By Shawn Raymundo
Early financial data shows that San Juan Capistrano has collected more than $2 million in general fund revenue for this fiscal year, keeping up with the city’s budget projection and tracking to provide nearly $16 million in reserves.
The city of San Juan Capistrano on Wednesday, Jan. 9, released its first quarter financial report for fiscal 2018-19. The report outlines how much revenue the city has collected between July 1 – the start of the fiscal year – and September 30.
The report also shows the city’s expenditures during that period, as well as how revenues are tracking against the projected revenue in the fiscal 2018-19 budget that City Council adopted last year.
According to the report, more than $2.42 million in general fund revenue has been collected so far, accounting for 9 percent of the city’s total anticipated general fund revenue of $28.2 million this fiscal year. Compared to the previous fiscal year, the city collected about $503,000 more than what it had collected during the same time period.
Of the city’s total projected general fund revenue this fiscal year, nearly $8.7 million (roughly 31 percent) is expected to come from sales taxes, according to the San Juan Capistrano adopted biennial budget.
The bulk of the city’s annual general-fund revenue comes from property taxes, which accounts for 38 percent. Property taxes get collected in April and December, so the latest report doesn’t reflect much of that revenue yet.
During the first quarter, San Juan Capistrano generated $711,427 in sales taxes. Property taxes accounted for $145,502, or 1 percent of the property tax portion the city expects to collect by the end of the fiscal year. Revenue from licenses, fees and permits provided the city with $673,686, the report shows.
Expenditures in the first quarter amounted to nearly $6.76 million, with most of that money being spent on public safety – about $2.63 million. Another $1.18 million went toward public works and utilities, according to the report.
While the city outspent its revenue collections by $4.3 million, the report notes that such an occurrence is typical as only 9 percent of the general fund’s total revenue is collected during the first three months of the fiscal year.
“This is consistent with the performance of the general fund for the same period of the previous fiscal year, during which expenditures exceeded revenues by $3.2 million,” the report stated.
The report also notes that the excess first-quarter expenditures were higher this current fiscal year compared to fiscal 2017-18, partially because of a $764,000 payment the city made to Caltrans in July 2018 for the former Jack-in-the-Box property.
At the start of the fiscal year, the city’s general fund reserves had approximately $16 million, according to the biennial budget. The latest report shows that the city will maintain that projection with an available fund balance of close to $15.85 million.
Based on the first-quarter financials, officials have proposed adjusting the budget by increasing the projected revenue by $3 million and expenditures by $3.1 million. The expenditure adjustment is to address the $2.9 million the city owes as part of a settlement agreement last September with the environmental advocacy group Orange County Coastkeeper.
The group filed a lawsuit in 2017, alleging that the Rancho Mission Viejo Riding Park contributed to pollution in San Juan Creek. Both the city and Blenheim Facility Management denied the claims.
Under the terms of the settlement agreement, the city must fund $1 million in projects through the California State Parks Foundation, benefiting the San Juan Creek Watershed, and also pay $1.9 million to Coastkeeper’s legal and expert fees related to the lawsuit.
The city is proposing the revenue projection amendment to account for a $3 million payment Orange County is expected to make to the city this month. The payment marks the first half of a $6 million payment the county owes for its extended use of the Prima Deshecha Landfill.
City Council will review and discuss the financial report during its next meeting Jan. 15 at 5 p.m.