TO: Urban Renewal Agency Board
THROUGH: Keith Stahley, Executive Director
FROM: Josh Eggleston, Chief Financial Officer
SUBJECT:
title
Urban Renewal Agency Fiscal Year (FY) 2025 Preliminary Quarter 1 Financial Report
Ward(s): All Wards
Councilor(s): All Board Members
Neighborhood(s): All Neighborhoods
Result Area(s): Good Governance
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SUMMARY:
summary
During the adoption of the FY 2025 budget, City Council motioned for staff to return within 45 days of the end of each quarter with a financial report showing budget to actuals in the General Fund. Although this motion was for the General Fund, staff will also be bringing a quarterly report for the Urban Renewal Agency. This is a continuation and expansion of the current practice of preparing quarterly financial reports and providing them to the Budget Committee.
The URA Preliminary Quarter 1 Financial Report reflects all activity posted through the closed months ending September 30, 2024.
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ISSUE:
Information Only
RECOMMENDATION:
recommendation
Information Only
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FACTS AND FINDINGS:
The first quarter ended on September 30, 2024, and the period was officially closed on October 10, 2024. The fiscal year is 25% completed and all financial activity available was posted prior to closing. This report is preliminary as FY 2024 is still being audited and as such, fund balance totals for FY 2025 could be impacted.
The URA is comprised of four funds: the Tax Allocation Bond Debt or Debt Service Fund (Fund 220), the Tax Allocation Improvement or Capital Improvements Fund (Fund 265), the Salem Convention Center - Operations (Fund 345), and the Convention Center’s Gain / Loss Reserve (Fund 428). The quarterly report displays both the Debt Service Fund and Capital Improvements Fund financial activity by Urban Renewal Area.
For the Debt Service Fund, the primary revenues are property taxes which are not received in the first quarter of the fiscal year. The revenues shown are mostly beginning fund balance. Expenses are associated with debt repayments (either long-term debt or overnight or du jour debt) which do not occur in the first quarter. The only expense that occurred was in Riverfront Downtown to transfer funds held in reserve for a prior borrowing to the Capital Improvements Fund.
The revenue in the Capital Improvements Fund is a largely beginning working capital. Debt proceeds from borrowings in the Debt Service Fund will be recorded as revenue later in the fiscal year. Expenditures are for capital projects listed in each area’s specific plan or grant programs.
One item to note is that the Fairview URA is no longer collecting property taxes or issuing debt which is why that line in the Debt Service Fund is blank. However, using the working capital already in the Fairview portion of the Capital Improvements Fund, projects are still being completed resulting in expenditures for FY 2025. Additionally, McGilchrist URA has reached maximum indebtedness and Mill Creek URA is anticipated to reach maximum indebtedness in FY 2025 which means no additional borrowings can occur without a plan amendment in each area.
The primary expenditures in FY 2025 for the various areas include the capital grant program and streetscape revitalization in the Riverfront URA, and 22nd St. improvements in the McGilchrist URA.
For the Salem Convention Center, operating revenues and expenditures are within Fund 345. Food sales and overall rentals are trending higher in the first quarter than the previous year. Overall, sales increased by approximately $176k and other professional services are also trending higher than previous year by about $159k. Fund 428 or the Gain Loss reserve interest income for Q1 is $23k and is trending as expected.
BACKGROUND:
The Budget Office has provided quarterly reports to the Budget Committee and published them online for the public for over a decade. These reports are typically provided to the Budget Committee at their winter and spring meetings when they review the forecast and budget. During adoption of the FY 2025 budget, City Council requested that these reports be provided directly to the City Council within 45 days of the end of each quarter. Due to the URA Board meetings being once a month, the URA Board quarterlies will come to the Board at their first meeting after that 45-day period.
Emese Bihari
Management Analyst II
Attachments:
1. URA FY 2025 Preliminary Quarter 1 Financial Summary