Review and file Fiscal Year 2021/22 Second Quarter Financial Update

Review and file Fiscal Year 2021/22 Second Quarter Financial Update.

None.

The intent of the quarterly financial report is to provide the Commission with an update on how LAFCo performed financially in the previous quarter as compared to the adopted budget and to discuss any issues as appropriate. The practice was recommended during a previous audit as an additional safeguard to ensure sound financial management, given the small size of the LAFCo staff. In accordance with LAFCo Administrative Policies and Procedures, the Commission adopts the final budget and is authorized to make adjustments as appropriate.

The LAFCo FY 2021/22 budget was adopted on May 27,2021. During the second quarter LAFCo remained on track with regards to both revenue and expenditures.

REVENUES
By the end of the second quarter of FY 2021/22 LAFCo had received $404,959 (76.41%) of its expected revenues of $522,820. Fund balance has been used to balance most of the remainder of the budget (20%). LAFCo's most significant revenue source comes from local government agency payments. By the close of the second quarter LAFCo had received 100% ($390,241) of its funds from the agencies. Expected revenue during the second quarter included $722.38 (28.90%) received in investment earnings. Other minimal revenue not yet received includes the CALAFCO stipend for Deputy Executive Officer activities. Revenue that was not anticipated in the budget and received during the second quarter included a deposit of $8,500 for the Yolo County Flood Control and Water Conservation District (YCFCWCD) Annexation (LAFCo No. 21-06).

In Attachments B and C, Yolo County Department of Financial Services (DFS) recorded an adjustment in the first quarter of $1,134 to Investment Earnings-Pool to comply with Government Accounting Standard Board (GASB) reporting requirements. However, it is a financial reporting adjustment only and is not considered a spendable revenue for budget purposes. Therefore, the adjustment was not included in the Budget Status Summary. Additionally, the income statement (Attachment B) does not match staff's budget summary (Attachment A). This is because each year, LAFCo uses some fund balance to balance its budget. The use of fund balance does not show up as new net income because its already in our fund.

EXPENDITURES
During the first half of FY 2021/22 LAFCo expended a total of $216,862 (41.89%) of its annual budgeted costs of $517,670. LAFCo expended $188,061.25 (46.58%) of its Salary and Benefits appropriation of $403,719. LAFCo expended $28,800.95 (32.38%) of its Services and Supplies appropriation of $88,951. During the first half LAFCo expended $5,380.50 (448.38%) of its appropriations for Professional & Specialist Service-Info Tech Svc (account 501152), exceeding its appropriations by $4,180.50. $4,000.50 of that amount was used for the collection of extensive GIS data, maps and information to inform all of the parties involved regarding the upcoming Fire Protection Districts Municipal Service Review (MSR). LAFCo has not expended any of its Other Charges account. This account is used to pay other agency fees (including State Board of Equalization filing fees for the reclamation district boundary changes) in processing LAFCo proposals and the fees are reimbursed by the applicant. For each budget its difficult to anticipate proposal revenue, and  in order to be conservative we don't assume any . Consequently, unexpected revenues and expenses reflect the pass through of these actual costs. LAFCo has not used any of its appropriation for contingencies.

BUDGET REPORTS
The Budget Status Summary (Attachment A) is an easy to read summary of the budget. The Income Statement Report  (Attachment B) shows the amount expended for the quarter, the year to date amount and budget and the percentage of budget used. The General Ledger Report (Attachment C) shows a running balance of all transactions, including both revenue and expenditure amounts.