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May 17, 2023 334 likes •519 views

CITY OF SACO About this presentation FINANCIAL OVERVIEW This presentation is intended as a tool to assist the City Council, School Department and Presented by: Roger A. Lebreux and Parker Madden management in understanding its financial

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SLIDE 1

CITY OF SACO

FINANCIAL OVERVIEW

Presented by: Roger A. Lebreux and Parker Madden RUNYON KERSTEEN OUELLETTE

INSIDE 2. Summary of Audit Results 3. City General Fund – Fund Balance 4. City General Fund – Revenues 5. City General Fund – Expenditures 6. School General Fund – Fund Balance 7. School General Fund – Revenues 8. School General Fund – Expenditures 9. Unassigned Fund Balance as a Percentage of Budget

  • 10. General Fund – Fund Balance Analysis Last Ten Years
  • 11. Unassigned Fund Balance as a Percentage of Budget

Compared to other Cities

  • 12. Property Tax Collection Rates
  • 13. Property Tax Rates
  • 14. General Fund - Expenditure Distribution - 2018
  • 15. General Fund - Expenditure Distribution – 2017
  • 16. Long Term Debt & Capital Leases
  • 17. Debt Per Capita – Last Ten Fiscal Years

About this presentation This presentation is intended as a tool to assist the City Council, School Department and management in understanding its financial

  • perating results. The information contained in

this publication should be read in conjunction with the audited financial statements and related disclosures and should not be used for any other purpose without the expressed consent of RUNYON KERSTEEN OUELLETTE. Please contact us at 207-773-2986 or 1-800-486- 1784 20 Long Creek Drive, South Portland, ME 04106

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SLIDE 2

CITY OF SACO

SUMMARY OF AUDIT RESULTS

2

  • Financial Statement Opinion – Unmodified
  • Awarded a certificate of achievement for excellence in

financial reporting for the fiscal year ended June 30, 2017

  • Report Required by Government Auditing Standards (GAS)
  • No Material Weaknesses
  • No Significant Deficiencies
  • There was one compliance finding
  • Other Comments
  • There were 2 additional other comments
  • Report Required by the Uniform Guidance
  • Programs Tested:
  • Child Nutrition Cluster
  • Findings: None
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SLIDE 3

CITY OF SACO

City General Fund – Fund Balance

3

Observations:

  • Total fund balance increased by $131,647 from 2017 to 2018. This is attributable to favorable

revenue and expenditure variances that will be discussed in further detail on further slides.

2018 2017 2016 2015 2014 Unassigned 7,113,072 7,010,696 5,755,852 4,779,487 4,595,094 Assigned 2,444,329 2,363,922 2,208,198 1,752,647 1,850,781 Committed 16,407 87,841 89,733 90,300 86,903 Nonspendable 164,149 143,851 144,165 144,234 165,829 (600,000) 1,400,000 3,400,000 5,400,000 7,400,000 9,400,000 11,400,000

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SLIDE 4

CITY OF SACO

City General Fund - Revenues

4 Observations:

  • Tax revenues exceeded budget due to higher than expected auto excise revenues as well as

real and personal property tax revenues.

  • Licenses and permits exceeded budget due to higher than anticipated building permit

revenues mostly related to new developments in FY2018. Cable television franchise fees also exceeded budget by $88,422.

  • Interest earnings exceeded budget due to conservative budgeting and better rates of returns
  • n investments.

Budget Actual Variance Taxes $45,531,980 $46,508,400 $976,420 Licenses and permits 815,360 1,102,620 287,260 Intergovernmental 2,526,996 2,624,896 97,900 Charges for services 1,052,879 1,181,158 128,279 Interest earnings 30,000 219,137 189,137 Other revenues 170,500 173,376 2,876 Total revenues 50,127,715 51,809,587 1,681,872 Budgeted utilization of surplus 2,317,384

  • (2,317,384)

Carryover of assigned fund balance 442,961

  • (442,961)

Transfers in 1,203,659 1,024,487 (179,172) Total revenues and other sources 54,091,719 52,834,074 (1,257,645)

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SLIDE 5

CITY OF SACO

City General Fund - Expenditures

5 Observations:

  • General Government was under budget due savings in technology, city clerks office, and

planning and economic development.

