 123,093 0.0 %
IBrokered Natural Gas 110,090 81,500 222,268 112,178 101.9 % 140,768 172.7
(Cable 483,230 474,532 465,238 (17,992) (3.7) % (9,294) (2.0) %
YTD Total $ 7,156,568 $ 7,476,594 $ 7,244,521 $ 87,953 1.2 % $ (232,073) (3.1) %
1
Page 39 of 68
Quarterly Financial Report Through June 2023 8
Utility Tax
=2023 Budget —0-2023 YTD Actual —2022Actual
$16.0
$14.0
$12.0
$10.0
$7.2 M
$6.0 •
$4.0
•
$2.0 •� J
$0.0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Utility Tax Revenues
$13.2 $12.8
$13.0
$11.1 $1090,00
$11.0 r
° $9.0
$7.2
$7.0 r.
$5.0
S3.0
2015 2019 2020 2021 2022 2023
YTD
Note: Of the total utility tax levied, 2.5% of Water/Sewer/Storm/Solid Waste tax and 1.0% of other
utility tax is allocated to City streets funds and is not reflected in the General Fund's portion
discussed here. The large increase from 2019 ($10.9 million) to 2020 ($12.7 million) is attributed
to the City's decision mid-2020 to reallocate 1.0%previously dedicated to the Arterial Street
Preservation Fund to support General Fund operations, due to the uncertainty of the economic
impacts of COVID-19. The Arterial Street Preservation Fund's 1.0% was reinstated in 2021, but
2021 collections continued to increase due to an increase in the City's internal utility tax rate from
7.0% to 10.0% effective in 2021.
Page 40 of 68
Quarterly Financial Report Through June 2023 9
An Admission Tax of 5.0% is placed on charges for general admission, season tickets, cover
charges, etc. Revenues from admission taxes are generally collected on a quarterly basis as
depicted on the chart below. Admission tax revenues of$178,800 collected through June 2023
were significantly higher (41.1%) than through Q2-2022. This is partially due to lingering effects of
the COVID-19 pandemic in the early part of the year, resulting in generally lower admissions in
early 2022. The City projects admission taxes will return to pre-pandemic levels over the
biennium. As of Q2-2023, admission tax revenues are favorable to budget by roughly $11,700.
Admission Tax
0 2023 Budget —0—2023 YT❑Actual —2022 Actual
$400
$300
o $178.8 K
$200
0
x
H
$100
$0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Note: The decrease in admission tax revenues in November 2022 was due to a change in
accounting wherein admissions tax ceased to be charged to the City's Golf Course operations.
Page 41 of 68
Quarterly Financial Report Through June 2023 10
Gambling Tax applies to all card games, punch board games, pull tabs, bingo games, raffles and
amusement games played within City limits. The majority of the gambling tax revenues are
collected from amusement games (33.4%) and card games (57.5%). As with admission tax, the
City projects increased collections from 2022 totals. Through the second quarter, collections are
$40,000 higher than 2022 year-to-date totals and report a $38,000 or 29.1% favorable variance to
budget. This revenue source historically has significant variance from year to year: excluding
2021, second-quarter revenue has been as high as $309,500 (2016) and as low as $151,000
(2018).
Gambling Tax
$400.0 p 2023 Budget —0-2023 YTD Actual 2022 Actual
$300.0
Na $170.2 K
Q $200.0
$100.0
$0.0
J,E Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Licenses and Permits include business licenses, building permits, plumbing, electric and other
licenses and permit fees. Building permit fees and business licenses make up approximately 70%
of the annual budgeted revenue in this category.
The annual Business License renewal fee for each business that is located within the City is
$103. Previously, all businesses were on calendar year renewal cycle, meaning that the majority
of business license revenue was collected in November and December for existing businesses
renewing their licenses, which is reflected in the large peak in the chart below in 2022.
As mentioned in last quarter's report, starting in September of 2022, businesses are now on an
annual renewal cycle that begins on the date the business had originally been granted a license.
This new methodology is expected to smooth out revenue collection throughout the year, which
can also be seen in the chart below as a more linear progression of year-to-date collections
totaling $312,000, compared to $205,500 in Q2-2022.
Also mentioned previously, changes in the timing of collections will affect year-over-year
performance comparisons for the remainder of 2023 and into 2024. Moreover, collections in 2023
are projected to be higher in total than 2022, due to increased discovery through B&O tax
collections and use of the State's Business Licensing System (BLS).
Page 42 of 68
Quarterly Financial Report Through June 2023 11
Business Licenses
0 2023 Budget —0—2023 YTD Actual 2022 Actual
$500
$450
$400
$350 5312.3 K
$300
2 $250
Q
0 $200 frss°.sAI
$150
$100
$50
$0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Business License Revenues
$500
$424
$400 $3:
$336 $326
N $312
ro
$300 $353 ■
Vi
0
L
~ $200
$100
$0
2018 2019 2020 2021 2022 2023
YTD
Page 43 of 68
Quarterly Financial Report Through June 2023 12
Building Permit revenues collected through June 2023 totaled $322,000. Building permits are
approximately $155,000 lower than 2022 collections year-to-date and hold an unfavorable
variance against the budget of$167,000. A large contributing factor for this unfavorable variance
is the decreased valuation of construction permits on mixed use (consisting of a single high-value
project) and subdivision builds throughout 2023, despite a higher volume of permits being issued
this year than in the same period last year. However, there are aged 2022 revenues that the City
is anticipating on collecting during the third quarter of 2023. It is assumed that with the collection
of the aged accounts, the year-to-date unfavorable variance will be mitigated in the third quarter.
