BUFFALO FISCAL STABILITY AUTHORITY Board Meeting May 20, 2020 - - PowerPoint PPT Presentation

BUFFALO FISCAL STABILITY AUTHORITY Board Meeting

May 20, 2020 Buffalo City School District Third Quarter Review

1

COVID-19 Pandemic

• All District schools closed March 13, 2020 as a result of the

Coronavirus Pandemic

 On May 1, 2020, the Governor extended the order for the remainder

• f the academic year
• All employee groups with the exception of Substitute Teachers are

currently receiving regular compensation and benefits

 Substitute Teachers are currently receiving unemployment insurance  All other employee groups are currently working remotely  Bus aides are not working but receive weekly salary based on an average workday’s pay

Review of the Buffalo City School District’s Third Quarter Report (FY 20 19-20 )

2

Review of the Buffalo City School District’s Third Quarter Report (FY 20 19-20 )

* Note: the Adopted Budget was modified to include $3.7 M

• f carryover encumbrances (not reflected above)

General Fund 2019-20 Modified Budget Projected FYE at 12.31.2019 Projected FYE at 03.31.2020 03.31.2020 FYE Variance to Budget Revenues $917.4 $914.3 $913.1 ($4.3) Expenditures 927.4 916.9 883.1 (44.3) Surplus (Deficit) ($10.0) ($2.6) $30.0 $40.0 $ in Millions

3

Modified Budget Projected FYE at 12.31.2019 Projected FYE at 03.31.2020 03.31.2020 FYE Variance to Budget

Real Property Tax $70.8 $70.8 $70.8 $0.0 Erie County Sales Tax 47.0 48.5 45.5 (1.5) Federal Medicaid Reimbursement 2.6 3.2 3.1 0.5 New York State Aid 784.4 779.2 781.1 (3.3) Miscellaneous (Tuition, Interest Earnings, Interfund Revenues, earnings on Debt Service Reserve Fund) 12.6 12.6 12.6 0.0 Total General Fund Revenues $917.4 $914.3 $913.1 ($4.3)

Buffalo City School District Revenues

2019-20 3rd Quarter Update $ in Millions

4

General Fund Expenditures Modified Budget Projected FYE at 12.31.2019 Projected FYE at 03.31.2020 03.31.2020 FYE Variance to Budget

Total Employee Compensation $324.5 $319.1 $313.8 $10.7 Total Employee Benefits 190.3 187.3 176.3 14.0 Payments to Charter Schools 132.8 131.9 131.4 1.4 Debt Service 114.9 113.0 114.9 0.0 Transportation 50.9 51.5 35.7 15.2 All Other Expenditures 114.0 114.1 111.0 3.0

Total General Fund Expenditures $927.4 $916.9 $883.1 $44.3

Buffalo City School District Expenditures

2019-20 3rd Quarter Update $ in Millions

5

Employee Group FY 2019-20 Adopted Budget Actual at 3/31/2020 Variance FY 2019-20 Adopted Budget Actual at 3/31/2020 Variance

Teachers

3,698.7 3,655.0 (43.7) 3,218.0 3,197.0 21.0

Administrators

264.7 260.0 (4.7) 229.0 230.0 (1.0)

Professional, Clerical, & Technical Employees Assoc. (White Collar)

494.4 448.0 (46.4) 381.0 354.0 27.0

Local 264 - (Blue Collar)

95.0 84.0 (11.0) 65.0 60.0 5.0

Teacher Aides/ Teaching Assistants

954.3 911.0 (43.3) 806.0 766.0 40.0

All Other Employees

137.6 123.0 (14.6) 134.0 121.0 13.0

Total FTEs 5,644.7 5,481.0 (237.5) 4,833.0 4,728.0 (105.0)

FY 2019-20 3rd Quarter Employee Count Comparison

All Funds General Funds

6

7

Summary

• The projected results for the 2019-20 year varies substantially

from the original budgeted appropriation of $10.0 M of fund balance due to the implications of the Coronavirus pandemic

 The District is projecting a $30.0 M surplus at FYE which will roll forward into next year’s budget

• The pandemic has had a substantive impact on the District

 Erie County Sales Tax receipts are forecast at a $1.5 M unfavorable budgetary variance  Transportation expenditures are forecast to be favorable by $15.2 M  Total healthcare expenditures are forecast to be significantly less than budget by $12.5 million, with a significant portion of these expenditures are anticipated to be deferred into FY 2020-21 and FY 2021-22

7

Review of the Buffalo City School District’s Third Quarter Report (FY 20 19-20 )

Summary

• The District had a substantial vacancy rate of 2.2% at March 31,

2020

 The District is now forecasting significant, favorable budgetary variances within various Employee Compensation and Employee Benefit lines

• Overall fiscal year-end projections are conservative

Review of the Buffalo City School District’s Third Quarter Report (FY 20 19-20 )

8

BUFFALO FISCAL STABILITY AUTHORITY Board Meeting

May 20, 2020 Review of the Buffalo City School District’s FY 2020-21 Recom m ended Budget and FY 2021-24 Financial Plan

9

Introduction

• The 2019-20 Recommended Budget and 2020-2024 Financial

Plan was submitted to the BFSA on May 1, 2020

• The District plans to review the Recommended Budget and

Financial Plan on May 20, 2020

• A deficit of $50.0 M is reflected in the Recommended Budget
• A budget gap has been projected for each year of the Financial

Plan with a cumulative four-year budget gap of $219.9 M

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

10

Introduction

• New York State’s finances have been deeply impacted by the

COVID-19 pandemic and the resulting Coronavirus Recession

• The New York State (NYS) 2020-21 Enacted Budget included a

“Pandemic Adjustment”

 Reduction in NYS aid payments to each school district equivalent to the federal stimulus provided under the U.S. Coronavirus Aid, Relief, and Economic Security (CARES) Act

• The total level of NYS aid included in the SFY 2020-21 Enacted

Budget is $26.27 B, slightly less than the SFY 2019-20 appropriation of $27.3 B

• A cumulative federal CARES Act Restoration of $1.13 B brings the

total New York State aid to $27.4 B, slightly higher than the PFY’s authorized appropriation

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

11

Introduction

• The level of NYS aid may be reduced further from that already

provided for within the NYS Enacted Budget

 The NYS Director of the Budget is authorized to determine whether the NYS Enacted Budget is balanced during three “measurement periods”: April 1 through April 30, May 1 through June 30, and July 1 through December 31  If a general fund imbalance has occurred during any measurement period, the Director of the Budget is empowered to “adjust or reduce any general fund and/or NYS special revenue fund appropriation and related cash disbursement by any amount needed to maintain a balanced budget

• Revised spending plan expected to include $8.2 B in reductions to

aid to localities

• The District has quantified an additional, potential reduction in

NYS aid of $110.0 M (Equivalent to a 20% reduction)

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

12

Introduction

• The Financial Plan includes deficit closing and cost savings

initiatives (Gap Closing Plan) to address the budget gaps projected over the outyears

• Includes various areas for savings through efficiencies, increased

revenues, and increased reliance on fund balance

 Additionally demonstrates potential methods available to close the projected out-year budgetary gaps in the event additional revenues and/or savings from efficiencies are inadequate to address the budget gaps

• Several actions have been implemented or are slated to be

implemented in FY 2020-21

 Such savings have been integrated in the Financial Plan

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

13

Key Observations

• General Fund revenues increase at a compound annual growth

rate of 0.8% over the Financial Plan

• General Fund expenditures increase at a CAGR of 0.6%

 General Fund expenditures exceed General Fund revenues in each year of the Financial Plan