  • Public Safety was under budget due to vacancies in the police department that remained

unfilled.

  • Public Works came in under budget due to vacancies, as well as contracted bids for gas

and oil coming in lower than expected.

  • Unclassified was under budget due to savings in fringe benefits which is tied to position

vacancies throughout all departments.

  • Capital Projects is made up of several long term projects, many of which carry over into

future years before completion.

Budget Actual Variance General government $3,221,927 $2,846,036 $(375,891) Public safety 7,135,269 6,891,441 (243,828) Public works 5,626,890 5,425,048 (201,842) Culture and recreation 1,684,409 1,616,769 (67,640) County tax 1,283,733 1,293,389 9,656 Unclassified 5,286,584 5,089,474 (197,110) Debt service 2,724,127 2,614,227 (109,900) Capital projects 943,499 702,422 (241,077) Total expenditures 27,906,438 26,478,806 (1,427,632) Transfers to other funds (includes education) 26,185,281 26,223,621 (38,340) Total expenditures and other financing sources 54,091,719 52,702,427 (1,389,292)

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SLIDE 6

CITY OF SACO

School General Fund – Fund Balance

2018 2017 Unassigned (490,728) (1,603,903) (1,700,000) (1,500,000) (1,300,000) (1,100,000) (900,000) (700,000) (500,000) (300,000) (100,000) 100,000

6

Observations:

  • Total fund balance increased by $1,113,175 from 2017 to 2018. This is attributed to an additional

$1,087,903 that was transferred from the City to help restore the School’s deficit fund balance.

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SLIDE 7

CITY OF SACO

School General Fund – Revenues

7 Observations:

  • State subsidy exceeded budget due to additional subsidy being received after the budget

passed.

  • Tuition fees were under budget because there were less Dayton students enrolled than

anticipated.

  • Transfer from the City general fund was less than budgeted due to the additional state subsidy

that was received. Therefore, less local funds were needed. Budget Actual Variance Intergovernmental: State subsidy – operating costs $10,780,639 $11,487,706 $707,067 State agency clients 125,000 163,894 38,894 Medical reimbursements 140,000 92,484 (47,516) Other revenues: Tuition fees 231,666 104,154 (127,512) Rentals 12,000 3,153 (8,847) Transportation 277,000 306,616 29,616 Miscellaneous 35,000 41,085 6,085 Transfer from the City General Fund 23,946,957 23,591,957 (355,000) Transfer from the City

  • 1,087,903

1,087,903 Total revenues and other sources 35,548,262 36,878,952 1,330,690

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SLIDE 8

CITY OF SACO

School General Fund – Expenditures

8 Observations:

  • Regular instruction was under budget due TA enrollment being less than expected as well

as teachers retiring with replacements paid at a lower pay scale.

  • Special education was over budget due to more positions added which were needed to

provide necessary services to meet student demand. Budget Actual Variance Regular instruction $21,748,321 $21,413,748 $334,573 Special education instruction 6,071,542 6,300,865 (229,323) Other instruction 175,173 163,361 11,812 Student and staff support 2,095,088 2,172,632 (77,544) System administration 694,939 760,883 (65,944) School administration 1,046,784 1,124,575 (77,791) Transportation 1,573,415 1,637,105 (63,690) Facilities maintenance 1,815,550 1,825,555 (10,005) Debt service 327,450 327,450

  • Transfer to other funds
  • 7,543

(7,543) Total expenditures and other uses 35,548,262 35,733,717 (185,455)

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SLIDE 9

CITY OF SACO

UNASSIGNED FUND BALANCE AS A PERCENT OF BUDGET

2014 2015 2016 2017 2018 City - General Fund 9.88% 10.15% 11.86% 13.58% 13.15% City - All Funds 7.25% 6.02% 9.04% 9.04% 11.63% City & School - General Fund 0.00% 8.15% 11.45% 10.40% 12.24% 0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00%

9 Observations:

  • Fund balance provides working capital for the City and enhances its credit worthiness.
  • RKO recommends a ratio of fund balance to equal approximately one and a half to two months of expenditures

which equals 12.5% to 16.67%.

