(Aug. 10, 2018) The Ocean City Council on Monday approved on first reading a fiscal year 2018 budget amendment that increased the overall budget by more than $5.9 million.
Budget Manager Jennie Knapp, who presented the financial updates during a council work session the week before, said the fiscal 2018 general fund, which is just one component of the budget, would increase by approximately $1.2 million.
“We do receive quite a bit of grant money and donations during the fiscal year,” she said at the work session. “If we don’t add them to the ordinance, we don’t have the legal authority to spend them.”
The majority of budget increase is from a nearly $5 million state grant for the Transportation Department to upgrade its 65th Street campus.
“The [state is] funding their portion over a three-year period and this is the first year of that,” she said.
The budget alterations do not require additional funding from real property taxes.
Knapp said budget amendments are used to adjust revenue and expense projections for fiscal year end.
Among the highlights on the revenue side of the ledger were higher dollar figures from taxes, licenses, service charges and revenue for other agencies.
“We’re recognizing other taxes in the amount of $101,552, which is an increase in income tax over the projected amount,” she said.
Knapp also said fees for licenses and permits went up $180,000.
“The majority of that is for building permits at $100,000,” she said.
There has also been a roughly $60,000 increase in room licensing and noise permit fees, Knapp said.
“There was a letter sent out in the beginning of the year that directly led to this increase in revenue,” she said.
The city also received $798,000 in revenue from other agencies, with the Maryland Office of Tourism Development leading the pack, Knapp said.
“The largest is the state tourism grant at almost $576,000,” she said. “We never include that in the original budget because we don’t know what the amount is going to be, and it does increase from year to year.”
Fines and forfeitures dropped, principally from parking, by more than $71,000, Knapp said.
“We were able to reduce the amount we thought we were going to be taking from appropriated fund balance because we’re recognizing other types of revenue,” she said.
Although revenue estimates were reduced by a total of $143,000 in the Transportation Fund, Knapp said the figure was initially more than $236,000 before a $93,000 savings was identified in the expense line item.
“At the end of the fiscal year we will be doing a thorough analysis of the transportation fund balance,” she said.