Finance Committee

B i fi – July,
Briefing J l 2009
ressullts

YTD Results
Presentation to the Dayton
y Cityy Commission
August 26, 2009
 Summary
• Through July, 2009, results reflect
continuing
ti i ttrends
d
ressullts
• Revenues are falling below the
estimate but we are also containing
expenditures
• Budget planning for 2010
p
represents a significant
g challenge
g
and departments have begun their
y work
analysis

2
 Overview – July,
July 2009 YTD
• Total revenues are 5.3% below the
original
i i l estimate
ti t ((or $5
$5.3
3 million)
illi )
ressullts
• Total expenditures are under budget
by 6.9% (or $6.7 million)
• Operating Transfers Out have been
completed for most planned uses
• Bottom Line: $2.0 million deficit at
the end of July which we plan to
eradicate by year-end
3
 July YTD 2009 Revenues
July,
• Income Tax revenues are below the
estimate by 4.4% (or $2.7 million) --
ressullts
this amount is 7.9% below revenues
in this period in 2008

• Preliminary revised forecast

anticipates a 7.0% decline for 2009,
a loss of $7.7 million in one year

4
 July YTD 2009 Revenues
July,
• The next two months will be critical
– We can expect sharper declines in the
ressullts
second half of the year given one-time
i
income tax revenues were received
i d iin
the second half of 2008 from the tax
amnesty program and oneone-time
time
severance payments

5
 Other Cities Income Tax
• Cincinnati’s revenues are down 6.3%
(net profit taxes down 26.7% and
ressullts
withholdings down 2.9%)
• Columbus is down 5.4%. Recent
ballot issue resulted in increase in
tax rate to 2.5% effective October 1,
2009 (up from 2.0%)
2 0%)
• Cleveland and Akron both down 6%

6
 July YTD 2009 Revenues
July,
• YTD investment earnings g are 32.9%
below the estimate (or $710,047)
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due to lower interest rates
– Average annual yield has fallen from
3.23% in 2008 to 1.90% through July,
2009

7
 July YTD 2009 Revenues
July,
• Local Government Fund revenues
continue to reflect downward trend
ressullts
– July,
y, YTD receipts
p are below estimate
by 14.3% (or $1.3 million) reflecting the
decline in State tax collections
• Fees/Charges/Other revenue below
y 3.3% (or
estimate by ( $553,848))
– Largest impact is from declining
Transportation Center Garage
revenues (-$312,000)
8
 July 2009 YTD Spending
July,
• Personnel costs are below budget
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by 2.5% (or $1.8 million)
– The
Th average number b off filled
fill d ffull-time
ll ti
positions is down by 125 full-time
positions over the same period last
year, a reduction of 8.2%
– Overall, General Fund overtime is
down 15.2% (or $315,928) although
some departments are over budget
(Fire, Public Works)
9
 July 2009 YTD Spending
July,
• Contracts & Materials expenditures
are 19.2% under budget (or $4.2
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million)
– Cost reductions are occurring in the
areas of fuel, supplies and property
ttaxes

10
 July 2009 YTD Transfers
July,
Transfers In $0
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Transfers Out:
Cash Capital Transfer $(1,570,000)
Development
p Fund ((4,330,000))
Downtown Fund (1,000,000)
Street Maintenance Subsidy (959,000)
Professional Development Fund (100,000)
Race and Reconciliation Program (25,000)
Grant Matches and Closings (105)
Total Transfers Out $(7,984,105)

Net Special Projects Transfers $100,000

Net Operating Transfers $(7,884,105)

