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HomeMy WebLinkAboutQ2 2019 Financial Report AGENDA BILL APPROVAL FORM Agenda Subject: 2nd Quarter 2019 Financial Report Date: September 4, 2019 Department: Finance Attachments: Quarterly Financial Report Budget Impact: $0 Administrative Recommendation: For discussion only. Background Summary: The quarterly 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 the year to date through June 2019 status report based on financial data available as of July 20, 2019 for the period ending June 30, 2019 and sales tax information representing business activity that occurred through April 2019. Staff: Thomas Meeting Date: September 9, 2019 Item Number: Quarterly Financial Report Through Q2-2019 General Fund Summary $11.3 $10.1 $6.7 $2.9 $0.4 $1.3 $3.2 $0.8 $23.2 $10.0 $4.6 $0.3 $11.6 $10.2 $6.8 $2.9 $0.5 $1.4 $3.4 $1.2 $21.6 $8.8 $4.6 $0.1 PropertyTaxesSalesTaxesOtherTaxesIntergovernmental(Grants, etc.)DevelopmentService FeesCulture &RecreationOther Fees& ChargesOtherRevenuesPersonnelSupplies& ServicesOtherExpendituresTransfersOutRevenues Expenditures $0 $5 $10 $15 $20 $25 MillionsYTD Budget YTD Actuals (Favorable) YTD Actuals (Unfavorable) General Fund Revenues and Expenditures (Through Q2-2019) $36.8 $38.1$37.9 $35.1 Total Revenues Total Expenditures $0 $10 $20 $30 $40 $50 Millions$0.6 $1.3 $0.6 $0.5 $0.8 $1.8 $1.4 $2.6 $2.5 $14.5 $1.9 $6.2 $1.9 $1.6 $0.5 $1.1 $0.4 $0.4 $0.7 $1.7 $1.3 $2.0 $2.5 $13.9 $1.9 $6.0 $1.7 $0.9 Council& MayorAdministrativeServicesCommunity &Human ServicesMunicipal Court& ProbationHumanResourcesFinanceCity AttorneyCommunityDevelopmentJail - SCOREPolicePublicWorksParks, Arts& RecreationStreetsNon-Departmental$0 $5 $10 $15 $20 MillionsYTD Budget YTD Actuals (Favorable) YTD Actuals (Unfavorable) General Fund Expenditures by Department (Through Q2-2019) 1 Quarterly Financial Report Through Q2-2019 2 General Fund 2018 Summary of Sources and Uses Annual YTD YTD YTD Budget Budget Actual Actual Amount Operating Revenues Property Tax 6 21,550,000$ 11,291,700$ 11,574,405$ 11,179,408$ 282,705$ 2.5 % Retail Sales Tax 8-9 18,435,100 9,010,500 8,949,659 7,776,717 (60,841)(0.7)% Sales Tax - Pierce County Parks 105,500 50,700 53,506 49,563 2,806 5.5 % Sales Tax - Annexation Credit - - - 1,056,364 0 N/A % Criminal Justice Sales Tax 2,162,000 1,029,900 1,146,909 1,072,063 117,009 11.4 % Brokered Natural Gas Tax 137,900 81,400 119,494 91,424 38,094 46.8 % City Utilities Tax 10-11 4,035,600 1,956,400 1,965,586 1,849,170 9,186 0.5 % Admissions Tax 398,000 199,200 196,375 206,076 (2,825)(1.4)% Electric Tax 10-11 3,558,100 1,945,000 1,940,402 2,048,591 (4,598)(0.2)% Natural Gas Tax 10-11 1,008,000 686,300 628,650 699,014 (57,650)(8.4)% Cable Franchise Fee 11-12 950,500 479,100 467,805 486,701 (11,295)(2.4)% Cable Utility Tax 12 1,020,000 510,000 489,453 516,215 (20,547)(4.0)% Cable Franchise Fee - Capital 65,000 32,500 32,416 30,406 (84)(0.3)% Telephone Tax 10-11 1,177,900 619,900 478,737 690,962 (141,163)(22.8)% Garbage Tax (external)10-11 134,400 67,200 72,002 66,702 4,802 7.1 % Leasehold Excise Tax 50,000 25,000 183,394 177,145 158,394 633.6 % Gambling Excise Tax 415,500 114,000 201,633 151,190 87,633 76.9 % Taxes sub-total 55,203,500$ 28,098,800$ 28,500,426$ 28,147,711$ 401,626$ 1.4 % Business License Fees 13-14 210,000$ 125,800$ 109,947$ 197,357$ (15,853)(12.6)% Building Permits 14 1,070,000 624,100 462,087 517,784 (162,013)(26.0)% Other Licenses & Permits 3 557,900 282,100 518,477 289,482 236,377 83.8 % Intergovernmental (Grants, etc.)15 5,846,400 2,890,260 2,903,456 3,113,230 13,196 0.5 % Charges for Services:16-19 General Government Services 16 2,721,110 1,309,673 1,294,500 41,605 (15,174)(1.2)% Public Safety 17 981,000 447,725 587,628 489,924 139,903 31.2 % Development Services Fees 17-18 805,000 423,100 484,874 351,908 61,774 14.6 % Culture and Recreation 18-19 2,409,980 1,271,300 1,428,369 1,368,831 157,069 12.4 % Fines and Penalties 19-20 859,500 456,400 443,163 503,588 (13,237)(2.9)% Fees/Charges/Fines sub-total 15,460,890$ 7,830,458$ 8,232,501$ 6,873,708$ 402,042$ 5.1 % Interest and Investment Earnings 21 348,700$ 174,000$ 237,171$ 176,279$ 63,171 36.3 % Rents and Leases 21 849,300 441,800 506,788 525,096 64,988 14.7 % Contributions and Donations 21 25,000 9,300 18,676 16,196 9,376 100.8 % Other Miscellaneous 21 228,400 126,000 220,487 150,102 94,487 75.0 % Transfers In 119,406 85,906 85,906 77,500 0 0.0 % Insurance Recoveries - Capital & Operating 25,000 12,500 92,092 32,523 79,592 636.7 % Other Revenues sub-total 1,595,806$ 849,506$ 1,161,121$ 977,696$ 311,615$ 36.7 % Total Operating Revenues 72,260,196$ 36,778,764$ 37,894,047$ 35,999,115$ 1,115,283$ 3.0 % Operating Expenditures Council & Mayor 1,109,779$ 553,300$ 516,985$ 582,102$ 36,315$ 6.6 % Administration 2,694,148 1,347,000 1,089,465 767,568 257,535 19.1 % Human Resources 1,626,831 817,000 749,505 595,394 67,495 8.3 % Municipal Court & Probation 2,879,221 493,336 407,473 355,018 85,862 17.4 % Finance 3,533,140 1,816,700 1,710,519 735,988 106,181 5.8 % City Attorney 2,795,950 1,381,800 1,261,975 1,064,040 119,825 8.7 % Community Development 5,197,326 2,594,100 1,972,261 2,041,319 621,839 24.0 % Community & Human Services (Comm Devel)1,069,373 552,000 405,513 509,006 146,487 26.5 % Jail - SCORE 5,001,000 2,500,500 2,481,207 1,665,696 19,293 0.8 % Police 29,397,379 14,454,200 13,949,875 13,375,970 504,325 3.5 % Public Works 4,068,425 1,930,500 1,928,949 1,716,278 1,551 0.1 % Parks, Arts & Recreation 12,962,401 6,228,400 6,034,861 6,063,359 193,539 3.1 % Streets 4,041,472 1,861,900 1,687,778 1,746,251 174,122 9.4 % Non-Departmental 2,075,610 1,571,200 910,566 2,787,830 660,634 42.0 % Total Operating Expenditures 78,452,055$ 38,101,936$ 35,106,931$ 34,005,818$ 2,995,004$ 7.9 % 2019 2019 YTD Budget vs. Actual Favorable (Unfavorable) Percentage Page Ref 2 Quarterly Financial Report Through Q2-2019 3 Executive Summary This Executive Summary provides an overview of the City’s overall financial position for the fiscal period ending June 30, 2019, reflecting financial data available as of July 20, 2019. General Fund: Through June 2019, General Fund revenues totaled $37.9 million and were $1.1 million higher than budget expectations and $1.9 million higher than revenues collected through Q2-2018. Some notable variances to budget through June 2019 include: • Property tax collections through Q2-2019 totaled $11.6 million, which was $283,000 higher than budget expectations and exceeded 2018 year-to-date collections by $395,000. [page 7] • General Fund retail sales tax revenues totaled $8.9 million, which was $61,000 under budget expectations. W hile General Fund sales tax collections through Q2-2019 were $1.2 million higher than what was collected through Q2-2018, this is due to a policy change: between 2013 and 2018, all sales tax dollars collected from sales tax on construction benefitted the Local Street Fund and therefore were not distributed to the General Fund. Effective January 1, 2019, this policy changed and now all sales tax dollars stay in the General Fund to support ongoing operations. [pages 8-9] • The other taxes category performed favorably to budget in Q2-2019. Actual revenues collected through Q2-2019 were $6.8 million, which was $60,000, or 0.9% favorable to budget. Leasehold excise tax revenues collected through Q2-2019 exceeded budget by $158,000 due to an unbudgeted leasehold excise tax receipt for the Emerald Downs property. Gambling tax revenues collected during the same period exceeded budget by $88,000. These revenues were somewhat offset by unfavorable variances in telephone tax and natural gas tax revenues in the amount of $141,000 and $58,000, respectively. [pages 10-12] • Building permit revenue collected through Q2-2019 totaled $462,000, compared to a budget of $624,000. The number of building permits issued through Q2-2019 totaled 269, which represents a 2.7% increase over the number of permits issued through Q2- 2018, while the valuation of those permits declined by 18.4% during that same timeframe. [page 14] • Other licenses and permit revenues collected year-to-date exceed budget expectations by $236,000. A portion of that favorable variance to budget is due to large grading permits issued for the Auburn Elementary School and Dick Scobee Elementary School projects. In addition, excavation permit revenues collected year- to-date exceed budget expectations by $165,000. While we are halfway through the year, these revenues already exceed the year-end collections of any year on record. The increased revenue collected is primarily due to the increase in the fee structure, where the City is now close to achieving full cost recovery on construction permits. • Intergovernmental revenues collected through Q2-2019 totaled $2.9 million and ended the period with a net of $13,000 favorable to budget expectations. Revenues from Muckleshoot Casino for services rendered exceeded budget expectations by $126,000 while the revenues collected for streamlined sales tax revenues were 3 Quarterly Financial Report Through Q2-2019 4 $168,000 unfavorable to budget. This variance to budget seen in the streamlined sales tax revenues are primarily due to the Marketplace Fairness Act (MFA). While the Marketplace Fairness Act (MFA) was passed in 2017 in order to capture the retail sales tax lost from internet and remote sales, the bill phases out and eventually eliminates the streamlined sales tax mitigation payments to local governments. It was anticipated that 2019 would be the last year that the City of Auburn would receive the streamlined sales tax monies, but when the 2019 legislative session adjourned (in May 2019), they voted to continue funding of the mitigation payments through June 2021. The annual revenue historically collected on this revenue stream was approximately $2.0 million. While the sales tax revenues collected under MFA are receipted in as sales tax revenue, it is deducted from the amount of revenue the City receives for streamlined sales tax revenues. The amount that the City received through Q2-2019 due to the Marketplace Fairness Act was $292,000. [page 15] • Culture and recreation revenues collected through Q2-2019 totaled $1.4 million compared to a budget of $1.3 million, exceeding budget expectations by $157,000. The primary areas of increased