Building Permits
$1.6 02023 Budget —0-2023 YTD Actual —2022Actual
$1.4
$1.2
$1.0
z
O $08
$0.6
$0.4 ,,0•000r$03M
$0.2
•
$0.0 •
1 2 3 4 5 6 7 8 9 10 11 12
Building Permits
$2.5
$2.0
o $1.5
$1.0
$09
$to e, $0.8 $1.3
$as
• $0.3
$0.0
2018 2019 2020 2021 2022 2023
YTD
Page 44 of 68
Quarterly Financial Report Through June 2023 13
Intergovernmental revenues include grants and stimulus monies (direct and indirect federal,
state, and local), revenue from the Muckleshoot Indian Tribe (MIT) compact as well as state
shared revenues. Collections through Q2-2023 totaled $2.6 million and were $504,000
unfavorable to budget expectations. This variance was mitigated by the final payment of the 2022
compact request, made in January 2023. However, the 2023 compact request is still pending
approval, and no 2023 revenues have been collected to date. Likewise, state grants are also
below projections, although these revenues are received on a reimbursement basis, subject to
the timing of reimbursable activities. Streamlined sales tax has an unfavorable variance due to
the state Department of Revenue's recalculation of the payment rate; effective July 2022,
payments are calculated as 80% of the payment made in the same quarter of the previous year.
Intergovernmental Revenues(Grants,Entitlements&Services)
Through June 2023
I 2022 2023 2023 2023 vs.2022 Actual 2023 vs.Budget
Revenue YTD Actual YTD Budget YTD Actual Amount %Change Amount %Change
Federal Grants $ 2,120 $ 24,250 $ - $ (2,120) (100.0)% $ (24,250) 1144.1
State Grants - 164,500 9,402 9,402 (155,098) (1649.7)
Interlocal Grants 73,895 58,100 49,322 (24,573) (33.3)% (8,778) 35.7
Muckleshoot Casino Services 385,997 859,229 539,508 153,511 39.8% (319,721) (208.3)
One-Time Allocation(SB 5092) - - - - -
State Shared Revenues:
Streamlined Sales Tax 500,079 488,578 400,063 (100,016) (20.0)% (88,515) 88.5
Motor Vehicle Fuel Tax 557,085 558,400 538,743 (18,342) (3.3)% (19,657) 107.2
Criminal Justice-High Crime 136,636 142,412 141,748 5,112 3.7% (664) (13.0)
Criminal Justice-Population 14,665 9,800 15,524 859 5.9% 5,724 666.3
Criminal Justice-Special Prog. 52,121 44,200 54,917 2,796 5.4% 10,717 383.2
Marijuana Excise Tax 111,497 86,464 114,012 2,516 2.3% 27,548 1095.0
State DUI 7,364 6,104 217 (7,147) (97.1)% (5,887) 82.4
Fire Insurance Tax 104,661 89,700 114,235 9,574 9.1 % 24,535 256.3
Liquor Excise 313,219 249,017 311,060 (2,159) (0.7)% 62,044 (2873.9)
Liquor Profit 341,600 350,943 339,263 (2,338) (0.7)% (11,680) 499.6
Total State Shared' 2,138,925 2,025,616 2,029,781 (109,144) (5.1)% 4,165 (3.8)
YTD Total $ 2,600,936 $ 3,131,695 $ 2,628,012 $ 27,076 1.0% $ (503,683) (16.1)
Intergovernmental Revenues
(Grants, Entitlements& Services)
$12
$10.2
$10 /o $8 \\ $6.9
$6-3 $6. $6 3
3 $6 //
$4
$2.6
$2
$0
2018 2019 2020 2021 2022 2023
YTD
Note: 2020 revenue was higher than normal due to the receipt of$3.8 million in federal CARES
grant money from the Department of Treasury.
Page 45 of 68
Quarterly Financial Report Through June 2023 14
Charges for Services consist of general governmental service charges, public safety charges,
development service fees, and culture and recreation fees. Total charges for services collected
through June 2023 totaled $5.1 million and were roughly $500,000, or 10.9%, more than
expected to date, mainly due to exceptional performance at the Auburn Golf Course.
