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<br />29: <br /> <br />TUESDAY <br /> <br />NOVEMBER 23, 1976 <br /> <br />~ <br /> <br />I have several comments in regard to Mr. Yeaman's October 15th <br />Quarterly Financial Summary. <br /> <br />First, total City funds are now projected to perform $517,317 <br />better than budgeted, although most of this was either planned <br />when the budget was finalized or can be attributed to an <br />unbudgeted windfall. Specifically, $145,124 of the projected <br />surplus is due to revenue-sharing funds not used to balance <br />the budget which Council knew would be coming if revenue <br />sharing was renewed by Congress. $218,700 of the projected <br />surplus is due to the 6.6% surcharge on electric rates which <br />was imposed (to parallel Appalachian Power's rates) after <br />the budget was finalized. These two items account for <br />$363,825 or 70% of the projected surplus in fund balances. <br />Excluding these two items, all other funds are now projected <br />to perform $153,492 better than budgeted, and I think this <br />reflects the fact that the City Administration and Department <br />Heads are trying to operate department with the objective of <br />showing a year-end surplus. <br /> <br />I cite three examples: <br /> <br />1. The Welfare Department is now projected to spend <br />$31,372 less local funds than budgeted. If the current <br />projection holds true, the local cost of welfare will <br />have risen 2.6% per year for the last two years. This <br />compares to fiscal '74 and '75 when the actual local cost <br />of welfare went up 38~% per year. <br /> <br />2. The water and sewer departments are now projected to <br />lose about $40,000 (which is about $20,000 better than <br />budgeted) due to a $14,700 projected increase in revenues <br />and a $5,000 projected decrease in expenses. <br /> <br />3. The Prison Fund is now projected to perform $77,268 <br />better than budgeted due primarily to an increase in <br />per-diem allowance by the State for State-Offense prisoners. <br /> <br />On the negative side, there are two potential problem areas <br />which I would like to point out: <br /> <br />1. The first is the Electric Department. Kilowatt hours <br />sales for the first quarter, as compared to last year, are <br />as follows: Residential, down 3.7%; Commercial, down 1.2%, <br />and Industrial, down 1.6%. Total kilowatt hours sales are <br />down 1.1%. <br /> <br />The problem is that Council forecased a sales increase of <br />9.7%, and first-quarter kilowatt hours sales are down 1.1%. <br />I estimate that the failure to achieve a 9.7% increase will <br />