Subject
title
Introduction and Possible Adoption of an Ordinance to amend Ordinance No. 16-24 to appropriate funds and levy taxes for FY 2025 (Budget Amendment #3)
end
Department
Finance
Recommendation
In accordance with the City Charter, since the budget ordinance is adopted at the fund level, a change in the appropriated amount of any fund requires action by the Mayor and Council. The vehicle for such action is an amendment to the budget ordinance. The proposed ordinance, Attachment 1, would amend the FY 2025 budget. The FY 2025 budget was adopted by the Mayor and Council on May 6, 2024, and has been amended twice since: on August 5 and October 28, 2024.
If the Mayor and Council wish to proceed with adoption of the ordinance at the same meeting, the ordinance should first be introduced and then a motion should be made to waive the layover period. If the motion to waive the layover period is approved by an affirmative vote of six or more members of the Mayor and Council, a motion to adopt the ordinance may then proceed.
Discussion
The proposed ordinance, Attachment 1, would amend the FY 2025 budget. This amendment recognizes the items that are described in this agenda report and detailed on Attachment 2. Attachment 3 is the 2Q FY 2025 Financial Report.
2Q FY 2025 Financial Report (Attachment 3)
As shown on page 1 of the attached 2Q FY 2025 Financial Report (Attachment 3), if this amendment is adopted, the FY 2025 estimated ending unassigned fund balance will equal $27.4 million, which is $5.6 million above the FY 2025 target. This amount factors in the funds recommended for appropriation on this amendment, including an increased CIP transfer to support Americans with Disabilities Act (ADA) and Public Right-of-Way Accessibility Guidelines (PROWAG) requirements within the city's Concrete Repair & Replacement (TC21) CIP project and to replace current Speed Camera Fund support in the CIP due to the decline in Speed Camera Fund revenue.
Amendment Detail (Attachment 2)
This amendment includes operating and capital improvements program (CIP) budget adjustments as described below.
Operating Budget
General Fund
• $27,500 expenditure increase for the General Fund transfer to the Rockville Emergency Assistance Program (REAP) Special Activities Fund, supported by unspent FY 2024 General Fund REAP appropriations and in compliance with the city’s Financial Management Policies
• $1.2 million expenditure increase for the General Fund transfer to the CIP, supported by unassigned General Fund reserves in excess of the city’s required reserve level, to support the Concrete Repair & Replacement (TC21) CIP project as noted below under the Capital Projects Fund heading
• $2.1 million expenditure increase for the General Fund transfer to the CIP, supported by unassigned General Fund reserves in excess of the city’s required reserve level, to replace Speed Camera Fund programming in the CIP with Capital Projects Fund support
• $17,400 revenue and expenditure increase to recognize receipt of a Police Accountability, Community, and Transparency (PACT) grant to provide police leadership training
• $254,720 revenue increase in the State Aid for Police Protection (SAPP) grant based on revised FY 2025 projections
• $800,000 expenditure increase in the General Fund for a transfer to the Speed Camera Fund to offset reduced revenue estimates and cover program expenses for FY 2025 and FY 2026
• $712,500 revenue increase and $254,125 expenditure increase for the city’s redlight camera photo enforcement program based on revised FY 2025 projections
• $500,000 revenue increase to reflect investment earnings based on revised FY 2025 projections
• Expenditure increases for the following one-time operating initiatives, supported by increased General Fund revenues:
o $15,000 for a dependent verification audit to ensure only eligible dependents are covered through the city’s health and wellness benefits
o $215,000 for a new mobile command trailer to replace the current mobile command center, which is no longer functional
o $22,400 for the General Fund portion of the cost to replace a current 15,000-lb lift that is at the end of its useful life with a 30,000-lb lift, reducing downtime for heavy duty vehicles. The full cost of this replacement is $112,000, split across the General, Water, Sewer, and Stormwater funds according to vehicle allocation
o $30,000 to repair the Courthouse Square fountain’s granite base
o $22,000 to install synthetic turf around the Maryvale Park splash pad to prevent mud infiltration and maintenance issues
o $20,000 to improve drainage, reduce mud accumulations, and provide a functioning hydration station in the dog park at Mattie Stepanek Park
Special Activities Fund
• $48,000 expenditure increase for the Farmers Market Eat Fresh program, funded by program reserves
• $100,000 expenditure increase for a Housing Needs Assessment, funded by reserves from the Housing Opportunities Fund
• $15,000 expenditure increase for targeted outreach to tenants, funded by reserves from the Housing Opportunities Fund
• $10,000 expenditure increase for additional recreation program scholarships, funded by reserves from the Recreation Fund
