General Fund unassigned balance ends slightly lower than in 2023 fiscal year
This week, a partner with the independent, external firm that handles the City of Sarasota’s audits reported to the city commissioners that the firm’s most important finding in its review of the city’s finances for the 2024 fiscal year was that no “corrections or misstatements” were discovered.
Jeff Wolf of Forvis Mazars in Tampa added, “We had an unmodified opinion, and that is the highest level of assurance that your financial statements are correct.”
Further, he said, “The city’s in a strong financial position.”
The backup materials for that agenda item included what is called the comprehensive annual financial report, or CAFR, for the 2024 fiscal year, which was prepared by the city’s Financial Administration Department.
An April 1 letter provided with the CAFR — signed by Kelly Strickland, the city’s director of financial administration, and interim City Manager Doug Jeffcoat, noted that the city received the Government Finance Officers Association’s Award for Distinguished Budget Presentation for the 2024 fiscal year.
“This was the thirty-fourth consecutive year that the City has received this prestigious award,” the letter said. To qualify for that recognition, the letter explained, “the City’s budget document was judged to be proficient in several categories including policy documentation, financial planning, organization, and as a communications medium. We are pleased that we continue to achieve this distinction,” it added.
During his April 21 remarks to the City Commission, Wolf of Forvis Mazars also pointed out that the city ratio regarding its ability to meet its current liabilities with its current assets in regard to governmental activities climbed to 9.6; it was 8.8 last year. Those activities, he explained, are funded by tax revenue “and other intergovernmental revenues.”
For business activities, he continued — referring to those funded by fees that the city receives — the ratio rose to 7.9 in the 2024 fiscal year, compared to 7.2 in FY 2023. “Again, a strong year,” Wolf said.
By the Sept. 30, 2024 end of the 2024 fiscal year, he noted, the total of assets related to governmental activities was $558.8 million. For the business-type activities, he said, the total was $434.7 million.
Wolf did note that the city’s unassigned fund balance in its General Fund “dropped a few percentage points,” compared to the figure for the 2023 fiscal year. The balance in FY 2024, as a percentage of total expenditures and other uses of funds, was 28.7%; at the end of FY 2023, it was 31.8%.
The total General Fund balance as of Sept. 30, 2024 was $36.4 million, a slide showed; as of Sept. 30, 2023, the figure was $36.2 million.
The 2024 total, Wolf pointed out, is “still certainly well within what’s considered a good fund balance reserve.”
He did note that the General Fund’s assets exceeded liabilities largely as a result of the city’s investment income. A chart included in the CAFR showed that the investments earnings totaled $11,544,683, making up 11.34% of the General Fund revenue. In the 2023 fiscal year, the same graphic showed, the city’s investment earnings added up to $5,292,630.
The General Fund is the city account that holds the property tax revenue and other types of income — such as revenue shared by the state. It covers the expenses for departments, such as the Sarasota Police Department, that do not generate revenue to support their operations.
A graphic in the CAFR showed that the city collected $51,446,974 in property tax revenue in the 2024 fiscal year, which represented 50.52% of the General Fund total. Gasoline tax revenue totaled $2,712,194, the graphic noted, while sales tax revenue added up to $19,941,784. The state revenue sharing total was $2,831,665.
Further, Wolf noted that the General Fund budget in FY 2024 ended up with total revenue and other financing sources of $102.1 million, even though staff had anticipated the city’s receipt of $94.4 million. Thus, the city had $7.7 million more in revenue than the figure staff had expected.
The expenditures in the 2024 fiscal year totaled $101.9 million, although staff had budgeted for $107.2 million. That meant the city ended up spending $5.3 million less, a slide showed.
Thus, the city’s General Fund ended up with $13 million more than staff had expected by the end of FY 2024, the slide pointed out.
The detailed CAFR included in the backup agenda materials for the April 21 meeting also noted that, at the end of the 2024 fiscal year, the city’s capital assets had a value of $477,940,516. The report explained that among those assets are buildings, land, infrastructure and equipment.
Yet another detail in the CAFR was that the operating revenues of the Water and Sewer Fund rose by $1,902,033. That mainly was attributed to a 3.5% rate increase, the document explained.
Moreover, the document pointed out that the Bobby Jones Golf Complex, which reopened on Dec. 15, 2023, following extensive renovations, had operating revenues of $3,370,607 for the 2024 fiscal year, while operating costs totaled $2,139,966. Thus, the golf course finished the 2024 fiscal year with income of $1,230,641.
Commissioner Kathy Kelley Ohlrich asked city Financial Administration Director Kelly Strickland whether the negative $12.8 million balance shown on the slide with details of the amended 2024 fiscal year budget was “mostly due to hurricane expenses?”
“No, ma’am,” Strickland responded. “It would be the encumbrances that roll forward from the previous year,” as well as the re-appropriation of funds from the previous year, she explained.
Ohlrich then asked, “Do we expect to be compensated for [the city’s hurricane] expenses?”
“We hope that FEMA will compensate us at least 75[%] to 85% of that,” Strickland responded.
The commissioners unanimously approved the CAFR on a motion by Commissioner Jen Ahearn-Koch, seconded by Ohlrich.