Memorandum

City of Lawrence

City Manager’s Office

 

DATE:

10/29/2009

TO:

David L. Corliss, City Manager

FROM:

Casey Toomay, Budget Manager

CC:

Cynthia Boecker, Assistant City Manager

Diane Stoddard, Assistant City Manager

Jonathan Douglass, Assistant to the City Manager

RE:

2009 Budget Update

 

Pursuant to your direction, a 2009 general fund projection has been updated to reflect revenues received and expenditures through the end of September 2009.  The projection shows General fund revenues totaling $59,834,171, which is $950,000 below budget.  All revenue categories are projected to be below budget for 2009 except for franchise fees, which are projected to exceed budget by $475,000.  This will offset interest earned, which is projected to be $560,000, below 2009 budget.  Licenses and Permits are also projected to be far below budget, totaling just 67.8% of 2009 budget.

 

The projection shows expenditures in the general fund of $59,735,064.  This total represents 96.85% of 2009 budget, excluding the transfer that was budgeted to achieve the five percent fund balance as required by state law. 

 

In order to achieve 96.85% of budget, it will be necessary to save almost $2 Million in the General Fund.  Departments were asked to project their remaining expenditures for the year and any projected savings were transferred into a general overhead budget reduction account.

 

Some of the savings was accomplished by reducing line items (office supplies, travel and training, meals and lodging, conferences and seminars, mileage reimbursement, educational materials, printing, repairs and maintenance, other contractual services, postage, software, etc.) by small amounts in each division.  Items that generated significant savings included:

·         Vacant positions - A number of vacant positions have remained/will remain unfilled including positions in Planning, Administrative Services, Parks and Recreation, and Legal.  In other departments, positions were budgeted for the entire year but were vacant for a period of time, generating savings (estimated savings - $658,000);

·         Fuel - In February, division budgets were reduced to reflect lower fuel prices (estimated savings - $130,000);

·         Rental Registration Program – despite funds being budgeted, the rental registration program was not expanded in 2009 (estimated savings - $68,600);

·         Contractor Licensing Program – It is assumed that fewer contractors will be receiving education through Johnson County (estimated savings - $45,000);

·         Primary Election -  Because of the changes in State law, it was not necessary to hold a primary election in 2009.  (estimated savings - $34,000);

·         Insurance – Savings are expected from insurance premiums, which increased less than anticipated when budgeted for 2009 (estimated savings – $30,000)

·         Equipment – funds encumbered for equipment will not be spent (estimated savings - $30,000);

·         Postage – based on expenditures to date, it is likely that some savings will be achieved (estimated savings - $24,500);

·         Natural Gas – natural gas prices have been lower than anticipated (estimated savings -$19,500); Advertising – reduced recruitment for positions should produce savings (estimated savings - $13,000)

·         Signs and sign materials ­ - purchase of sign replacement materials will be deferred (estimated savings - $10,000)

 

Staff will continue to further reduce expenditures, if necessary, in response to revenue information as it becomes available.  For instance, notification of the October sales tax distribution was received on October 28 and is approximately $100,000 below the projection for the month of October.  It may be necessary to make further expenditure reductions as a result.