Midyear budget review shows signs of optimism for Lindsay

After six months into the 2020-2021 fiscal year Lindsay’s finances show encouraging signs of health despite the pandemic

LINDSAY – City finances for Lindsay has been nothing short of dreary over the last few years, but last month’s mid-year budget review showed some signs of improvement.

The initial impact of the pandemic put cities into a panic over the presumption that sales tax revenues would fall. But looking at the numbers in the first half of the fiscal year—between July 2020 and December 2020—things seem to be on track. Lindsay finance director, Juana Espinoza, said the city is lucky that most of the local industries are considered essential leaving few people out of work.

“Most of the industry here, agriculture, is essential. So thankfully we haven’t been as impacted as larger cities that really depend on say, tourism or on people coming in and staying at hotels,” Espinoza said.

As of the end of last December the city collected half of their total expected general fund revenue at $2.76 million. The general fund is the city’s largest discretionary account and has been a bellwether for the strength of a city’s finances. Lindsay’s general fund is up more than $200,000 over the previous year’s midway point where the city collected $2.5 million. However, the cities expenses in the second half of 2020 were also higher than they were in 2019.

Between July 2020 and December of 2020, the city spent $2.75 million out of their general fund. Over the same six-month period in 2019, they city spent $2.5 million. At the end of 2020 the city netted a surplus of $10,700 which is less than they had net at the same point in 2019 where they net a surplus of $14,500.

If finances stabilize and meet the city’s budgeted projections the general fund will come up $307,000 short. However, Espinoza said the city has had a steady flow of general fund income from their cannabis dispensaries throughout the year—although she was unable to recall how much specifically. And it is possible the city outperforms their revenue projections. As Espinoza put it in an interview with The Sun-Gazette last week, the better the city performs, the more services they’ll be able to provide as the pandemic comes to a close.

“I know small businesses have been hit the hardest. That is what are our revenues are looking at just in terms of collection of business licensing and those types of items. So, what we’re trying to do now is we’re trying to figure out how to continue to provide services to the community,” Espinoza said. “So if our revenue stream allows us to do that, that’s what we’ll focus on.”

Enterprise funds

In terms of enterprise funds, the city has collected on 60% of their revenues from the water fund, amounting to $959,700 out of the $1.597 million they expect to have by June 30. The city’s 2020 collection was 4% higher than it was at the end of December 2019 where the city had gathered $925,600. The driving factor was the sale of the city’s surplus water, presumably from the Friant-Kern Canal. Lindsay expected to sell $25,000 worth of water when they created the budget last June, but instead sold $63,300 worth of water as of December—a 253% increase of projections.

In 2019 at the same time the city ran a deficit of $29,000. At the end of 2020 the water fund has run a surplus of $129,500. According to the mid-year budget review the city has expected to run a deficit in the water fund at the endo of the year of almost a million dollars.

Lindsay’s sewer fund has collected 54% of it’s projected revenue half way through the 2020-2021 fiscal year. According to the Espinoza’s report the city has collected $720,200 out of their budgeted $1.3 million. It is still 1% less than was collected at the end of 2019 where the city collected $726,400. Unlike the city’s water fund, their sewer fund is running a slight deficit half way through the year having spent $726,300 in expenses.

In December of 2019 Lindsay’s sewer fund was running a marginal surplus of $23,600. Last December the fund was $6,100 behind revenues. According to the report the city expects to run a deficit by the end of the year to the tune of $354,300.

Lindsay’s refuse fund—which is outsourced to third party Mid Valley Disposal like many other cities in Tulare County—is healthy midway through the fiscal year. According to the report, the city has collected on 54% of their revenues making up $539,000. That is 9% more than they had collected at the end of 2019 where they gathered $488,800. Half way through the year the city has spent only 20% on their expected costs giving them a healthy $334,700 surplus at the six-month mark. At the same point in the 2019-2020 fiscal year the city had a $295,800 surplus. Espinoza’s report notes that the city is still expected to run a deficit $34,600.

The city’s Wellness and Aquatic Center’s revenues have been on pace. At the midway point the city has collected exactly 50% of their projected revenues amounting to $394,100. That is 60% more than they collected at the half way point of the 2019-2020 fiscal year where they collected $158,600.

In total the city expects they will collect $792,800 in revenue. So far the city has spent 51% on their expected costs amounting to $404,900 leaving the city at a deficit of $10,800 halfway through the 2020-2021 fiscal year. That is miles better than the $214,100 deficit they were facing halfway through the 2019-2020 fiscal year.

The city finance department expects to make up some of their $10,800 deficit by the end of the year where they project to be down just $7,500.

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