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Mission holds workshop for 2019-2020 budget

The city is “being creative” in order to get out of the negative in certain areas of the budget.

This past Tuesday evening, Mission held a preliminary budget workshop outlining their expenditures from the last fiscal year (2018-2019) so far and the potential 2019-2020 budget. According to City Manager Randy Perez, it was a “very preliminary presentation” of the balances since Sept. 30, 2018, and the audit that will be presented at Monday’s city council meeting.

City of Mission logo“It’s an unapproved schedule, and I wanted to go over them [the figures],” Perez said.

Since Sept. 30 of last year, the total general fund balance has been about $3.3 million, a little less than half of the expected $6-7 million typically reserved in the general fund.

“The total revenues from the general fund [for the year ending Sept. 30, 2018] are $37,461,079, and total expenditures of $44,161,851,” Perez said. “So there was a difference in excess [deficiency] of revenue over expenditures of minus $6.7 million.”

The general fund balances at the beginning of that year were at $6.3 million, and by the end of the year it was down to $3.3 million. For the utility fund, the total fund balance at the end of the last fiscal year was $3.2 million.

“$1.6 million of that is for construction, and its restricted for construction,” Perez said. “And then $279,000 is for capital projects. What we consider available is committed to debt service, $1.4 million.”

The unrestricted part of the utility fund, or what’s available for use, is also in the negative at $135,928. The presentation also included information and expenditures on the golf course fund and solid waste fund.

The estimate for the unassigned fund balances for the current 2018-2019 fiscal year are estimated to end up at $3.4 million.

“Assuming that all the revenues that are budgeted come in at the end of this year in Sept. 2019, we’re estimating $35,488,127 [in total revenues],” Perez said. “With the transfers-in of $7.4 million including the utility fund and the sanitation fund, it gives us a total available resources of $46.3 million.”

On the operations side, the total expenses are about $43.6 million, leaving an estimated total unassigned fund balance at the end of FY 2018-2019 at negative $671,266.

“This is assuming that all of the expenses are expensed at 100 percent and what we budgeted at revenue is collected at 100 percent,” Perez said. “That’s the very very preliminary estimate of the general fund, assuming we have not calculated any kind of savings or any kind of cost-saving measures that have been implemented. This is what the projection would be.”

The presentation involved a separate run-down on financial statements from the Mission Event Center from April 2018 to the end of March 2019. The total income to the event center is $312,238.01, and the total expenses to run it are $753,930.44, making the net income at negative $441,692.43.

During the workshop it was noted that many religious and non-profit organizations have been able to rent the facility with “in-kind” discounted payments, or donations, rather than the rental rates listed.

Rental rates for the Mission Event Center vary, but are tiered based on the renter’s residence and if it will be in use for residential/non-profit, non-resident, corporate and promoter events. Council member Norie Gonzalez-Garza was concerned about the rate at which the city was waiving the set fees for in-kind payments, saying she hadn’t heard that was happening and the city needs to charge everyone something for use of the facility.

“It does cost money to operate it, open it up, to have someone there, to have someone clean it,” Gonzalez-Garza said. “So I think we really need to consider the, I’m going to call ‘the freebies.’ I think everyone should pay something.”

Council member Jessica Ortega-Ochoa agreed with Gonzalez-Garza that changes in that regard need to be made, and the event center needs to be promoted more in order to gain more customers.

Mayor Armando O’caña said that typically, when cities open new facilities like the Mission Event Center, they have a first-year trial budget so they can afford the initial and ongoing expenses.

“We did start low for the first year, considering where we wanted to be and it is being utilized,” Perez said. “It’s just whether we want to revisit the fee structure again and do a comparable with the neighboring cities.”
Ortega-Ochoa added that the reason the city wanted a financial assessment and performance reviews last year was to see their financial standing prior to new leadership.

“We’re working together as hard as we can, as a team, to move Mission forward, but these are the numbers we have before us that was left from the previous administration,” Ortega-Ochoa said. “We need to figure things out in an effective and smart way, with transparency.”

By the end of fiscal year 2017-2018, the beginning unassigned fund balance was $6.3 million, ending at $3.4 million, with about $50 million in available resources.

For fiscal year 2018-2019, the estimated beginning unassigned fund balance is $3.4 million, and is estimated to end at a negative of $671,266, with about $46 million in available resources.

Perez said he’s been trying to be creative by asking the city departments to help in saving money, and they all agreed that travel expenses need to be some of the first to be reduced. Before the final budget is due, Perez plans to meet with the 22 city department heads to see if more changes can be made internally.

Council will have another workshop to discuss the budget and any updates May 6.

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