02-26-2022 Budget Review2023=24
Biennial
Budget
Overview
City Council Retreat
February 26, 2022
Every Budget's Goals
LJ Achieve a balanced budget in
every fund
LI Assure appropriately -prioritized
service delivery
LJ Monitor and manage all funds'
reserves
Budget Calendar
1. Council determines priorities, goals
2. Staff forecasts revenue
3. Staff calculates existing obligation expenses
(payroll and benefits the largest by far)
4. Mayor and staff prepare proposed budget
5. Council briefings, review, study
6.
Prioritize
proposed services
to funding
7.
Adoption
— legal authority to
deliver services
Budget Calendar
During 2022 Jan Feb Mar
Apr
May
Jun
Jul I Aug
Sep
Oct
Nov
Dec
Revenue forecasting Jan. 1 lFinance
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Council Financial Reports Monthly Finance
Strategic Planning Feb. 26 City Council
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2021 roll-fwd appropriation Apr. 6 Finance
Senior Staff Budget Kickoff Jul. 1 Finance
2022 MidYear Report Jul. 20 Finance
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2022 Course Corrections Jul. 20 Finance
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Dept Staffing Review Jul __Aug All Depts
Policy/Project identification Aug -Oct All Depts
Mayor's Proposed Budget Sep Mayor
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Council meetings on budget Sep City Council
County Assessed Value Sep. 25 Co. Assessor
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Revenue forecast final I Oct.1 Finance
Set dates for Nov. Hearings Oct. 5 Finance
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City Council Study Sessions Oct. All Depts
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Ad Valorem Rate Hearing Nov. 1 Finance
Budget Hearings Nov. 1,15
Finance
Budget adoption Dec. 6
Finance
Council's Role
• Exercise governance
• Insist on being fully briefed
• Make policies that align goals with
realistic resources
• Prioritize goals
When there's enough money,
decisions are easy
Who makes the hardest decisions?
Staff's Role
• Bring comprehensive information
• Brief council and public realistically
• Deliver bad news we all need to hear
• Front-line staff knows, cares
• Front-line staff knows what is NOT being
attended to, deferred
• Mayor and staff execute, manage to budget
• Mayor and staff manage details, course -correct
Public's Role
• Have a right to receive and have a say in the
services they have no choice but to pay for
• Have a right to full transparency and
accountability
• Public input is both at policy -level and
service -delivery level (often daily!)
• Public input for Budget therefore comes from
both Council and Staff
What is a Citv Budget?
A control document
Spending must not exceed budget
Communications document
Defines what services will be done
Forecasting Tool
Reasonable revenue forecasts'
Attainable
-�he 11
1\o6ks
Go\d.
S�;de
Service delivery depends on funding
Budget in a Nutshell
Will the
Increase in forecasted revenues
Minus the
� Increase in personnel costs
Be a positive number?
If so, then what?
If not, then what?
Revenues
Service Infra -
Delivery structure
Genera
Capital Funds
Police Fund (Downtown, facilities,
Streets parks, Surface Water,
Codes/Planning Transportation, PAEC)
Parks
Administrative
Reserve
Debt Service Funds
Internal Service Funds
Other
Funds
Restricted
Special Revenue
Funds
(Risk Management, Info Systems,
Mail, Fleet, Buildings, Health &
Unemployment Insurance)
Infrastructure (Capital Budget)
Long-term assets are an obligation:
• Streets
• Vehicles
• IT infrastructure
• Buildings
Budgeting for Infrastructure
• Save up
• Debt
• Pay as we go
Infrastructure (Use Caution)
1. Deferring has a compounding cost
2. Cutting Infrastructure spending is a
short-sighted strategy
3. Must have along-term plan for
capital budget funding
Where Do City Revenues Come From?
Taxes — very predictable
• We budget as probable as possible
• Underbudgeting fails to deliver services
Fees — fairly forecastable
• Generally, less material
Grants
• We don't budget until they are certain
• We don't budget grants applied for
� �S ,nit U
deb Source
�und�n9
CITY OF FEDERAL R;4Y202112022 BUDGET EXEC17B'E SC':11:M4RY
0
0
0
SOURCES & USES - ALL FUNDS
�18 2019 2020 2021 20� ?] Ado 1[d-20Ad�
eA.....-A aA—A
Item
2918
A ctual
1019
Actual
ZM
2Cc L
Ada led
ado tcd
21 Adopted - 2OA4f
Adapted
A d'ustcd
P14'ected
$ ih
o [ 1
B� Cf.V.W.Wi FI D B.4ZI W I
S 3.32c3 3
S f'. L=1.94�3
S % 3%.151
S 69-3M.x%o
S fi9 b Lli
S hu_' Nxfi 3 f
S W. 5,X.90
S l5.'aLL{I.;
�.0
RE vf-ilE
PDp,E }Tams
$ IQ79Sk
$ 16117.428
$ 11,077�13
$ 1l?75.$31i
1L,275,839
S LL-U5X5
S 1L-1d7-280
L10.L77
1.0%
Saks Tax
14;731,810
15.".M3
15.844.755
14,457.M'.1
14,4573AL
L5,949,755
15.W.755
1,44? 74
10-1%
C6Tilal Justizc Saks Tax
2,917,406
3^010
2.81A.349
I�M-1 r1
5jn7XL
3JM7XL
3.21-161
lJlil yTax
11,719,W
11,10�.1��•
1 "1
14X-W.