11
 CITY OF DAYTON
GENERAL FUND
STATEMENT OF REVENUE AND EXPENDITURES
DRAFT UNAUDITED
(all numbers in current dollars)
Budget
Variance
2007 YTD '07 % of 2008 YTD '08 % of 2009 YTD 2009 YTD Favorable/ '09 % of '08-09 %
Revenues 2007 Actual 2008 Actual 2009 Budget (7/31/07) Total (7/31/08) Total Budget (7/31/09) (Unfavorable) Budget Change
Income Tax 112,764,901 110,449,891 105,417,700 67,891,157 60.2% 65,218,793 59.0% 62,826,108 60,087,538 (2,738,570) 57.0% -7.9%
Property Tax 11,310,193 10,978,432 10,556,200 7,685,259 67.9% 8,677,477 79.0% 7,168,707 7,497,812 329,105 71.0% -13.6%
Local Gov't Fund 14,867,281 14,714,040 14,553,500 9,385,772 63.1% 9,244,277 62.8% 9,197,812 7,884,382 (1,313,430) 54.2% -14.7%
Investment Earnings 5,938,116 4,088,187 3,633,000 2,873,473 48.4% 2,604,290 63.7% 2,155,688 1,445,642 (710,047) 39.8% -44.5%
Fees/Charges/Other 25,911,902 25,522,302 27,113,000 15,979,931 61.7% 15,424,420 60.4% 16,727,911 16,174,063 (553,848) 504.8% 4.9%
EMS/vehicle accident fees 3,968,175 3,972,725 3,204,200 2,287,779 57.7% 1,936,742 48.8% 1,836,866 1,862,041 25,175 163.2% -3.9%
Special Project Revenue 832,162 803,406 1,140,700 430,309 51.7% 507,509 63.2% 697,205 361,752 (335,453) 0.2% -28.7%
Total Revenue 175,592,730 170,528,985 165,618,300 106,533,681 60.7% 103,613,508 60.8% 100,610,298 95,313,230 (5,297,068) 9 -8.0%
Appropriated Fund Balance 3,171,610 N.A. N.A. N.A.
Appropriated Fund Balance-Special Projects 4,058,400
Total Revenue and
Appropriated Fund 175,592,730 170,528,985 172,848,310 106,533,681 60.7% 103,613,508 60.8% 100,610,298 95,313,230 (5,297,068) 55.1% -8.0%
L
Less Special
S i l Projects
P j t 174 760 567
174,760,567 169,725,579
169 725 579 164,477,600
164 477 600 106,103,371
106 103 371 60 7%
60.7% 103,105,999
103 105 999 60 7%
60.7% 99 913 093
99,913,093 94,951,478
94 951 478 (4,961,615)
(4 961 615) 57 7%
57.7% -7.9%
7 9%

Expenditures
Expenditures against
Current Year
Personnel 124,138,051 123,125,719 124,399,500 70,164,439 56.5% 72,839,935 59.2% 72,838,800 71,051,830 1,786,970 57.1% -2.5%
Contracts and Materials 30,689,907 32,155,357 34,683,500 17,680,247 57.6% 17,132,863 53.3% 19,389,485 16,557,380 2,832,105 47.7% -3.4%
Capital Equipment 2,178,881 652,352 0 71,523 3.3% 62,844 9.6% 0 79,633 (79,633) #DIV/0! 26.7%
Debt Service 145,011 145,011 233,000 84,590 58.3% 84,590 58.3% 135,917 84,590 51,327 36.3% 0.0%
Special Project Expenditures 1,686,863 1,762,745 2,323,400 799,335 47.4% 1,032,478 58.6% 1,236,931 573,654 663,277 24.7% -44.4%
Total Expenditures
against Current Year 158,838,713 157,841,183 161,639,400 88,800,135 55.9% 91,152,710 57.7% 93,601,133 88,347,087 5,254,046 54.7% -3.1%

Expenditures against
Appropriated Fund
Contracts and Materials 1,761,091 2,048,959 2,539,502 1,584,921 90.0% 1,947,481 95.0% 2,378,123 1,027,427 1,350,696 40.5% -47.2%
Capital Equipment 705,893 675,245 0 591,813 83.8% 663,012 98.2% 0 300 (300) #DIV/0! -100.0%
Special Project Expenditures 49,832 201,193 125,408 49,832 100.0% 158,859 79.0% 108,592 50,759 57,833 40.5% -68.0%
Total Expenditures
against Appropriated 2,516,816 2,925,397 2,664,910 2,226,566 88.5% 2,769,352 94.7% 2,486,715 1,078,486 1,408,229 40.5% -61.1%
All Expenditures
Personnel 124,138,051 123,125,719 124,399,500 70,164,439 56.5% 72,839,935 59.2% 72,838,800 71,051,830 1,786,970 57.1% -2.5%
Contracts and Materials 32,450,998 34,204,316 37,223,002 19,265,168 59.4% 19,080,344 55.8% 21,767,608 17,584,807 4,182,801 47.2% -7.8%
Capital Equipment 2,884,774 1,327,597 0 663,336 23.0% 725,855 54.7% 0 79,933 (79,933) #DIV/0! -89.0%
Debt Service 145,011 145,011 233,000 84,590 58.3% 84,590 58.3% 135,917 84,590 51,327 36.3% 0.0%
Special Project Expenditures 1,736,695 1,963,937 2,448,808 849,167 48.9% 1,191,337 60.7% 1,345,523 624,413 721,110 25.5% -47.6%
Total Expenditures 161,355,529 160,766,580 164,304,310 91,026,701 56.4% 93,922,062 58.4% 96,087,848 89,425,573 6,662,275 54.4% -4.8%