Charges for Services by Type
i Through June 2023
I Revenue YTD
2023 2023 2023 vs. 2022 Actual 2023 vs. Budget
I D Actual YTD Budget YTD Actual Amount Percentage Amount Percentage
General Govemment $ 1,728,339 $ 2,265,835 $ 2,225,731 $ 497,392 28.8 % $ (40,104) (1.8) %
Public Safety 439,528 455,000 551,101 111,573 25.4 % 96,101 21.1
Development Services 681,920 562,500 530,435 (151,486) (22.2) % (32,065) (5.7)
Culture& Recreation 1,413,393 1,295,409 1,770,365 356,973 25.3 % 474,957 36.7 %
YTD Total $ 4,263,180 $ 4,578,744 I $ 5,077,632 $ 814,452 19.1 % $ 498,888 10.9
w
The General government revenue category primarily includes the interfund assessment for
support departments (Finance, Human Resources and Legal). Operating costs for these
departments are charged to the respective General Fund home department and the portion of
those costs that provide citywide benefit are recouped from other funds via interfund charges.
General Government revenues also include fees for passport services, reimbursement from cities
participating in the South King Housing and Homelessness Partners (SKHHP), as well as
revenues regarding transportation projects for a salt/sand storage shed. The unfavorable
variance of$40,000 to budget is due to the timing of SKHHP revenues, which are received on a
reimbursement basis. Furthermore, the City expects to collect revenues for the salt/sand storage
(carried forward from 2022) per an interlocal agreement during the second half of the year, which
will mitigate the unfavorable variance through the second quarter.
Public safety revenues mainly consist of revenues for law enforcement services, which are extra
duty security services whereby police officers are contracted for, and reimbursement is made by
the hiring agency. This category also includes reimbursements from the Muckleshoot Indian Tribe
(MIT) for a full-time dedicated police officer and associated expenditures as well as monies
collected from the Auburn School District for services rendered. Public safety revenues collected
in the second quarter of 2023 totaled $551,000 and saw a $112,000 incline from 2022 second
quarter totals. Revenues generated from DUI emergency response fees represent $89,000 or
92.5% of the $96,000 favorable variance versus the YTD 2023 budget. This is due to a change in
the accounting basis on which these revenues are recognized.
Development services fee collections consist primarily of plan check fees, facility extension
charges, and zoning and subdivision fees. Through Q2-2023, development service fees collected
totaled $530,500 and were $32,000 unfavorable to budget expectations. Major contributors to this
variance were FAC linear charges (fees assessed on projects that require extension of public
facilities). Although FAC linear charges are down year-over-year by $110,500, this is an effect of
the revenue regressing to the mean after an exceptional three-year period of high collections from
2020 through 2022. By comparison, 2023's collections, while lower than 2022, are still well above
the previous average collection for the first quarter. However, plan check fee collections
increased during the second quarter overcoming an unfavorable Q1-2023 budget variance and
now reports a $32,000 favorable variance to help offset some of the FAC linear charges.
Page 46 of 68
Quarterly Financial Report Through June 2023 15
Development Service Fees
$2.0
$1.6
$1.5
$1.1
0
$0.9 $1.
$0.5
$0.5 a
$0.0
2018 2019 2020 2021 2022 2023
rrD
Most of the culture and recreation revenues are derived from green fees and pro shop sales at
the Auburn Golf Course, recreational classes, ticket sales at the Auburn Avenue Theater, senior
programs, and special events. Overall, culture and recreation revenues exceeded budget by
$475,000, or 36.7%, with nearly 72% of revenues coming from greens fees and recreation
classes. Greens fee revenues have increased $76,500 or 10.8% from the same period last year,
and are favorable to budget by $190,000 due to a 3-4% increase in greens fees and good
weather during the spring and summer months. These revenues are projected to continue rising
through the summer and taper down in fall as the golfing season slows. Recreation class
revenues have increased by $114,000 or 30.8% from the prior year, and ticket sales for
performances held at local school venues (previously held at the Auburn Avenue Theater) have
increased by$50,500 or 234.2%.A portion of the increase is attributable to lower revenues due to
COVID-19 restrictions in place during 2022, which have since been removed.
Culture & Recreation
$3.0 2023 Budget —0-2023YTNActual —2022Actual
$2.5
$2.0
$1.8 M
$1.5
$1.0 •
$0.5 •
$0.0
Jan Feb Mar Apr May Jul Jul Aug Sep Oct Nov Dec
Page 47 of 68
Quarterly Financial Report Through June 2023 16
Fines & Penalties include civil penalties (such as code compliance fines), parking and traffic
infraction penalties, criminal fines (including criminal traffic, criminal non-traffic, and other criminal
offenses) as well as non-court fines such as false alarm fines. The table below shows a detailed
breakdown of the different types of fines and penalties collected by the City.