14-?47,547
15,177A06
15.177:6
880.fy",
6-'%
PridFf atc 6esetex
4.,-*v5
5,riM3
3.640,000
1 0,00U
5fi#0,OU0
0"
1.610.WO
OtheCTems
1 ;A 750
W7 jk
1.304.3316
1 13
.. 15
n7�10
513
MI AG I
-51-f1rlr
Leeoses end Pcmits
46%4yS
5,785A10
4.491914
4.$4( lI
4 011
1%7-%b
5,8(10
�M451j
-MPA
h3urpvcmuemal
11.701.4)(6
11,360,417
9.448.M
15,446,d15
1544b,615
LI'll LAO
i641.S9t3
{4-215.035)
-27. 6
Clb r fwr5ffvices
23.906.88
75,M-614
21,0A80
21,705,959
21,705,959
2918 6s
23,1A1.743
6.126.705
25.9%
Fines end Pembe5
4.2%11-1
4.D30
4.74.401
309A3.1
1,&"43 L
3,G99,426
3.6%.42A
1.195
0.1%
Vliscdlaneaus
-,9 554
4.L91.0
2.514.7C10
2344.515
2W,515
3,T7,434
4.152.3I2
61.5%
Pwprietary Fuod Rcvrnue
595,L06
N3.461
49A.000
458.00L1
45K U0
U8 ku
4M.A00
30.000
6.6%
ahcr FinenenirS,-;;o-unes
19;44(k341
37.4M-W
17.%6.V
21N.7-M
n-147,778
A 9M
M872.913
15.093.011
64.0%
Tatel lkcvcmues
S L 13.bXK. L35
13f1. rf+zJ.4Mf1
S M.393.?12
S 1' L_90.121J
S I' L_90.144
S 14 -45,652
S f � h 601.13(M
S 19.41a<fr.5CL2
16.b%
Mi 24AM.lz'fi
h&, pk.&C k..JsSY., 9P10IAM
P.bkw.& Z.8fi'14
Voo-lkpanoeo�l 3Q75SX
TolelEWend¢ures S LI49*523
CLuges io kuod 6>fauce f [L26LV4
E MGFUNDB.ALAACE: f V,12L963
24.7A AM
2S,u5GIO 2ia25,5a1 Y5, ,141 14,lb 286 25ja3,757(859,55) ;.a°o
&635.M
7,979621
807531
$027_'.3I
KIM916
k954,169
MM5
S.'f
21MLV
1017,496
24,70-W
2g7%,W
NJ 19,467
26,436,182
632a 1'e
43510.711
33.531.339
42Mr10
4LjIMN
W2IN
34,418,471
9�11X
23.5%
5 129.654.671
f 110.49306
f 120620-�.%
S 127,929,111
S 144,18,rS
S 121^610
S 15,%6 SH
12.1%
f 1M,815
f {],07d,744]
f (6.631,401)
S (5,940,1q
S (2,6A7,325
S (4,733303)
S 3.933.6M
-59-1%
f 69236799
1 f O—VI-157
f 6?60-93
$ 63j96A34
S 60.598,909
S 51M5.605
S {2.90G.484]
-323i
B-1
$16,000, 000,odo
$14,000, 0oo,odo
$1$,000, 000,000
$10,000, 000,odo
$0,O O,000,Oo0
$6,Oa0,000,000
$4,Oaa,00a,OW
$2,O O,OOa,OW
$0
$1$,000,000
$10,000,000
$8,000,000
$6,000,000
$4,Oaa,00a
$2,ODO,aan
Forecasting Revenue
Property Value
C�,O1. IOr. tIjK�liFr:��[EfL')�i�Yi��4�Y3�
Total Annual Levy
196 296 396
2011 2012 2013 2014 2015 2016 2017 2018 2079 2020 W21
Capped Property Tax Revenue (1 %) forces
us to have conversations to prioritize
expenditures every year
1 -1 ea r Forecast
d
Aw
W
1 2 3 4 5
'Revenue
aw
Opp
MOW
OOP
Go& Ow
dw
6 7 s 9 10
— —Expense
20,OC)0,000
18101O
161 O00,0OO
14,000,000
1210001000
10,000,000
8,0001000
610001000
410001000 100j"y�-01000
8/
Forecasting Revenue
Sales Tax - Actual and Forecast
4%
0%
4% 3% 2%
2016 Act 2017 Act 201SAct 2019 Act 20 0 Act 2021Est 2022 2023 2024
forecast forecast forecast
ouncil-level Budoet Deds-IC
eIrwAt z.
;u n d
Deferred Maintenance
Existing Required Payroll and Benefits
Existing Service Delivery Obligations
Existing Debt Obligations
Required Infrastructure Obligations
Recap
✓ There is a detailed plan and timeline
✓Staff brings information needed to
decision -making
✓Staff brings realistic forecasting
✓The result is our mutual commitment to
deliver most -needed services
A Budget That Works In the Real World?
Once budget is adopted,
staff has marching orders,
those are our top priorities,
staff executes faithfully,
every penny assigned to the most
important needs.
What's the problem?
What Staff Needs From Council
What department briefings will help inform
you?
• Community Development
• IT
• Parks
• Police
• Public Works
Full awareness of current service levels?
What bad news needs to be heard now?
Council Questions
Any topics staff can get to work on now?
Anything Finance -specific to bring to
FEDRAC in coming months?
Specific study sessions?
City of Federal Way
Finance Department
An increasingly well -managed city