(Aug. 2, 2019) Balancing the ledgers to close out fiscal year 2019, while recognizing additional revenue and expenses incurred during the current calendar year, was the focus of a budget amendment presentation during the Ocean City Council work session on Tuesday.
Budget Manager Jennie Knapp said despite an overall general fund increase of $1.3 million the fiscal 2019 adopted budget total derived from real property taxes remains at roughly $40.8 million.
“I want to stress there is no additional funding from real property taxes,” she said. “The total overall increase in all budgets is $7.3 million and $7.1 million of that is grants that we received.”
The second budget amendment for fiscal 2019 includes grants and donations the city has received since January.
During this calendar year, Knapp said revenue from other agencies has increased by $767,000.
“The biggest part of that is the state tourism grant of $373,000,” she said.
The total also included a beach mat grant for $122,000, roughly $115,000 to fund construction of a pickleball court, $54,000 for a mass casualty trailer for the Emergency Services Division and $100,000 in public safety grants.
“Part of that is recognizing county grants that were over the budgeted amount,” she said. “Those funds we used to purchase pagers for the Volunteer Fire Company … and an additional 15 radios between the fire and police divisions.”
The budget amendment also includes an additional $70,000 in state casino revenue.
“The casino revenue is being transferred to the capital projects fund for street paving,” she said. “That’s what we have assigned the casino revenue to in the past.”
In total, roughly $2.7 million was dedicated to street paving during fiscal 2019.
Service charges were reduced by more than $120,000 during calendar year 2019, with $90,000 of that total due to reducing the fees charged for the beach photo franchise agreement.
Parking revenue estimates were also reduced by $52,500, but were offset by fines, Knapp said.
“The parking fines are actually up $52,000, so that directly offset what the parking revenue estimate was down,” she said.
Revenue from other sources also grew by $437,000, which includes $66,000 in donations received since January and $371,000 from investment interest.
“Under appropriated fund balance, we’re actually able to reduce the amount that we’re going to be taking out of fund balance,” she said. “Part of that is from recognizing other revenue that has come in like … the corporate tax.”
Additional funds were drawn from fund balance at the end of fiscal 2018 due to unspent advertising and Tourism Advisory Board (TAB) funds.
“Our funding formula says that we’re supposed to spend that on advertising, so I’m appropriating that and putting it back in the advertising budget for this year,” she said. “I was able to reduce what we took out of fund balance by $678,000 and then to reduce the transfer to transportation by $246,000 from savings on the expense side there.”
Knapp said the prior fiscal year’s unspent funds were largely TAB related at $348,000, with $6,600 in unused advertising money.
“The total spent on advertising [from] TAB and sponsorships in FY 19, or the total budgeted is $7.6 million,” she said. “The total that was funded through our funding formula from room tax was $6.9 million.”
Councilman John Gehrig stressed the advertising budget revenue comes solely from visitors.
“The $7.6 million sounds like a lot of money, and it is, but zero dollars come from property tax,” he said.
The largest dollar variations were in the transportation fund, Knapp said.
“That is the biggest single change in this budget amendment,” she said.
Bus passenger revenue estimates were dropped by $100,000, despite the tally being on pace with the prior year totals.
“Our bus passenger revenue finished FY 19 almost dead even with FY18, but we had estimated that we would increase our passenger revenue,” she said.
The council voted unanimously to move the budget amendment to ordinance form with a first reading scheduled for its meeting on Aug. 5.