• General Fund revenues includes a NYS Pandemic Adjustment of

$29.6 M in FY 2020-21

 This decrease is offset with $29.6 M in Federal CARES Restoration in FY 2020-21

• Each outyear includes an annual Pandemic Adjustment

 Based on past experience

• NYS aid was reduced through a Gap Elimination Adjustment from

FY 2008-09 through FY 2015-16 as a result of the 2007-2009 Great Recession

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

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Key Observations

• The District has budgeted the appropriation of $50.0 M of fund

balance in FY 2020-21

 The total four-year deficit of $219.9 M is reduced to $169.9 M following the appropriation of fund balance  The Gap Closing Plan included within the Financial Plan demonstrates the District’s strategic plan to address these outyear deficits through various deficit closing and cost savings initiatives

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

15

Key Observations

• All collective bargaining units have labor agreements that either

are expired or are scheduled to expire in the next several years

• Several of the main cost drivers for the District have reduced rates
• f increase over the Financial Plan including health insurance for

both active employees and retirees and pension payments

• The implementation and continuation of various efficiency

initiatives along with additionally available fund balance will begin to address projected out-year budget gaps but will be insufficient to fully close the gap

 Various cost reduction actions including program and staffing cuts are reflected to close the remaining budget gaps

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

16

Key Observations

• The District had intended to be operationally balanced by FY

2020-21

 This is no longer planned due to the impact of the Coronavirus Recession  Each FY of the Financial Plan has a projected deficit between $45.3 M to $64.8 M

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

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2020-21 Recommended Budget 2021-22 Outyear 1 2022-23 Outyear 2 2023-24 Outyear 3 4-Year Totals Revenues

$904.7 $901.2 $917.0 $927.6 $3,650.5

Expenditures

954.7 966.0 976.8 972.9 3,870.4

Surplus/(Deficit)

($50.0) ($64.8) ($59.8) ($45.3) ($219.9)

Assigned Fund Balance

4.0 0.0 0.0 0.0 4.0

Unassigned Fund Balance

46.0 0.0 0.0 0.0 46.0

Total Fund Balance

50.0 0.0 0.0 0.0 50.0

Remaining Deficit

($0.0) ($64.8) ($59.8) ($45.3) ($169.9)

FY 2021-2024 Financial Plan Summary

$ in Millions

18

General Fund Revenues

2019-20 Adopted Budget 2020-21 Recommended Budget 2021-22 Outyear 1 2022-23 Outyear 2 2023-24 Outyear 3 $ Change from Year 1-4 % Change from Year 1-4 Real Property Tax $70.8 $70.8 $70.8 $70.8 $70.8 $0.0 0.0% Erie County Sales Tax 47.0 44.0 44.7 45.6 46.5 2.5 5.7% Federal Medicaid Reimbursement 2.6 3.0 3.0 3.0 3.1 0.1 3.3% New York State Aid (less Building Aid) 664.3 651.1 673.8 682.5 694.0 42.9 6.6% New York State Pandemic Adjustment 0.0 (29.6) (21.0) (15.0) (10.0) 19.6

• 66.2%

Federal CARES Restoration 0.0 29.6 0.0 0.0 0.0 (29.6)

• 100.0%

New York State Building Aid 120.1 116.5 116.5 116.5 109.5 (7.0)

• 6.0%

Miscellaneous (Tuition, Interest Earnings, Interfund Revenues, earnings on Debt Service Reserve Fund) 12.6 19.3 13.4 13.6 13.7 (5.6)

• 29.0%

Total General Fund Revenues $917.4 $904.7 $901.2 $917.0 $927.6 $22.9 2.5% Fund Balance 10.0 50.0 0.0 0.0 0.0 Total GF Revenue & Assigned Fund Balance $927.4 $954.7 $901.2 $917.0 $927.6 ($27.1)

• 2.8%

FY 2021-2024 Financial Plan General Fund Revenues

(In Millions)

19

General Fund Expenditures

2019-20 Adopted Budget

2020-21 Recommended Budget 2021-22 Outyear 1 2022-23 Outyear 2 2023-24 Outyear 3 $ Change from Year 1-4 % Change from Year 1-4

Employee Compensation

$320.5 $326.0 $331.9 $334.7 $338.2 12.2 3.7%

Employee Benefits

193.3 201.1 208.3 214.9 224.7 23.6 11.7%

Debt Service

113.0 112.3 108.8 101.0 76.3 (36.0)

• 32.1%

Charter School Payments

133.7 138.1 137.2 143.9 149.0 10.9 7.9%

Transportation

51.3 60.3 61.7 62.8 63.9 3.6 6.0%

All Other Expenditures

115.6 116.9 118.1 119.5 120.8 3.9 3.3%

Total $927.4 $954.7 $966.0 $976.8 $972.9 $18.2 1.9%

FY 2021-24 Financial Plan General Fund Expenditures

$ in Millions

20

General Fund

FY 2019-20 Adopted Budget FY 2020-21 Recommended Budget FY 2021-22 (Out-year 1) FY 2022-23 (Outyear 2) FY 2023-24 (Outyear 3) BTF

$230.7 $234.9 $239.2 $240.9 $243.1

# of FTEs

3,218 3,275 3,245 3,217 3,198

Substitutes*

$6.9 $7.8 $7.8 $7.8 $7.8

BSCA

$25.8 $25.9 $26.3 $26.7 $27.1

# of FTEs

229 233 233 233 233

PCTEA

$17.8 $19.0 $19.6 $19.9 $20.2

# of FTEs

381 382 382 382 382

BEST

$17.8 $16.8 $17.1 $17.3 $17.6

# of FTEs

806 810 810 810 810

TAB*

$5.7 $6.0 $6.1 $6.2 $6.3

Trades

$3.6 $3.4 $3.5 $3.6 $3.7

# of FTEs

33 33 33 33 33

Local 264 (Blue Collar)

$2.5 $2.5 $2.6 $2.6 $2.7

# of FTEs

65 66 66 66 66

Local 409 (Engineers)

$3.1 $3.1 $3.1 $3.1 $3.1

# of FTEs

56 57 57 57 57

Exempt Employees

$4.4 $4.7 $4.7 $4.7 $4.7

# of FTEs

36 36 36 36 36

Board Members*

$0.0 $0.0 $0.0 $0.0 $0.0

# of FTEs

9 9 9 9 9

Total # of FTEs

4,833 4,901 4,871 4,843 4,824

Miscellaneous Items

$0.4 $0.3 $0.3 $0.3 $0.3

Overtime

$1.8 $1.6 $1.6 $1.6 $1.6

TOTAL EMPLOYEE COMPENSATON

$320.5 $326.0 $331.9 $334.7 $338.2

*Board members receive a $10,000 annual stipend. $ in Millions * The District does not provide FTE estimates for hourly, part-time positions.

