Item:
Title
Budget Ordinance Amendment No. 25BCC035 - Transferring $692,479.19 of General Fund Fund Balance to the Capital Financing Fund in Recognition of Final Sales and Occupancy Tax Collection from the Prior Year in Adherence to Board Policy
Body
Date of BOCC Meeting: October 28, 2024
Request for Board Action:
Agenda Text
The Board is requested to approve Budget Ordinance Amendment No. 25BCC035 appropriating $692,479.19 of General Fund fund balance and transferring those funds to the Capital Financing Fund to comply with the County’s capital and debt financing policy. Transferring prior year’s overcollection of Sales and Occupancy tax is completed on an annual basis as part of the natural cycle of reconciliation at the end of a fiscal year.
As part of the Durham County Policy on financing capital projects, all collected Article 40 and 42 sales tax and Local Occupancy Tax are directed for support of capital projects and their related debt service. In FY 2023-24, $692,479.19 from these revenue sources was realized over what was budgeted to be collected in the General Fund, and per capital financing policy, needs to be transferred to the Capital Financing Fund where they can be applied to debt service. Per Generally Accepted Accounting Principles (GAAP) the revenues are recorded in the fiscal year that they apply. However, it is too late to amend the prior year budget to transfer the over realized funds in the prior fiscal year, therefore these monies have fallen to fund balance within the General Fund for the prior fiscal year (FY 2023-24). This action is administrative in nature ensuring that the funds are located per Board policy in the appropriate Fund.
Revenues per source collected over budgeted amounts (the top section of this table reflects the traditional annual reconciliation items):
• Article 40: $317,678.49
• Occupancy Tax: $374,800.70
• Total: $692,479.19
Moving these funds from the General Fund to the Capital Financing Fund will not affect the overall fund balance percentage for the General Funds, as both of these funds are accounted for in the overall fund balance percentage.
Alignment with Strategic Plan: This item aligns with Durham County Strategic Goal: Financial Stewardship
Resource Persons: Keith Lane, Director of Budget and Management and David Ades, Assistant Director of Budget and Management
County Manager’s Recommendation: The Manager recommends the Board of County Commissioner approve Budget Ordinance Amendment No. 25BCC035 appropriating $692,479.19 of General Fund fund balance and transferring those funds to the Capital Financing Fund to comply with the County’s capital and debt financing policy.
Signature
County Manager: ____________________________