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Midyear review: Greenfield’s revenues lag budget while personnel costs drive spending
Summary
Finance staff reported general fund revenues are at about 44% of budget through midyear while expenditures are at about 47%, leaving a midyear shortfall largely tied to economy‑linked revenues and staffing patterns; council was advised to slow hiring and account for ARPA fund timing in next year’s budget.
Finance staff gave a midyear financial review showing revenues lagging budgeted targets while personnel costs remain the largest spending category.
Finance Director Ed told the City Council the general fund is budgeted for roughly $21 million in revenues and $21 million in expenditures. Through the July–December accrual period revenues are about $9.4 million, or roughly 44% of the annual budget, and expenditures are at about 47% of budget, leaving a midpoint shortfall of about $600,000 compared with target pacing.
Why it matters: Sales tax and certain fee streams have been weaker than budgeted; personnel expenses comprise about 80% of the city’s operating spending, so the city has limited options other than slowing hiring or trimming services to rebalance the budget.
Key points from the presentation - Major revenue drivers: fees and permits (construction/permits), cannabis taxes and transient occupancy taxes (TOT) were discussed; cannabis and other taxes are collected on a schedule that can affect midyear numbers. Ed said some franchise fee receipts and construction permits typically come in later in the fiscal year. - Expenditures: roughly 47% of budgeted expenditures are spent at midyear. The finance director said the city is more fully staffed than a year ago and that personnel costs are a primary driver of spending. - ARPA and fund balances: Council discussed how prior years’ ARPA (American Rescue Plan Act) receipts — roughly $4.2 million received in earlier years — are available in fund balance but were recognized as revenue in previous fiscal years. That creates the appearance of a shortfall in the current year when the city appropriates those prior-year funds for projects such as wastewater plant repairs; the city reported it has committed $1.2 million of ARPA funds for the wastewater treatment plant.
Council direction and fiscal outlook Councilmembers questioned where additional savings might be found and asked staff to prepare options for the FY 2025–26 budget. Finance staff recommended careful control of hiring and overtime, a closer look at people‑related costs, and identification of any nonessential spending that can be delayed until revenues improve.
Ending: Staff will return with the cost estimates and scenarios for the next year’s budget process. Council members stressed caution and asked staff to bring proposed hiring and spending adjustments back for early review during the FY 2025–26 budget cycle.