21

4,257 4,396 4,509 4,721 4,679 4,832 4,901 4,870 4,842 4,823 5,175 5,257 5,327 5,544 5,454 5,644 5,638 5,608 5,580 5,560

• 1,000

2,000 3,000 4,000 5,000 6,000 FYE 2014- 15 FYE 2015- 16 FYE 2016- 17 FYE 2017- 18 FYE 2018- 19 FY 2019-20 Adopted Budget FY 2020-21 Adopted Budget FY 2021-22 Outyear 1 FYE 2022- 23 Outyear 2 FYE 2023- 24 Outyear 4

BCSD District-Wide FTE Count

General Fund All Funds

22

General Fund Expenditures

2020-21 Recommended Budget 2021-22 Outyear 1 2022-23 Outyear 2 2023-24 Outyear 3 Additional Compensation FY 2021-24 Estimated Increase from Settled CBAs (Salary & Wages) $7.2 $7.7 $7.7 $8.5 $31.1 Estimated Increase from Settled CBAs (Fringe Benefits) 0.5 0.6 0.6 0.6 9.3 Gross Cost of Settling CBAs $7.7 $8.3 $8.3 $9.1 $33.4 less hypothetical savings from various concessions 0.8 0.8 0.8 0.9 3.3 Estimated Net Cost of Settled CBAs $6.9 $7.5 $7.5 $8.2 $30.1

Buffalo City School District

Contract Settlem ent Scenario

23

33,100 32,550 32,086 31,658 31,359 9,400 9,950 10,414 10,842 11,141 42,500 42,500 42,500 42,500 42,500

5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 FY 2019-20 (Adopted Budget) FY 2020-21 (Adopted Budget) FY 2021-22 (Projected) FY 2022-23 (Projected) FY 2023-24 (Projected) District Enrollment Charter School Enrollment Combined Enrollment

Buffalo City School District

Projected Public School Enrollm ent: District and Charter School

24

34,066 33,367 33,221 33,129 32,920 33,100 32,550 32,086 31,658 31359 7,578 7,910 8,055 8,670 9,142 9,400 9,627 9,881 10,842 11141 41,644 41,277 41,276 41,799 42,062 42,500 42,500 42,500 42,500 42,500

• 5,000

10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 2014-15 (Actual) 2015-16 (Actual) 2016-17 (Actual) 2017-18 (Actual) 2018-19 (Actual) 2019-20 (Projected) 2020-21 (Recommeded Budget) 2021-22 (Projected) 2022-23 (Projected) 2023-24 (Projected)

BCSD Charter School Combined

Buffalo City School District

Historical Public School Enrollm ent: District and Charter School

25

FY 2020-21 Recommended Budget FY 2021- 22 Outyear 1 FY 2022- 23 Outyear 2 FY 2023- 24 Outyear 3 4-Year Totals

$904.7 $901.2 $917.0 $927.6 $3,650.5 $954.7 $966.0 $976.8 $972.9 $3,870.4 ($50.0) ($64.8) ($59.8) ($45.3) ($219.9) 50.0 0.0 0.0 0.0 50.0 ($0.0) ($64.8) ($59.8) ($45.3) ($169.9) 0.0 38.0 32.0 15.0 85.0 Other Revenue 0.0 0.3 0.3 0.3 0.9 Efficiencies and Savings 0.0 6.4 6.9 7.4 20.7 Other Cost Reductions 0.0 40.5 41.0 41.5 123.0 $50.0 $85.2 $80.2 $64.2 $229.6 $0.0 $20.4 $20.4 $18.9 $59.7 Fund Balance Excess/(Shortfall) Total Deficit Closing and Cost Saving Initiatives Use of Fund Balance Revised Baseline Gap

General Fund Deficit Closing and Cost Saving Initiatives

$ in Millions Revenues Expenditures Baseline Gap

26

Fund Balance - $85.0 M

• Fund balance is currently projected to total $203.6 M at June 30,

2024

 If this deficit closing action were implemented at the full extent provided within the Gap Closing Plan, total fund balance would total $118.6 M at June 30, 2024

• Unrestricted estimated at $93.8 M
• 4% of expenditures = $38.9 M in 2023-24
• The Financial Plan includes the ability to use additional fund

balance

 FY 2021-22 - $38.0 M  FY 2022-23 - $32.0 M  FY 2023-24 - $15.0 M

Buffalo City School District

FY 2020-21 through FY 2023-24 Gap-Closing Measures

27

Other Revenue - $0.9 M

• The Financial Plan includes revenue enhancement ($0.3 M

annually/$0.9 M cumulatively)

 Revenue enhancement: Aid maximization program to yield greater revenues though better data collection and understanding of the various NYS and federal regulations

• The cumulative increase is estimated at $7,047,000 through FY 2019-

20

Buffalo City School District

FY 2020-21 through FY 2023-24 Gap-Closing Measures

28

Savings to be Achieved through Efficiencies - $20.7 M

• The Financial Plan includes 7 individual actions for cost

reductions and savings to be achieved through greater efficiencies

• Provides a cumulative $20.7 M of cost reductions:

1. Vacancies ($2.0 M annually/$6.0 M cumulatively): Potential additional budgetary savings resulting from vacancies based on historical experience 2. Employee healthcare ($1.5 M annually/$4.5 M cumulatively): Potential budgetary savings from various employee healthcare initiatives 3. Reduce Substitute Teacher Costs ($0.1 M annually/$0.3 M cumulatively): Potential budgetary savings from better management of teacher absences

Buffalo City School District

FY 2020-21 through FY 2023-24 Gap-Closing Measures

29

Savings to be Achieved through Efficiencies - $20.7 M

4. Negotiations/Analysis of Top 150 Vendors/Best Practices ($0.5 M in FY 2021-22/ increases of $0.2 M annually/ cumulative $2.1 M):

• Implemented an electronic bid/RFP process where bids/RFPs are

submitted online to the District and evaluations are completed in the system to improve the efficiency/accuracy of the evaluation process

• Undertaking a project to improve the MWBE process which will

bring more competition to District offerings

• Analyzed several best practices through work with the Council of

Great City Schools and other organizations and is anticipated that some of the best practices identified during this process will yield more cost-efficient procurement

Buffalo City School District

FY 2020-21 through FY 2023-24 Gap-Closing Measures

30

Savings to be Achieved through Efficiencies - $20.7 M

5. Reduction in overtime ($0.1 M annually/$0.3 M cumulatively): Potential annual savings from this continued initiative 6. Public Transportation ($2.0 M in FY 2021-22/ increases of $0.3 M annually/cumulatively $6.9 M): Potential annual savings from possibility

• f splitting bussing services into zones

7. Reduced compensated leave time ($0.2 M annually/$0.6 M cumulatively): Procedural controls over staff’s utilization of workers’ compensation, medical leave and administrative leave

Buffalo City School District

FY 2020-21 through FY 2023-24 Gap-Closing Measures

31

Other Cost Reductions - $123.0 M

• The District has included three (3) gap-closing measures to provide

cost reductions in the event such actions are necessary. These actions have an estimated cumulative $123.0 M impact over the Financial Plan and include more severe measures and include:

 The reduction of the general contingency account ($1.5 M annually for a cumulative total of $6.0 M)  The reduction and/or elimination of non-mandated programs ($0.25 M annually for a cumulative $0.75 M)  The reduction of central office, instructional and support positions ($38.75 M annually for a cumulative $116.25 M)

Buffalo City School District

FY 2020-21 through FY 2023-24 Gap-Closing Measures

32

Conclusions

• The Financial Plan was developed using consistent underlying key

assumptions used in development of the Recommended Budget, adjusted for known or estimated increases or decreases

 Teaching positions: assumed reduction in positions due to a shift in students from District schools to charter schools

• Estimated reduction of 6.5 teachers for every 100 students that

enroll in charter schools

• Equivalent to $20 M over the Financial Plan

 Nursing revenue of $1.2 M annually now included in the Budget

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

33

Conclusions

• The State’s finances have been deeply impacted by the COVID-19

pandemic and the resulting Coronavirus Recession

 The NYS Enacted Budget included a Pandemic Adjustment offset by the Federal CARES stimulus funding

