Okaloosa County BOCC — November 20, 2014 — III.c. Financial Update — reading text

Financial Update November 2014 FY 2014-15 ADOPTED BUDGET: $36,917,500 Financial data as of 11/13/14 The adopted budget of $34,917,500 will likely be amended early this fiscal year to record FDEP grant funds for Okaloosa Island dune restoration, FWC grant funds for artificial reef construction, and to finalize reserve carryforwards. REVENUE ANALYSIS 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 $2.68M, for a total of $13.4M in bed taxes. Lodging establishments th remit bed tax collections to the Tax Collector by the 20 of each month for the preceding month. The Tax th Collector reconciles and remits the revenues to the County by the 10 of the following month. Due to the timing of this process, October collections will not be received until December. Year-to-date revenues are largely attributable to convention center room and equipment rentals and catering. November 13, 2014 Tourist Development Department, Okaloosa County, FL Financial Update – November 2014 RevPAR Revenue per available room (RevPAR) is a widely used performance metric in the lodging industry. RevPar = gross monthly receipts divided by days in month divided by number of units (data taken from Tax Collector’s monthly reports) RevPar is a measurement for a point in time, so it is most appropriately used when comparing equivalent time periods (e.g. October 2013 to October 2014). However, since year-to-year comparison is not possible until twelve months of data are obtained, it is being presented here to establish benchmarks. The December financial update will include the October 2013 to October 2014 comparison. November 13, 2014 Tourist Development Department, Okaloosa County, FL 2 of 6 Financial Update – November 2014 EXPENSE ANALYSIS 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: $20.0M reserve revenue – $17.8M reserve expenses = $2.2M budgeted use/drawdown, primarily for capital projects. Each percentage of the bed tax is required to be spent in a certain way per County Ordinance. (1) Amended budget - $15K transferred from convention center operations to personnel to cover overtime. County practice is to perform a budget transfer at the beginning of the year rather than budget overtime. November 13, 2014 Tourist Development Department, Okaloosa County, FL 3 of 6 Financial Update – November 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 November 13, 2014 Tourist Development Department, Okaloosa County, FL 4 of 6 Financial Update – November 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 (1) Amended budget - $15K transferred from convention center operations to personnel to cover overtime. County practice is to perform a budget transfer at the beginning of the year rather than budget overtime. FOURTH PERCENTAGE (These permissible uses are intended to be representative, not all-inclusive) • expansion, renovation, reconstruction of the convention center and outdoor venues November 13, 2014 Tourist Development Department, Okaloosa County, FL 5 of 6 Financial Update – November 2014 FIFTH PERCENTAGE (These permissible uses are intended to be representative, not all-inclusive) • tourism promotion PROMOTIONAL ACTIVITIES (-548xxx accounts) TDC Recommendation to BCC Approve the financial update as presented. November 13, 2014 Tourist Development Department, Okaloosa County, FL 6 of 6