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Hoover CFO: Revenues ahead of midyear projections but cautions against spending spree
Summary
City Chief Financial Officer presented preliminary six-month FY2025 results showing revenues above 50% of budget, with sales and use taxes and SSUT up year over year; council asked staff to publish the reports and staff warned some revenues are lumpy and expenditures will rise in the second half.
Jennifer, Hoover’s chief financial officer, told the City Council on June 23 that the city had collected roughly $104.7 million in total revenues through March — about 61% of the annual budget — and about $86 million in tax receipts during that period.
The report matters because it frames how much the city can spend this fiscal year: Jennifer said expenditures for the first six months totaled about $77.8 million, or roughly 47% of the annual budget, leaving a positive net change in fund balance that she estimated at about $24 million if current trends held. “We’re going to see more expenditures, obviously, for the next six months,” she said, and cautioned council members not to assume the midyear excess is permanent.
Jennifer emphasized that some revenue categories arrive in uneven lump sums, so percentages through March can be misleading: special revenues totaled about $4.2 million collected to date (48% of budgeted special revenues), capital projects are spending committed dollars (about $7.4 million spent through March), and the city’s 2023 general obligation bond funds are showing only investment income until project spending occurs. She said the projected special-revenues fund balance would be roughly $18 million at this point in the year.
On tax detail, Jennifer reported that sales and use taxes accounted for about 67% of the city’s tax revenue for the six-month period and that sales-and-use receipts excluding the state sales surtax (SSUT) were up about 10.8% in May compared with May of the prior year. SSUT collections for May rose from about $632,000 to about $728,000 (a 15.2% increase year over year for that month), and cumulative SSUT through the latest reporting period was higher than the prior year by low double digits. City staff reported year-to-date lodging-tax receipts of $2,002,123, down about 0.39% from the prior year; grocery-tax collections were reported as about $10.4 million of the sales-and-use total collected so far.
Council members asked follow-up questions about how particular items — for example, the performing-arts designation and bed-fee detail in lodging taxes — appear in the accounting; Jennifer said some items were recorded after the March cutoff and would shift into the capital projects fund. A council member asked that the two interim financial reports and the revenue-trend report be made public; Jennifer agreed to post them on the city website.
The CFO said a fuller update incorporating June collections and the city’s two-month lag in some tax receipts should be available on the July report. “We’re pleased to report these numbers but I do expect that excess to get whittled away quite a bit,” she said.
Less critical detail: the city’s bond-related fund (General Obligation Warrant 2023) is reporting investment income while project expenditures are pending, and staff noted that many rebate and special-revenue payments occur annually (often in September), which will change later statements.