Excess of Revenue Over Ex 14,237,201 9,762,405 8,544,000 15,506,980 109% 9,691,446 99.3% 4,522,450 5,887,657 1,365,206 69% -39.2%

Other Financing Sources (Uses)

Operating Transfers In 15,215 13,415 2,875,700 13,315 87.5% 1,636 12.2% 0 0 N.A. -100.0%
Operating Transfers Out
Cash Capital Transfer (5,330,000) (1,670,000) (1,570,000) 0 0.0% (670,000) 40.1% (1,570,000) (1,570,000) 0 100.0% 134.3%
Development Fund Trans. (2,670,000) (3,830,000) (4,330,000) (800,000) 30.0% (3,830,000) 100.0% (4,330,000) (4,330,000) 0 100.0% 13.1%
Downtown Fund Trans. (1,000,000) (1,000,000) (1,000,000) 0 0.0% (1,000,000) 100.0% (1,000,000) (1,000,000) 0 100.0% 0.0%
Other Transfers (4,857,664) (3,561,998) (1,679,000) (1,811,029) 37.3% (1,744,013) 49.0% (1,084,105) (1,084,105) 0 64.6% -37.8%
Net Special Project Transfe 530,445 542,766 (2,840,700) 120,000 22.6% 143,546 26.4% 100,000 100,000 0 -4% -30.3%
Net Operating Transfers (13,312,004) (9,505,817) (8,544,000) (2,477,714) 18.6% (7,098,831) 74.7% (7,884,105) (7,884,105) 0 92.3% 11.1%

Excess of Revenues and Transfers In

over Exp. & Transfers Ou 925,197 256,588 0 13,029,266 1408% 2,592,615 1010.4% (3,361,655) (1,996,448) 1,365,206 N.A. -177.0%

Notes:
1) All revenue and expenditures taken from the Banner Financial system. (Income Tax and Personnel Cost are posted on a cash basis in the financial system).
2) To avoid double counting, termination and executive savings are deducted from Special Projects expenditures as they also appears in operating departments as a set aside
espenditure each month.
3) Year to date budget represents the mean percentage of total for the prior three years with the exception of Interest Earnings which are based on known maturities and Personnel
Costs which have been adjustedto reflect the SA 27th payroll.
4) Reduction to 2009 budgets for the decrease in gasoline will be made later in the year. The aggregate amount of the decrease is currently captured in the 2009 appropriation fund
balance.
5) The statement has been adjsuted to reflect the 2008 April payment from the Local Government Fund which was posted in May.
 General Fund
Year-to-Date Financial Performance
as of July 31, 2009

Budget
2009 YTD Variance
2008 YTD (7/31/09) 08-'09% 2009 YTD Favorable/
Revenues (7/31/08) Actual Actual Change Budget (Unfavorable)
Income Tax 65,218,793 60,087,538 -7.9% 62,826,108 (2,738,570)
Property Tax 8,677,477 7,497,812 -13.6% 7,168,707 329,105
Oth Revenue
Other R 29 717 238
29,717,238 27 727 881
27,727,881 3 0%
3.0% 30 615 482
30,615,482 (2 887 601)
(2,887,601)
Total Revenues 103,613,508 95,313,231 -8.0% 100,610,297 (5,297,066)

Expenditures
Personnel 72,839,935 71,051,830 -2.5% 72,838,800 1,786,970
Other Expenditures 21,082,126
21 082 126 18 373 773
18,373,773 -12.8%
12 8% 23 249 048
23,249,048 4 875 275
4,875,275
Total Expenditures 93,922,061 89,425,603 -4.8% 96,087,848 6,662,245

Net Transfers (7,098,831) (7,884,105) 11.1% (7,884,105) -

Revenues over Expenditures

& Net Transfers 2,592,616 (1,996,477) -177.0% (3,361,656) 1,365,179

1) Revenues through July are below the estimate by 5.3% (or $5.3 million).

2)) Income tax revenues are 4.4% below the estimate p

primarily
y due to declines in both withholding
g
and non-withholding collections.

3) Investment earnings continue to fall below the estimate due the decline in interest rates.

