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City of Huntington Beach
File #: 19-1200 MEETING DATE: 12/16/2019
REQUEST FOR CITY COUNCIL ACTION
SUBMITTED TO: Honorable Mayor and City Council Members
SUBMITTED BY: Oliver Chi, City Manager
PREPARED BY: Dahle Bulosan, Interim Chief Financial Officer
Subject:
Approve Fiscal Year 2018/19 Year End Preliminary Unaudited General Fund Balance
Designations
Statement of Issue:
The Finance Department is currently undergoing the year-end closing process for the Fiscal Year
(FY) 2018/19, which began on July 1, 2018, and ended on June 30, 2019. City Council authorization
is requested to allocate the currently estimated increase in General Fund balance of $10A million
and reallocate fund balance categories to finalize the City's Comprehensive Annual Financial Report
(CAFR), subject to final certification by the City's independent, external auditors.
Financial Impact:
Authorization is requested to allocate the currently estimated increase in General Fund Balance of
$10.4 million and reallocate fund balance categories to finalize the City's CAFR.
Recommended Action:
Approve the assignments of preliminary FY 2018/19 year-end General Fund Balance increase of
$10.4 million and reallocation of fund balance categories in the amounts and for the purposes
indicated in Attachment 1 .
Alternative Action(s):
Do not approve the recommendation and direct staff accordingly.
Analysis:
For the Fiscal Year 2018/19, preliminary, unaudited figures reflect a total of approximately $232.1
million in recurring General Fund revenue and $4.5 million in one-time revenue for a total of$236.6
million in total estimated General Fund revenue. The total estimated General Fund expenditures and
transfers is $226.2 million. After accounting for actual expenditures and transfers, there is a
preliminary unaudited increase in fund balance of $10.4 million, or 4.4 percent of the General Fund
revenues.
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File #: 19-1200 MEETING DATE: 12/16/2019
General Fund Designations
The City Council developed Strategic Initiatives at the City Council's Strategic Planning Retreat on
February 7, 2019. These includes a three-year goal specific to each of the City's strategic objectives.
The Strategic Initiatives Reserve was established to ensure funding for these goals. These goals are
currently being reviewed and evaluated by Executive Team based on needs and priorities. Staff
recommends to assign estimated available net General Fund balance of$10.4 million to the Strategic
Initiatives Reserve. It is also recommended to consolidate various reserves (Redevelopment
Dissolution, Senior Center Debt Service, CalPERS Rate Increase, Park Improvements, Police Facility
Enhancements and Unassigned) funds to the Strategic Initiatives Reserve (See Attachment 1).
Recommended uses of this fund will be presented to the City Council for review and authorization at
a later date.
Please note that the preliminary, unaudited $10.4 million increase in General Fund Balance that is
the basis for this recommendation is an estimate and is still subject to potential change. It is
recommended that any required reductions to this number (or additions), be reflected in the Strategic
Initiative Reserve to help ensure implementation of the City Council established priorities.
The City's final audited figures for the fiscal year ended June 30, 2019, will be available on or before
December 31, 2019, pursuant to Generally Accepted Accounting Principles and Governmental
Accounting Standards Board requirements.
Environmental Status:
Not applicable.
Strategic Plan Goal:
Enhance and maintain high quality City services
Enhance and maintain the infrastructure.
Strengthen long-term financial and economic sustainability.
Enhance and modernize public safety service delivery.
Attachment(s):
1. FY 2018/19 Recommended General Fund Balance Designations
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ATTACHMENT 1
Recommended FY 2018/19 General Fund Balance Designations*
(in thousands)
FY 2017/18 FY 2018/19 Year over Year
Fund Balance Category Audited Recommended Change
Economic Uncertainties 25,011 25,011
Equipment Replacement 8,295 8,295
Redevelopment Dissolution 1,080 (1,080)
General Plan Maintenance 439 546 107
General Liability Plan Migration 2,801 2,801
Capital Improvement Reserve(CIR) 8,046 8,046
Senior Center Debt Service 2,000 (2,000)
CalPERS Rate Increase 1,637 (1,637)
Cityview Replacement 1,028 1,028
Park Improvements 200 (200)
Strategic Initiatives 558 15,998 15,440
Section 115 Trust 1,500 2,500 1,000
Triple Flip 1,759 1,113 (646)
Police Facility Enhancements 2,000 (2,000)
Housing Agreeement 1,580 1,580
Other Fund Balance 4,650 4,661 11
Year-End Market Value 1,184 1,184
Unassigned 2,734 (2,734)
Section 115 Trust Bank Balance 4,896 1 6,250 1,354
Total Fund Balance: 68,634 79,013 1 10,379
Notes:
` These recommended fund balance designations may be subject to change upon further review and certification
by the City's external independent auditors.
^ Other Fund Balance-includes Prepaid Expenses,Encumbrances,Non-Spendable and Other Restricted Items
which may also be subject to further change as per auditor review and GASB rules.
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