Discussion:
General Fund - June 2018 Review (See Attachment)
The end of June marks the halfway point of the year and is a good point in time to see how the year is transgressing. I am happy to report that June continues on the same positive path as the previous months this year.
Revenue Variances (+/- 10% of 50% Target)
- General Fund revenues continue trending in the right direction. First half property taxes were received in June, which alleviated the revenue shortfall previously reported.
- Intergovernmental revenues are below the target range at this point of the year, but are only slightly less than the actual receipts at this same time last year. The difference between this year and last year is due to a shift in state-aid from street maintenance to street construction aid. Maintenance aid is accounted for in the General Fund and construction aid is accounted for in the Capital Improvement Fund. Staff did account for this shift when preparing the 2018 budget.
- Miscellaneous revenue is higher than both the target budget and the actuals from June 2017. This increase in revenue is attributed to an increase in interest revenue and the accumulation of donations for the Rev. Pond statue.
Expenditure Variances (+/- 10% of 50% Target)
- Natural Resources expenditures will be beginning to ramp up as the summer season progresses and tree maintenance and preservation activities begin.
- All other departments are within the target variance at this time.
Community Center/Sand Venture& Ice Arena Year-over-Year Comparison - June 2018 (See Attachment)
2018 Ice Arena revenues are $24,600 higher than this same time last year.
Ice arena total expenditures are nearly identical to this same time last year and are tracking with the 2018 budget.
Community Center/Sand Venture revenues are trending at about 63 percent of the 2018 budget, which is slightly above the budget target for June.
Community Center/Sand Venture expenditures are higher than this time last year due to the facility not being fully functional until mid-summer. Through June 2018, the community center/sand venture expenditures account for approximately 42 percent of the budget. Individual line item expenditures will continue to be monitored as the year progresses.
Deferred membership revenue as of June 30, 2018 is $209,821 compared to $153,557 a year ago. This is direct result of strong annual membership sales throughout 2017 and into 2018.
Quarterly Investment Portfolio Report - Q2, 2018
Part of the process of attaining a higher bond rating is ensuring that city has a solid set of management policies and practices. One of those practices involves communicating regular budget updates with the city council, which we have been doing for some time now. Another one of those policies and practices is ensuring the city has a sound investment policy and that regular updates are provided to the city council.
The city's investment policy is guided by the investment acronym SLY, which stands for Safety, Liquidity and Yield, and in that priority order. Safety of principal is the foremost objective of the investment program. Second, the investment portfolio needs to remain sufficiently liquid to meet day-to-day operational requirements. Lastly, attaining a market yield is the third goal of the investment policy. The first two priorities of safety and liquidity limit the ability of the portfolio to realize comparable private sector earnings in those robust years. However, the policy also minimizes the chances of experiencing losses in the down years.
The city utilizes Securian Asset Management as its investment manager. They handle a majority of the city's investment portfolio. Part of their services include the preperation of monthly and quarterly investment reports. On a quarterly basis I will be providing council with a review of the city's portfolio and performance.