• The District’s Pandemic Adjustment was $29.6 M, equivalent to the

CARES Restoration

• The Financial Plan’s outyears include the assumption of additional

annual NYS Pandemic Adjustments to NYS aid

 No assumption of additional federal stimulus funding

• Risk identified: NYS aid could be further reduced

 $8.2B gap expected to be closed with cuts to localities  District estimate = potentially $110.0 M

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

34

Conclusions

• The District’s Financial Plan includes an initial budget gap of

$219.9 M

 The District has closed the 2020-21 budget gap with $50.0 M in fund balance  The remaining out-years of the Financial Plan contain budget gaps to be closed solely through the various gap-closing measures

• $85.0 M in additional fund balance
• $0.9 M in additional revenue
• $20.7 M in various efficiency savings
• $123.0 M in various cost reductions including $116.4 M in staffing

cuts

• The Gap Closing Plan demonstrates necessity for staffing cuts

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

35

Conclusions

• The District has included a staffing plan which increases the

number of budgeted positions in FY 2020-21 by 69 FTE positions

• n a General Fund basis

 Budgeted staffing at 4,901 FTEs represents the highest level of budgeted FTEs since BFSA’s inception on a General Fund basis  On an All Funds basis, 5,638 FTEs are budgeted, a decrease of 6 FTEs

• ver the FY 2019-20 Adopted Budget

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

36

Conclusions

• The District has budgeted the appropriation of $50.0 M of fund

balance in FY 2020-21

• Projected unassigned fund balance will exceed the Board of

Education’s 4% retainage policy by an estimated $41.2 M at June 30, 2024

 This amount is projected without factoring in the use of fund balance to balance the outyears of the Financial Plan

• Fund balance may be significantly depleted over the Financial

Plan

• Due to the difficult financial circumstances anticipated over this

Financial Plan, there is no replenishment of fund balance provided

• ver this four-year period and would need to be considered by the

District in ensuing years

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

37

Conclusions

• The Financial Plan does not include any increases for expired

labor agreements

 Teachers contract expired June 30, 2019

• $9.0 M has been set-aside in fund balance for settling labor

agreements

• Financial Plan generally provides for 1.5% annual compensation

increases

 A portion is anticipated to be used for annual step increases and a portion available for contract negotiations  BFSA estimates that $3.5 M has been built into the budget and is available for settling expired labor agreement  Estimated cumulative increase for settling all contracts is $30.1 M over the Financial Plan

Buffalo City School District

2020-21 Recom m ended Budget & 2021-2024 Financial Plan

38

BUFFALO FISCAL STABILITY AUTHORITY Board Meeting

May 20, 2020 Review of Buffalo Urban Renew al Agency FY 2019-20 Third Quarter

39

BURA Current Year Grant Awards

40

Total BURA City of Buffalo CDBG* 13,760,335 $ 6,262,554 $ 7,497,781 $ HOME 3,007,593 3,007,593 ESG 1,160,583 1,160,583 HOPWA 798,764 798,764 Total: 18,727,275 $ 9,270,147 $ 9,457,128 $ HUD Allocation Entitlement Funds Program Year 45: 2019-20

Revenues and Expenditures as of March 31, 2020

41

Summary of revenues: Budget Actual $ % Community Development Block Grant (CDBG) 5,405,690 $ 4,165,445 $ (1,240,245) $

• 22.9%
• Program Income/Interest/Rental Income

750,000 955,083 205,083 27.3% Housing Opportunities Made Equal (HOME) 2,836,130 2,734,722 (101,408)

• 3.6%
• Program Income/Interest Income

262,500 184,763 (77,737)

• 29.6%

All other 1,575,500 1,544,815 (30,685)

• 1.9%

Total 10,829,820 $ 9,584,828 $ (1,244,992) $

• 11.5%

Summary of expenditures: Budget Actual $ % CDBG program costs 3,163,000 $ 3,464,374 $ 301,374 $ 9.5% HOME program costs 2,578,093 2,547,049 (31,044)

• 1.2%

Administrative & planning costs 2,953,278 2,611,162 (342,116)

• 11.6%

All other 162,000 188,506 26,506 16.4% Total Expenditures 8,856,371 $ 8,811,091 $ (45,280) $

• 0.5%

March 30, 2020 Variance March 30, 2020 Variance

BURA as of March 31, 2020

• BURA is dependent on HUD funding

– Future decreases would place additional stress on

• perations

– Current year HUD award consistent with prior-year

• Additional grants awarded outside of HUD entitlement funds

– Evans Bank = $475,000

• $30,000 in current year

– Local Initiatives Support Corporation = $350,000

• $87,500 in current year

– Enterprise New York Cities RISE = $1.0M

• $80,000 in current year

42

BURA as of March 31, 2020

• Collective bargaining agreement with CSEA expires June 30, 2020
• No restrictions placed on operations resulting from FBI and IRS raid
• BURA received notice that 2020-21 entitlement grants will be consistent

with current year

• BURA has continued to operate during pandemic

– Affordable housing is deemed essential and construction has continued with proper safety equipment and procedures in place – Staff working remotely – Minor expenses of approximately $3,000 incurred

• Possible FEMA reimbursement

– Subrecipient awards and payment requests being processed

• BURA is working with City Administration to implement return-to-work

program

43

BUFFALO FISCAL STABILITY AUTHORITY Board Meeting

May 20, 2020 Review of the 2021-2024 Financial Plan

• f the Buffalo Urban Renew al Agency

44

BURA 2021-2024 Financial Plan Overview

• BURA operations are expected to continue with no

planned stoppage of work. Affordable housing is deemed essential and construction work has continued.

• BURA received the Year 46 Entitlement Funds award

notice from HUD on March 30, 2020

– Increase of $735,650 in Entitlement Funds when compared to 2019-20

• Out-year revenues are budgeted conservatively with

increases attributed to outside grants:

– 1.9% increase in 2021-22 – 4.3% decrease in 2022-23 – 0.0% in 2023-24

• Subrecipients receive approximately $700,000 a year

from BURA

45

Year 46 Entitlement Funds

46

Total BURA City of Buffalo CDBG* 14,042,558 $ 6,630,812 $ 7,411,746 $ HOME 3,342,830 3,342,830 ESG 819,189 819,189 HOPWA 1,204,344 1,204,344 Total: 19,408,921 $ 9,973,642 $ 9,435,279 $ *CDBG amount is currently an estimate; split between City and BURA has yet to be finalized. HUD Allocation Entitlement Funds Program Year 46: 2020-21

Entitlement Funds Year-to-Year

47

2020-21 2019-20 $ $ $ % Grant: Community Development Block Grant 14,042,558 13,706,335 336,223 2.5% HOME 3,342,830 3,007,593 335,237 11.1% Emergency Shelter Grants* 819,189 1,160,583 (341,394)

• 29.4%

Housing Opportunities for Persons with Aids* 1,204,344 798,764 405,580 50.8% 19,408,921 18,673,275 735,646 3.9%

*Funds that are administered solely by the City.