Fines&Penalties by Type
Through June 2023
2022 2023 2023 2023 vs. 2022 Actual 2023 vs. Budget
Month I YTD Actual YTD Budget YTD Actual Amount Percentage Amount Percentage
Civil Penalties $ 3,937 $ 9,165 $ 393 $ (3,544) (90.0) % $ (8,772) (95.7)
'Civil Infraction Penalties 63,633 69,500 74,035 10,402 16.3 % 4,535 6.5
(Photo Enforcement 531 1,700 1,067 536 100.8 % (633) N/A %
(Parking Infractions 44,383 40,500 98,844 54,461 122.7 % 58,344 144.1 %
'Criminal Traffic Misdemeanor 18,708 20,100 13,812 (4,896) (26.2) % (6,288) (31.3) %
(Criminal Non-Traffic Fines 18,179 19,800 28,080 9,901 54.5 % 8,280 41.8 %
(Criminal Costs 14,601 17,000 7,580 (7,021) (48.1) % (9,420) (55.4) %
INon-Court Fines& Penalties 19,655 38,700 50,249 30,593 155.6 % 11,549 29.8 %
YTD Total $ 183,627 $ 216,465 $ 274,060 $ 90,432 49.2 % $ 57,594 26.6 %
Total revenues collected through June 2023 totaled $274,000 as compared to a budget of
$216,500 and were 26.6% above budget expectations. This was primarily due to higher-than-
expected collections of fines related to a new photo enforcement program, which are classified as
parking infractions. With the implementation of this new program, the City expects significant
increases to revenue in this category.
Municipal Court fines and penalties account for 81% of the budgeted revenue in this category,
and equally account for 81% of the over collection. As shown in the graph below, annual
collections of fines and penalties are experiencing a decreasing trend. The City contracts with the
King County Court to operate its municipal court services; the number of hearings,judgements,
and collections activity began decreasing in 2019 and has continued to dramatically decrease
since that time. Initially, the decreasing fines collected via the Court was partially offset by an
increase in false alarm fees.
Fines&Penalties
$1.2
$1.0 1
o $0.8
0.6
$0.6
$0.4
$0.4
$0.4
$0.3
$0.2
$0.0
2018 2019 2020 2021 2022 2023
YTD
Page 48 of 68
Quarterly Financial Report Through June 2023 17
Miscellaneous Revenues consist of investment earnings, income from facility rentals, revenue
collected for golf cart rentals at the Auburn Golf Course, contributions and donations, and other
income including the quarterly purchasing card (P-card) rebate monies. A breakdown of the most
significant miscellaneous revenue categories are listed in the table below.
Miscellaneous Revenues by Type
Through June 2023
2022 2023 2023 I 2023 vs.2022 Actual 2023 vs. Budget
Month YTD Actual YTD Budget YTD Actual 1 I Amount Percentage Amount Percentage
Interest& Investments $ 156,679 $ 183,350 $ 541,990 $ 385,311 245.9 % $ 358,640 195.6
'Rents& Leases 537,347 462,300 617,461 80,114 14.9 % 155,161 33.6
'Contributions& Donations 7,654 3,629 4,164 (3,490) (45.6) % 535 14.7 %
'Other Miscellaneous Revenue 365,020 144,700 261,987 (103,033) (28.2) % 117,288 81.1
YTD Total $ 1,066,699 $ 793,978 $ 1,425,602 $ 358,902 33.6 % $ 631,624 79.6 %
Revenues collected YTD 2023 in this category totaled $1.4 million and were $632,000 favorable
to budget. The majority of the favorable variance to budget was in the interest and investments
category, with the City already surpassing the annual budgeted total through the second quarter.
The "other" miscellaneous revenue category, while $103,000 less than the same timeframe last
year, was nonetheless favorable to the 2023 year-to-date budget by $117,250. This category
includes $52,100 in revenue related to a national opioid settlement distribution program in the first
quarter. Furthermore, through the second quarter, the quarterly P-card rebates have totaled
$62,000 or 24% of the total "other" miscellaneous revenue.
The rents and leases category includes prepayments for facility rentals. During the second
quarter, we saw an influx of facility rentals, which coincides with prior years as the weather
generally becomes more favorable for gatherings. The increase in revenue brings the YTD 2023
total to $617,500 resulting in a $155,000 or 33.6% favorable variance to budget expectations.
Miscellaneous Revenues
82.5 t' "
$2.0
51.8
$1. $1 4
$1.5
1.2
$1.0
$0.5
$0.0
2018 2019 2020 2021 2022 2023
YTD
Page 49 of 68
Quarterly Financial Report Through June 2023 18
OTHER FUNDS
Real Estate Excise Tax (REET) revenues are taxes on the sale of both commercial properties
and single-family residences. These collections are receipted into the Capital Improvement
Projects Fund and used for governmental capital projects.
REET revenues collected year-to-date in 2023 total $1.7 million which is $603,000 or 36.4%
favorable to budget expectations. However, as reflected in the table below, REET revenues
collected were significantly lower (47.1%) than in 2022. Continued borrowing rate increases and
slower housing markets contribute to the decreased revenues during this period. However, the
City anticipates continued growth in REET revenues as property values on new and existing
homes increase.
Real Estate Excise Tax
57.0 =2023Budget —0—ana VTnArtual 7n97 Artual
56.0
55.0
gtZP °1°'
0
$1.7 M
2.0
51.0
5 0.0
1 2 3 4 5 6 7 8 9 10 11 12
Page 50 of 68
Quarterly Financial Report Through June 2023 19
Shown in the table below, REET collections have been lower in each month of 2023 than their
counterparts in 2022. In context, 2022 saw the highest collection of REET revenue through the
second quarter since 2015, largely due to high-value purchases made by Pepsi Beverages
Company, Holiday Inn Express, and a large land purchase made by an investment group. Lower
REET collections in 2023 represent a cooling market as interest rates increased dramatically after
a period of low interest rates and historic inflation.