revenues collected compared to last year were green fees generated at the Auburn Golf Course and ticket sales for performances at the Auburn Avenue Theater. [pages 18-19] General Fund expenditures through the first half of 2019 totaled $35.1 million compared to a budget of $38.1 million, representing a 7.9% favorable variance to budget. All departments operated within their allocated year-to-date budget through Q2-2019. Year-to-date General Fund expenditures ended the period $1.1 million, or 3.2% higher than expenditures through Q2-2018. This year-over-year increase was primarily due to increased expenditures for salaries and benefits. Through Q2-2019, salary and benefit costs increased by $1.8 million, or 8.9%, compared to salary and benefit expenditures through Q2-2018. This increase largely reflects increased costs associated with the Police Bargaining Agreements that were approved earlier this year, with the retroactive salary and benefit payments having been posted in April 2019. In addition, this year-over-year increase includes the impacts of the cost of living adjustments (COLAs), an increase in Council-approved FTEs (Full Time Equivalents), and increased costs associated with healthcare benefits. In addition, the year-over-year salary and benefit costs reported in the General Fund in 2019 are higher than salary and benefit costs in 2018 due not only to the wage adjustments noted above but also to a change in the way salary and benefit costs are allocated. Prior to 2019, salary and benefit costs for support departments (Finance, Human Resources and the Legal Department) were directly charged to other General Fund departments as well as to other City funds. Effective January 1, 2019, all salaries and benefit costs for the support departments mentioned above are now charged 100% to the General Fund. In order to recoup the cost of services, the General Fund now charges other funds for these services via an interfund charge, with an associated revenue in the General Fund (for reference, refer to the general government services line item in the tables on pages 2 and 16 of this report). While this change results in higher salary and benefit costs within the General Fund, the change is actually cost neutral to the bottom line. 4 Quarterly Financial Report Through Q2-2019 5 Street Funds: The City’s three street funds are special revenue funds wherein the revenue sources and expenditures are legally restricted. These funds are used for street capital construction projects, local street repair, and arterial street repair and preservation projects. Historically, the majority of expenditures in all three street funds occur during the second half of the year when weather conditions are optimal for pavement construction. Through Q2-2019, Arterial Street Fund revenues totaled $1.1 million as compared to collections of $1.3 million through Q2-2018, while expenditures totaled $1.2 million as compared to expenditures of $2.1 million through Q2-2018. These variances are due to the level of activity on projects in the fund and timing of grant reimbursements and other funding. [pages 25–26] Local Street Fund revenues of $1.1 million are in line with budget expectations, and compare to collections of $1.3 million through Q2-2018. This variance is due to a change in funding sources – last year, the Local Street Fund received revenue from sales tax on construction. Starting in 2019, the fund instead receives a set revenue amount from real estate excise tax (REET 2). Expenditures through the second quarter were $244,000 as compared with $563,000 through Q2-2018. [pages 27–28] Lastly, Arterial Street Preservation Fund revenues totaled $1.4 million through Q2-2019, compared to collections of $1.2 million through Q2-2018. Expenditures totaled $657,000 versus $266,000 through Q2-2018. These variances are due to the level of activity on projects in the fund and timing of grant reimbursements and other funding. [pages 29–30] YTD Budget $ 36.8M YTD Budget $ 38.1M YTD Actuals $ 37.9M YTD Actuals $ 35.1M $0 $5 $10 $15 $20 $25 $30 $35 $40 $45 $50 Revenues Expenditures $ Millions General Fund Revenues vs. Expenditures Through Q2-2019 5 Quarterly Financial Report Through Q2-2019 6 Enterprise Funds: The City’s enterprise funds account for operations with revenues primarily provided from user fees, charges or contracts for services. All City utilities transitioned from bimonthly to monthly usage billing starting in January 2019. The Water Fund ended the second quarter with operating income of $2.4 million, compared to $2.1 million during the same period last year. [page 32] The Sewer Fund finished Q2-2019 with operating income of $1.5 million versus $1.0 through Q2-2018. [page 33] The Stormwater Fund also ended the second quarter with operating income of $1.5 million compared to $1.3 million through Q2-2018. [page 33] The Solid Waste Fund finished Q2-2019 with operating income of $284,000 compared to $376,000 through Q2-2018, a variance caused by increased payments to the City’s primary solid waste contractor. [pages 33-34] The Airport Fund finished Q2-2019 with operating income of $239,000 compared to $146,000 through Q2-2018, a variance largely attributable to the purchase and sale of aviation fuel. [page 35] The Cemetery Fund had operating income of $115,000, representing an increase of $4,000 over the same period last year. [page 35] Internal Service Funds: 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 the second quarter. [page 35] 6 Quarterly Financial Report Through Q2-2019 7 General Fund Revenues The combined total of property, sales/use, utility, gambling, and admissions taxes provides 75% to 80% of all resources supporting general governmental activities. The following section provides additional information on these sources. Property Tax collections through Q2-2019 totaled $11.6 million and was $283,000, or 2.5% favorable to budget expectations. As depicted in the graphic below, the majority of property taxes are collected during the months of April and October, coinciding with the due dates for the County property tax billings. $0.0 $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 $14.0 $16.0 $18.0 $20.0 $22.0 $24.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecMillionsProperty Taxes 2019 Budget 2019 YTD Actual 2018 Actual $15.8 $17.2 $17.9 $20.8 $21.4 $11.6 $0.0 $5.0 $10.0 $15.0 $20.0 $25.0 2014 2015 2016 2017 2018 2019 YTDMillionsProperty Tax Revenue Actuals 7 Quarterly Financial Report Through Q2-2019 8 Retail sales tax collections through Q2-2019 totaled $8.9 million, which was $61,000 under budget expectations. While it was anticipated that sales tax growth in 2019 would wane compared to the growth seen in 2018, it has been lower than expected where 2019 year-to-date growth was 0.9% compared to 5.0% revenue growth through Q2-2018. While sales tax revenues collected in the General Fund in Q2-2019 were $1.2 million more than collections through Q2-2018, this is primarily due to a policy change that became effective on January 1, 2019. Between 2013 and 2018, all sales tax dollars collected from sales tax on construction benefitted the Local Street Fund and were therefore not distributed to the General Fund; effective January 1, 2019, this policy changed whereby all sales tax dollars stay in the General Fund to support ongoing operations. In June 2019, the City issued a rebate in the amount of $47,000 in accordance with the Sales Tax Exemption Program, which is a permanent program that incentivizes construction of new or expanded businesses in specific zoned areas of the City. This rebate is reflective of the differences in retail sales taxes reported on page 2 and page 9 of this report. Due to the Marketplace Fairness Act (MFA) which became effective on January 1, 2018, retail sales taxes collected through Q2-2019 included $292,000 from retail sales taxes collected on internet and remote sales. This is collected as retail sales tax revenue and is deducted from the amount the City receives for streamlined sales tax revenue (see page 15 for more information). Other sales tax revenues include Pierce County Parks sales tax revenue and the Criminal Justice sales tax revenue, both ended the period favorable to budget by $3,000 and $117,000 respectively. Total sales tax revenues – including retail and other sales taxes – were $10.2 million through Q2-2019, or slightly above the year-to-date budget of $10.1 million. $0.0 $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 $14.0 $16.0 $18.0 $20.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecMillionsRetail Sales & Use Tax 2019 Budget 2019 YTD Actual 2018 Actual 8 Quarterly Financial Report Through Q2-2019 9 The following table breaks out the City’s retail sales taxes by major business sector. Citywide retail sales tax revenue collected through Q2-2019 was $81,000, or 0.9%, more than collected through Q2-2018. The business sector that realized the greatest revenue increase compared to the same period last year was in the retail trade category, while the construction category declined 16.5%, or $188,000, compared to collections through Q2-2018. $13.8 $14.5 $14.6 $14.9 $15.9 $8.9 $0.0 $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 $14.0 $16.0 $18.0 $20.0 2014 2015 2016 2017 2018 2019 YTDMillionsRetail Sales & Use Tax Actuals 2018 2019 Component Group Actual Actual Amount Construction 1,139,316$ 950,985$ (188,331)$ (16.5)% Manufacturing 340,007 394,967 54,961 16.2 % Transportation & Warehousing 52,991 44,147 (8,844)(16.7)% Wholesale Trade 744,827 711,499 (33,328)(4.5)% Automotive 2,020,503 1,964,979 (55,523)(2.7)% Retail Trade 2,501,011 2,673,680 172,669 6.9 % Services 2,042,381 2,127,235 84,854 4.2 % Miscellaneous 74,998 129,498 54,500 72.7 % YTD Total 8,916,034$ 8,996,990$ 80,957$ 0.9 % Comparison of Retail Sales Tax Collections by Group Through June Change from 2018 Percentage 9 Quarterly Financial Report Through Q2-2019 10 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). Utility taxes collected through Q2-2019 totaled $5.1 million and were $189,000, or 3.6%, below budget expectations. The majority of this unfavorable variance to budget through Q2-2019 was seen in telephone tax collections. This is due, in part, to the timing of payments received from telephone businesses as well as the steady decline in telephone