Increased property taxes, sales taxes and developer impact fees, and underspending has resulted in an $8.2 million surplus for the City of Chino’s General Fund reserves for the 2017-18 fiscal year.
The surplus brings the total General Fund reserves for the City to $55 million for the 2017-18 fiscal year.
The surplus was discovered during the City’s Comprehensive Annual Financial Report (CAFR), an end-of-the-fiscal-year report required by the state.
The surplus came as a surprise to city officials because the original budget, adopted in June 2017, had predicted a $2.2 million deficit for the General Fund. At that time, the City had identified one-time capital expenditures of $6.2 million and $1 million in continuing appropriations, resulting in a decrease in the General Fund reserves of $9.4 million.
City officials said “steady economic activity” in Chino’s three major revenue sources helped to create the surplus. Property tax increased $1.4 million to $22.7 million, and sales tax increased $3.4 million to $12.6 million. The City’s development revenue of $12.6 million is “the most ever received,” according to City officials.
The City attributed the rise in development revenue — approximately $3.3 million more than expected — to developers paying development impact fees early because the City increased those fees in July, the start of the 2018-19 fiscal year.
In addition, the City underspent its General Fund operating budget by $3.3 million in the 2017-18 fiscal year, according to the financial report.
City officials said that if the surplus could have been anticipated at the beginning of the fiscal year in 2017, staff might have recommended using the funds to reduce the City’s obligation for rising pension costs.
The surplus could help the City with its projected $10 million to $12 million cost for expanding the Eastside Water Treatment Facility, which will provide water to residents living in the Preserve and College Park areas.
The City's total revenues from all sources for 2017-18 were $19.7 million and total expenses were $169.7 million.
The City’s CAFR received a Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers Association and the California Society of Municipal Finance Officers.