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Finance director flags $5.5M budgetary shortfall, cites one-time reimbursements for FY26 swings
Summary
At a June 24 Madeira Beach budget workshop, the finance director highlighted that one-time reimbursements (FEMA, Pinellas County) distort year-to-year revenue comparisons and warned a $5.5 million budgetary carryover used in FY26 reduces reserves and could complicate balancing the FY27 general fund.
The finance director opened the Board of Commissioners’ June 24 workshop with a fund-by-fund revenue review and said several large, one‑time inflows are responsible for volatile year-to-year numbers.
“On fiscal year 25 we recognized about $4.5 million in FEMA reimbursements,” the finance director said, and later notified commissioners that the city had just received $1,050,813 from FEMA through the state — $617,987 for beach parking-lot repairs and $432,826 for Archibald Park. He also pointed to Pinellas County reimbursements tied to a Reddington fire station project that caused a FY26 revenue spike.
Those irregular receipts, the director said, make FY26 look stronger than recurring operations warrant. On the packet pages he described how reimbursements and grant proceeds have been recorded and cautioned that FY27 budgeting should not assume similar one-offs.
The presentation also highlighted a budgetary item labeled “fund balance net position carryover use,” which staff said reflects a $5.5 million draw on reserves included in the FY26 budget to balance expenditures. The finance director described that as a budgetary (not cash) recognition and said he is less comfortable relying on large reserve draws going into FY27.
Commissioners questioned several line items that appear to swing widely — for example, rental-inspection fees and sponsorship/special-event receipts that were reclassified between account strings. Staff explained some historic sponsorship revenue had been captured in a general non‑departmental account before being departmentalized under recreation in FY26, which makes prior-year comparisons look inconsistent.
Staff said interest-earnings have declined because cash balances are lower than in prior years, and that the city will finalize expense tallies before completing a full FY27 balance assessment at the July workshop. The director urged a conservative approach to revenue estimates and recommended continued review of capital reimbursements and grant timing before finalizing the budget.
The workshop closed with staff promising follow-up detail on outstanding items, including updated FEMA and Pinellas County reimbursement entries, and a deeper workshop on stormwater fees and the full FY27 operating picture.
