CC - Item 4G - Transmittal of FY 2014-15 City Rosemead and Rosemead Housing Corporation Annual Financial ReportsROSEMEAD CITY COUNCIL
STAFF REPORT
TO: THE HONORABLE MAYOR AND CITY COUNCIL
FROM: JEFF ALLRED, CITY MANAGER q1A
DATE: JANUARY 12, 2016
SUBJECT: TRANSMITTAL OF FY 2014 -15 CITY OF ROSEMEAD AND ROSEMEAD
HOUSING CORPORATION ANNUAL FINANCIAL REPORTS
SUMMARY
This is to transmit the FY 2014 -15 annual financial reports for the City of Rosemead and
the Rosemead Housing Development Corporation to the City Council. The attached
reports provide a complete presentation of the finances of each of the above mentioned
organizations. The 2014 -15 Fiscal Year was a good year of revenues for the City, and
was also a year of capital asset growth. A highlight of the City's capital asset growth in
FY 2014/15 was the purchase of real property on River Avenue from the General Fund
balance at a cost of approximately $1.8 million for the establishment of a City Yard
public works maintenance facility. The impact of this capital expenditure was partially
offset by higher than budgeted revenues and lower than budget expenditures resulting
in a decrease in General Fund balance of only $1.2 million. A summary of impacts on
the City's General Fund balance is included in this report.
Staff Recommendation
Staff recommends that the City Council receive and file the City of Rosemead
Comprehensive Annual Financial Report (CAFR) and the Rosemead Housing
Development Corporation Annual Financial and Compliance Report for the 2014 -15
Fiscal Year.
ANALYSIS
Governmental activities. From year to year the net assets of all Governmental
activities typically fluctuates a few percentage points which can equal a couple million
dollars. These fluctuations are generally the result of new construction for City facilities
or changes in long term debt. For Fiscal Year 2014 -15, Governmental activities (all
governmental funds) increased the City of Rosemead's net assets by $3.6 million or
5.5 %. The increase is the result of both general and program revenues exceeding
expenses as well as the reclassification of capital assets. General Fund highlights are
presented below and a detailed presentation of all funds is available in the attached
Comprehensive Annual Financial Report (CAFR).
ITEM NO. 4.G
City Council Meeting
January 12, 2016
Page 2 of 3
General Fund. The general fund is the chief operating fund of the City of Rosemead.
At the end of the current fiscal year, the unassigned fund balance of the general fund
was $10,128,160, while total fund balance reached $16,470,361. As a measure of the
general fund's liquidity, it may be useful to compare both unassigned fund balance and
total fund balance to total fund expenditures. Unassigned fund balance represents 50
percent of total general fund expenditures, while total fund balance represents 81
percent of that same amount.
The General Fund expenditures exceeded revenues, primarily due to the City's
acquisition of real property for a City Yard maintenance facility. Therefore, the General
Fund fund balance had a decrease of $1,226,705. The highlights of the change in fund
balance are outlined below:
• The major increase in expenditures was the $1,846,136 planned purchase of
property (land and building) to be used as the City Yard and offset by revenues
over the prior year. While fund balance decreased this year, the property
expenditure is a one time expenditure to establish a City Yard maintenance
facility.
• The increase in expenditures for the property purchase was offset by a $448,553
decrease in transfers out in the current year. This decrease was the result of
less capital improvement projects funded from the General Fund in 2014/15.
• Revenues increased $765,000 in in 2014/15. While property tax increased
$216,000, the largest revenue increase was in Licenses and Permits. This
category increased $538,000 as both building permits and public works permits
were up substantially in 2014/15. This substantial increase is result of increased
development projects in the City as well as an indication of an improving
econcomy.
• The increase in expenditures in 2014/15 in the Community Development division
was a result of additional costs of $163,000 for professional services to work on
the Garvey Avenue Specific Plan and EIR as well as $224,000 additional costs
for building inspections and plan checking. The Garvey Avenue Specific Plan
and EIR is intended to enhance the community and stimulate the economy to
bring in future revenues. The building inspection and plan checking costs are
offset by the additional revenues received.
• The City received $151,000 over budget in Transient Occupancy Tax resulting
from an improved travel industry as well as the additional rooms available in the
Double Tree Hotel.
City Council Meeting
January 12, 2016
Page 3 of 3
• Operating cost overruns in the City as a whole were minimal. The Community
Development Department was slightly over budget by $16,016 due to higher
building inspection costs, however this was due to more projects and was more
than offset by increased revenues.
PUBLIC NOTICE PROCESS
This item has been noticed through the regular agenda notification process.
Submitted by: /� /'
(�' . Cp
Carolyn A. Chu
Finance Director
Attachments: (1) City of Rosemead Comprehensive Annual Financial Report
(2) Rosemead Housing Development Corporation Financial and Compliance Report