Real Estate Excise Tax Revenues
Through June 2023
2022 2023 2023 2023 vs. 2022 Actual 2023 vs. Budget
Month Actual Budget Actual Amount Percentage Amount Percentage
1 $ 235,988 $ 112,068 $ 231,316 $ (4,672) (2.0) % $ 119,248 51.6 %
2 320,851 112,249 229,810 (91,041) (28.4) % 117,561 51.2 %
3 855,713 254,131 335,109 (520,604) (60.8) % 80,978 24.2 %
4 530,857 182,134 470,605 (60,253) (11.4) % 288,471 61.3 %
5 710,134 208,433 100,896 (609,238) (85.8) % (107,537) (106.6) %
6 479,225 184,014 288,285 (190,941) (39.8) % 104,271 36.2 %
7 331,971 177,876
8 497,294 215,051
9 587,492 304,681
10 316,404 141,042
11 202,461 134,581
12 191,104 202,039
YTD Total $ 3,132,769 $ 1,053,030 $ 1,656,021 $ (1,476,748) -47.1% $ 602,991 36.4%
Real Estate Excise Tax Revenues
$7.0
$6.0
$6.0
$5.2 $5.3
$5.0
$4.2
$3.9
$4.0
$3.0
$2.0 51.7
0
$1.0
$0.0
2018 2019 2020 2021 2022 2023
YT❑
Page 51 of 68
Quarterly Financial Report Through June 2023 20
American Rescue Plan Act (ARPA) Fund
In March 2021, the American Rescue Plan Act (ARPA) was signed into law, with the intent of
mitigating the economic impacts related to COVID-19. Through ARPA's State and Local
Government Fiscal Recovery Fund program, the City was allocated $14.75 million in funding.
Council approved the City's acceptance of ARPA funds in Resolution #5608, and the general
spending categories of those funds (as determined by a Council ad hoc committee) in Ordinance
#6832.
The City's plan for using ARPA funding is to mitigate the cost of providing public safety services
throughout the City. Since receiving the funding, the City has been able to offset $9.6 million in
public safety expenditures, as shown in the table below and reported to the Department of the
Treasury.
ARPA FUNDING STATUS
Total ARPA Funding Received 14,751,232
ARPA Funding Used to Mitigate Public Safety Costs 9,602,484
ARPA Funding Remaining 5,148,748
As a result of the cost mitigation provided by the ARPA funding, the City has been able to allocate
General Fund funding toward projects approved by the Council ad hoc committee. As of June 30,
2023, the City has been able to spend $825,000 year-to-date and $3.5 million since 2021 on the
following projects:
2023 Lifetime Spend
Title Budget Q2 Spend (includes this quarter) Remaining
Completed Projects 1,450,000 - 1,668,601 -
Body Cameras 586,400 - 550,325 36,075
Vaccination Incentive Program 47,500 - 34,980 12,520
Neighborhood Street Light Program 500,000 38,598 41,497 458,503
Human Services Grants includes admin 1,000,000 131,312 186,773 813,227
Dykstra Foot Bridge 400,000 - 10,357 389,643
Minor Improvements to Qualifying Neighborhood Parks 100,000 - 28,626 71,374
Limited Term Employee(LTE):Grants Coordinator 420,000 - 118,729 301,271
Paving Gravel Roads 636,866 2,391 21,646 615,220
Translation Services 75,000 469 1,685 73,315
Auburn Way South Median Landscape Replanting/Irrigation 50,000 - 40,187 9,814
Auburn Way South Roundabout 150,000 478 507 149,493
Emergency Housing Voucher Program 2,000,000 63,842 97,330 1,902,670
Encampment Cleanup 500,000 265,499 341,907 158,093
Downtown sidewalk replacement on Main Street and B Street Plaza surface
replacement 1,643,266 5,530 17,655 1,625,611
Broadband grants to hardest hit communities 180,000 1,686 139,504 40,496
Community violence intervention programs(drone,SPIDR Tech) 313,600 2,184 210,015 103,585
Arts Culture Center Renovations 100,000 - - 100,000
Signing bonuses for lateral hires 200,000 11,051 87,759 112,241
OtherProjects(notstarted) 4,180,000 - - 4,180,000
Total: 14,751,232 523,041 3,598,083 11,153,149
The Neighborhood Parks Improvement project will be able to make minor improvements in
qualifying neighborhood parks. Numerous parks in our low-income census tracts are in need of
modernization that will assist in getting these community members outdoors and experiencing a
better quality of life. To date this project has spent $28,626 which provided new fencing around
Forest Villa Tot Lot. The City plans to start building a new playground in the near future.
Page 52 of 68
Quarterly Financial Report Through June 2023 21
The Encampment Cleanup project provides two service contracts that began in 2023; one
contract provides continued cleanup of garbage and debris related to encampments and other
illegal dumping on City-owned properties and rights of way (ROW), while the secondary contract
focuses specifically on encampment trash cleanup. To date, the project has spent $299,140 with
$200,860 remaining.