utility tax revenue since 2010. $0.0 $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecMillionsUtility Tax 2019 Budget 2019 YTD Actual 2018 Actual 2018 2019 2019 Utility Tax Type YTD Actual YTD Budget YTD Actual Amount Amount City Interfund Utility Taxes 1,849,170$ 1,956,400$ 1,965,586$ $ 116,417 6.3 % $ 9,186 0.5 % Electric 2,048,591 1,945,000 1,940,402 (108,189) (5.3)%(4,598) (0.2)% Natural Gas 699,014 686,300 628,650 (70,363) (10.1)%(57,650) (8.4)% Telephone 690,962 619,900 478,737 (212,225) (30.7)%(141,163) (22.8)% Solid Waste (external)66,702 67,200 72,002 5,300 7.9 %4,802 7.1 % YTD Total 5,354,438$ 5,274,800$ 5,085,377$ $ (269,061)(5.0)% $ (189,423)(3.6)% Through June 2019 Utility Tax by Type 2019 vs. 2018 Actual 2019 vs. Budget Percentage Percentage 10 Quarterly Financial Report Through Q2-2019 11 Cable Franchise Fees, which are collected quarterly, totaled $468,000 through Q2-2019 and were $11,000, or 2.4%, lower than budget expectations. $10.0 $9.7 $10.0 $10.2 $9.9 $5.1 $0.0 $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 2014 2015 2016 2017 2018 2019 YTDMillionsUtility Tax Revenues Actuals $0 $100 $200 $300 $400 $500 $600 $700 $800 $900 $1,000 1st Quarter 2nd Quarter 3rd Quarter 4th QuarterThousandsCable Franchise Fee 2019 Budget 2019 YTD Actual 2018 Actual 11 Quarterly Financial Report Through Q2-2019 12 Cable Utility Tax. This tax became effective on January 1, 2017 and is also collected quarterly. Total cable utility tax revenue collected through Q2-2019 totaled $489,000 and was unfavorable to budget expectations by $21,000, or 4.0%. $0.9 $0.9 $1.0 $1.0 $1.0 $0.5 $0.0 $0.2 $0.4 $0.6 $0.8 $1.0 $1.2 $1.4 2014 2015 2016 2017 2018 2019 YTDMillionsCable Franchise Fee Actuals $0 $100 $200 $300 $400 $500 $600 $700 $800 $900 $1,000 $1,100 1st Quarter 2nd Quarter 3rd Quarter 4th QuarterThousandsCable Utility Tax 2019 Budget 2019 YTD Actual 2018 Actual 12 Quarterly Financial Report Through Q2-2019 13 Licenses and Permits include business licenses, building permits, plumbing, electric and other licenses and permit fees. Building permit fees and business licenses make up about 70% of the annual budgeted revenue in this category. Business license revenues collected through June 2019 totaled $110,000 as compared to a budget of $126,000. This shortfall relates to the timing of when business license renewal notices are paid: a majority of businesses paid their 2019 business licenses in late 2018. $0 $50 $100 $150 $200 $250 $300 $350 $400 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecThousandsBusiness Licenses 2019 Budget 2019 YTD Actual 2018 Actual $171 $282 $225 $163 $353 $110 $0 $50 $100 $150 $200 $250 $300 $350 $400 2014 2015 2016 2017 2018 2019 YTDThousandsBusiness License Revenues Actuals 13 Quarterly Financial Report Through Q2-2019 14 Building permit revenue collected through Q2-2019 totaled $462,000 compared to a budget of $624,000. Revenues collected through Q2-2019 were 10.8% below collections through Q2- 2018, while the valuation of permits during these same periods declined by 18.4% (after adjusting for the Auburn Apartments project, for which permits were paid in 2018). The number of building permits issued through Q2-2019 totaled 269, which represents a 2.7% increase over the number of permits issued through Q2-2018. Although the number of permits has increased, the average value of projects through Q2-2019 has declined compared to the same period last year. Major projects contributing to building permit revenues this quarter includes the Auburn Heights Elementary School and the Dick Scobee Elementary School as well as projects at Boeing and Skills, Inc. In addition, permits were issued for single-family housing developments, most notably Trussler Estates. $0.0 $0.2 $0.4 $0.6 $0.8 $1.0 $1.2 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecMillionsBuilding Permits 2019 Budget 2019 YTD Actual 2018 Actual $1.5 $1.2 $2.0 $1.2 $0.9 $0.5 $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 2014 2015 2016 2017 2018 2019 YTDMillionsBuilding Permits Actuals 14 Quarterly Financial Report Through Q2-2019 15 Intergovernmental revenues include grants (direct and indirect federal, state and local), revenue from the Muckleshoot Indian Tribe (MIT) compact, intergovernmental service revenues, and state shared revenues. Collections through the first half of 2019 totaled $2.9 million and were a net of $13,000 above budget expectations. The majority of the variance to budget was seen in the streamlined sales tax revenue distribution, which was reduced by $292,000 through Q2-2019 due to the Marketplace Fairness Act (MFA), which was implemented in January 2018 to capture the retail sales tax lost on internet and remote sales. MFA revenues are collected as retail sales tax revenues, which then reduces the amount the City receives in streamlined sales taxes (see also page 8). 2018 2019 2019 Revenue YTD Actual YTD Budget YTD Actual Amount Amount Federal Grants 110,084$ 154,150$ 99,372$ $ (10,712)N/A % $ (54,778)N/A % State Grants 89,821 63,000 94,063 4,242 4.7 %31,063 49.3 % Interlocal Grants 28,817 0 0 (28,817) 0.0 %0 N/A % Muckleshoot Casino Services 496,975 462,800 588,830 91,856 18.5 %126,030 27.2 % State Shared Revenues: Streamlined Sales Tax 895,247 842,500 674,010 (221,237) (24.7)%(168,490) (20.0)% Motor Vehicle Fuel Tax 577,019 541,400 551,415 (25,604) (4.4)%10,015 1.8 % Criminal Justice - High Crime 104,972 100,000 114,594 9,622 9.2 %14,594 14.6 % Criminal Justice - Population 11,190 11,000 11,759 568 5.1 %759 6.9 % Criminal Justice - Special Prog.40,540 40,200 42,416 1,877 4.6 %2,216 5.5 % Marijuana Revenues 145,971 54,000 91,231 (54,741) (37.5)%37,231 68.9 % State DUI 5,837 5,800 5,863 26 0.4 %63 1.1 % Fire Insurance Tax 79,798 78,900 80,386 588 N/A %1,486 N/A % Liquor Excise 199,801 207,060 220,899 21,098 10.6 %13,839 6.7 % Liquor Profit 327,159 329,450 328,618 1,459 0.4 %(832) (0.3)% Total State Shared:2,387,534 2,210,310 2,121,190 (266,344)(11.2)%(89,120) (4.0)% YTD Total 3,113,230$ 2,890,260$ 2,903,456$ (209,774)$ (6.7)%13,196$ 0.5 % Through June 2019 Intergovernmental Revenues (Grants, Entitlements & Services) 2019 vs. 2018 Actual 2019 vs. Budget % Change % Change $5.1 $5.3 $5.7 $6.1 $6.3 $2.9 $0 $1 $2 $3 $4 $5 $6 $7 $8 2014 2015 2016 2017 2018 2019 YTDMillionsIntergovernmental Revenues (Grants, Entitlements & Services) Actuals 15 Quarterly Financial Report Through Q2-2019 16 Charges for Services consist of general governmental service charges, public safety charges, development service fees, and culture & recreation fees. Overall, charges for services collected through Q2-2019 totaled $3.8 million, which was $344,000 favorable to budget. The primary areas of increases were in both culture and recreation revenues and public safety revenues as explained on pages 17 and 18. A process change was implemented in 2019 that significantly affects the comparison of year- over-year variances. Prior to 2019, salary and benefit expenditures for support departments (Finance, Human Resources and the Legal Department) were allocated between the General Fund and other City funds. Effective January 1, 2019, all salary and benefit costs for support departments are now fully charged to their respective General Fund department. The General Fund now charges these other funds for these services via an interfund assessment, with a corresponding General Fund revenue shown under “General Government” in the table above (hence the dramatic change from 2018 to 2019 shown in the table above). This policy change results in salary and benefit expenditures within the General Fund that appear higher than were previously reported, but the change has a cost-neutral impact on the General Fund due to the revenue offset. Total revenues recouped through Q2-2019 as general governmental revenues in the General Fund for the salary and benefit interfund charges totaled $1.3 million. 2018 2019 2019 Revenue YTD Actual YTD Budget YTD Actual Amount Amount General Government 41,605$ 1,309,673$ 1,294,500$ $ 1,252,895 3,011.4 % $ (15,174)(1.2)% Public Safety 489,924 447,725 587,628 97,703 19.9 %139,903 31.2 % Development Services 351,908 423,100 484,874 132,967 37.8 %61,774 14.6 % Culture & Recreation 1,368,831 1,271,300 1,428,369 59,537 4.3 %157,069 12.4 % YTD Total 2,252,268$ 3,451,798$ 3,795,370$ 1,543,102$ 68.5 % $ 343,572 10.0 % Through June 2019 Charges for Services by Type 2019 vs. 2018 Actual 2019 vs. Budget Percentage Percentage $3.9 $4.3 $4.1 $4.2 $4.7 $3.8 $0.0 $1.0 $2.0 $3.0 $4.0 $5.0 $6.0 2014 2015 2016 2017 2018 2019 YTDMillionsCharges for Services Actuals 16 Quarterly Financial Report Through Q2-2019 17 Public safety revenues consist of revenues received for police officer extra duty security services, whereby officers are contracted for and reimbursement is made by the hiring agency. This 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 and the Criminal Justice Training Commission (CJTC) for services rendered. Public safety revenues collected through June 2019 totaled $588,000 as compared to a budget of $448,000. The majority of the favorability seen in this revenue source is due to extra duty overtime reimbursements exceeding budget expectations resulting from increased requests for police officer security services. Development services fee collections consist primarily of plan check fees, facility extension charges, and zoning and subdivision fees. Through Q2-2019, development service fees totaled $485,000 and ended the quarter $62,000 favorable to budget expectations. Total plan check revenues collected through Q2-2019 totaled $242,000 compared to $204,000 collected through Q2-2018 which is an 18.5% increase in revenues. Plan check revenues collected in the second quarter of 2019 were from numerous commercial and residential projects including projects at Boeing, Starbucks Distribution Warehouse, and Valley Cities Phoenix Rising. In addition to increased plan check revenues collected through Q2-2019, both facility extension fees and zoning fees were higher than anticipated. $0.0 $0.2 $0.4 $0.6 $0.8 $1.