06-02-2020 Financial UpdateCity of Federal Way
Financial Update
June 02, 2020
Presented by:
Ade Ariwoola, Finance Director
Update On Major Revenues
1.Sales Tax –36% of GF. 2.Property Tax –26% of GF.3.Building Permit Fees –8%4.Traffic Safety (Red Lights)5.Utility Tax –18%6.Prop 1
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May Jan-May Jun Jul Aug Sep Oct Nov Dec YTD Total
2019 Actual 1,346,880 4,950,834 1,229,332 1,263,066 1,502,252 1,401,269 1,438,593 1,528,439 2,595,078 15,908,863
2020 Budget 1,350,342 4,963,560 1,232,492 1,266,313 1,506,113 1,404,871 1,442,291 1,532,368 2,601,748 15,949,755
2020 Actual 1,130,545 5,012,100 862,744 1,076,366 1,280,196 1,194,140 1,225,947 1,302,513 2,211,486 14,165,492
Sales tax as % of year 2020 General Fund (GF) budgeted revenue 36.14%
1,784,263
-11.19%
Sales Tax Revenue
Projected loss
•YTD revenue is $5.01 million.
•YTD budget is $4.96 million.
•2019 YTD Actual was $4.95 million.
•March/May budget -$1.35 million.
•March/May revenue –$1.13 million.
•May revenue is 83.72% of budget
•2020 Actuals for June through December are estimates.
•Projected loss is about $1.8 million
•Sales Tax –36% of General Fund Revenue.
Sales Tax
Major Sales Tax Revenue Driver
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•Local Economy
•COSTCO
•Wal Mart Stores
•Home Depot
•Fred Meyer’s
•Target
•Jet Chevy
•Best Buy
•Lowe’s
•Amazon
•Safeway
•Nation-wide Economy
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May Jan-May Jun Jul Aug Sep Oct Nov Dec YTD Total
2019 Actual 1,466,187 5,729,242 53,981 48,704 66,266 215,895 3,554,163 1,141,913 107,265 10,917,428
2020 Budget 1,510,007 5,900,472 55,594 50,159 68,247 222,348 3,660,386 1,176,041 110,471 11,243,718
2020 Actual 1,037,720 5,192,538 660,000 48,000 66,000 222,000 4,100,000 1,176,041 757,307 12,221,886
25.48%
Property Tax Ravenue
Property Tax as % of year 2020 General Fund (GF) budgeted revenue
•YTD revenue is $5.19 million.
•YTD budget is $5.90 million.
•2019 YTD Actual was $5.73 million.
•2020 Actuals for June through December are estimates.
•May revenue was ($1.04m/$1.51m) 68.87% of budget.
•April revenue was ($3.61m/$3.85m) 93.67% of budget.
•King County allowed property owners to delay till payment till June.
•It may affect our cashflow but NOT revenue.
Property Tax
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May Jan-May Jun Jul Aug Sep Oct Nov Dec YTD Total
2019 Actual 825,324 2,128,907 163,185 238,899 436,819 181,193 600,317 359,558 437,556 4,546,434
2020 Budget 416,781 1,490,029 240,387 298,966 302,991 251,788 329,693 253,269 228,651 3,395,774
2020 Actual 143,034 885,252 192,310 239,173 242,393 176,252 263,754 177,288 160,056 2,336,477
Building permits as % of year 2020 General Fund (GF) budgeted revenue 7.69%
Projected loss
Building Permit
$1,059,297
•Building Permit revenue is 7.69% of General Fund
•YTD revenue is $0.89 million
•YTD budget is $1.49 million, and
•2019 YTD Actual was $2.13 million
•2020 Actuals for June through December are estimates.
•April revenue was 63.33% of budget
•May revenue was 34.32% of budget
•ST is paying for staff and equipment separately
•Projected loss is about $1.0 million
Building Permit
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May Jan-May Jun Jul Aug Sep Oct Nov Dec YTD Total
2019 Actual 294,168 1,526,886 405,464 309,469 237,046 249,582 299,469 287,654 261,679 3,577,248
2020 Budget 312,650 1,622,818 430,938 328,913 251,939 265,262 318,284 305,726 278,120 3,802,000
2020 Actual 110,173 1,194,823 150,828 115,119 226,745 238,736 286,456 275,154 250,308 2,738,170
Projected loss 1,063,830$
Traffic Safety Revenue
•May revenue was 35.24% of budget
•April revenue was 79.62% of budget
•Potential revenue loss is about $1.0 million
•The fund is not GF, but it funds positions and other items of GF
•This revenue stream funds 1 Lieutenant, 8 police officers, and
emergency communication system.
•Stay at home order has affected this revenue and as more people
tele-work the revenue will continue to decline for a while.
•2020 YTD revenue is 73.63% of budget
Traffic Safety (Red Light)
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May Jan-May Jun Jul Aug Sep Oct Nov Dec YTD Total
2019 Actual 723,958 3,250,330 630,209 617,562 607,842 609,077 670,599 597,293 1,610,557 8,593,468
2020 Budget 771,781 3,465,040 671,839 658,357 647,995 649,311 714,897 636,749 1,716,947 9,161,135
2020 Actual 716,602 3,201,155 638,247 625,439 615,595 616,846 679,152 604,912 1,631,100 8,612,445
Projected loss $548,690
Utility Tax
•Potential loss is minimal but it affects GF
•Commercial buildings use the most utility and pay the largest share.
•$8.47 million was transferred into General fund in 2019.
•$8.56 million is expected to be transferred into General Fund in 2020.
•Its major source of funding for FWCC, DBC, and Prop 1.
•Utility tax on Water and Sewer law suit still pending
•June –December are estimates
Utility Tax
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May Jan-May Jun Jul Aug Sep Oct Nov Dec YTD Total
2019 Actual 212,192 949,754 184,257 180,122 177,287 177,647 195,591 174,211 469,746 2,508,615
2020 Budget 225,665 1,010,055 195,955 191,558 188,543 188,927 208,010 185,272 499,571 2,667,891
2020 Actual 209,191 935,158 186,158 181,981 179,116 179,480 197,609 176,008 474,592 2,510,102
Projected loss $157,789
Utility Tax Prop 1
•Potential loss is minimal but it affects GF
•This revenue stream funds 1 Code Compliance Officer, 2
Prosecutors, 1 Court Clerk, 0.5 Judge, 1 Maintenance Worker, 1
Record Specialist, 17 Police Officers, and 2 Lieutenants.
•It usually doesn’t generate enough revenue to cover required
items.
Utility Tax Prop 1
Other Affected Funds/Revenues
1.Hotel/Motel Tax.
2.Admission Tax
3.Gas Tax
4.Business Registration Fees
5.PAEC.
6.Dumas Bay Center.
7.FWCC.
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What Will Affect Comeback
1.Employee’s Willingness.
2.Customers’ Willingness.
3.Gas Price.
4.How Many Businesses Survive The Lockdown.
5.If We Get Second Wave of Pandemic.
6.Recession?
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What To Come
1.We will survive 2020. 2.What to keep an eye out for in 2021.a)Boeingb)Airlinec)Hoteld)Closed businesse)Pandemicf)Real Estate marketg)Construction3.Federal Way will do better than most but we still need to plan.a)Utility taxb)Staff levelc)Pay leveld)SCOREe)SCORE ADPf)Vacanciesg)Sound Transith)2021 and 2023-2026 NCAA
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Questions?
Thank You