• $50,000 expenditure increase for the REAP program due to increased demand, funded by program reserves ($22,500) as well as a transfer from General Fund reserves in the amount of the unspent FY 2024 General Fund appropriations ($27,500)
Speed Camera Fund
• $400,000 revenue reduction in speed camera citation revenue due to a continued decline in issued citations from the city’s speed cameras. This decline is offset by a transfer from the General Fund of $800,000 to cover both FY 2025 and FY 2026 program expenditures in excess of projected program revenue
Water Fund
• $33,600 expense increase for the Water Fund’s portion of the cost to replace a vehicle lift as described in the General Fund section above
Sewer Fund
• $267,090 expense increase for Blue Plains operating costs based on billing from WSSC
• $80,000 expense increase for a sewer improvement project on North Washington Street to address residential backups
• $224,000 expense increase for emergency repairs at the North Horners and Fallsgrove Wastewater Pump Stations
• $33,600 expense increase for the Sewer Fund’s portion of the cost to replace a vehicle lift as described in the General Fund section above
Stormwater Management Fund
• $22,400 for the Stormwater Management Fund’s portion of the cost to replace a vehicle lift as described in the General Fund section above. This expense increase is offset by a reduction in the budgeted addition to reserves, so no additional appropriation is needed
Capital Improvements Program (CIP)
Capital Projects Fund
• $25,000 revenue and expenditure increase to the Outdoor Recreation Pool Renovations (RC18) CIP project to provide recreational play amenities, supported by a contribution from the Rockville Recreation & Parks Foundation
• $1.2 million expenditure increase, supported by an increase in the General Fund CIP transfer, to the Concrete Repair & Replacement (TC21) CIP project to work toward compliance with the most recent guidance from the Americans with Disabilities Act (ADA) and Public Right-of-Way Accessibility Guidelines (PROWAG)
• $2.1 million expenditure increase, supported by an increase in the General Fund CIP transfer, to replace all unspent Speed Camera Fund support in the current CIP including planned future appropriations
Speed Camera Fund
• $1.1 million expenditure decrease to reflect current unspent Speed Camera Fund CIP appropriations shifting to Capital Projects Fund support as noted above. This amount is less than the total transfer to the CIP for Speed Camera support as a portion of the support is programmed for spending in a later year, not currently appropriated
Impact Statements
Equity
This budget amendment provides funds to promote equitable outcomes for Rockville residents and visitors in the form of emergency assistance, matching funds for food assistance recipients at the city’s farmers market, recreation program scholarships, a housing needs assessment and targeted outreach to tenants, and ADA/PROWAG-required sidewalk modifications.
Environment
There are no significant environmental impacts resulting from the adoption of this budget amendment.
Economy
There are no significant economic impacts resulting from the adoption of this budget amendment.
Mayor and Council History
This is the third budget amendment for FY 2025. The FY 2025 budget was adopted by the Mayor and Council on May 6, 2024, and has been amended twice since: on August 5 and October 28, 2024.
Fiscal Impact
The following operating fund(s) will be adjusted if this budget amendment is adopted.
TABLE 1
|
Operating Fund |
Amended Budget |
2/24/2025 Amendment |
Amended Budget |
|
General Fund |
$116,301,887 |
$4,825,633 |
$121,127,520 |
|
Water Fund |
$16,323,883 |
$33,600 |
$16,357,483 |
|
Sewer Fund |
$15,812,656 |
$604,690 |
$16,417,346 |
|
Refuse Fund |
$9,105,300 |
$ - |
$9,105,300 |
|
Parking Fund |
$2,791,920 |
$ - |
$2,791,920 |
|
Stormwater Mgt Fund* |
$7,319,350 |
$ - |
$7,319,350 |
|
Special Act. Fund |
$2,838,210 |
$223,000 |
$3,061,210 |
|
CDBG Fund |
$526,000 |
$ - |
$526,000 |
|
Speed Camera Fund** |
$1,308,520 |
$111,480 |
$1,420,000 |
|
Debt Service Fund |
$4,455,600 |
$ - |
$4,455,600 |
|
Total |
$176,783,326 |
$5,798,403 |
$182,581,729 |
*Changes were made to the Stormwater Management Fund as detailed in Attachment B, but the amount of the changes was fully offset by a reduction in the budgeted addition to reserves, resulting in no net change to the appropriated fund total.
**Changes were made to the Speed Camera Fund as detailed in Attachment B, but the amount of the changes was partially offset by a reduction in the budgeted use of reserves, resulting in a smaller net change to the appropriated fund total.
The following Capital Improvements Program (CIP) fund(s) will be adjusted if this budget amendment is adopted:
TABLE 2
|
CIP Fund |
Amended Budget |
2/24/2025 Amendment |
Amended Budget |
|
Capital Projects Fund |
$65,144,687 |
$3,338,513 |
$68,483,200 |
|
Water Fund |
$22,094,904 |
$ - |
$22,094,904 |
|
Sewer Fund |
$12,132,725 |
$ - |
$12,132,725 |
|
Refuse Fund |
$741,022 |
$ - |
$741,022 |
|
Stormwater Mgt Fund |
$18,567,082 |
$ - |
$18,567,082 |
|
Special Activities Fund |
$1,509,109 |
$ - |
$1,509,109 |
|
Speed Camera Fund |
$1,178,470 |
($1,073,513) |
$104,957 |
|
Total |
$121,367,999 |
$2,265,000 |
$123,632,999 |