Beginning in 2023, the Clean and Sober Housing Program is budgeted at$2 million over the life
of the program. This program is to assist residents of Auburn who are experiencing
homelessness and drug addiction and who are willing to enroll in and complete inpatient
treatment. The program will cover the costs of clean and sober housing of participants for up to
three years, provided the participant follows the clean and sober housing agreement. Total
project spend through Q2-2023 is $78,042.
The Broadband Network to Hardest Hit Communities project allows the City to expand the City's
broadband network capabilities for all residents, visitors, and city employees to utilize. The IT
department has acquired all necessary hardware and software related to the broadband/Wi-Fi
replacement and expansion. Total spent in Q2-2023 was $1,686 bringing the accumulated project
total to $139,504. All replacement of existing hardware has been completed. The expansion is
estimated to begin during Q4-2023.
Utility Enterprise Funds
Utility activities are divided between operating funds and capital sub-funds. Operating funds
house all the operating costs along with debt service and financing obligations. Capital funds
show costs associated with capital acquisition and construction. Both the operating and capital
funds have a working capital balance, which is equivalent to current assets minus current
liabilities. This approach isolates those funds available for capital and cash flow needs for daily
operations, and project managers will know exactly how much working capital is available for
current and planned projects.
Through June 2023, the Water Utility had operating income of$1.98 million (operating revenues
less operating expenditures), approximately $467,000 above the same period last year. Water
Fund operating revenues were $1.2 million or 17.8% higher than Q2-2022; the majority of this
variance was due to higher revenues from water sales ($935,000) and interest earnings
($297,000). As previously mentioned, this increase in interest earnings is due to an increase in
the City's cash and investments balances.
Operating expenditures also increased by $753,000, due in roughly equal measure to increases
in personnel costs, interfund allocations and utility taxes.
Billable water consumption through June 2023 totaled 1.29 million hundred cubic feet (ccf),
approximately 83,600 ccf higher than consumption volume through Q2-2022. Consumption
increased across every customer class compared to Q2-2022, with the largest increases by both
volume and revenue amount occurring in irrigation and single-family accounts.
Page 53 of 68
Quarterly Financial Report Through June 2023 22
Water Revenues and Water Sold
2022 vs 2023
V $2.5M 1,000
LI
c
0
3
$2.OM 800
$1.5M • 600
$1.0M •••••••• 400
$0.5M ��•Q •••"' •• 200 a
t
$0.OM -
>ac lac Q `$a� �c >� �� hQQ O� ,04 p�
2022 Water Sales($) -2023 Water Sales($)
2022 Water Sold(ccf) :2023 Water Sold(ccf)
Through the second quarter of 2023, the Sewer Utility finished with operating income of$2.1
million as compared to $706,000 through the same period last year. Operating revenues were up
$597,000 or 12.6% from the same period last year due to stronger performance in charges for
City sewer service and higher interest earnings. Interest earnings increased from $17,000
through Q2-2022 to $280,000 through Q2-2023 due to higher cash and investment balance and
higher interest rates.
Operating expenses were down $761,000 due to decreased in expense related to interfund utility
taxes. As discussed on pages 7-8, the City is no longer applying this tax to the pass-through King
County Metro revenue. This, combined with lower interfund charges, more than offset increases
in personnel costs and supplies, resulting in overall lower expenses compared to last year.
Through June 2023, the Stormwater Utility had operating income of$1.6 million compared with
$1.3 million in the same period last year. Operating revenues were up $737,000 compared to last
year due to charges for City storm service and interest earnings. Interest earnings increased from
$23,600 through Q2-2022 to $328,800,000 through Q2-2023. As most Stormwater service
charges are based on a flat rate, there are not typically significant fluctuations in this revenue.
Operating expenditures in the Stormwater Utility were up $482,000 in the first half of the year
compared to the same period last year. This increase is mainly due to higher personnel and
interfund allocation costs.
The Solid Waste Utility finished the second quarter with an operating loss of$569,000. While
operating revenues were up by $2.4 million compared to Q2-2023 due to stronger performance in
charges for solid waste service, operating expenses were up by $3.4 million. This increase was
due to increased interfund utility tax payments, payments to the City's solid waste vendor Waste
Management, and a payment of$530,000 of B&O tax to the Department of Revenue.
Page 54 of 68
Quarterly Financial Report Through June 2023 23
Internal Service Funds
Operating expenditures within the Insurance Fund represent the premium cost pool that will be
allocated monthly to other City funds over the course of the year. As a result, the expenditure
balance gradually diminishes each month throughout the year.
No significant variances are reported in the Workers' Compensation, Facilities, Innovation &
Technology, or Equipment Rental Funds.
Contact Information
This report is prepared by the Finance Department. Additional financial information can also be
viewed at our website: http://www.auburnwa.gov/. For any questions about this report please
contact Jamie Thomas at idthomas(c�auburnwa.gov.