4) Expenditures are below budget by 6.9% (or $6.7 million) largley due to wage freeze and fewer
positions being filled.

BOTTOM LINE: Overall, we are not meeting our revenue targets, but lower than originally planned
expenditures are helping offset this negative revenue trend. Careful monitoring of concern areas
will continue. Budget Revisions are being prepared to address 2009 revenue shortfalls.
 2010 Budget
ressullts
g
Planning
 2010 Budget – The
Challenge
• 2010 preliminary estimates
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indicate we will continue to see a
decline in income tax revenues
• Property taxes will further decline
• Local Government Fund will likely
level off from the 2009 revised
estimate but still very vulnerable
given current State budget
situation
15
 2010 Budget – The
Challenge
• 2010 projected
j t dbbudget
d t gap: $15 –
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$20 million based on preliminary
estimates
ti t
• 2010 forecast is underway
– Will meet with Revenue Advisors in
September
• 27th payroll in 2009 can be reduced
from baseline costs in 2010

16
 2010 Budget – The
Challenge
• W
Wage freeze
f and
d costt savings
i days
d
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will reduce costs and are factored
i th
in the gap estimate
ti t
• Attrition of current jobs will occur
• DROP will impact Police and Fire
attrition
• Voluntary Separation Program
(VSP) planned for second year

17
 General Fund
(excluding Special Projects)
2010
2009 Original 2009 Adjusted '08-'09 Adj. $ PRELIMINARY '09 Adj.-'10 $
Revenues 2007 Actual 2008 Actual Budget Budget Change % Chg. Estimate Change % Chg.
Income Tax 112,764,901 110,449,891 105,417,700 102,718,400 (7,731,491) -7.0% 101,218,400 (1,500,000) -1.5%
Property Tax 11,310,193 10,978,432 10,556,200 10,500,000 (478,432) -4.4% 9,659,000 (841,000) -8.0%
Local Gov't Fund 14,867,281 14,714,040 14,553,500 12,376,900 (2,337,140) -15.9% 12,376,900 0 0.0%
Investment Earnings 5,938,116 4,088,187 3,633,000 2,987,300 (1,100,887) -26.9% 2,000,000 (987,300) -33.0%
Fees/Charges/Other 29 880 077
29,880,077 29 495 027
29,495,027 30 317 200
30,317,200 30 017 200
30,017,200 522 173
522,173 1 8%
1.8% 27 316 700
27,316,700 (2 700 500)
(2,700,500) -9.0%
9 0%
Total Revenue 174,760,568 169,725,578 164,477,600 158,599,800 (11,125,778) -6.6% 152,571,000 (6,028,800) -3.8%

Expenditures
Personnel 124,138,051 123,125,719 124,399,500 122,617,200 (508,519) -0.4% 121,342,200 (1,275,000) -1.0%
Contracts and Materials 32 450 998
32,450,998 34 204 316
34,204,316 34 176 800
34,176,800 34 176 800
34,176,800 (27 516)
(27,516) -0 1%
-0.1% 33 776 800
33,776,800 (400 000)
(400,000) -1 2%
-1.2%
Capital Equipment 2,884,774 1,327,597 0 0 (1,327,597) -100% 2,000,000 2,000,000 N.A.
Debt Service 145,011 145,011 233,000 145,000 (11) 0.0% 675,000 530,000 365.5%
Total Expenditures 159,618,834 158,802,643 158,809,300 156,939,000 (1,863,643) -1.2% 157,794,000 855,000 0.5%

Revenue over Expenditures 15 141 734

15,141,734 10 922 935
10,922,935 5 668 300
5,668,300 1 660 800
1,660,800 (9 262 135)
(9,262,135) -84.8%
84 8% (5 223 000)
(5,223,000) (6 883 800)
(6,883,800) -414.5%
414 5%

Operating Transfers
Operating Transfers In 15,215 13,415 2,875,700 2,875,700 2,862,285 21336% 0 (2,875,700) -100.0%
Operating Transfers Out
Cash Capital Transfer (5 330 000)
(5,330,000) (1 670 000)
(1,670,000) (1 570 000)
(1,570,000) (1 570 000)
(1,570,000) 100 000
100,000 -6.0%
6 0% (4 000 000)
(4,000,000) (2 430 000)
(2,430,000) 154 8%
154.8%
Development Fund Transfer (2,670,000) (3,830,000) (4,330,000) (4,330,000) (500,000) 13.1% (3,830,000) 500,000 -11.5%
Downtown Fund Transfer (1,000,000) (1,000,000) (1,000,000) (1,000,000) 0 0.0% (1,000,000) 0 0.0%
Other Transfers (4,857,664) (3,561,998) (1,644,000) (2,644,000) 917,998 -25.8% (3,000,000) (356,000) 13.5%
Net Operating Transfers (13,312,004) (10,048,583) (5,668,300) (6,668,300) 3,380,283 -33.6% (11,830,000) (5,161,700) 77.4%