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecMillionsDevelopment Service Fees 2019 Budget 2019 YTD Actual 2018 Actual 17 Quarterly Financial Report Through Q2-2019 18 The majority of 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, special events, and athletic league fees. Culture and recreation revenues collected through Q2- 2019 totaled $1.4 million, exceeding collections in the same period last year by $60,000 and exceeding Q2-2019 budget by $157,000. The majority of the year-over-year increase in revenues was in green fee revenues at the Auburn Golf Course and increased ticket sales at the Auburn Avenue Theater. Through Q2-2019, green fee revenues at the Auburn Golf Course increased 5.6%, or $29,000 and ticket sales at the Auburn Avenue Theater increased 31.1%, or $26,000, compared to the same period last year. $1.1 $1.4 $1.0 $0.9 $0.9 $0.5 $0.0 $0.2 $0.4 $0.6 $0.8 $1.0 $1.2 $1.4 $1.6 2014 2015 2016 2017 2018 YTD 2019MillionsDevelopment Service Fees Actuals $0.0 $0.2 $0.4 $0.6 $0.8 $1.0 $1.2 $1.4 $1.6 $1.8 $2.0 $2.2 $2.4 $2.6 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecMillionsCulture & Recreation 2019 Budget 2019 YTD Actual 2018 Actual 18 Quarterly Financial Report Through Q2-2019 19 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. Total revenues collected through the first half of 2019 totaled $443,000 and compare to a budget of $456,000. As seen in the table below, civil penalty revenues collected through Q2-2019 were $14,000 higher than collections through Q2-2018. This year-over-year increase relates to revenues collected for code compliance penalties, which are largely unbudgeted. Code compliance penalties are revenues collected from banks on vacant bank-owned properties that are neglected and in non-compliance with City code. $2.2 $2.3 $2.3 $2.4 $2.6 $1.4 $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 2014 2015 2016 2017 2018 2019 YTDMillionsCulture & Recreation Revenues Actuals 2018 2019 2019 Month YTD Actual YTD Budget YTD Actual Amount Amount Civil Penalties 49,378$ 6,500$ 63,356$ $ 13,978 28.3 % $ 56,856 874.7 % Civil Infraction Penalties 262,485 259,200 219,147 (43,338) (16.5)%(40,053) (15.5)% Redflex Photo Enforcement 4,616 0 1,749 (2,867) (62.1)%1,749 N/A % Parking Infractions 68,184 76,800 66,550 (1,634) (2.4)%(10,250) (13.3)% Criminal Traffic Misdemeanor 28,616 25,800 15,508 (13,108) (45.8)%(10,292) (39.9)% Criminal Non-Traffic Fines 26,032 21,400 34,721 8,689 33.4 %13,321 62.2 % Criminal Costs 23,337 26,500 10,174 (13,163) (56.4)%(16,326) (61.6)% Non-Court Fines & Penalties 40,938 40,200 31,956 (8,983) (21.9)%(8,244) (20.5)% YTD Total 503,588$ 456,400$ 443,163$ $ (60,424)(12.0)% $ (13,237)(2.9)% Through June 2019 Fines & Penalties by Type 2019 vs. 2018 Actual 2019 vs. Budget Percentage Percentage 19 Quarterly Financial Report Through Q2-2019 20 $0.0 $0.1 $0.2 $0.3 $0.4 $0.5 $0.6 $0.7 $0.8 $0.9 $1.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecMillionsFines & Penalties 2019 Budget 2019 YTD Actual 2018 Actual $1.2 $0.9 $0.9 $0.9 $0.9 $0.4 $0.0 $0.2 $0.4 $0.6 $0.8 $1.0 $1.2 $1.4 $1.6 2014 2015 2016 2017 2018 2019 YTDMillionsFines & Penalties Actuals 20 Quarterly Financial Report Through Q2-2019 21 Miscellaneous revenues consist of investment earnings, income from facility rentals, revenue collected on golf cart rentals at the Auburn Golf Course, contributions & donations, and other income including the quarterly purchasing card (P-card) rebate monies (see page 36 for more information on P-cards). Revenues collected in this category through Q2-2019 totaled $983,000 and exceeded budget expectations by $232,000, or 30.9%. The majority of this increase was in the other miscellaneous revenue category and was due to one-time unbudgeted monies. Interest and investments revenue collected through Q2-2019 totaled $237,000 and exceeded budget expectations by $63,000. Interest and investments earnings collected through Q2-2019 were $61,000 higher that collections in the same period last year. The primary reason for the year-over-year increase in revenues is due to an increase in the State Investment Pool interest rate. Rents and lease revenue collected through Q2-2019 totaled $507,000 and was $65,000 favorable to budget. This favorability to budget was mainly due to facility rentals – unbudgeted miscellaneous parks unearned revenue (deposits) totaling $61,000 through Q2-2019. In addition, revenues collected for the Farmer’s Market vendors through Q2-2019 were $16,000 higher than what was collected through Q2-2018 due to vendors pre-paying their fees in advance in order to receive a discount as well as an increased number of vendors participating this year due to the new location at Les Gove Park. 2018 2019 2019 Month YTD Actual YTD Budget YTD Actual Amount Amount Interest & Investments 176,279$ 174,000$ 237,171$ 60,892$ 34.5 %63,171$ 36.3 % Rents & Leases 525,096 441,800 506,788 (18,308)(3.5)%64,988 14.7 % Contributions & Donations 16,196 9,300 18,676 2,480 15.3 %9,376 100.8 % Other Miscellaneous Revenue 150,102 126,000 220,487 70,385 46.9 %94,487 75.0 % YTD Total 867,673$ 751,100$ 983,122$ 115,449$ 13.3 %232,022$ 30.9 % Miscellaneous Revenues by Type Through June 2019 2019 vs. 2018 2019 vs. Budget Percentage Percentage $1.0 $1.0 $1.2 $1.5 $1.8 $1.0 $0.0 $0.2 $0.4 $0.6 $0.8 $1.0 $1.2 $1.4 $1.6 $1.8 $2.0 2014 2015 2016 2017 2018 2019 YTDMillionsMiscellaneous Revenues Actuals 21 Quarterly Financial Report Through Q2-2019 22 Real Estate Excise Tax (REET) revenue is receipted into the Capital Improvement Projects Fund and is used for governmental capital projects. REET revenue represents taxes on the sale of both commercial properties and single-family residences. REET revenues collected in the first half of 2019 totaled $2.0 million, exceeding budget expectations by $725,000. Commercial sales in Q2-2019 included the sale of several commercial warehouses/industrial businesses, several multi-family complexes, a strip mall, an auto dealership, a medical/dental building and vacant land. 2018 2019 2019 Month Actual Budget Actual Amount Amount Jan 240,414$ 210,100$ 383,547$ 143,132$ 59.5 %173,447$ 82.6 % Feb 200,783 210,100 206,022 5,239 2.6 %(4,078) (1.9)% Mar 255,218 210,100 229,181 (26,037) (10.2)%19,081 9.1 % Apr 362,999 210,100 315,855 (47,144) (13.0)%105,755 50.3 % May 427,054 210,100 372,394 (54,661) (12.8)%162,294 77.2 % Jun 371,816 210,100 478,537 106,720 28.7 %268,437 127.8 % YTD Total 1,858,286$ 1,260,600$ 1,985,536$ 127,250$ 6.8 %724,936$ 57.5 % Real Estate Excise Tax Revenues June 2019 Percentage 2019 vs. 2018 2019 vs. Budget Percentage $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $4.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecMillionsReal Estate Excise Tax 2019 Budget 2019 YTD Actual 2018 Actual 22 Quarterly Financial Report Through Q2-2019 23 $2.5 $4.6 $4.3 $3.6 $3.8 $2.0 $0.0 $1.0 $2.0 $3.0 $4.0 $5.0 $6.0 2014 2015 2016 2017 2018 2019 YTDMillionsReal Estate Excise Tax Revenues Actuals 23 Quarterly Financial Report Through Q2-2019 24 Pet Licensing Pet licensing services are provided by the Auburn Valley Humane Society. Through Q2-2019, 2,277 pet licenses were sold, resulting in $60,735 in revenue. Through Q2-2018 a total of 2,112 licenses were sold, resulting in $55,525 in revenue. EXTEND EXTEND 0 1,000 2,000 3,000 4,000 5,000 6,000 $0 $20 $40 $60 $80 $100 $120 $140 JanFebMarAprMayJunJulAugSepOctNovDecNumber of Licenses IssuedLicense Revenue( thousands )Cumulative Pet Licensing Revenues & Licenses Sold 2019 vs 2018 2019 License Revenue 2019 Licenses Issued 2018 Licenses Issued 0 500 1,000 1,500 2,000 2,500 $0 $5 $10 $15 $20 $25 JanFebMarAprMayJunJulAugSepOctNovDecNumber of Licenses IssuedLicense Revenue( thousands )Pet Licensing Revenues vs Licenses Sold 2019 vs 2018 2018 License Revenue 2019 License Revenue 2018 Licenses Issued 2019 Licenses Issued 24 Quarterly Financial Report Through Q2-2019 25 Street Funds This section provides a financial overview of the City’s three street funds for the quarter ending June 30, 2019. The City’s three street funds include the Arterial Street Fund (Fund 102), the Local Street Fund (Fund 103), and the Arterial Street Preservation Fund (Fund 105). Fund 102 – Arterial Street Fund The Arterial Street Fund is a special revenue fund that is funded by transportation grants, traffic impact fees, a portion of the City’s gas tax receipts, Public Works Trust Fund loans, developer contributions, and other sources. As of June 30, 2019 there were 29 separate street projects budgeted in this fund. Through Q2-2019, revenues collected totaled $1.1 million as compared to collections of $1.3 million through Q2-2018. Total expenditures through Q2-2019 were $1.2 million as compared to $2.1 million expended through Q2-2018. Variances in revenues and expenditures are largely due to the timing of capital expenditures and any subsequent reimbursement via grants and/or operating transfers. Expenditure timing is generally determined by the current phase of each individual capital project; expenditures tend to increase as projects move from design phase into construction. In addition, several inclement weather situations during Q1-2019 were not conducive to street construction. Fund 102 - Arterial Street 2018 Summary of Sources and Uses 2019 2019 YTD 2019 YTD 2018 YTD Report Period: June 2019 Budget Budget Actual Actual Amount Revenues Federal Grants 1,001,381$ 297,173$ 382,510$ 323,675$ 85,338$ 28.7 % State Grants - - - - - Motor Vehicle Fuel and Multimodal Taxes 620,000 290,054 292,256 303,360 2,202 0.8 % Developer Contributions - - - - - Miscellaneous Revenue - - - 1,313 - Operating Transfer In 1,367,060 598,272 417,552 613,996 (180,720) (30.2)% Investment Income 28,300 12,231 22,526 14,465 10,295 84.2 % Total Revenues 3,016,741$ 1,197,730$ 1,114,845$ 1,256,809$ (82,885)$ (6.9)% Expenditures Salary and Benefits 132,000$ 69,639$ 133,674$ 196,445$ (64,035)$ (92.0)% Capital Outlay 2,964,858 1,048,075 760,234 1,431,033 287,841 27.5 % Subtotal - Capital Project Expenditures 3,096,858 1,117,714 893,908 1,627,477 223,806 20.0 % Services and Charges 400,000 115,798 44,422 170,642 71,376 61.6 % Interfund Payments for Services 78,100 39,050 39,050 39,432 (0) (0.0)% Debt Service Principal and Interest 208,300 208,300 208,122 208,817 178 0.1 % Operating Transfer Out 68,196 22,732 53,933 15,490 (31,201) (137.3) Total Expenditures 3,851,454$ 1,503,594$ 1,239,435$ 2,061,858$ 264,159$ 17.6 % Net Change in Fund Balance (834,713)$ (305,864)$ (124,590)$ (805,049)$ 181,274$ (59.3)% Beg. Fund Balance, January 2019 2,104,190$ Net Change in Fund Balance, June 2019 (124,590) Ending Fund Balance, June 2019 1,979,600$ 2019 Budgeted Ending Fund Balance 1,269,477$ 2019 2019 YTD Budget vs. Actual Favorable (Unfavorable) Percentage 25 Quarterly Financial Report Through Q2-2019 26 The table below presents the status of the projects with the most significant budget impact on the fund. Many capital projects are budgeted over multiple years; what is displayed below is the 2019 portion of each project’s budget and year-to-date expenditures. Notes: • The numbers above do not include the effects of Budget Adjustment #3, which will be included in the Q3- 2019 financial report. This added a recent grant and matching funds for the Auburn Way South Corridor Widening Project in the amount of $1.5M for the design phase. • Several large multi-year projects are reaching completion of construction in 2019 and several large projects are beginning design, with construction anticipated in 2020. $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $4.