Amount of Grant Award Increase/ (Decrease)

48

Buffalo Urban Renewal Agency Review of Financial Plan

Financial Plan is reflective of:

• All known and estimated revenues including

entitlement funds, program income and additional grants (Evans Fund, LISC, Cities RISE and restricted funds)

• Includes resources in the first three years of

financial plan for negotiating a labor agreement between BURA and Local CSEA 815

• Current CBA expires June 30, 2020
• Includes separate projections for salaries and

fringe benefits

49

Buffalo Urban Renewal Agency Financial Plan Summary ($ in millions)

2020-21 ($) 2021-22 ($) 2022-23 ($) 2023-24 ($) Budget Projected Projected Projected Revenues CDBG, including prior year allocation 6.6 6.8 7.0 7.0 HOME, including prior year allocation 3.3 3.4 3.5 3.5 CDBG & HOME Program Income 1.4 1.0 1.0 1.0 Other Income - Other Grants, Rental Income & City 1.4 1.7 0.8 0.8 TOTAL 12.7 12.9 12.3 12.3 Expenditures Program Costs 8.7 8.8 8.2 8.2 Administration and Planning Costs 4.0 4.1 4.1 4.1 TOTAL 12.7 12.9 12.3 12.3 Surplus/(Deficit) 0.0 0.0 0.0 0.0

CDBG has been budgeted in the amount of $7.6 million

• $4.6 million for program delivery
• $3.1 million for emergency loan program
• $1.3 million for program delivery costs
• $0.2 million for crime prevention program delivery
• $3.0 million for administrative costs

HOME has been budgeted in the amount of $3.9 million

• $3.6 million for HOME program delivery
• $3.0 million for rehabilitation and new construction
• $0.5 million for community housing development organizations
• $0.1 million for HOME program delivery
• $0.3 million for administrative costs

50

2020-21 CDBG and HOME Expenditures

Adm inistrative Costs:

• Limited to certain maximum % of grant award
• CDBG = 20% + program income
• HOME = 10%
• Program delivery personal service costs are not

included in these limits

51

Buffalo Urban Renewal Agency Administrative Costs

52

Buffalo Urban Renewal Agency Other Notable Items

• Additional grants were received by BURA and

are now reflected in the Budget and Financial Plan

• BURA continues to look for new revenues
• BURA is including prior year allocations as a

current year resource-CDBG and HOME Funds

• Revenue forecast is conservative in the out-

years

• There is adequate funding for administrative

costs

53

Buffalo Urban Renewal Agency Other Notable Items

• BURA does not participate in the City of Buffalo’s self-

funding of health insurance and continues to maintain coverage through Blue Cross Blue Shield

• Annual increases of 7.0% are included in the Financial Plan
• BURA is holding 36 properties valued at $3.2 million
• Intent is to continue to strategically assess portfolio and

sell properties

• Neighborhood framework plan is ongoing
• Allows multiple stakeholders the ability to coordinate with

each other on agreed-upon housing goals and objectives

54

Buffalo Urban Renewal Agency Staff Schedule

2020 2021 2022 2023 2024 Budget Budget Projected Projected Projected Total FTE's 39 39 39 39 39 BURA Staff Schedule

55

Buffalo Urban Renewal Agency Conclusions

• 2021-2024 Financial Plan is balanced
• Key underlying assumption is Entitlement Funds

will increase 2% annually

• Future entitlement awards will need to be

monitored

Plan for potential funding reductions by prioritizing projects and projecting staffing needs

• Unknown how 2020 census will impact funding
• Larger social and city-wide issues are challenging

and driven by policy as implemented by BURA’s Board of Directors

56

Buffalo Urban Renewal Agency COVID – 19 Pandemic

• Federal stimulus dollars as provided under the

CARES Act excluded from the Financial Plan

Unknown if BURA will receive

• Business activities have not been greatly

impacted

Essential services under NYS Pause Order

• Construction ongoing

Circumstances could impact timetable/plans for projects as time progresses

BUFFALO FISCAL STABILITY AUTHORITY Board Meeting

May 20, 2020 Review of the Buffalo Municipal Housing Authority’s FY 2019-20 Third Quarter Financial Results

57

Introduction

• BMHA issued its FY 2019-20 third quarter report covering July 1,

2019 through March 31, 2020

 Y-T-D Revenues = $36.4 M (76.5% of budget)  Y-T-D Expenses = $35.0 M (75.6% of budget)

• BMHA noted a favorable revenue budgetary variance of $0.6 M

and an unfavorable budgetary variance for expenses of $0.1 M as of March 31, 2020, as compared to the Modified Budget

Buffalo Municipal Housing Authority

2019-20 Third Quarter Review

58

Significant Events

• On January 30, 2020, the BMHA amended its FY 2019-20 Adopted

Budget and FY 2020-2023 Financial Plan

 The FY 2019-20 Adopted Budget as amended (Modified Budget) includes increased revenues from $46.7 M to $47.6 M

• $0.8 M in operating subsidy
• $0.1 M in housing choice voucher income

 Budgeted expenses were increased from $46.2 M to $46.3 M to reflect

• ne additional executive-level white-collar budgeted and filled position

 The adopted staffing plan was increased by one position from 157 FTE employees to 158 FTEs employees

Buffalo Municipal Housing Authority

2019-20 Third Quarter Review

59

Significant Events

• On March 7, 2020, Governor Cuomo issued Executive Order No.

202, “Declaring a Disaster Emergency in the State of New York,” as a response to the COVID-19 pandemic

• At April 30, 2020, 25% of BMHA residents authority-wide had not

paid rent for the month of April

 The monthly unpaid rent amount associated with April 2020 is over $0.3 M  BMHA estimates that, if a trend emerges, the impact could be over $1.0 M in the FY 2019-20 fourth quarter

 On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law

 CARES Act increased HUD Public Housing Operating Fund by an additional $685.0 M  The BMHA’s additional Operating Subsidy was quantified at $2.8 M

Buffalo Municipal Housing Authority

2019-20 Third Quarter Review

60

2019-20 Adopted Budget 2019-20 Modified Budget Budget-to- Date Actual at 3.31.2020 Variance Percent Received Year-to-Date

HUD Subsidy $17.0 $17.8 $13.4 $14.3 $0.9 80.3% Net Dwelling/Non-Dwelling Income 14.4 14.4 10.8 10.6 (0.2) 73.6% HUD PHA Grants - Vouchers 6.2 6.3 4.7 4.8 0.1 76.2% All Other Revenues 6.1 6.1 4.6 4.9 0.3 80.3% Transfers from Capital Grants 3.0 3.0 2.3 1.8 (0.5) 60.0% Total Revenue $46.7 $47.6 $35.8 $36.4 $0.6 76.5%

3rd Quarter Consolidated Results - Revenues

Description

$ in Millions

Buffalo Municipal Housing Authority

2019-20 Third Quarter Review

61

2019-20 Adopted Budget 2019-20 Modified Budget Budget-to- Date Actual at 3.31.2020 Variance Percent Expended Year- to-Date

General Expenses $12.8 $12.8 $9.8 $9.8 $0.0 76.6% Maintenance 11.3 11.3 8.5 8.4 0.1 74.3% Administrative 8.7 8.7 6.5 6.5 0.0 74.7% Utility 5.7 5.7 4.3 4.0 0.3 70.2% Other Expenses 6.2 6.2 4.6 5.1 (0.5) 82.3% Protective Services/ Resident Service Costs 1.5 1.6 1.2 1.2 0.0 75.0% TOTAL EXPENSES $46.2 $46.3 $34.9 $35.0 ($0.1) 75.6%

3rd Quarter Consolidated Results - Expenses

Description

$ in Millions

Buffalo Municipal Housing Authority

2019-20 Third Quarter Review

62

Personnel Department 2019-20 Adopted Budget Actual at 3.31.2020 Actual vs. Modified Budget Variance

Executive 9 9 MIS 3 3 Finance 11 10 1 Personnel 3 2 1 Capital Improvements 13 11 2 Asset Management 119 113 6 Total