Excess of Revenues & Trans. In

over Exp. & Trans. Out 1,829,730 874,352 0 (5,007,500) (5,881,852) -673% (17,053,000) (12,045,500) 240.5%
* Actual expenditures represent both uncommitted and committed.
2009 Original budget includes $506,700 adjustment for gasoline and diesel fuel.
* The LGF was reduced by $806,600 and $1.5M from $14,553,500 to $12,376,900 and Interest Earnings were reduced by $645,700 from $3,633,000
to $2,987,300 and RTA Reimbursement of $300,000 was eliminated.
* Personnel costs were reduced by 1.4% in 2009 Adjusted Budget or $1.8M, the value of the General Fund wage freeze and cost savings for all groups
is estimated at $1.4M.
Notes:
1) The national economic slowdown could reduce income tax collections more than projected.
2) The weak financial sector and continued fall-out from the mortgage foreclosure crisis could increase property tax delinquencies in the short run
and will likely reduce total valuations over the next few years.
3) LGF revenue sharing is down significantly in 2009 and will not likely rebound in 2010.
4) Interest Earnings in 2010 include the loss of Sewer earnings valued at 15.2% of portfolio earnings in 2008.
5) Many fees and charges are procyclical and are likely to contract during a protracted recession. New and enhanced fees developed during the
2009 budget process are not fully materializing.
6) Personnel costs could increase more in 2010 due to the rising costs of health insurance.
7) Personnel costs in some departments may exceed budget if overtime is not contained.
8) Contracts & Materials were reduced by $400,000 and Debt Service was increased by a like amount reflecting the cost of the energy performance contract.
9) Capital equipment investments in 2008 and 2009 were the lowest in a decade requiring additional funding in 2010 to avoid serious disinvestment.
 2010 Budget – The
Priorities
• Most critical element of our
ressullts
budget process is having a
clear understanding of the City
Commission’s priorities
• Refinement
R fi t off the
th priorities
i iti may
run parallel to the budget
d
development
l t process
• Layoffs can be expected and
service adjustments will likely
result 20
 Current City Commission
Priorities (not in order)
• Development (i.e. economic
ressullts
development)
• Infrastructure (including community
p
development) )
• Public Safety (with stronger
emphasis on Police above Fire)

21
 2010 Budget
• Development Fund planned at
ressullts
$4.83 million
– $1.0
$1 0 million for downtown projects
– $3.83 million for various incentives
– Note: Annual allocation reduced
$500,000 and replaced with CDBG
funding for Crown Plaza project

22
 2010 Budget
• Capital Projects funding estimated at
ressullts
$4.0 million
• Restores partial amount of capital
equipment funding of $2.0 million after
no General Fund allocation in 2009
– This allocation will be a high priority in the
2010 recommendations
– 2008 allocation was $1.3
$ million
– Strategic Financial Plan recommendation:
$4 0 million per year
$4.0

23
 2010 Budget
Budget Reductions due to a
combination of factors:
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1. Reduced Revenue
2 Need to restore (in part) capital
2.
projects and capital equipment
funding
3. Need to restore Street Maintenance
subsidy
4. One-time sources of $2.8 million
will not occur in 2010 (transfers
from Termination Pay Fund and 27th
Payroll Fund)
24
 2010 Budget General
Timeline
• August • Phase I Solutions
ressullts
• September • Budget Development
• O t b
October • CMO reviews
• November • CFRG reviews
• D
December
b • B d t
Budget
recommendations to
City Commission

25
 2010 CFRG Timeline
• August 20 & • Performance Measurement
ressullts
27 Reviews
• September 10 • Development Projects Update
• September 24 • Revenue Forecast
• October 8 & 15 • Open dates
• October 22 • Budgets: ED, PCD
• October 29 • Budgets: Police, Fire
• November 5 • Budgets: PW,
PW RYS
• November 19 • Discuss Recommendations

26
 Thank You
• Questions?
ressullts

• Comments?
C t ?

27