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecMillionsFund 102 -Capital Project Expenditures 2019 YTD Budget 2019 YTD Actual 2018 YTD Actual 2019 YTD Actual: $0.9M 2019 Budget: $3.1M 2018 YTD Actual: $1.6M Name 2019 Budget YTD Actual Remaining A St SE Corridor Signal Safety & Op. Imp.$0.4M $0.4M $0.0M Evergreen Heights Safe Routes to School $0.3M $0.0M $0.3M A St SE & 37th St SE $0.2M $0.1M $0.1M All Other Projects (26 Others Budgeted)$2.2M $0.5M $1.7M Total $3.1M $0.9M $2.2M *Components may not sum to total due to rounding. Fund 102 - Arterial Street Capital Projects Status * 26 Quarterly Financial Report Through Q2-2019 27 Fund 103 – Local Street Fund The Local Street Fund is a special revenue fund used for local street preservation. Effective January 1, 2019 through 2020 this fund is funded at a specific annual amount by real estate excise tax (REET 2) whereas, previously, the funding source was sales tax on construction. Through Q2-2019, revenues in this fund totaled $1.1 million, which is slightly higher than budget expectations due to strong performance in interest earnings. This compares to collections of $1.3 million through Q2-2018. Expenditures through Q2-2019 were $244,000 and compare to expenditures of $563,000 through Q2-2018. Historically, well over half of this fund’s annual expenditures occur in the final four months of each year due to the weather sensitivity of pavement construction (this work needs to be done primarily in the summer and early fall). In addition, several inclement weather situations during Q1-2019 were not conducive to street construction. Highlighted in the table below and shown in the following graph are the fund’s total expenditures related to capital projects. Fund 103 - Local Street Fund 2018 Summary of Sources and Uses 2019 2019 YTD 2019 YTD 2018 YTD Report Period: June 2019 Budget Budget Actual Actual Amount Revenues Sales Tax on Construction -$ -$ -$ 1,139,316$ -$ Operating Transfer In 1,900,000 1,025,000 1,025,000$ 150,000 - 0.0 % Interest Earnings 12,000 4,798 38,720$ 28,630 33,922 707.0 % Total Revenues 1,912,000$ 1,029,798$ 1,063,720$ 1,317,946$ 33,922$ 3.3 % Expenditures Capital Salary and Benefits 231,616 114,802 17,168 - 97,634 85.0 % Capital Outlay 3,217,860 601,052 209,640 487,757 391,412 65.1 % Subtotal - Capital Project Expenditures 3,449,476 715,854 226,808 487,757 489,046 68.3 % Admin Salary and Benefits - - 8,778 66,926 (8,778)$ Admin Services and Charges 40,700 19,676 357 2,236 19,320 98.2 % Interfund Payments for Services 15,200 7,600 7,600 6,120 (0) (0.0)% Operating Transfer Out - - - 145 - Total Expenditures 3,505,376$ 743,130$ 243,542$ 563,184$ 499,588$ 67.2 % Net Change in Fund Balance (1,593,376)$ 286,668$ 820,178$ 754,762$ 533,510$ 186.1 % Beg. Fund Balance, January 2019 2,550,256$ Net Change in Fund Balance, June 2019 820,178 Ending Fund Balance, June 2019 3,370,434$ 2019 Budgeted Ending Fund Balance 956,880$ 2019 2019 YTD Budget vs. Actual Favorable (Unfavorable) Percentage 27 Quarterly Financial Report Through Q2-2019 28 The table below presents the status of the projects with the most significant budget impact on the fund. Many capital projects are budgeted over multiple years; what is displayed below is the 2019 portion of each project’s budget and year-to-date expenditures. Notes: • The 2019 Local Street Pavement Reconstruction project was awarded June 17, 2019. $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $4.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecMillionsFund 103 -Capital Project Expenditures 2019 YTD Budget 2019 YTD Actual 2018 YTD Actual 2019 Budget : $3.4M 2018 YTD Actual: $0.5M 2019 YTD Actual: $0.2M Name 2019 Budget YTD Actual Remaining 2019 Local Street Reconstruction $2.6M $0.1M $2.4M 2018 Citywide Pavement Patch and Overlay $0.5M $0.1M $0.4M 2018 Local Street Pavement Reconstruction $0.3M $0.0M $0.2M All Other Projects (1 Other Budgeted)$0.2M $0.0M $0.2M Total $3.4M $0.2M $3.2M *Components may not sum to total due to rounding. Fund 103 - Local Street Capital Projects Status* 28 Quarterly Financial Report Through Q2-2019 29 Fund 105 – Arterial Street Preservation Fund The Arterial Street Preservation Fund is a special revenue fund that is primarily funded by a 1.0% utility tax that was adopted by Council in 2008; these utility tax revenues are restricted for arterial street repair and preservation projects. Major projects budgeted within the Arterial Street Preservation Fund in 2019 include A Street SE Preservation, 2019 Citywide Pavement Patching & Overlay, and 2018 Citywide Pavement Patching & Overlay. Through Q2-2019 revenues totaled $1.4 million, which is approximately $222,000 higher than the same period last year and $45,000 higher than budget expectations. Expenditures through Q2-2019 were $657,000 as compared to $266,000 through Q2-2018. Historically, the majority of this fund’s expenditures occur in the second half of each year due to the weather sensitivity of pavement construction (this work needs to be done primarily in the summer and early fall). In addition, several inclement weather situations during Q1-2019 were not conducive to street construction. Highlighted in the table below and shown in the following graph are the fund’s total expenditures related to capital projects. Fund 105 - Arterial Street Preservation 2018 Summary of Sources and Uses 2019 2019 YTD 2019 YTD 2018 YTD Report Period: June 2019 Budget Budget Actual Actual Amount Revenues City Utility Tax 674,600$ 327,158$ 327,598$ 308,195$ 440$ 0.1 % Electric Utility Tax 711,600 383,718 388,080 409,718 4,362 1.1 % Natural Gas Utility Tax 201,600 136,067 125,730 139,803 (10,337) (7.6)% Cable TV Tax 190,100 94,864 97,891 103,243 3,027 3.2 % Telephone Utility Tax 235,600 121,706 95,747 126,231 (25,959) (21.3)% Garbage Utility Tax (External Haulers)22,400 11,200 12,000 10,746 800 7.1 % Grants 940,511 57,050 58,914 68,224 1,863 3.3 % Operating Transfer In 746,279 248,760 310,802 33,845 62,042 24.9 % Interest Earnings 29,800 14,900 24,102 19,095 9,202 61.8 % Total Revenues 3,752,490$ 1,395,423$ 1,440,863$ 1,219,099$ 45,440$ 3.3 % Expenditures Salary and Benefits 241,000$ 110,750$ 253,618$ 170,299$ (142,868)$ (129.0)% Capital Outlay 4,530,722 904,438 403,448 95,379 500,990 55.4 % Subtotal - Capital Project Expenditures 4,771,722 1,015,188 657,066 265,678 358,122 35.3 % Supplies - - - - - Services and Charges 165,000 - - - - Operating Transfer Out 26,831 8,944 - - 8,944 100.0 Total Expenditures 4,963,553$ 1,024,132$ 657,066$ 265,678$ 367,066$ 35.8 % Net Change in Fund Balance (1,211,063)$ 371,292$ 783,798$ 953,421$ 412,506$ 111.1 % Beg. Fund Balance, January 2019 2,580,480$ Net Change in Fund Balance, June 2019 783,798 Ending Fund Balance, June 2019 3,364,278$ 2019 Budgeted Ending Fund Balance 1,369,417$ 2019 2019 YTD Budget vs. Actual Favorable (Unfavorable) Percentage 29 Quarterly Financial Report Through Q2-2019 30 The table below presents the status of the projects with the most significant budget impact on the fund. Many capital projects are budgeted over multiple years; what is displayed below is the 2019 portion of each project’s budget and year-to-date expenditures. Notes: • The A Street SE Preservation project was awarded June 3, 2019. • The 2019 Citywide Patch and Overlay project was awarded May 6, 2019. $0.0 $1.0 $2.0 $3.0 $4.0 $5.0 $6.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecMillionsFund 105 -Capital Project Expenditures 2019 YTD Budget 2019 YTD Actual 2018 YTD Actual 2019 2019 Budget: $4.8M 2018 2018 YTD Actual: $0.3M 2019 2019 YTD Actual: $0.7M Name 2019 Budget YTD Actual Remaining A Street SE Preservation $1.8M $0.0M $1.8M 2019 Citywide Pavement Patching & Overlay $1.0M $0.1M $1.0M 2018 Citywide Pavement and Patching Overlay $0.9M $0.2M $0.7M All Other Projects (8 Others Budgeted)$1.0M $0.4M $0.6M Total $4.8M $0.7M $4.1M *Components may not sum to total due to rounding. Capital Projects Status* Fund 105 - Arterial Street Preservation 30 Quarterly Financial Report Through Q2-2019 31 Fund 124 – Mitigation Fees The Mitigation Fees fund is a special revenue fund funded from revenues from fees for new development that are assessed at the time applications are received for development activity. These revenues are used to address costs associated with City growth. The fund houses two types of revenues: mitigation fees and impact fees. Mitigation fees are variable charges collected as a result of State Environmental Policy Act (SEPA) reviews and the City’s determination that a project must pay additional fees to compensate for a unique effect that it has on the community. Impact fees are set charges collected automatically for a variety of projects. These fees are adopted annually by the City Council based on projects anticipated in the Capital Facilities Plan over the next six years. About $1.6 million, or nearly 100%, of annual budgeted revenues were received through Q2- 2019. This significant favorable revenue performance was driven by the receipt of nearly $600,000 in traffic impact fee revenue in Q2 from the Young’s Market truck warehouse and distribution center. Additionally, a transfer-in of approximately $400,000 was completed in May to pay for traffic mitigation fees related to the Legacy Senior Housing Project and the Auburn Town Center. Expenditures were significantly below budget due to the timing of capital projects funded by these