Finance advisory committee: Measure W first-quarter receipts $1.08 million; $647,000 spent and roughly $400,000 reserved

Cathedral City’s Finance Advisory Committee was briefed on Measure W receipts and spending for the first quarter, with staff reporting $1,080,000 in receipts and $647,000 in actual expenditures, leaving roughly $400,000 in reserves.

Finance staff said the committee originally budgeted for $763,000 of council-directed items in the quarter — including a fourth ambulance purchase, outfitting, up to six temporary full-time equivalents for two months, ambulance equipment and supplies, Desert Recreation District (DRD) activation and swim program costs — but actual spending totaled about $647,000.

The committee heard that Measure W is the city’s half-cent sales tax; staff noted it is expected to be roughly half of Measure B, the city’s 1% general sales tax. “Vendors report quarterly to the state,” finance staff said, and early quarters can understate the eventual run rate while vendors update systems to collect the new half-cent tax. That ramp-up, staff said, helps explain why the quarter’s receipts were shy of the simple one-quarter projection.

Staff clarified accounting treatment: Measure W receipts are tracked in a separate object code in the city’s financial system and held in a distinct fund for visibility, but for government-wide financial statement presentation the fund will be merged into the general fund in the annual comprehensive financial report. “We have visibility of that so we don't co-mingle those,” finance staff said.

Committee members asked how positive ambulance transport revenue is treated; staff said those operational revenues are recorded in the general fund rather than credited back to the Measure W fund. The committee also discussed the DRD arrangement: until annexation is complete, the city is paying DRD from Measure W via a direct services reimbursement agreement and invoicing is occurring monthly; once annexation is completed a property-tax based transfer mechanism will be used and staff said they expect to record transfers so Measure W expenditures show correctly in the Measure W accounting records.

Committee members asked whether Measure W reserves could cover multi-year obligations such as community center debt service or ongoing DRD costs if receipts decline. Staff said the city will maintain a fund balance in the Measure W fund and can scale commitments if revenues fall; the committee was told the city’s forecast assumes Measure B will be closer to $9 million this year (versus prior highs of $9.7 million), yielding about $4.5 million annually for Measure W instead of the $5 million assumed in early planning.

The report included several operational notes: the fourth ambulance was purchased during the quarter; DRD’s program manager Cynthia began May 12; DRD invoicing is being reconciled monthly by Rick (city liaison) and DRD counterparts; and staff continue to use a third-party vendor to perform comparative sales-tax analysis. No formal committee action was taken on Measure W during the meeting.

The committee scheduled continued oversight: staff will return with further quarterly receipts and forecast updates in later meetings so the committee and council can align planned commitments with realized receipts.