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EUGENE CITY COUNCIL AGENDA ITEM SUMMARY Public Hearing and Action: Resolution 4818 Adopting a Supplemental Budget; Making Appropriations for the City of Eugene for the Fiscal Year Beginning July 1, 2004 and Ending June 30, 2005 Meeting Date: December 6, 2004 Agenda Item Number: 5 Department: Central Services Staff Contact: Kitty Murdoch www. cl. eugene, or. us Contact Telephone Number: 682-5860 ISSUE STATEMENT City Council approval of the first Supplemental Budget for FY05 is requested. Oregon Local Budget Law (ORS 294.480) allows for supplemental budgets for "an occurrence...which had not been ascertained at the time of the preparation of a budget for the current year..." Supplemental Budget #1 consists of $44.18 million in proposed changes to the FY05 Adopted Budget. A brief description of the proposed transactions is provided in Attachment A. This supplemental budget does not authorize any increased property tax levy. BACKGROUND The supplemental budget which occurs in December of a fiscal year is usually the largest because of audit adjustments to budgeted Beginning Working Capital and reappropriation of funds from the prior fiscal year for program initiatives or projects begun, but not completed, in that year. Supplemental budgets also recognize new revenue and authorize other needed changes in legal appropriations. For this supplemental budget, the proposed changes fall into the following categories: Transactions Related to Beginning Working Capital Grove, Mueller & Swank P.C., the City's external auditor, has completed its audit for FY04 and the City's Financial Reporting staff has completed the draft of the FY04 Comprehensive Annual Financial Report. Based on audited FY04 actual revenues and expenditures, staff determined the FY05 Actual Beginning Working Capital for all funds. The FY05 Actual Beginning Working Capital was then reconciled with the FY05 Budgeted Beginning Working Capital, and the difference between the Budgeted and Actual Beginning Working Capital is the audit adjustment being recognized on this Supplemental Budget. In most cases, that adjustment is positive; that is, the fund received more revenue than budgeted and/or expended less than was budgeted. These transactions are noted in Attachment A. In most funds the transactions increase Balance Available or Reserve, but in some cases operating or capital expenditures are affected. L:\CMO\2004 Council Agendas\M041206\S0412065.doc