158 148

10

BUFFALO MUNICIPAL HOUSING AUTHORITY Budgeted vs. Actual Employees

63

Conclusions

• All BMHA’s Net Dwelling revenue was unfavorable by $0.2 M at

March 31, 2020

• Subsequent to the third quarter’s end, 25% of April’s rental receipts

were not received, directly correlated with the Coronavirus pandemic

• BMHA estimated that the fourth quarter reduction in Net Dwelling

income would be $1.0 M if May and June receipts are similarly delinquent

• Most of the favorable budgetary variance in expenses at March 31,

2020 is due to seasonality and the timing of payments

• Some level of FYE favorable variances is anticipated due to the

vacancies of the first nine months of the fiscal year

Buffalo Municipal Housing Authority

2019-20 Third Quarter Review

64

BUFFALO FISCAL STABILITY AUTHORITY Board Meeting

May 20, 2020 Review of the Buffalo Municipal Housing Authority’s FY 2020-21 Adopted Budget and FY 2021-24 Financial Plan

65

Introduction

• The FY 2020-21 Consolidated Adopted Budget and FY 2021-2024

Consolidated Financial Plan was submitted to the BFSA on May 1, 2020

• The Financial Plan includes the individual budgets and financial

plans for the combined twenty-two AMPS, the COCC, the Marine Drive Apartments, and the HUD Housing Choice Voucher Program

• The Financial Plan includes the individual financial plans and a

consolidated financial plan

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

66

Economic Factors Impacting BMHA’s Adopted Budget and Financial Plan

• The Congressional approval of HUD funding levels for the BMHA
• Local, inflationary, recessionary and unemployment trends that

affect resident incomes and the number of eligible recipients

• The uncertainty regarding the impact from the COVID-19

pandemic on BMHA’s operations and financial performance as well as upon its tenants, employees and vendors

• The U.S. Coronavirus Aid, Relief, and Economic Security (CARES)

Act’s impact on BMHA revenues

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

67

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

Notes: (1) Total expenses include the annual accrual for OPEB, a non-cash accrued expense of future benefits earned by active employees. (2) The BMHA’s Financial Plan depicts Debt Service static at $1.8 M annually. Actual Debt Service is scheduled to be increase to $1.9 M in FY 2021-22, to $2.1 M in FY 2022-23, and to $2.2 M in FY 2023-24. As such, the cash impact is overstated by $0.8 M on a combined basis.

2019-20 Adopted Budget 2020-21 Adopted Budget 2021-22 Outyear 1 2022-23 Outyear 2 2023-24 Outyear 3 Totals

Total Revenues $46.7 $48.8 $49.9 $51.0 $52.1 $201.8 Total Expenses 46.2 47.0 47.4 47.9 48.3 190.6 Net Operating Income (Loss) before Debt Service 0.5 1.8 2.5 3.1 3.8 11.2 Debt Service - Principal Reduction 1.4 1.8 1.8 1.8 1.8 7.2 Net Income Reduced for Debt Service - Principal Reduction (0.9) 0.0 0.7 1.3 2.0 4.0 Cash Impact after Removal of the Non-cash OPEB Accrual ($0.1) $1.3 $2.0 $2.6 $3.3 $9.1

FY 2021-2024 Financial Plan Consolidated Summary

Description

$ in Millions

68

2019-20 Adopted Budget 2020-21 Adopted Budget 2021-22 Outyear 1 2022-23 Outyear 2 2023-24 Outyear 3 $ Change from Year 1-4 % Change from Year 1-4

HUD Subsidy $17.0 $18.2 $18.7 $19.3 $19.9 $1.7 9.3% Net Dwelling/Non-Dwelling Income 14.4 15.0 15.3 15.6 15.9 0.9 6.0% HUD PHA Grants - Vouchers 6.2 6.4 6.6 6.8 7.0 0.6 9.4% All Other Revenues 6.1 6.7 6.8 6.8 6.8 0.1 1.5% Transfers from Capital Grants 3.0 2.5 2.5 2.5 2.5 0.0 0.0% Total Revenue $46.7 $48.8 $49.9 $51.0 $52.1 $3.3 6.8%

Description

Consolidated FY 2021-24 Financial Plan Revenues

$ in Millions

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

69

70

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

2019-20 Adopted Budget 2020-21 Adopted Budget 2021-22 Outyear 1 2022-23 Outyear 2 2023-24 Outyear 3 $ Change from Year 1-4 % Change from Year 1-4

AMP $32.0 $33.3 $34.0 $34.8 $35.7 $2.4 7.2% COCC 4.6 4.8 4.8 4.8 4.8 $0.0 0.0% Marine Drive 2.9 3.4 3.5 3.6 3.6 $0.2 5.9% Section 8 7.2 7.3 7.6 7.8 8.0 $0.7 9.6% Total Revenues $46.7 $48.8 $49.9 $51.0 $52.1 $3.3 6.8% Revenues

Consolidated FY 2021-24 Financial Plan Revenues (by Unit)

Description

$ in Millions

2019-20 Adopted Budget 2020-21 Adopted Budget 2021-22 Outyear 1 2022-23 Outyear 2 2023-24 Outyear 3 $ Change from Year 1-4 % Change from Year 1-4

General Expenses $12.9 $13.0 $13.1 $13.3 $13.3 $0.3 2.3% Maintenance 11.3 11.0 11.1 11.2 11.3 0.3 2.7% Administrative 8.7 9.4 9.5 9.5 9.6 0.2 2.1% Utility 5.6 5.5 5.5 5.7 5.8 0.3 5.5% Other Expenses 6.2 6.6 6.7 6.7 6.8 0.2 3.0% Protective Services/ Resident Service Costs 1.5 1.5 1.5 1.5 1.5 0.0 0.0% Total Expenses $46.2 $47.0 $47.4 $47.9 $48.3 $1.3 2.8%

Consolidated FY 2021-24 Financial Plan Expenses

Description

$ in Millions

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

71

2019-20 Adopted Budget 2020-21 Adopted Budget 2021-22 Outyear 1 2022-23 Outyear 2 2023-24 Outyear 3 $ Change from Year 1-4 % Change from Year 1-4

Expenses AMP $31.6 $31.4 $31.5 $31.9 $32.2 $0.8 2.5% COCC 4.6 4.9 5.1 5.2 5.2 0.3 6.1% Marine Drive 3.1 3.4 3.4 3.4 3.4 0.0 0.0% Section 8 6.9 7.3 7.4 7.4 7.5 0.2 2.7% Total Expenses $46.2 $47.0 $47.4 $47.9 $48.3 $1.3 2.8%

Consolidated FY 2021-24 Financial Plan Expenses (by Unit)

Description

$ in Millions

72

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

Note: (1) Total employee salaries and benefits are budgeted at $13.7 M in FY 2020-21 and are projected to increase $0.5 M to $14.2 M over the Financial Plan based on the contractual and estimated increases in employees’ labor agreements as well as two additional executive full-time employees.