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SLIDE 10

CITY OF SACO

GENERAL FUND – FUND BALANCE ANALYSIS 2009 - 2018

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Assigned $2,457 $2,111 $773 $663 $1,622 $1,851 $1,753 $2,208 $2,364 $2,444 Unassigned $2,386 $2,089 $2,491 $3,671 $4,552 $4,595 $4,779 $5,756 $7,011 $7,113 $- $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 10 * Amounts presented are rounded to nearest thousand.

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SLIDE 11

CITY OF SACO

UNASSIGNED FUND BALANCE AS A PERCENTAGE OF BUDGET COMPARISON

2016 2017 2018 Bangor 10.80% 11.54% 12.92% Augusta 10.14% 9.60% 9.74% Biddeford 3.62% 4.50% 3.19% Gorham 12.99% 14.05% 12.32% Saco 9.80% 8.46% 12.24% 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00% 16.00% 11 Observations:

  • All of these calculations includes the City/Town and the School Department’s unassigned fund

balance and their respective budgets.

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SLIDE 12

CITY OF SACO

PROPERTY TAX COLLECTION RATES

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Collected in fiscal year 96.54% 96.13% 96.48% 97.27% 97.78% 97.48% 97.92% 97.66% 97.66% 97.76% Collected in subsequent fiscal years 99.97% 99.96% 99.98% 99.98% 99.98% 99.99% 99.98% 99.98% 99.97% 97.76% 94.00% 95.00% 96.00% 97.00% 98.00% 99.00% 100.00% 101.00%

12 Observations:

  • The collection of current taxes have remained relatively stable over the last ten years.
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SLIDE 13

CITY OF SACO

PROPERTY TAX RATES

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Rate $13.42 $13.62 $13.82 $14.42 $18.30 $18.58 $18.62 $19.22 $19.42 $19.38 $10.00 $11.00 $12.00 $13.00 $14.00 $15.00 $16.00 $17.00 $18.00 $19.00 $20.00 13 Observations:

  • Tax rates have remained fairly consistent through 2012 with a large spike in 2013 due to

increases in the education assessment, along with a 7% reduction in values. They have increased 5.9% since then.

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SLIDE 14

CITY OF SACO

GENERAL FUND – Expenditure Distribution - 2018

14

General government 5.40% Public safety 13.08% Public works 10.29% Culture and recreation 3.07% County tax 2.45% Unclassified 9.66% Debt service 4.96% Capital projects 1.33% Transfer out (includes education) 49.76%

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SLIDE 15

CITY OF SACO

GENERAL FUND – Expenditure Distribution - 2017

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General government 6.09% Public safety 17.63% Public works 12.70% Culture and recreation 3.91% County tax 2.60% Unclassified 2.85% Debt service 4.69% Capital projects 2.54% Transfer out (includes education) 46.99%

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SLIDE 16

CITY OF SACO

LONG TERM DEBT & CAPITAL LEASES

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Bonds Payable

  • Gov't. Act.

Bonds Payable

  • Bus. Type

Notes Payable Capital Leases Net Pension Liability Other post-

  • employ. ben.

2014 $12,410,330 $510,000 $448,247 $1,817,653 $2,450,525 $817,143 2015 $13,163,163 $290,000 $336,185 $2,548,437 $1,197,303 $918,867 2016 $12,957,097 $145,000 $224,124 $2,994,112 $3,194,374 $1,013,935 2017 $11,366,531 $- $112,062 $2,577,325 $6,048,244 $1,490,873 2018 $21,703,731 $- $- $2,574,375 $5,419,452 $1,505,773 $- $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000

Observations:

  • The City and School entered into $1,029,050 of new capital leases during 2018.
  • The change in the net pension liability is due to the actuarial calculation of the liability

based on investment performance and other assumptions.

  • Other post-employment benefit liability changed due to implementing GASB 75.
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SLIDE 17

CITY OF SACO

DEBT PER CAPITA – LAST TEN FISCAL YEARS

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Outstanding Debt $960 $1,373 $1,131 $866 $782 $699 $728 $709 $635 $1,224 $- $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 17 Observations:

  • Debt per capita increased significantly due to a new general obligation bond in 2018.
  • Bonding agencies typically like this number to be $2,000 or less.