(Sept. 11, 2020) The Ocean City Council gave its final approval on Tuesday to a second budget amendment that recognizes a total budget increase of $10 million and a general fund reduction of $430,349 for the fiscal year 2020 budget.
The amendment will not be the final number recorded in the city’s Comprehensive Annual Financial Report (CAFR).
“This amendment recognizes revenue sources that increased since budget amendment number one, it recognizes revenue that will exceed the original budgeted amount, it recognizes adjustments due to the coronavirus and also other uses of prior year reserves or fund balance,” City Budget Manager Jennie Knapp said during an August meeting.
Revenue sources that increased were the pier franchise ($1.1 million), grants ($752,135), donations ($117,707), damaged vehicle insurance reimbursement ($51,401), Procurement or Purchasing card (P-Card) rebate ($33,000) and Crown Castle commission ($32,845).
Several revenue sources would also exceed their budgeted revenues, such as income tax ($316,000), parking fines ($572,000), interest on investments ($350,000), corporation tax ($50,000) and forfeiture funds ($79,786).
Certain taxes, licenses and permits, service charges and fund transfers will all be adjusted because of the novel coronavirus.
Knapp said previously that she had reduced revenue estimates by $2.2 million. That included reductions in room tax, highway user tax, admissions tax and casino revenue.
Transfers from the general fund to other funds will go up by $641,358. These transfers are $374,000 to Eagle’s Landing Golf Course, $230,000 to the Ocean City convention center on 40th Street and $73,000 to risk management.
Transportation funds will be reduced by $36,000.
The budget amendment recognizes a $3.7 million increase in expenditures. The most costly of these expenditures are Boardwalk re-decking at $1.1 million, grants and forfeited funds at $659,088 and street paving at $374,301.
This expenditure increase is balanced out by a $4.1 million reduction — $1.3 million in salary and benefits, $1.2 million for a fire rescue truck and $734,507 for advertising/TAB/sponsorships.
The city’s water and wastewater, transportation, airport, golf course, convention center, IT and service center and vehicle trust and risk management funds would also see changes.
Overall, the budget amendment recognizes a $3 million revenue shortfall, but also a $2.6 million reduction in expenses.