HomeMy WebLinkAbout1/21/2025 Item 6a, Jackson and Malicoat - Staff Agenda CorrespondenceCity of San Luis Obispo, Council Memorandum
City of San Luis Obispo
Council Agenda Correspondence
DATE: January 21, 2025
TO: Mayor and Council
FROM: Emily Jackson, Finance Director
Debbie Malicoat, Deputy Director of Finance/City Controller
VIA: Whitney McDonald, City Manager
SUBJECT: ITEM #6a. ANNUAL COMPREHENSIVE FINANCIAL REPORT AND
TRANSPORTAION DEVELOPMENT ACT REPORT FOR FISCAL YEAR
2023-24
Staff received the following questions, regarding the FY 2023-24 Annual Comprehensive
Financial Report and Transportation Development Act Report for Fiscal Year 2023 -24.
The questions are below with staff’s response shown in italics:
1) On page 36 of the packet, it says: “Multi-year budgets are adopted for capital
projects as necessary but revert to fund balance after three years of non -
activity.” Can you provide more detail about this concept, and explain how
it relates to the new CIP budgeting process that staff is proposing to initiate
this year?
Staff Response: The language on page 36 references an existing process which
is intended to ensure fiscal accountability. When capital project budget balances
revert to fund balance, it is most commonly due to there being a relatively small
remaining balance on a project that was completed, but not “closed out” at the end
of the project. It is far less common for a project to be budgeted and then have no
activity for three years, however this does occasionally happen. The new CIP
budgeting process that staff is implementing focuses on more accurate scoping of
projects and aligning funding with realistic delivery timelines to reduce occurrences
of project budgets reverting to fund balance . However, the existing process
described above provides a safeguard to reallocate idle funds when priorities shift
or unforeseen delays occur, ensuring resources are effectively utilized.
ITEM #6a. ACFR and TDA Report for Fiscal Year 2023-24 Page 2
2) In the Transportation Development Act Report on page 271 of the packet,
can you provide more detail about why the management’s discussion was
omitted as described?
Staff Response: The Transportation Development Act (TDA) Report is
supplemental to the City’s Annual Comprehensive Financial Report (ACFR), which
is where the City has presented Management’s Discussion and Analysis. It is not
duplicated again in the TDA Report. Because the City’s auditors provide an opinion
on both the ACFR and the TDA report, they are familiar with the contents of
Management’s Discussion and Analysis in the ACFR, therefore their opinion of the
TDA Report’s basic financial statements is not affected by the missing information.
3) The organizational chart on page 55 in the Annual Comprehensive Financial
Report (ACFR) appears to be incorrect. Can we note that the chart will be
corrected in future years?
Staff Response: The organizational chart presented in the ACFR correctly depicts
the overall structure of the City organization, but staff agrees that some of the
functions under each department need to be updated (ex. Diversity Equity and
Inclusion should be added to Administration and IT). Staff will work to update the
organizational chart for inclusion in future ACFRs.