revenues. Of the twelve projects funded by parks impact fee revenues, only the Brannan Park Synthetic Infield project has seen significant progress. There are three projects budgeted with parks impact fee funding of at least $500,000 that have had minimal expenditures. A substantial portion of the year-to-date expenditures of transportation impact fee revenue consists of scheduled debt service payments. Fund 124 - Mitigation Fees Summary of Sources and Uses Report Period Through:Ending Ending June 2019 Fund Balance Fund Balance Transportation Impact Fees 800,000$ 1,189,129$ 5,115,601$ 963,003$ 317,552$ 5,980,184$ Transportation Migitation Fees - 51,100 67,905 1,353 - 120,961 Fire Impact Fees 100,000 75,000 212,773 45,674 - 277,432 Fire Mitigation Fees - - 81 - - 81 Parks Impact Fees 100,000 2,457,077 3,086,936 38,500 296,997 5,332,299 Parks Mitigation Fees - 300,000 40,702 - - 341,614 School Impact Admin Fees 1,200 - 58,515 628 - 67,212 Wetland Mitigation Fees - 36,600 33,861 - - 70,972 Interest and Investment Income 195,000 - 195,000 148,112 - 148,112 Fees in Lieu of Improvements - 100,000 24,413 - 100,000 25,634 Operating Transfers-In 416,200 - 416,200 398,528 - 398,528 Total 1,612,400$ 4,208,906$ 9,251,987$ 1,595,797$ 714,550$ 12,763,028$ Beginning Fund Balance, January 2019 11,881,781$ Net Change in Fund Balance, June 2019 881,248 Ending Fund Balance, June 2019 12,763,028$ 2019 Budgeted Ending Fund Balance 9,251,987$ YTD ACTUALSBUDGET Revenues ExpendituresRevenuesExpenditures 31 Quarterly Financial Report Through Q2-2019 32 Enterprise Funds Detailed income and expense statements for Enterprise and Internal Service funds can be found in an attachment at the end of this report. The attachment provides operating and – as applicable – capital fund reports for these funds showing budget, actuals, and variances. 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. 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 Q2-2019 the Water Utility had operating income of $2.4 million as compared to $2.1 million through Q2-2018. Total Water Fund operating revenues were $424,000 higher than in Q2-2018, mainly due to strong performance in water sales and interest income. Water sales revenue is directly impacted by the rate changes, which were implemented across all water consumption categories. Operating expenditures through Q2-2019 were up $112,000, or 2.5% from Q2-2018. This variance is mainly due to increases in personnel costs and to increased interfund taxes associated with utility revenues. Water sales by volume through June 2019 totaled 1.4 million hundred cubic feet (ccf) as compared to 1.3 million ccf through June 2018, an increase of 9.2%. Total consumption was up across all customer categories except school and wholesale. Large increases were also seen in single family and commercial usage. While overall consumption has increased compared to the same period last year, the Water utility has seen a general trend of decreased year-over-year consumption per account due largely to conservation efforts and appliance efficiency improvements. 0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000 1,000,000 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 $1,800 $2,000 CCFThousandsWater Revenues vs Water Sold 2019 vs 2018 2018 Water Sales ($) 2019 Water Sales ($) 2018 Water Sold (ccf) 2019 Water Sold (ccf) 32 Quarterly Financial Report Through Q2-2019 33 The Sewer Utility finished Q2-2019 with operating income of $1.5 million as compared to $1.0 million through Q2-2018. Increased revenues from charges for City sewer service following the rate adjustment in January 2019 account for about half of the favorable variance; the remainder consists mainly of a $203,000 refund from the Department of Revenue for overpayment of excise tax. Year-to-date operating expenditures in the Sewer Utility are nearly equal to Q2-2018, and the percentage of annual expenditure budget used is less than 1% different (43.5% of budget used, versus 43.2% through Q2-2018). Budget usage through the second quarter has remained consistent for the last several years. Through Q2-2019, the Stormwater Utility had operating income of $1.5 million compared with $1.3 million through Q2-2018. Operating revenues are up $165,000 compared to Q2-2018 due to charges for City storm service, which saw increases to all non-single family variable rates, as well as from strong investment income performance. Operating expenditures in the Stormwater Utility are down $103,000 from Q2-2018, contributing to the higher operating income noted above. Factors contributing to this include a decrease in spending on repairs and maintenance and the timing of certain intergovernmental payments. Through Q2-2019 the Solid Waste Utility Fund had $8.0 million in operating revenues, compared to $7.7 million in operating expenditures. The City of Auburn’s Solid Waste services are outsourced to Waste Management and to Republic Services, who manages the contract for the annexed areas. As of June 2019, Waste Management serviced 15,498 customers (79% of customers) and Republic Services serviced 4,117 customers (21% of customers). The current mix of solid waste customer account types is: • 89.7% Residential • 7.8% Commercial • 2.5% Multifamily The “diversion rate” is a measure of how much generated waste is not sent to the landfill; i.e., waste that is either recycled or collected yard waste. Through Q2-2019, the total diversion rate was 28.6%, which represents a total of 9,900 tons of waste that was diverted from landfills. 33 Quarterly Financial Report Through Q2-2019 34 2019 Tons Collected and Diversion Rates: Of the total tonnage collected through Q2-2019, 33% was collected from residential customers, 14% from multifamily customers, and 53% from commercial customers, as shown in the following graph. e: 50% 22% e: 17% e: 29% Garbage- 5,740 tons (50.2%) Yard Waste- 3,609 tons (31.5%) Recycling- 2,093 tons (18.3%) Q2-2019 Residential Waste Stream Garbage Yard Waste Recycling Garbage- 3,781 tons (78%) Yard Waste- 284 tons (5.9%) Recycling- 780 tons (16.1%) Q2 -2019 Multifamily Waste Stream Garbage Yard Waste Recycling Total: 4,845 tons collected Diversion Rate: 22% Garbage- 15,225 tons (82.9%) Yard Waste- 101 tons (0.5%) Recycling- 3,036 tons (16.5%) Q2-2019 Commercial Waste Stream Garbage Yard Waste Recycling Total: 18,361 tons collected Diversion Rate: 17% Garbage- 24,746 tons (71.4%) Yard Waste- 3,993 tons (11.5%) Recycling- 5,909 tons (17.1%) Q2-2019 Total Waste Stream Garbage Yard Waste Recycling Total: 34,648 tons collected Diversion Rate: 29% Total: 11,442 tons collected Diversion Rate: 50% 6,016 4,562 5,433 6,489 6,482 5,666 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19TonnageSolid Waste Tonnage by Customer Type Residential Multifamily Commercial 34 Quarterly Financial Report Through Q2-2019 35 Since January 1, 2016 the Auburn Municipal Airport has been managed by the City of Auburn’s Public Works Department. Starting January 1, 2019 the City transitioned from contracted management services through a third-party management company (AMG) and began management of the Airport with in-house staffing. The Airport Fund finished Q2-2019 with operating income of $239,000 as compared with operating income of $146,000 through Q2-2018. Operating revenues in the Airport Fund are up $223,000 over Q2-2018, largely due to sales of aviation fuel. Aviation fuel was previously sold by AMG, with a portion of the profit remitted to the City. Currently the City sells fuel directly, and recovers all associated revenue. Operating expenditures in the Airport Fund through Q2-2019 have increased by $130,000 over the same period last year. A significant portion of this increase is due to the purchase of aviation fuel for resale; the balance represents interfund charges related to City internal services, public utility costs, and interfund transfers to fund one-time technology and vehicle purchases. Through Q2-2019, the Cemetery Fund experienced operating income of $115,000 as compared with an operating income of $111,000 through Q2-2018. While sales of lots have decreased from 2018, this is offset by increases in openings/closings and sales of liners and markers. Overall, operating revenues are up by $32,000, or 4.6% while operating expenditures are up $29,000, or 4.8%, from the same period last year. 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 2019. 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. $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 ThousandsCEMETERY 2019 Budgeted Revenue 2019 YTD Actual Revenue 2018 Actual Revenue 2019 YTD Actual Expenses Cumulative Revenues & Expenditures 2019 Budget vs. Actual 35 Quarterly Financial Report Through Q2-2019 36 Investment Portfolio The City’s total cash and investments at the end of the Q2-2019 totaled $147.8 million, and compares to $140.3 million at the end of Q1-2019. [attachment] P-Card Statistics The City has been actively promoting the use of P-Cards in lieu of purchase orders to minimize effort and maximize incentive payments from the vendor and the State. In Q2-2019, 4,234 P-Card transactions were processed as compared with 1,128 purchase order transactions. Total incentive payments received from US Bank in Q1-2019 totaled $26,377. These are estimated payments since the quarterly rebate checks are not actually received until the next quarter. Additionally, there is an annual incentive payment from the State that is received in Q2 of each year. The annual State incentive payment for 2018 was $27,723 and was received in April of 2019. 