Finance staff presented the Des Moines general fund report for February 2025, saying the city’s sales-tax receipts through February were “only under budgeted expectations by about $14,000” and that year-to-date operating revenues were “a little over $75,000, over budget.”

The staff presentation said business-and-occupation (B&O) tax receipts were about $138,000 above budgeted expectations and business-license receipts about $29,000 above budget. Charges for services showed only $15 year-to-date on one line because Sound Transit payments are received quarterly and new services such as notary and passport processing have not yet started, the presenter said.

“On the expenditure side, we have total operating expenditures that are about $447,000 over budget,” the presenter said, and listed reasons including annual software maintenance and membership payments, unbudgeted costs related to staff turnover, and election costs for last year’s levy lid lifts that were paid in January and February. The presenter summarized: “We show a $372,000 operating loss.”

Staff emphasized that property-tax distributions arrive in April and said many of the items driving the reported shortfall are timing or one-time payments that should improve the position once those revenues are posted. The sales-tax report through March (attached to the packet) showed the city about $78,000 ahead of pace compared with the prior year; staff noted that construction activity accounted for roughly $56,000 of that year-over-year gain.

Committee members asked for clarifications. Councilor Harris asked whether “turnover” referred to staff departures; staff answered that the city experienced a mix of layoffs and several voluntary departures (about three or four people), which created both involuntary and voluntary turnover costs. Harris suggested the city consider smoothing approaches to account for recurring, lumpy annual costs; staff said year-to-date budget lines try to reflect historical timing (for example, property-tax percentages through February) but that level of granularity can be adjusted.

Members also asked about red-light camera revenue and new businesses. Staff said red-light camera receipts have trended downward but that month-to-month variability remains and that sales-tax receipts show a two-month lag (January activity appears in March data). Council members said the construction-driven sales-tax improvement is promising but that they would watch broader economic news.

The committee did not take formal policy action on the report but accepted the presentation and moved on to the next agenda item.