73

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

2019-20 Adopted Budget 2020-21 Adopted Budget 2021-22 Outyear 1 2022-23 Outyear 2 2023-24 Outyear 3 Totals

Total Revenues $32.0 $33.3 $34.0 $34.8 $35.7 $137.8 Total Expenses 31.6 31.4 31.5 31.9 32.2 127.0 Net Operating Income (Loss) before Debt Service 0.4 1.9 2.5 2.9 3.5 10.8 Debt Service - Principal Reduction 1.7 1.5 1.5 1.5 1.5 6.0 Net Income reduced for Debt Service - Principal Reduction (1.3) 0.4 1.0 1.4 2.0 4.8 Cash Impact after Removal of the Non-cash OPEB Accrual) ($0.7) $1.1 $1.7 $2.1 $2.7 $6.6

Asset Management Program FY 2021-24 Financial Plan Summary

Description

$ in Millions

• The FY 2020-21 AMP Adopted Budget depicts $1.9 M in net
• perating income

 The cash impact after a $1.5 M debt service principal reduction and removing the non-cash $0.7 M OPEB accrual is budgeted at $1.1 M

74

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

• The COCC is the business unit of the BMHA

 Operates as a property management company and is financially supported through fees earned by overseeing business activities

• The BMHA has budgeted a FY 2020-21 net operating loss of

$0.1 M

 A net loss is projected in each fiscal year at a cumulative $1.2 M  The cash impact is a $0.4 M in FY 2020-21 after removing the $0.5 M non-cash OPEB accrual

2019-20 Adopted Budget 2020-21 Adopted Budget 2021-22 Outyear 1 2022-23 Outyear 2 2023-24 Outyear 3 Totals

Total Revenues $4.6 $4.8 $4.8 $4.8 $4.8 $19.2 Total Expenses 4.6 4.9 5.1 5.2 5.2 20.4 Net Operating Income (Loss) before Debt Service 0.0 (0.1) (0.3) (0.4) (0.4) (1.2) Debt Service - Principal Reduction 0.0 0.0 0.0 0.0 0.0 0.0 Net Income reduced for Debt Service - Principal Reduction 0.0 (0.1) (0.3) (0.4) (0.4) (1.2) Cash Impact after Removal of the Non-cash OPEB Accrual) $0.4 $0.4 $0.2 $0.1 $0.1 $0.6

COCC FY 2021-24 Financial Plan Summary

Description

$ in Millions

75

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

• In February 2011, BMHA took over management of Marine Drive
• Budgeted $0 operating income in FY 2020-21

 The cash impact is a loss of $0.2 M after paying $0.3 M in debt service and removing the $0.1 M non-cash OPEB accrual  If losses incur, would receive cashflow assistance from the current year

• perations of the COCC or through COCC reserves as available.
• Reductions in non-fixed expenses at the Marine Drive Apartments

would need to be considered

2019-20 Adopted Budget 2020-21 Adopted Budget 2021-22 Outyear 1 2022-23 Outyear 2 2023-24 Outyear 3 Total

Total Revenues $2.9 $3.4 $3.5 $3.6 $3.6 $14.1 Total Expenses 3.1 3.4 3.4 3.4 3.4 13.6 Net Operating Income (Loss) before Debt Service (0.2) 0.0 0.1 0.2 0.2 0.5 Debt Service - Principal Reduction 0.0 0.3 0.3 0.3 0.3 1.2 Net Income reduced for Debt Service - Principal Reduction (0.2) (0.3) (0.2) (0.1) (0.1) (0.7) Cash Impact after Removal of the Non-cash OPEB Accrual) ($0.1) ($0.2) ($0.1) $0.0 $0.0 ($0.3)

Marine Drive FY 2021-24 Financial Plan Summary

Description

$ in Millions 76

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

• Revenues = $7.4 M, or 15.2% of total FY 2020-21 revenues
• Expenses = $7.3 M, or 15.6% of total FY 2020-21 expenses
• The CARES Act has provided the Section 8 program with an

additional $1.25 B in overall funding

 The BMHA’s additional funding has not yet been quantified

• Any reported surplus or deficit is temporary in nature

2019-20 Adopted Budget 2020-21 Adopted Budget 2021-22 Outyear 1 2022-23 Outyear 2 2023-24 Outyear 3 Totals

Total Revenues $7.2 $7.4 $7.6 $7.8 $8.0 $30.8 Total Expenses 6.9 7.3 7.4 7.4 7.5 29.6 Net Operating Income (Loss) before Debt Service 0.3 0.1 0.2 0.4 0.5 1.2 Debt Service - Principal Reduction 0.0 0.0 0.0 0.0 0.0 0.0 Net Income reduced for Debt Service - Principal Reduction 0.3 0.1 0.2 0.4 0.5 1.2 Cash Impact after Removal of the Non-cash OPEB Accrual) $0.3 $0.0 $0.2 $0.4 $0.5 $1.1

Description

$ in Millions

Section 8 FY 2021-24 Financial Plan Summary

77

Conclusions

• The BMHA 2021-2024 Financial Plan appears to be reasonably

developed

 Expenses are increased based on estimated inflationary rates or other known increases  All collective bargaining units and non-represented employees will be under contract for the first three years of the Financial Plan with labor agreements with Local 264 and Local 409 expiring June 30, 2023  BMHA has projected a reasonable increase in salaries for collective bargaining in the final year of the Financial Plan, which is a more conservative and reasonable approach compared to that in prior years

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

78

Conclusions

• The revenues are reasonable as projected over the Financial Plan,

although the budgeted and projected increase of rental income may be overly optimistic given the current recession

 Rental receipts are nearly the sole form of operating revenue for the Marine Drive Apartments  Any cash shortfall in the operations of Marine Drive would require cost reduction actions and possibly a loan from COCC as Marine Drive does not have adequate cash reserves available

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

79

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

Conclusions

• Additional HUD Subsidy and Section 8 Voucher Grant funds will

be received in FY 2020-21

 The additional HUD Subsidy expected pursuant to funding under the CARES Act of $2.8 M has been incorporated within the Adopted Budget and Financial Plan

• On a consolidated basis, net income is projected annually

 Cumulatively, net income is projected at $11.2 M with a revised positive four-year cash flow of $8.3 M  The cash flow projection includes $5.1 M of non-cash OPEB accruals  BMHA has projected net income for Section 8, which represents pass- through funding for which BMHA receives a small administration fee

• The combined financial plan includes a cumulative total of $1.1 M
• f Section 8 program income which also is factored into the

positive cash flow

80

Conclusions

• Individually, the Central Office Cost Center has budgeted annual

losses with a cumulative loss of $1.2 M projected over the next four years

 The cash impact after removing the non-cash OPEB accrual is a positive $0.6 M

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

81

Conclusions

• BMHA has budgeted the HUD Operating Subsidy based on a 97%

proration and a 95% occupancy rate

 As of March 31, 2020, the occupancy rate for units classified as HUD- rentable units was 80.7%

• A.D. Price Courts and Commodore Perry Homes have 444 units

listed as HUD-rentable units which are uninhabitable

• When excluding these units, BMHA’s occupancy rate approaches

95% at 91.7%  BMHA’s assumption of a 95% occupancy rate assumes HUD will allow these 444 units to be removed from the occupancy calculation

• The units will be removed from the calculation once revitalization

plans are approved for the properties

• BMHA has historically conservatively budgeted the HUD

Operating Subsidy

Buffalo Municipal Housing Authority

2020-21 Adopted Budget & 2021-2024 Financial Plan

82

BUFFALO FISCAL STABILITY AUTHORITY Board Meeting

May 20, 2020 Review of City of Buffalo’s Third Quarter Report

83

2019-20 Year-End Projection $ in Millions

84

3rd Qtr. Adopted Budget Year-End Projection $ $ $ % Revenues 508.7 478.7 (30.0)

• 5.9%

Expenditures (508.7) (494.4) 14.3

• 2.8%

Use of fund balance

• (15.7)

(15.7) N/A City of Buffalo 2019-20 3rd Quarter Summary Projected Budget Variances - General Fund Variance Between Adopted Budget and Year-End Projection Favorable / (Unfavorable)

85

3rd Quarter Revenue Source Adopted Budget Year-End Projection $ $ $ % Intergovernmental 269,010,295 250,446,641 (18,563,654)

• 6.9%

Taxes 158,651,403 157,811,417 (839,986)

