City reports $2 million general fund surplus in pre-audit FY25 statement
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Summary
Finance staff told council the city ended FY25 with an un-audited $2 million surplus in the general fund and a larger all-funds variance driven by one-time items and unspent Destination WG funds. Sales-tax receipts remain a concern going into FY26.
Webster Groves Finance Director Greg Donovan presented the city's pre-audit year-end financial review on Wednesday, telling council the general fund closed FY25 about $2 million ahead of budget while the citywide picture showed variances driven by one-time receipts and multi-year project timing.
Why it matters: the reported surplus gives the city room to maintain service levels and to plan for near-term capital needs, but staff cautioned that revenue uncertainty ' chiefly sales-tax performance and the timing of federal and state funding ' will influence the FY26 budget.
Donovan said the all-funds numbers showed a material difference because some destination project dollars were not spent in FY25 and rolled into the next fiscal year; he also cited a higher-than-expected bond premium as a positive one-time contributor. On the general fund, Donovan said personnel savings from unfilled positions accounted for roughly $1.2 million of the underspend and that materials and project timing accounted for the remainder.
On revenues, Donovan said the city collected roughly $707,000 more than budgeted across revenue lines, with a building permit related to a large local project contributing about $500,000 of that gain. He also reported roughly $150,000 greater than-budget business-license receipts and higher-than-expected interest income.
Donovan cautioned council that sales-tax receipts trailed budget assumptions: "Sales taxes came in at about 90% of budget," he said, and later noted this translated into several hundred thousand dollars less than the city took in the prior year. He urged a conservative approach to FY26 forecasting.
Council members asked about the director's approach to projecting revenue; Donovan said his department considers both year-over-year trends and recent monthly receipts when setting budget estimates. He also noted the city is earning higher yields on short-term investments with a weighted cash yield near 4% on invested balances, reflecting recent market conditions.
Donovan closed by reminding council the numbers are preliminary and that the formal audit begins in September; staff will present final audited results after the audit is complete.