Page 55 of 68
City of Au urn
2nd Quarter 2023
Financia Report
CITY COUNCIL STUDY SESSION
SEPTEMBER 11, 2023
Page 56 of 68
General Fund Revenue Overview
Summary
Variance to Variance
Budget to 2022
•Collected 13% more
2022 2023 2023 Favorable Favorable
revenue YTD Revenue YTD Actual YTD Budget YTD Actual (Unfavorable) % (Unfavorable)
compared to budget Property Tax $ 12,627,152 $ 12,551,800 $ 12,841,702 $ 289,902 $ 214,550
and 25% more than Sales Tax 11,184,579 9,933,500 11,289,585 1,356,085 105,006
Utility Tax 7,156,568 7,476,594 7,244,520 (232,074) 87,952
YTD last year B&O Tax 568,689 4,110,720 5,160,718 1,049,998 4,592,029
Other Tax 2,377,718 2,130,536 2,558,710 428,174 180,992
•Underspent the YTD Licenses and Permits 1,150,205 1,295,100 1,348,504 53,404 198,299
budgeted Intergovernmental 2,600,936 3,131,695 2,628,012 (503,683) 27,076
Charges for Services 4,263,180 4,578,744 5,077,632 498,888 814,452
expenditures by 11%
Other 1,340,986 1,041,693 1,905,685 863,992 564,699
and have spent 13% Transfers In 818,861 2,433,602 5,159,722 2,726,120 4,340,861
more compared to Total Revenue $ 44,088,874 $ 48,683,984 $ 55,214,790 $ 6,530,806 13% $ 11,125,916 25%
YTD last year Total Expenditures $ 38,448,944 $ 48,747,495 $ 43,503,681 $ 5,243,814 11% $ (5,054,737) -13%
Page 57 of 68
Tax Revenue
2023 budgeted taxes account for $68.8 million, or 75% of the General Fund budget
Property Tax (35% of taxes)
• $24 million 2023 budget
• Expected to collect 100% of the budget by year-end
Retail Sales and Use Tax (30% of taxes)
• $20.3 million 2023 budget
• $105,000 (1%) over prior YTD actual
• $1.4 million (14%) over YTD budget
Page 58 of 68
Tax Revenue
Construction: Completion of several large
Comparison of Retail Sales Tax Collections by Group projects in 2022 led to lower Jan. and Feb.
Through June 2023 figures, offset by an average monthly
2022 2023 Change from 2022 increase of 9.2% in March - June (January—
Component Group YTD Actual YTD Actual Amount Percentage April activity).
Construction $ 1,372,433 $ 1,426,126 $ 53,693 3.9 % Manufacturing: a DOR correction January
Manufacturing 484,023 278,890 (205,133) 42.4) % 2022 accounted for an inflated Q1 2022 and
Transportation & Warehousing 136,358 117,422 (18,937 (13.9)
Wholesale Trade 725,599 825,585 99,986 13.8 % 100% of the $205k decrease.
Automotive 2,281,327 2,399,616 118,289 5.2 %
Retail Trade 3,277,070 3,265,511 (11,559) (0.4) % Transportation & Warehousing: The $19k
Services 2,615,432 2,697,575 82,143 3.1 % decrease is entirely attributed to couriers
Miscellaneous 174,471 165,446 (9,025) (5.2) % and messengers.
YTD Total $ 11,066,712 $ 11,176,169 $ 109,457 1.0 % Services: telecommunications,
I car/equipment rentals and leasing,
restaurants, and fitness centers
Page 59 of 68
Tax Revenue
Utility Tax (21% of taxes) Utility Tax
=I2023Budget —0-2023 YTD Actual —2022Actual
$14.4 million 2023 budget $16.0
• Water, Sewer, Storm, Solid Waste Utility Tax rate 9%
($6.8 million of total budget)
• Electric, Natural Gas, Cable, and Telephone Utility Tax
rate 5% ($7.6 million of total budget)
$232,000 (3%) under budget
$7.2 M
• Higher than expected natural gas and cable tax
collected
$88,000 (1%) over prior year
• Lower than expected City Utility tax, offset by higher
natural gas collections •
$z.0 re
$0.0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Page 60 of 68
Tax Revenue
Business and Occupation Tax (B&O) (8% of total taxes)
• $5.5 million 2023 budget
• $5.2 million collected YTD
• $3.8m in gross receipts tax
• $1.4 million in square foot tax
• Includes Q4 2022, Q1 2023, and 2022 Annual Filings
• $1 million (26%) over YTD budget
Other Taxes (8% of total taxes)
• $4.4 million budgeted
• Criminal justice sales tax, admissions tax, gambling tax, leasehold excise tax, franchise fees
• $428,000 (20%) over 2023 YTD budget
• $181,000 (8%) over 2022 YTD collections
▪ Both variances are due to higher sales tax collections offset by the timing of the collection of cable franchise fees
Page 61 of 68
Licenses and Permits
Accounts for 3% of the total General Fund
Resources Building Permits
$1.6 - =02023Budget —0-2023 YT D Actual —2022 Actual
$2.5 million budgeted in 2023
$1.4 —
Most all of this ($2.0 million is related to
building permits) $1.2
$53,000 (4%) over budget six)
$198,000 (17%) over prior year 5 sag