• 0.5%

Service Charges 20,012,575 14,002,681 (6,009,894)

• 30.0%

Non-Property Taxes 11,610,000 11,610,000

• Fines

13,738,200 10,838,482 (2,899,718)

• 21.1%

Miscellaneous 15,003,173 13,683,837 (1,319,336)

• 8.8%

Licenses and Permits 6,189,545 5,421,260 (768,285)

• 12.4%

Interest 1,200,000 1,651,774 451,774 37.6% Total Departmental 495,415,191 465,466,092 (29,949,099)

• 6.0%

Transfers In 13,267,646 13,267,646

• Use of Fund Balance (1)
• Total Resources and Transfers In

13,267,646 13,267,646

• Total Revenues, Resources

and Transfers In 508,682,837 478,733,738 (29,949,099)

• 5.9%

City of Buffalo (1) Per generally accepted accounting principles (GAAP) the use of fund balance is not recognized as a revenue, but a deficit to be closed utilizing fund balance. 2019-20 Third Quarter Report Summary of Revenues Variance Between Adopted Budget and Year-End Projection Favorable / (Unfavorable)

City of Buffalo Projected 2019-20 Revenues

• FYE total revenues projection is $29.9M under

adopted budget:

– $18.6M projected to be under budget in intergovernmental revenue

• $11.0M is attributed to Tribal State Compact Casino

Revenue

• $8.3M is attributed to sales tax

– $6.0M under budget in service charges

• $2.4M is attributed to default mortgage fees
• $1.1M is attributed to parking meter fees
• $0.6M is attributed to utility inspection fees
• $0.4M is attributed to casino police service fees
• $1.5M is attributed to all remaining service fees

86

City of Buffalo Projected 2019-20 Revenues

• FYE total revenues projection is $29.9M under

adopted budget:

– $2.9M under budget in fines

• $0.8M is attributed to parking fines
• $0.5M is attributed to permit fines
• $0.5M is attributed to moving violation tickets
• $0.5M is attributed to court fines
• $0.4M is attributed to school zone camera fines
• $0.2M is attributed to all other fines

87

City of Buffalo Projected 2019-20 Revenues

• FYE total revenues projection is $29.9M under

adopted budget:

– $1.3M projected to be under budget in miscellaneous revenue

• $1.1M is due to sale of capital assets
• $0.9M in relation to gifts and donations
• $1.2M positive variance attributed to the Staffing for

Adequate Fire and Emergency Response (SAFER) grant

– All other revenues net unfavorable variance of $1.2M

• Taxes unfavorable by $0.8M, Licenses & Permits $0.8M, and

a favorable variance in Interest of $0.5M

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3rd Quarter Departments Adopted Budget Year-End Projection $ $ $ % Police 89,621,930 84,772,707 4,849,223 5.4% Fire 58,475,038 61,845,725 (3,370,687)

• 5.8%

Public Works 31,021,593 29,244,400 1,777,193 5.7% Administration & Finance 10,037,899 9,189,231 848,668 8.5% Permits & Inspections 5,798,348 5,525,968 272,380 4.7% Human Resources 5,561,043 4,397,419 1,163,624 20.9% Management Information Systems 5,617,457 5,349,768 267,689 4.8% Community Services 4,773,764 4,570,602 203,162 4.3% Law 3,263,310 3,128,807 134,503 4.1% Assessment 2,719,166 2,487,605 231,561 8.5% Mayor & Executive 5,492,327 5,204,485 287,842 5.2% Audit & Control 3,628,905 3,166,188 462,717 12.8% Parking 3,198,691 2,836,319 362,372 11.3% City Clerk 2,895,526 2,720,348 175,178 6.0% Common Council 2,536,152 2,398,576 137,576 5.4% Total Departmental 234,641,149 226,838,148 7,803,001 3.3% General Charges Fringe Benefits 144,979,419 137,294,308 7,685,111 5.3% Other 2,650,000 6,901,876 (4,251,876) -160.4% Personal Services 6,200,000 5,700,000 500,000 8.1% Capital Outlay

• 0.0%

Grants In Aid 1,110,000 402,870 707,130 63.7% Debt Service 390,000 60,000 330,000 84.6% Services 1,391,500 1,391,500

• 0.0%

Utilities 17,142,800 15,597,800 1,545,000 9.0% Total General Charges 173,863,719 167,348,354 6,515,365 3.7% Total General Fund 408,504,868 394,186,502 14,318,366 3.5% Transfers Out 100,177,969 100,177,969 0.0% Total General Fund w/ Transfers 508,682,837 494,364,471 14,318,366 2.8% City of Buffalo 2019-20 Third Quarter Report Summary of Expenditures Favorable / (Unfavorable) Variance

City of Buffalo Projected 2019-20 Expenditures

• FYE total expenditure projection is $14.3M below

adopted budget:

– $7.8M total budgetary favorable variance in Departmental expenditures largely due to vacancies

• Fire Department exceeds adopted budget by $3.4M
• Remaining departments projected to have favorable budget

variances of $11.2M: – Police department - $4.8M – Public Works - $1.8M – Human Resources - $1.2M – Administration & Finance - $0.8M – All other departments - $2.6M

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City of Buffalo Projected 2019-20 Expenditures

• FYE total expenditure projection is $14.3M below adopted budget:

– $6.5M total budgetary projected favorable variance in General Charges

• $8.2M favorable variance in fringe benefits & personal services

– Pension $3.2M favorable variance – Health insurance $2.7M favorable variance – $0.5M favorable variance for duty disability salaries – $0.4M favorable variance for employer payroll taxes – $0.4M favorable variance for workers’ compensation

• $4.3M unfavorable variance in Other category

– Settlement of litigation

• $1.5M favorable variance in Utilities
• $0.7M favorable variance in Grants In Aid
• $0.3M favorable variance in Debt Service

– The City did not need to issue a RAN during the current fiscal year

– Transfers Out – no projected variance

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City of Buffalo Third Quarter Analysis City Employees at March 31, 2020

• Vacant positions continue to remain unfilled

Budgeted FTEs = 2,682 Filled FTEs = 2,512

• (170, or 6.3%)
• Vacant fire and police positions

Police Fire Budgeted FTEs = 798 742 Filled FTEs = 762 741

• (36, or 4.5%) (1, or 0.0%)

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City of Buffalo Third Quarter Analysis Conclusions and Recommendations

• Considering the pandemic and resulting fiscal

uncertainties, the BFSA recommends the financial impact be monitored

– Steps to be taken as appropriate to manage financial impact

• The Tribal State Compact revenue was budgeted at

$11.0 million

– Not included in the year-end projection as revenue

• Arbitration panel found in favor of NYS, release of funds to City

is expected by fiscal year-end

• Timing of release of funds is unknown
• Estimated $20.5M is due to the City of Buffalo

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City of Buffalo Third Quarter Analysis Conclusions and Recommendations

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Fund balance Category Balance at July 1, 2019 Projected Year- End Deficit Estimated Balance at June 30, 2020 Nonspendable $29,606,150 $- $29,606,150 Restricted 11,787,948

• 11,787,948

Committed 38,529,527 (2,615,923) 35,913,604 Assigned 13,014,810 (13,014,810)

• Unassigned
• Total

$92,938,435 $(15,630,733) $77,307,702

City of Buffalo Third Quarter Review Conclusions and Recommendations

• Favorable variance projected for expenditures
• f $14.3M

– Most significant variance is in fire department – BFSA recommends the City assess the projected expenditures in the current financial plan and adjust the new financial plan as appropriate

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