2007-08 2nd Quarter Status Report - City Of Beverly Hills

showed that our sales taxes, as of 3 rd Quarter 2007, were 6.4% higher than the previousyear. Also many businesses within the City have told us that while their holiday sales werenot like the last few years, they were “all right.” For comparison, Culver City, Los Angelesand Los Angeles County all experienced sales tax decreases between 3 rd Quarter 2006 and2007. Transient Occupancy Taxes is collected monthly by the City, and our 2 nd QuarterTOT revenues are also at an all time high, above our original estimates for this fiscal year.However, this fiscal year brings a lot of uncertainty regarding the economy which leads tostaff’s conservative projection for this fiscal year’s end. Staff is concerned that this midyearcould be a peak period, and our economic future may be less secure. No one knows ifa recession will occur or not, but even if one does, Beverly Hills is in a unique position toguard against radical changes due to the economy.ExpendituresThe current General Fund Operating budget, which includes re-appropriations from theprior year’s budget and new appropriations, is $163.6 million. At the end of the secondquarter of the fiscal year, actual General Fund expenditures were $72.1 million, whichrepresent 44% of the current budget. This is partly due to making sure we areconservative not knowing what the 3 rd and 4 th quarters have in store for us. This is lowerthan historical spending rates from the past 10 years, which averages 53% expensed atmid-year. In addition, to prepare for any economic downturn, all departments havedeveloped a 10% expenditure reduction plan to be implemented by the City Manager asnecessary.IV - 2FY 2007/08 2nd Quarter