FY2014 Recommended Budget - City of Surprise

General Fund
Revenue Summary
General Fund Operating Revenues
Operating revenues are those used to provide core government services (e.g. police, fire, street
maintenance, library, parks, etc.) and are recorded in the general fund. The general fund is the primary
operating fund of the city and used to account for all financial resources not accounted for in the other funds.
Key Assumptions
A number of assumptions influence the revenue forecast including the character of the economy and the
effect of the state budget on the city. The city is experiencing a modest recovery following the recent
economic downturn with increases showing in most revenue categories. A full recovery is likely in 2015, eight
years from the beginning of the recession. The city’s population will continue to grow at a rate greater than
that of many neighboring communities. As a result, the city is expected to capture a greater portion of state
shared revenues and will receive a greater share of city revenues from building related activity.
Consumers are beginning to spend more discretionary income and the city is experiencing an increase in
sales tax revenues. Additionally, resident participation in city recreation programs continues to drive up
demand for services, also resulting in greater revenue streams to recover associated costs.
The city will continue to monitor activity in the state legislature related to transaction privilege tax reform.
Recent conversations related to state action on the construction related tax could have a negative impact on
the city budget.
The degree of forecast accuracy varies by revenue source. Some revenue sources, such as state shared
income tax, which is based on collections from two years prior, are known to the city in advance and the
forecast is completely accurate. Other sources, such as construction sales tax, are much more sensitive to
market forces and are more difficult to forecast.
Millions
$100.0
$95.0
$90.0
$85.0
$80.0
$75.0
$70.0
$65.0
$60.0
$55.0
$50.0
$81.1
FY2012
Actual
3%
$83.0
FY2013
Adopted
Budget
14
3%
$84.5
FY2013
Estimate
5%
$88.2
FY2014
Forecast