title
Consideration of amendment to the 2024 Budget to reflect 2023 capital project carryovers
body
Submitted by:
John Ruggini and Thania Cervantes
Department:
Finance Department
A. Issue
Earlier this year, the 2023 Operating Carryovers were approved. Presented here for approval are the capital project carryovers
B. Background/Options
A carryover is a budgetary mechanism by which spending authority is transferred from one fiscal year to the next. This is most often necessary where a project budgeted for in one fiscal year (2023) is not completed so that remaining committed but unspent funds associated with the project are transferred to the following fiscal year (2024). While the City adopts a five-year capital plan, only the first year of the plan is actually authorized. In this case, the 2023-2027 plan was adopted in February 2023 and the 2024-2028 plan was adopted in December 2023. We are now requesting the 2024 fiscal year of the 2024-2028 plan be amended for the unspent 2023 funds.
Capital projects are typically complex infrastructure projects (such as street and utility construction) or large equipment purchases (such as a Fire engine) that often span multiple fiscal years so carryover funds are not uncommon. The Capital Budget is adopted separate from the Operating budget but once approved, they are combined in the City's financial system so spending can be tracked. Capital projects have multiple funding sources including property taxes, special assessments, grants, surplus funds (cash) and bonds (borrowed money). The majority of capital carryovers typically represent bond funds that have been borrowed but not yet spent. Of the $16.5 million requested for carryover, 61% are bond funds. These borrowed funds legally must be spent on capital projects within two years of having been borrowed Staff actively monitor these timeliness requirements.
I am requesting that $16,465,418 be carried over as compared to the $12,216,435 in the prio...
Click here for full text