Entirely attributed to a $205,000 YTD increase $0.6 —
in business license revenue and a $155,000 s0.4
decrease in YTD building permit
Total building permits issued YTD 2023 $0.2
exceeded 2022 by 23% but total value of $0.0
permit has decreased by 26% 1 2 3 4 5 6 7 8 9 10 11 12
Page 62 of 68
Intergovernmental
Revenues include: Federal/State/Interlocal Grants, Muckleshoot Indian Tribe
(MIT) Compact, State Shared Revenue
• State Shared Revenue:
Streamlined Sales Tax, Motor Vehicle Excise Tax (MVET), Marijuana/Liquor excise taxes, Criminal Justice Sales Tax
$504,000 (16%) under 2023 YTD budget
• Timing of contribution payment from the MIT compact, collection of grants, and
Streamlined Sales Tax Mitigation reductions
$27,000 (1%) over 2022 YTD collections
• Streamlined Sales Tax Mitigation reductions offset by a increases in other State
Shared revenue
Page 63 of 68
Charges for Services
General Government - $40,000 below budget (2%)
• Timing of SKHHP Payments — Reimbursement basis
Public Safety - $96,000 above budget (21%)
• Reimbursement for law enforcement services provided for private business
• Reimbursement for officers at the Auburn School District and Muckleshoot Contract
• Collected more DUI emergency response fees than budgeted
Development Services - $32,000 below budget (6%)
• Plan check fees, facility extension charges, zoning and subdivision fees
• Primary drivers for this is tied to the permitting activity
Culture and Recreation - $475,000 above budget (37%)
• Green fees and pro shop sales account for 40% of the total increase due to green fee increases
• Recreation Classes and Special Events account for the remaining 60% of the favorable performance over
budget
Page 64 of 68
General Fund Expenditures
byDepartment
2022 YTD 2023 YTD 2023 YTD Budget vs Actual
Department Actual Budget Actual $
Council, Mayor,Admin 1,276,235 1,364,200 1,365,505 (1,305) 0%
Diversity, Equity and Inclusion - 352,800 205,390 147,410 42%
Municipal Court 428,751 478,519 537,758 (59,239) -12%
Community Development 2,976,302 4,056,000 3,664,325 391,675 10%
Housing and Homelessness Outreach* 544,575 1,502,534 908,355 594,179 40%
Public Works 1,734,678 2,303,000 2,146,293 156,707 7%
Streets(M&O) 1,815,652 2,332,900 1,948,396 384,504 16%
Parks,Art, and Recreation 6,562,370 7,236,000 7,341,589 (105,589) -1%
Police 15,581,950 17,582,600 16,447,457 1,135,143 6%
SCORE 2,023,815 2,800,200 2,519,519 280,681 10%
Internal Services (HR, Finance, Legal, Nondepartment) 5,504,615 8,738,743 6,419,095 2,319,648 27%
(Total I $ 38,448,943 I $ 48,747,495 I $ 43,503,682 I $ 5,243,813 I 11%I
Page 65 of 68
ARPA Update
2023 Lifetime Spend
Title Budget Q2Spend (includes this quarter) Remaining
Completed Projects 1,450,000 - 1,668,601
Body Cameras 586,400 - 550,325 36,075
Vaccination Incentive Program 47,500 - 34,980 12,520
Neighborhood Street Light Program 500,000 38,598 41,497 458,503
Human Services Grants includes admin 1,000,000 131,312 186,773 813,227
Dykstra Foot Bridge 400,000 - 10,357 389,643
Minor Improvements to Qualifying Neighborhood Parks 100,000 - 28,626 71,374
Limited Term Employee(LTE):Grants Coordinator 420,000 - 118,729 301,271
Paving Gravel Roads 636,866 2,391 21,646 615,220
Translation Services 75,000 469 1,685 73,315
Auburn Way South Median Landscape Replanting/Irrigation 50,000 - 40,187 9,814
Auburn Way South Roundabout 150,000 478 507 149,493
Emergency Housing Voucher Program 2,000,000 63,842 97,330 1,902,670
Encampment Cleanup 500,000 265,499 341,907 158,093
Downtown sidewalk replacement on Main Street and B Street Plaza surface
replacement 1,643,266 5,530 17,655 1,625,611
Broadband grants to hardest hit communities 180,000 1,686 139,504 40,496
Community violence intervention programs(drone,SPI DR Tech) 313,600 2,184 210,015 103,585
Arts Culture Center Renovations 100,000 - - 100,000
Signing bonuses for lateral hires 200,000 11,051 87,759 112,241
Other Projects(not started) 4,180,000 - - 4,180,000
Total: 14,751,232 523,041 3,598,083 11,153,149
Page 66 of 68
Non -General Fund Highlights Ca ital
p
Real Estate Excise Tax (REET) Real Estate Excise Tax
YTD Collections: $1.7 million 2023Budget —0-2023YTDActuaf --2022Actual
$1.5 million less prior year
$6.0
$603,000 over YTD budget
$5.0 -
$4.0 -
0
i $3.0
slim
$2.0
• •$1.0
•
• _
$0.0
1 2 3 5 6 7 8 9 10 11 12
AA
Page 67 of 68
Questions
Page 68 of 68