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 jdthomas@auburnwa.gov. 921 3,924 1,128 4,234 - 1,000 2,000 3,000 4,000 5,000 Purchase Order Transactions PCard Transactions PCard Incentives Received (see text)TransactionsPurchase Order and PCard Transactions 2018 and 2019 Q2 $25,372 $26,377 2,065 8,190 $71,820 2,215 8,133 $76,716 - 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000 Purchase Order Transactions PCard Transactions PCard Incentives Received (see text)Transactions2018 and 2019 YTD 2018 2019 36 Investment Purchase Book Maturity Yield to Type Date Value Date Maturity State Investment Pool Various 100,953,718$ Various 2.51% KeyBank Money Market Various 4,718,600 Various 0.15% OpusBank Public Interest Acct Various 10,346,908 Various 2.56% FHLB 2/28/2018 2,001,840 2/28/2023 2.65% FFCB 5/21/2018 1,997,160 10/21/2019 2.48% FAMCA 6/27/2018 1,999,940 7/16/2020 2.50% FFCB 7/16/2018 2,000,620 7/16/2020 2.60% TX ST-BABs-A 8/8/2018 1,761,620 4/1/2020 2.68% FFCB 8/27/2018 2,004,660 2/23/2021 2.70% RFCSP 10/5/2018 5,032,674 10/15/2019 2.69% RFCSP 12/14/2018 5,012,903 7/15/2020 2.73% RFCSP 2/19/2019 4,999,824 1/15/2021 2.52% RFCSP 5/9/2019 4,999,802 10/15/2020 2.23% Total Cash & Investments 147,830,269$ 2.447% Investment Mix % of Total State Investment Pool 68.3%Current 6-month treasury rate 2.17% KeyBank Money Market 3.2%Current State Pool rate 2.51% OpusBank Public Interest Acct 7.0%KeyBank Money Market 0.15% FHLB 1.4%OpusBank Public Interest Acct 2.56% FFCB 4.1%Blended Auburn rate 2.45% FAMCA 1.4% TX ST-BABs-A 1.2% RFCSP 13.6% 100.0% City of Auburn Investment Portfolio Summary June 30, 2019 Summary 37 SALES TAX SUMMARY JUNE 2019 SALES TAX DISTRIBUTIONS (FOR APRIL 2019 RETAIL ACTIVITY) 2018 Annual Total 2018 YTD 2019 YTD YTD 2018 Annual Total 2018 YTD 2019 YTD YTD NAICS CONSTRUCTION (Nov '17-Oct '18)(Nov '17-Apr -18)(Nov '18-Apr 19)% Diff NAICS AUTOMOTIVE (Nov '17-Oct '18)(Nov '17-Apr -18)(Nov '18-Apr 19)% Diff 236 Construction of Buildings 1,257,918 655,180 470,003 -28.3%441 Motor Vehicle and Parts Dealer 3,843,704 1,887,904 1,834,132 -2.8% 237 Heavy and Civil Construction 170,543 68,876 70,664 2.6%447 Gasoline Stations 278,087 132,598 130,848 -1.3% 238 Specialty Trade Contractors 881,157 415,260 410,317 -1.2%TOTAL AUTOMOTIVE 4,121,791$ 2,020,503$ 1,964,979$ -2.7% TOTAL CONSTRUCTION 2,309,617$ 1,139,316$ 950,985$ -16.5%Overall Change from Previous Year (55,523)$ Overall Change from Previous Year (188,331)$ 2018 Annual Total 2018 YTD 2019 YTD YTD 2018 Annual Total 2018 YTD 2019 YTD YTD NAICS RETAIL TRADE (Nov '17-Oct '18)(Nov '17-Apr -18)(Nov '18-Apr 19)% Diff NAICS MANUFACTURING (Nov '17-Oct '18)(Nov '17-Apr -18)(Nov '18-Apr 19)% Diff 442 Furniture and Home Furnishings 209,879 104,300 106,324 1.9% 311 Food Manufacturing 7,745 3,217 4,736 47.2%443 Electronics and Appliances 229,028 112,421 142,182 26.5% 312 Beverage and Tobacco Products 12,379 6,214 6,402 3.0%444 Building Material and Garden 576,468 252,997 303,155 19.8% 313 Textile Mills 559 297 145 -51.3%445 Food and Beverage Stores 387,928 183,687 191,447 4.2% 314 Textile Product Mills 1,860 760 1,475 94.1%446 Health and Personal Care Store 420,087 201,383 226,861 12.7% 315 Apparel Manufacturing 347 145 281 94.0%448 Clothing and Accessories 1,170,083 588,758 600,572 2.0% 316 Leather and Allied Products 221 24 205 747.9%451 Sporting Goods, Hobby, Books 220,869 109,173 126,609 16.0% 321 Wood Product Manufacturing 16,224 6,628 6,675 0.7%452 General Merchandise Stores 870,096 478,419 416,758 -12.9% 322 Paper Manufacturing 12,982 4,093 7,137 74.4%453 Miscellaneous Store Retailers 689,386 320,709 442,114 37.9% 323 Printing and Related Support 46,020 24,501 20,787 -15.2%454 Nonstore Retailers 267,088 149,165 117,659 -21.1% 324 Petroleum and Coal Products 9,780 5,511 3,908 -29.1%TOTAL RETAIL TRADE 5,040,912$ 2,501,011$ 2,673,680$ 6.9% 325 Chemical Manufacturing 12,512 5,868 5,056 -13.8%Overall Change from Previous Year 172,669$ 326 Plastics and Rubber Products 8,844 4,791 3,413 -28.8% 327 Nonmetallic Mineral Products 21,776 7,698 10,175 32.2% 331 Primary Metal Manufacturing 4,065 683 26,883 3837.5%2018 Annual Total 2018 YTD 2019 YTD YTD 332 Fabricated Metal Product Manuf 26,115 11,740 17,367 47.9%NAICS SERVICES (Nov '17-Oct '18)(Nov '17-Apr -18)(Nov '18-Apr 19)% Diff 333 Machinery Manufacturing 24,283 13,530 13,273 -1.9%51*Information 637,625 332,048 327,241 a -1.4% 334 Computer and Electronic Product 7,184 3,481 2,080 -40.2%52*Finance and Insurance 140,135 71,874 69,284 -3.6% 335 Electric Equipment, Appliances 791 346 122 -64.9%53*Real Estate, Rental, Leasing 367,824 184,859 221,094 19.6% 336 Transportation Equipment Man 488,093 214,293 233,575 9.0%541 Professional, Scientific, Tech 253,684 120,935 160,837 33.0% 337 Furniture and Related Products 19,899 10,490 12,726 21.3%551 Company Management 16 5 27 487.1% 339 Miscellaneous Manufacturing 32,607 15,698 18,548 18.2%56*Admin. Supp., Remed Svcs 423,760 192,566 245,412 27.4% TOTAL MANUFACTURING 754,285$ 340,007$ 394,967$ 16.2%611 Educational Services 47,224 22,465 20,814 -7.4% Overall Change from Previous Year 54,961$ 62*Health Care Social Assistance 93,420 45,791 49,202 7.4% 71*Arts and Entertainment 119,180 49,109 40,797 -16.9% 72*Accommodation and Food Svcs 1,435,327 687,679 699,125 1.7% 2018 Annual Total 2018 YTD 2019 YTD YTD 81*Other Services 560,054 271,126 292,755 8.0% NAICS TRANSPORTATION AND WAREHOUSING (Nov '17-Oct '18)(Nov '17-Apr -18)(Nov '18-Apr 19)% Diff 92*Public Administration 150,574 63,924 647 -99.0% 481 Air Transportation 3 0 0 N/A TOTAL SERVICES 4,228,822$ 2,042,381$ 2,127,235$ 4.2% 482 Rail Transportation 25,453 13,351 11,065 -17.1%Overall Change from Previous Year 84,854$ 484 Truck Transportation 26,564 2,780 7,642 174.9% 485 Transit and Ground Passengers 56 34 24 -30.4% 488 Transportation Support 52,211 27,619 19,364 -29.9%2018 Annual Total 2018 YTD 2019 YTD YTD 491 Postal Service 1,007 659 367 -44.3%NAICS MISCELLANEOUS (Nov '17-Oct '18)(Nov '17-Apr -18)(Nov '18-Apr 19)% Diff 492 Couriers and Messengers 1,359 1,074 144 -86.6%000 Unknown 0 0 0 N/A 493 Warehousing and Storage 13,554 7,474 5,541 -25.9%111-115 Agriculture, Forestry, Fishing 3,656 1,737 2,950 69.9% TOTAL TRANSPORTATION 120,208$ 52,991$ 44,147$ -16.7%211-221 Mining & Utilities 26,370 9,996 11,349 13.5% Overall Change from Previous Year (8,844)$ 999 Unclassifiable Establishments 123,605 63,266 115,199 82.1% TOTAL SERVICES 153,632$ 74,998$ 129,498$ 72.7% Overall Change from Previous Year 54,500$ 2018 Annual Total 2018 YTD 2019 YTD YTD NAICS WHOLESALE TRADE (Nov '17-Oct '18)(Nov '17-Apr -18)(Nov '18-Apr 19)% Diff 423 Wholesale Trade, Durable Goods 1,147,872 603,177 571,144 -5.3%GRAND TOTAL 18,198,285$ 8,916,034$ 8,996,990$ 424 Wholesale Trade, Nondurable 315,956 139,479 136,350 -2.2%Overall Change from Previous Year 80,957$ 0.9% 425 Wholesale Electronic Markets 5,189 2,172 4,005 84.5% TOTAL WHOLESALE 1,469,017$ 744,827$ 711,499$ -4.5%Total June 2019 Sales Tax Distributions 1,504,125$ Overall Change from Previous Year (33,328)$ Dollar Increase from June 2018 142,107$ Percent Increase from June 2018 Comparisons: Includes Adjustments in excess of +/- $10,000.June 2018 8,916,034 7,554,016 1,362,018$ a. WA State Department of Revenue audit adjustment to sales tax returns for February 2019 Reporting (adjustment: $14,165).June 2017 8,493,080 7,169,390 1,323,690$ 06/24/19 Prepared by Auburn Finance Department 10.4% 38 Budget YTD Actual Variance Budget YTD Actual Variance Budget YTD Actual Variance Budget YTD Actual Variance OPERATING FUND:460 460 461 461 462 462 OPERATING REVENUES Charges For Service 15,471,500 6,688,661 (8,782,839) 9,014,200 4,442,525 (4,571,675) 18,370,000 9,041,997 (9,328,003) 10,085,900 5,034,758 (5,051,142) Grants - - - - - - Interest Earnings 20,000 113,006 93,006 20,000 70,222 50,222 2,500 14,450 11,950 15,000 66,373 51,373 Rents, Leases, Concessions, & Other 187,000 100,412 (86,588) 70,000 238,166 168,166 - - - 56,000 38,178 (17,822) TOTAL OPERATING REVENUES 15,678,500 6,902,079 (8,776,421) 9,104,200 4,750,913 (4,353,287) 18,372,500 9,056,447 (9,316,053) 10,156,900 5,139,309 (5,017,591) OPERATING EXPENSES Salaries & Wages 2,472,136 1,175,080 1,297,056 1,478,205 696,052 782,153 - - - 2,511,990 1,164,762 1,347,228 Benefits 1,335,528 605,501 730,027 783,349 359,360 423,989 - - - 1,329,580 586,678 742,902 Supplies 364,244 132,217 232,027 164,550 37,758 126,792 - - - 84,550 39,612 44,938 Other Service Charges 4,455,849 1,336,256 3,119,593 2,912,150 1,316,366 1,595,784 18,215,600 8,922,306 9,293,294 1,994,100 739,609 1,254,491 Intergovernmental Services (Less Transfers Out)- - - - - - Waste Management Payments See Note Sewer Metro Services - - - Debt Service Interest 1,092,600 376,984 715,616 245,500 131,058 114,442 - - - 311,100 169,233 141,867 Interfund Operating Rentals & Supplies 1,773,617 896,637 876,980 1,391,917 705,787 686,130 - - - 1,818,400 915,097 903,303 TOTAL OPERATING EXPENSES 11,493,974 4,522,676 6,971,298 6,975,671 3,246,381 3,729,290 18,215,600 8,922,306 9,293,294 8,049,720 3,614,991 4,434,729 OPERATING REVENUES LESS EXPENSES BEFORE DEPRECIATION 4,184,526 2,379,403 (1,805,123) 2,128,529 1,504,532 (623,997) 156,900 134,141 (22,759) 2,107,180 1,524,318 (582,862) NON-OPERATING REVENUES Operating Transfers-in - - - Intergovernmental Loan - 39,258 (39,258) Other Non-Operating Revenues - NON-OPERATING EXPENSES Transfer to Capital Subfund 811,400 16,633 794,767 - - - - - - Other Operating Transfers-out 381,491 34,662 346,829 328,692 5,099 323,593 404,392 79,099 325,293 Debt Service Principal 1,775,400 624,107 1,151,293 563,400 288,262 275,138 438,000 - 438,000 Net Change in Restricted Net Assets - 63,331 63,331 - (17,771) (17,771) - 14,527 14,527 Interfund Loan Repayment BEGINNING WORKING CAPITAL - January 1, 2019 3,915,375 3,915,375 - 4,292,249 4,292,249 - 3,184,467 3,184,467 - 2,886,614 2,886,614 - ENDING WORKING CAPITAL - June 30, 2019 5,131,610 5,595,303 463,693 5,528,686 5,521,191 (7,495) 3,341,367 3,318,608 (22,759) 4,151,402 4,317,306 165,904 NET CHANGE IN WORKING CAPITAL (see Note)1,216,235 1,679,928 463,693 1,236,437 1,228,942 (7,495) 156,900 134,141 (22,759) 1,264,788 1,430,692 165,904 CAPITAL FUND: CAPITAL REVENUES Interest Revenue 10,000 21,913 11,913 80,000 123,492 43,492 80,000 67,349 (12,651) Grants 450,592 17,901 (432,691) 181,965 5,792 (176,173) Contributions - - - - - - - Other Non-Operating Revenue - 558 558 - - - - - - Increase In Contributions - System Development 937,700 333,369 (604,331) 654,700 524,873 (129,827) 489,900 329,742 (160,158) Interfund Revenues - - - - - - - - - Increase In Contributions - FAA - - - - - - - - - Proceeds of Debt Activity 7,525,324 - (7,525,324) - - - - - - Transfers In from Operating Sub-Fund 811,400 16,633 (794,767) - - - - - - Transfer In from Other Funds - 22,625 22,625 - - - - - TOTAL CAPITAL REVENUES 9,735,016 412,999 (9,322,017) 734,700 648,365 (86,335) 751,865 402,883 (348,982) CAPITAL EXPENSES Other Non-Operating Expense - - - - - - - - - Increase In Fixed Assets - Salaries 424,300 120,663 303,637 182,900 29,356 153,544 202,900 31,470 171,430 Increase In Fixed Assets - Benefits 169,700 59,652 110,048 73,100 14,189 58,911 81,100 14,528 66,572 Increase In Fixed Assets - Services 300 - 300 1,900 - 1,900 1,900 - 1,900 Increase In Fixed Assets - Site Improvements - 3,736 (3,736) - - - - - Increase In Fixed Assets - Equipment - - - - - - - - - Increase In Fixed Assets - Construction 9,896,443 792,224 9,104,219 3,617,608 96,421 3,521,187 3,507,258 95,913 3,411,345 Operating Transfers Out 50,000 50,000 - 50,000 50,000 - 50,000 50,000 - TOTAL CAPITAL EXPENSES 10,540,743 1,026,275 9,514,468 3,925,508 189,966 3,735,542 3,843,158 191,912 3,651,246 BEGINNING WORKING CAPITAL - January 1, 2019 2,848,451 2,848,451 - 12,240,299 12,240,299 - 13,792,781 13,792,781 - 2,042,724 2,235,175 192,451 9,049,491 12,698,698 3,649,207 10,701,488 14,003,752 3,302,264 NET CHANGE IN WORKING CAPITAL (see Note)(805,727) (613,276) 192,451 (3,190,808) 458,399 3,649,207 (3,091,293) 210,971 3,302,264 Total Change in Working Capital 410,508 1,066,652 656,144 (1,954,371) 1,687,341 3,641,712 156,900 134,141 (22,759) (1,826,505) 1,641,663 3,468,168 (*) Depreciation 3,612,800 1,946,926 2,333,400 1,139,819 - - 2,184,100 1,049,444 OPERATING & CAPITAL FUNDS WATER ENTERPRISE FUNDS SEWER SEWER METRO STORMCash Basis through June 2019 (*) Debt service interest as shown represents actual cash outlay. Debt service principal represents actual expenditures; payments will be made as scheduled in December 2019. Working Capital = Current Assets minus Current Liabilities ENDING WORKING CAPITAL - June 30, 2019 39 OPERATING FUND: OPERATING REVENUES Charges For Service Grants Interest Earnings Rents, Leases, Concessions, & Other TOTAL OPERATING REVENUES OPERATING EXPENSES Salaries & Wages Benefits Supplies Other Service Charges Intergovernmental Services (Less Transfers Out) Waste Management Payments See Note Sewer Metro Services Debt Service Interest Interfund Operating Rentals & Supplies TOTAL OPERATING EXPENSES OPERATING REVENUES LESS EXPENSES BEFORE DEPRECIATION NON-OPERATING REVENUES Operating Transfers-in Intergovernmental Loan Other Non-Operating Revenues NON-OPERATING EXPENSES Transfer to Capital Subfund Other Operating Transfers-out Debt Service Principal Net Change in Restricted Net Assets Interfund Loan Repayment BEGINNING WORKING CAPITAL - January 1, 2019 ENDING WORKING CAPITAL - June 30, 2019 NET CHANGE IN WORKING CAPITAL (see Note) CAPITAL FUND: CAPITAL REVENUES Interest Revenue Grants Contributions Other Non-Operating Revenue Increase In Contributions - System Development Interfund Revenues Increase In Contributions - FAA Proceeds of Debt Activity Transfers In from Operating Sub-Fund Transfer In from Other Funds TOTAL CAPITAL REVENUES CAPITAL EXPENSES Other Non-Operating Expense Increase In Fixed Assets - Salaries Increase In Fixed Assets - Benefits Increase In Fixed Assets - Services Increase In Fixed Assets - Site Improvements Increase In Fixed Assets - Equipment Increase In Fixed Assets - Construction Operating Transfers Out TOTAL CAPITAL EXPENSES BEGINNING WORKING CAPITAL - January 1, 2019 NET CHANGE IN WORKING CAPITAL (see Note) Total Change in Working Capital (*) Depreciation OPERATING & CAPITAL FUNDS Cash Basis through June 2019 Working Capital = Current Assets minus Current Liabilities ENDING WORKING CAPITAL - June 30, 2019 Budget YTD Actual Variance Budget YTD Actual Variance Budget YTD Actual Variance Budget YTD Actual Variance 464 464 465 465 466 466 - 16,071,700 7,907,109 (8,164,591) 1,205,700 674,328 (531,372) 1,086,000 735,185 (350,815) - - - 88,600 4,994 (83,606) - 1,000 1,000 - - 88,800 57,201 (31,599) 6,900 12,409 5,509 1,000 9,694 8,694 21,000 12,707 (8,293) - 3,446 3,446 6,000 4,993 (1,007) - 214 214 16,249,100 7,972,750 (8,276,350) 1,218,600 692,731 (525,869) 1,087,000 745,094 (341,906) 21,000 12,707 (8,293) - - - 207,803 104,721 103,082 464,932 230,719 234,213 - - - - - - 149,990 62,437 87,553 269,930 129,417 140,513 175,000 25,765 149,235 53,400 1,789 51,611 212,700 171,948 40,752 221,700 131,779 89,921 - - - 2,123,775 810,781 1,312,994 247,400 92,855 154,545 151,500 60,047 91,453 5,600 608,752 (603,152) - - - - - - - - - - - - 13,485,300 6,558,190 6,927,110 - - - 3,700 2,089 1,611 - - - - - - 612,000 317,794 294,206 38,600 19,300 19,300 155,900 77,950 77,950 - - - 16,274,475 7,688,554 8,585,921 860,193 453,350 406,843 1,263,962 629,913 634,049 180,600 634,517 (453,917) (25,375) 284,196 309,571 358,407 239,381 (119,026) (176,962) 115,181 292,143 (159,600) (621,810) (462,210) 100,000 - (100,000) - - - 350,000 51,649 100,000 - 21,831 3,505 18,326 10,000 4,236 5,764 - - - 186,500 - 186,500 - - - - 12,274 12,274 - - - 42,100 20,743 21,357 5,556,175 5,556,175 - 474,633 474,633 - 441,060 441,060 - 1,928,070 1,928,070 - 5,508,969 5,836,866 327,897 244,440 625,111 380,671 264,098 556,241 292,143 1,768,470 1,306,260 (462,210) (47,206) 280,691 327,897 (230,193) 150,478 380,671 (176,962) 115,181 292,143 (159,600) (621,810) (462,210) 2,000 1,244 (756) - 3,058 3,058 104,316 6,120 (98,196) - - - - - - - - - - - - - - - - - - - - - 2,367,730 60,269 (2,307,461) - - - - - - - - - 350,000 51,649 (298,351) 100,000 - (100,000) - - - 55,442 - (55,442) 2,824,046 119,283 (2,704,763) 155,442 3,058 (152,384) - - - - - - 4,300 57 4,243 - - - 1,700 41 1,659 - - - 100 - 100 100 - 100 - - - - - - - - 2,928,308 257,032 2,671,276 380,442 - 380,442 73,200 69,034 4,166 - - - 3,007,608 326,164 2,681,444 380,542 - 380,542 246,967 246,967 - 261,037 261,037 - 63,405 40,086 (23,319) 35,937 264,095 228,158 (183,562) (206,881) (23,319) (225,100) 3,058 228,158 (47,206) 280,691 (413,755) (56,403) 357,352 (402,062) 118,239 520,301 (159,600) (621,810) (462,210) 19,900 9,410 490,300 212,529 45,000 16,551 - - Note: Includes June's Waste Management payment ($1,145,334), which will be made in July. (*) Debt service interest as shown represents actual cash outlay. Debt service principal represents actual expenditures; payments will be made as scheduled in December 2019. ENTERPRISE FUNDS SOLID WASTE AIRPORT CEMETERY INTERNAL SERVICE FUNDS INSURANCE see Note 40 OPERATING FUND: OPERATING REVENUES Charges For Service Grants Interest Earnings Rents, Leases, Concessions, & Other TOTAL OPERATING REVENUES OPERATING EXPENSES Salaries & Wages Benefits Supplies Other Service Charges Intergovernmental Services (Less Transfers Out) Waste Management Payments See Note Sewer Metro Services Debt Service Interest Interfund Operating Rentals & Supplies TOTAL OPERATING EXPENSES OPERATING REVENUES LESS EXPENSES BEFORE DEPRECIATION NON-OPERATING REVENUES Operating Transfers-in Intergovernmental Loan Other Non-Operating Revenues NON-OPERATING EXPENSES Transfer to Capital Subfund Other Operating Transfers-out Debt Service Principal Net Change in Restricted Net Assets Interfund Loan Repayment BEGINNING WORKING CAPITAL - January 1, 2019 ENDING WORKING CAPITAL - June 30, 2019 NET CHANGE IN WORKING CAPITAL (see Note) CAPITAL FUND: CAPITAL REVENUES Interest Revenue Grants Contributions Other Non-Operating Revenue Increase In Contributions - System Development Interfund Revenues Increase In Contributions - FAA Proceeds of Debt Activity Transfers In from Operating Sub-Fund Transfer In from Other Funds TOTAL CAPITAL REVENUES CAPITAL EXPENSES Other Non-Operating Expense Increase In Fixed Assets - Salaries Increase In Fixed Assets - Benefits Increase In Fixed Assets - Services Increase In Fixed Assets - Site Improvements Increase In Fixed Assets - Equipment Increase In Fixed Assets - Construction Operating Transfers Out TOTAL CAPITAL EXPENSES BEGINNING WORKING CAPITAL - January 1, 2019 NET CHANGE IN WORKING CAPITAL (see Note) Total Change in Working Capital (*) Depreciation OPERATING & CAPITAL FUNDS Cash Basis through June 2019 Working Capital = Current Assets minus Current Liabilities ENDING WORKING CAPITAL - June 30, 2019 Budget YTD Actual Variance Budget YTD Actual Variance Budget YTD Actual Variance Budget YTD Actual Variance - - 568 568 560 560 1,075,200 533,491 (541,709) 3,436,500 1,742,944 (1,693,556) 6,276,600 3,145,182 (3,131,418) 2,007,606 1,003,803 (1,003,803) - - - - - - 46,000 27,704 (18,296) 24,600 23,630 (970) 8,000 32,958 24,958 - 38,139 38,139 50,000 4,777 (45,223) - - - - - - - 32,784 32,784 1,171,200 565,972 (605,228) 3,461,100 1,766,574 (1,694,526) 6,284,600 3,178,140 (3,106,460) 2,007,606 1,074,726 (932,880) - - - 728,510 336,925 391,585 2,070,555 986,396 1,084,159 604,034 303,651 300,383 250,000 52,505 197,495 424,233 196,859 227,374 1,072,035 481,777 590,258 324,807 151,271 173,536 - - - 144,720 54,423 90,297 469,150 106,319 362,831 1,092,000 403,645 688,355 448,315 149,586 298,729 1,995,950 674,791 1,321,159 2,861,600 1,551,394 1,310,206 493,050 211,291 281,759 - - - - - - - - - - - - - - - - - - - - - 2,700 895 1,805 119,800 59,900 59,900 159,700 79,850 79,850 183,000 91,500 91,500 291,600 145,800 145,800 818,115 261,991 556,124 3,453,113 1,342,847 2,110,266 6,656,340 3,217,386 3,438,954 2,808,191 1,216,552 1,591,639 353,085 303,981 (49,104) 7,987 423,727 415,740 (371,740) (39,246) 332,494 (800,585) (141,826) 658,759 44,500 - (44,500) 276,210 24,062 (252,148) - - - 733,950 321,688 412,262 30,000 - 30,000 - - - - - - - - - - - - - (12,774) (12,774) 2,128,988 2,128,988 - 1,548,874 1,548,874 - 2,698,004 2,698,004 - 3,091,626 3,091,626 - 2,482,073 2,432,969 (49,104) 867,411 1,650,913 783,502 2,572,474 2,682,820 110,346 2,291,041 2,962,574 671,533 353,085 303,981 (49,104) (681,463) 102,039 783,502 (125,530) (15,184) 110,346 (800,585) (129,052) 671,533 - 18,331 18,331 - 50,118 50,118 - 60,000 60,000 - - - - - - - - - - - - - - - - - - - - - 1,771,194 885,597 (885,597) - - - - - - - - - - - - - - - - - - 22,500 - (22,500) 1,046,000 139,434 (906,566) 22,500 18,331 (4,169) 2,817,194 1,135,149 (1,682,045) - - - - - - - 4,357 (4,357) - - - - 2,277 (2,277) - - - 300 - 300 500 - 500 - - 871,500 34,998 836,502 2,333,450 542,752 1,790,698 20,000 10,272 9,728 1,140,000 - 1,140,000 - - - - - - 891,800 51,904 839,896 3,473,950 542,752 2,931,198 1,169,997 1,169,997 - 3,709,510 3,709,510 - 300,697 1,136,424 835,727 3,052,754 4,301,907 1,249,153 (869,300) (33,573) 835,727 (656,756) 592,397 1,249,153 353,085 303,981 (49,104) (681,463) 102,039 783,502 (994,830) (48,757) 946,073 (1,457,341) 463,345 1,920,686 - - - - 500,000 174,702 1,250,000 641,713 INTERNAL SERVICE FUNDS WORKER'S COMPENSATION FACILITIES INNOVATION & TECHNOLOGY EQUIPMENT RENTAL 41