Okaloosa County BOCC — March 27, 2014 — III.b. Financial Update — reading text

Financial Update March 2014 FY 2013-14 AMENDED BUDGET: $36,713,969 Financial data as of 03/18/14 The adopted budget of $33,967,750 has been amended during the year to record BP grant funds for marketing, FDEP grant funds for Okaloosa Island dune walkovers, FDOT grant funds for seasonal transit service on Okaloosa Island and Destin, and general reserve carryforwards. REVENUE ANALYSIS The tourist development department has three recurring revenue sources – tourist development tax (5 percent), convention center fees (e.g. room & equipment rentals, ticket sales), and interest income on cash balances – along with two non-recurring revenue sources – grants & assessments (BP, FDOT, FDEP, MSBU) and reserves. Reserves are the largest component of budgeted revenues because the budget reflects anticipated revenues as well as current cash on hand. Reserves/cash on hand is a budget “placeholder” and represents the accumulation of unspent prior year bed tax dollars; it’s not an actual source of incoming revenues for the year. Tourist development taxes comprise the largest part of actual annual revenue collections. Each percentage is anticipated to generate $2.4M, for a total of $12M in bed taxes. Lodging establishments remit bed tax collections to the tax collector by the 20th of each month for the preceding month. The tax collector reconciles and remits the revenues to the County by the 10th of the following month. Due to the timing of this process, the $1.6M in actual revenue only represents collections through January 31st. March 19, 2014 Tourist Development Department, Okaloosa County, FL Financial Update – March 2014 EXPENSE ANALYSIS The tourist development department has several recurring expenses – personnel, beaches & parks, vis itor services & lifeguards, convention center, and tourism promotion – along with two non-recurring expenses – grants & assessments and reserves. Reserves are the largest component of budgeted expenses because budgeted expenses must equal budgeted revenues. The budgeted use/drawdown of reserves is reflected in the amount by which budgeted reserves expenses are less than budgeted reserves revenues: $21M reserve revenue – $15M reserve expenses = $6M use/drawdown for capital projects Each percentage of the bed tax is required to be spent in a certain way per County Ordinance. March 19, 2014 Tourist Development Department, Okaloosa County, FL 2 of 5 Financial Update – March 2014 EXPENSES BY LEVEL OF TOURIST DEVELOPMENT TAX RESTRICTION FIRST PERCENTAGE (These permissible uses are intended to be representative, not all-inclusive)  beach park facilities or beach improvements  beach & waterway maintenance, renourishment, restoration, enhancement, access  tourist destination facilities SECOND PERCENTAGE (These permissible uses are intended to be representative, not all-inclusive)  visitor services, brochure distribution, communication and research  tourist bureau administration  lifeguard services and protection March 19, 2014 Tourist Development Department, Okaloosa County, FL 3 of 5 Financial Update – March 2014 THIRD PERCENTAGE (These permissible uses are intended to be representative, not all-inclusive)  operations, maintenance, improvement of Visitor Welcome or Information Centers, Convention Center, and Tourist Destination Facilities  promotion of the Convention Center and Tourist Destination Facilities FOURTH PERCENTAGE (These permissible uses are intended to be representative, not all-inclusive)  expansion, renovation, reconstruction of the convention center and outdoor venues March 19, 2014 Tourist Development Department, Okaloosa County, FL 4 of 5 Financial Update – March 2014 FIFTH PERCENTAGE (These permissible uses are intended to be representative, not all-inclusive)  tourism promotion STRATEGIC MARKETING PLAN The $4K increase in the amended budget for the In-House Strategic Marketing Plan (SMP) is the result of a budget transfer to fund the Film Commission’s website maintenance, which was performed prior to the discovery of a variance between the adopted SMP and promotional activity budget. Staff is in the process of reconciling approved task orders with the revised ad agency SMP and reviewing expenses to ensure they are coded to the correct accounts. An update will be provided at the April TDC meeting. EXPENDITURE TRANSACTION ANALYSIS “Expenditures which the council believes to be unauthorized shall be reported to the county governing board and the Department of Revenue” pursuant to Florida Statutes 125.0104(4)(e). One of the most comprehensive reports from the County’s accounting system is the Expenditure Transaction Analysis, which lists the fiscal period, date, transaction type, check number, vendor number, vendor name, dollar amount, and description for each tourist development tax expenditure transaction. This report is being provided to assist the TDC in identifying possibly unauthorized expenditures. The attached reports are for the period 10/1/13 through 3/18/14. Moving forward, this information will be provided monthly in arrears. For instance, transactions for the month of March will be provided at the April TDC meeting. March 19, 2014 Tourist Development Department, Okaloosa County, FL 5 of 5