According to the Jacksonville City Council auditor’s report, FY 2016 was a good year for the city of Jacksonville’s budget, highlighted by a $29 million favorable variance in a $1.1 billion budget.
Revenues were $15 million above budgetary expectations, and expenditures were $14 million under projections.
However, underneath the rosy picture, the report spotlighted issues with pension contributions below where they could be, inadequate emergency reserves, and questions about one independent authority’s accounting practices.
Property tax collections showed a favorable variance of $4.6 million, with the bulk of that money from the collection of delinquent property tax.
“Summer temperatures” are credited with higher revenue from JEA taxes. Between electric, water, and sewer, the city came out $6.4 million over projections.
Red light cameras, a program which Policy Advisor Robin Lumb suggested the sheriff sell the renewal of to council, outperformed revenue targets.
Expectations were that the city would come out $150,000 ahead; the real collection was close to $1.12M.
Expenditures also trended well for the city.
A $2.3 million unfavorable variance in Fire and Rescue was offset, and then some, by a $10 million favorable variance in the Jacksonville Sheriff’s Office budget.
Despite these positives, a worry was expressed regarding pension contributions from the city that may be too low: “For the General Employees Pension Fund pension contributions, the City utilized the percentage of covered payroll method … However, as we have noted in recent years, this approach may result in the City under-contributing to the fund.”
And another worry was expressed regarding the emergency reserve, which came in below 5 percent at the end of September.
With $101 million in unassigned operating reserves, “the Emergency Reserve will fall short of the 5% target by $382,586 mainly due to an additional $8.0 million transfer from fund balance near the end of the budget process.”
The recommendation from the council auditor: an emergency reserve of at least $55 million.
Among the subfunds with some issues: municipal stadiums and arenas.
The stadium is over $3.5 million in the hole. The arena subfund is almost $1.6 million in the red. And the Performing Arts Center fund? Insolvent.
City Council has sought to increase user fees on these facilities to make the books balance, but that bill still has to clear one committee before the full council hears it in January.
Meanwhile, there are some line-item issues with the Jacksonville Transportation Authority, as “the Skyway Division, CTC Division and the General Fund/Engineering Division all overspent their Fiscal Year 2015/2016 amended budgets.”
The council auditor also threw major shade at JTA’s shoddy accounting practices: “It should be noted that while JTA submitted their quarterly report on time, there were numerous errors with JTA’s report. JTA had to submit their quarterly report three separate times before we could properly review the report for reasonableness. JTA should be reviewing their reports for errors and inconsistencies before submitting them to our office to ensure the quarterly reports agree to the supporting documentation.”