TO: AC Transit Board of Directors
FROM: Michael A. Hursh, General Manager/Chief Executive Officer
SUBJECT: Quarterly Budget Update
BRIEFING ITEM
AGENDA PLANNING REQUEST: ?
RECOMMENDED ACTION(S):
Title
Consider receiving the Quarterly budget update for the period of July 2022 through the end of June 2023 of FY 2022-23.
Staff Contact:
Chris Andrichak, Chief Financial Officer
Body
STRATEGIC IMPORTANCE:
Goal - Financial Stability and Resiliency
Initiative - Financial Efficiency and Revenue Maximization
Regular financial reporting benefits staff and Board Members in assessing the condition of the District.
BUDGETARY/FISCAL IMPACT:
There are no budgetary or fiscal impacts with this report.
BACKGROUND/RATIONALE:
Overview
The District financials performed well in the final quarter of FY 2022-23. Revenues are $28.6 million (5.3%) above budget and Expenses are $29.4 million (5.4%) below budget, resulting in a surplus of $58.0 million. The District's surplus position is mostly explained by budgeting targets above actual achieved service levels due to difficulties filling vacancies and hiring for service restoration. Although the District continues to support efforts and initiatives to attract operators, recruiting difficulties resulted in excess labor and non-labor budget. The current year budget better aligns budget and expected staffing levels.
Sales and property tax revenues remained resilient for FY 2022-23, resulting in more than $33 million subsidies revenue surplus. Due to higher-than-expected revenues from sales tax and property tax as well as cost controls that reduced expenses, the District was able to make a smaller than expected drawdown of American Rescue Plan (ARP) Act funds. Any surplus budget remaining at year-end will be used to pay for District capital requirements and to increase the District's reserves in preparation for a potential economic downturn and the end of ARP funds.
Operating Revenues
Total revenues and subsidies ar...
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