Fund Accounting Revenue Overview Tuesday April 25 th

Fund Accounting & Revenue Overview Tuesday, April 25 th, 2017 Christopher M. Quinn, MACC, CPA, CFE, CGFO, CGMA Finance Director Lina Williams Budget Coordinator Helena Alves, CIA, MBA Chief Accountant

Budget Preparation Timeline January - March q First Quarter Review q Annual Financial Audit q Presentation of Annual Progress Report q Survey Results to City Council q Annual Update of the Strategic Action Plan April q Revise 10 Year Infrastructure Plan q Year to Date Budget Results Presentation q Fund Accounting & Revenue Presentation q Second Quarter Review q Departments Begin FY 2018 Budget Preparation

Budget Preparation Timeline May – June q. Long Term Financial Planning Presentation q. Property Tax Review Presentation July - August q. General Fund Budget Workshop q. Adopt Maximum Millage Rate (August 4 th deadline) q. Third Quarter Review q. Proprietary, Special Revenue & Capital Funds Budget Workshop q. Final Proposed Budget Presentation

Budget Preparation Timeline September q. Public Hearing to Tentatively Adopt Millage Rate & Budget q. Public Hearing to Adopt Final Millage Rate & Budget October – December q. FY 2017 Year End Close-out q. End of Year Review with Departments

Presentation Overview üRegulatory Authorities üClassification of Funds üRevenue Overview • Restricted vs. Unrestricted

Regulatory Authorities Governmental Accounting Standards Board (GASB) Exposure Drafts Statements Federal Government (IRS, SEC, GAO) Payroll taxes Accounting and Financial Reporting Guidance (Statutes, Department of Revenue, Rules of the Auditor General) Truth in Millage (TRIM) Debt issuance Grant compliance Technical Bulletins State Government Grant compliance 1099 reporting Yellow Book Annual reporting requirements

Fund Accounting § A fund is a segregated accounting entity (checkbook) § Tracks activities according to regulations, restrictions, or limitations. § Revenue, restricted for a specific purpose, cannot be used for general operations § Funds are divided into various types according to legal restrictions or their uses.

Revenue Restrictions § Must comply with legal and external requirements. § Small County Surtax Capital projects § Utility Revenues Operation and expansion of utility system § Impact Fees Infrastructure capacity improvements related to growth § Grants Specific programs/projects DO NOT TOUCH Restricted Fund

Fund Types Governmental Proprietary Fiduciary Enterprise funds Trust funds Internal services funds Agency funds General fund Special revenue funds Capital projects funds Debt service funds Permanent funds

Fund Classifications Governmental Funds Proprietary Funds Fiduciary Funds Primarily supported by taxes Primarily supported by user fees Not the City’s money

Fund Classifications Governmental Funds Proprietary Funds General Fund Utility Fund Capital Projects Fund Stormwater Fund Special Revenue Funds Building Fund Fiduciary Funds VFF Pension Fund

Fund Classifications Governmental Funds Proprietary Funds Administration & Finance Utility Public Safety (Fire & Police) Community Development (excluding Building) Streets & Parks Maintenance Parks & Recreation Stormwater Building Information Technology Solid Waste Fleet Facilities

Fund Balance Definition Accumulated revenues over expenditures Use Policy For emergencies or one time expenditures (capital project) General Fund Utility Fund Stormwater Fund Solid Waste Fund Disaster Reserve Self Insured Fund Fleet Fund Not meant to fund continuing operations

Revenue Classifications Taxes Permits, Fees and Special Assessments Intergovernmental Revenue Charges for Services Judgments Fines and Forfeits Miscellaneous Revenues & Other Sources

2017 Revenues by Source

Taxes Ad Valorem Tax (Property Tax) Based on taxable value of property Considered general revenue Local Option Fuel Tax Discretionary Sales Surtaxes Currently 6 cents per gallon on fuel purchased in Flagler County Replaced Local Government Infrastructure Surtax Distributed per Inter-local agreement based on road miles . 5 percent of the 7% sales tax collected in Flagler County Restricted to transportation expenditures Pursuant to an ordinance enacted by Flagler County Currently allocated to the Streets Improvement Fund Currently allocated to Capital Projects Fund (Small County Surtax)

Taxes Communications Services Tax Applies to telecommunications, video, satellite and related services Business Tax Receipt Public Service Taxes (Not currently in use) Electricity Local Water Rate of 5. 22% Currently allocated to General Fund Considered general revenue Natural Gas Propane

Intergovernmental Revenue State Revenue Sharing Local Government Half-Cent Sales Tax Portion of State sales and use tax collections & one-cent municipal fuel tax Distributes a portion of the state 6% sales tax Fire Insurance Premium Tax Other Grants (a)76. 20% Sales & Use Tax collections Taxable sales within Flagler County Volunteer Firefighters’ Pension County Business Tax Receipts (b) 23. 80% Fuel Tax and User Fees collections Currently allocated to General Fund (a) & Streets Improvement Fund (b) Currently allocated to General Fund Alcoholic Beverage License tax

Permits, Fees, Special Assessments Franchise Fees Solid Waste Special Assessments Old Kings Road Natural Gas Utility (not in use) Code Nuisance

Charges for Service Utility Fees Water and Sewer Solid Waste Stormwater Impact Fees Other Fees Water and Wastewater Annual Fire Inspections Transportation State Road Maintenance Parks Recreation Fees Fire Planning Fees School Building Permits & Inspections (remitted to Flagler County Schools)

Judgements, Fines and Forfeitures Citations & Violations Local Ordinance Violations Parking Tickets Traffic Citations Code Fines Animal Control

Other Sources Inter-fund Transfers Payment-In-Lieuof-Taxes (PILOT) Debt Proceeds Loans Internal Charges Fleet Replacement & Maintenance Facilities Maintenance Tax Increment for the CRA Bonds IT Allocation

Restricted Revenue Sources State Restricted Fire Insurance Premium Tax Fuel Tax Refund Police Education Building Permit & Inspection Fees Local Option Fuel Tax Volunteer Firefighters pension Construction & maintenance of roads Law Enforcement Applied solely to BPI costs Transportatio n expenditures

Restricted Revenue Sources State Restricted State Revenue Sharing (b) 24. 86% Tax Increment Revenue (CRA) Impact Fees Special Assessments Transportation expenditures Per CRA plan Capacity improvements Purpose of assessments

Restricted Revenue Sources Other Water & Sewer Charges Restricted by Bond Covenants & City Council Used to maintain system & debt service Small County Surtax Restricted by Flagler County Ordinance Used for construction & improvement of public facilities, operating expenses etc… Stormwater Fee Disaster Reserve Restricted by loan covenants & City Council Restricted by City Council Used to maintain system & debt service Used for costs related to a disaster

Unrestricted Revenue Sources Unrestricted revenue can be used for general purpose and at the discretion of the governing body In Use Ad Valorem Tax Alcoholic Beverage License Not Currently in Use Utility Franchise Fee Business Tax Receipts Communication Services Tax Natural Gas Franchise Fee Half-Cent Sales Tax Solid Waste Franchise Fee State Revenue Sharing (a) 76. 20% Public Service (Utility) Tax

Looking Ahead May 15 th June 13 th July 11 th July 18 th August 29 th September: Long Term Financial Planning Presentation Property Tax Presentation Budget Workshop - General Fund Adopt Maximum Millage Rate (August 4 th deadline) Budget Workshop – Proprietary Special Revenue Funds & Capital Funds Final Proposed Budget Presentation Public Hearing to adopt tentative millage rate and Budget & Final Public Hearing to adopt final millage and budget