CITY COUNCIL AGENDA ITEM
ACTION REQUESTED:
title
Pass the ordinance approving an amendment to the City of Naperville 2024 Annual Budget to accommodate the use of Rebuild Illinois Funds for the Washington Street Bridge project (requires six positive votes)
body
DEPARTMENT: Finance Department
SUBMITTED BY: Raymond Munch, Finance Director
BOARD/COMMISSION REVIEW:
N/A
BACKGROUND:
The City’s budget is organized by funds. Each fund is comprised of numerous expenditure accounts and each of those accounts is assigned an annual budget. While individual accounts may go over budget, those are typically offset by other accounts being under budget, and no action is required. However, budgetary compliance is maintained at the fund level. Best practice and generally accepted accounting principles (GAAP) dictate that any fund exceeding budgeted expenses by a material amount should be corrected through a budget amendment.
On May 21, 2024, the City Council passed Ordinance 24-050 which amended the 2024 budget for the Motor Fuel Tax (MFT) Fund. That budget amendment transferred portions of the Road and Bridge Fund and the Capital Projects Fund budgets to the MFT Fund to accommodate a revised Street Maintenance Improvement Program. The amendment decreased the Road and Bridge Fund budget by $3,138,379 and decreased the Capital Projects Fund budget by $463,159. The 2024 MFT Fund budget increased to $10,601,539. There was no total budget increase associated with this budget amendment.
Further analysis of the MFT Fund determined that a second budget amendment is necessary to account for work associated with the Washington Street Bridge project, which was not budgeted in the MFT Fund in 2024.
DISCUSSION:
In March of 2023, the City Council adopted an Illinois Department of Transportation (IDOT) resolution to allow for the use of $2,200,000 of Rebuild Illinois Funds on the Downtown Washington Street Bridge project. Rebuild Illinois Funds are held in the MFT Fund; however, the 2024 budget for the Washington Street Bridge project is allocated to the Capital Projects Fund. This was an oversight during the development of the 2024 budget.
The estimated total expenditures for the MFT Fund, inclusive of the MFT street resurfacing program and the Washington Street Bridge project, are $12,342,269 for 2024 versus a budget of $10,601,539.
Staff recommends decreasing the Capital Projects Fund budget by $1,740,730 and increasing the MFT Fund budget by the same amount. This action effectively transfers dollars budgeted for the Washington Street Bridge between those two funds.
FISCAL IMPACT:
This budget amendment has a net zero impact on the total 2024 budget amount as the amendment decreases the budget in the Capital Projects Fund by $1,740,730 and increases the budget in the MFT Fund by the same amount in accordance with GAAP.