Agenda

Back to Calendar Return

Regular 8.

LAFCO

Meeting Date:

02/27/2014

Information

SUBJECT

Second Quarter Financial Update for Fiscal Year 13-14 and Budget Adjustments

RECOMMENDED ACTION

Review and file the Fiscal Year (FY) 13-14 2nd Quarter Financial Update.
Approve the transfer of $33,499 from the Appropriations for Contingency account to the Salary and Benefits major object account to pay for the recently filled analyst position.
Approve the transfer of $50,000 from the fund balance into a restricted cash account for OPEB liability.

FISCAL IMPACT

None

REASONS FOR RECOMMENDED ACTION

The intent of the quarterly financial report is to provide the Commission with an update on how LAFCo performed financially in the previous quarter as compared to the adopted budget and to discuss any issues as appropriate. The practice was recommended during our most recent audit as an additional safeguard to ensure sound financial management, given the small size of the LAFCo staff.

In addition to providing the second quarter financial update, staff is recommending several adjustments to the adopted budget to account for recent staffing changes and responsible financial management of OPEB liability.

BACKGROUND

Second Quarter Financial Report

The LAFCo FY 2013/14 budget was adopted on May 23, 2013, and LAFCO is currently largely on target with regards to both revenues and expenditures.

LAFCo has received 98.1 percent of its expected revenues for FY 13/14 through payments from government agencies. The remaining 2 percent of LAFCo’s expected revenues are attributed to investment earnings and fees for services, which may be collected over the remaining quarters in FY 13/14.

LAFCo is also on target with regards to expenditures. Overall, LAFCo has expended 36.5 percent of its budgeted costs in the first two quarters of FY 13/14. LAFCo has expended 49.7 percent of the Salary and Benefits appropriation, and 51.6 percent of the Services and Supplies appropriation. LAFCo has only expended 2 percent of its Shared Services Initiative appropriation, but expects that the majority of this appropriation will be utilized in paying for the contract with Magellan Advisors over the next two quarters.

Budget Adjustments for LAFCo Analyst

On September 26, 2013 the Commission authorized the Executive Officer to hire a part-time analyst, and the position was filled in October 2013. The position was not planned for in the adopted FY 13-14 budget, although at the time of authorization the Executive Officer demonstrated that LAFCo had sufficient funding to support the position due to contingency funds and a robust un-appropriated fund balance. At this time staff seeks authorization to transfer $33,499 from the Appropriations for Contingency account to the Salaries and Benefits major object to account for this position. Although this will leave a contingency of $40,829, LAFCo has an un-appropriated fund balance of $132,833.

Other Post-Employment Benefits (OPEB) Liability

LAFCo’s FY 11-12 independent audit, conducted by Richardson & Company, determined that LAFCo had an OPEB liability estimated at $50,000. Since that time staff has held the $50,000 as a part of the un-appropriated fund balance. At the recommendation of the County Auditor-Controller’s Office, staff now seeks authorization from the Commission to create a restricted cash account for holding LAFCo’s OPEB liability. The restricted account will be interest earning, and will provide greater clarity in budgeting. The Commission will still have access to the funds, and will be able to re-appropriate the funds to another purpose, if necessary.

Attachments
Item 8-ATT Budget Adj.
Item 8-ATTs AtoE 2nd QTR Financials
Item 8-Supplemental

Form Review

Inbox	Reviewed By	Date
Christine Crawford	Christine Crawford	02/12/2014 11:49 AM
Christine Crawford	Christine Crawford	02/18/2014 11:18 AM
Form Started By: Tracey Dickinson		Started On: 02/12/2014 11:19 AM
Final Approval Date: 02/18/2014