TO: HONORABLE CHAIR AND MEMBERS OF THE TRANSACTION AND USE TAX OVERSIGHT COMMITTEE
FROM: Javier Carcamo, Finance Director
PREPARED BY: Javier Carcamo, Finance Director
SUBJECT:
title
Measure T Budget to Actuals
end
RECOMMENDATION
recommendation
Receive and file.
body
BACKGROUND
In November 2018, Murrieta voters passed ballot Measure “T,” a one-cent Transaction and Use Tax. Measure T is a general tax revenue source for the purpose of maintaining the City of Murrieta's long-term finances, providing funding for general services, including faster response times to emergencies, improved fire protection/paramedic services, increased police sworn personnel to strengthen crime prevention, reduced gang activity/drug crimes, graffiti removal, parks and recreation, and street maintenance/pothole repair.
The Citizens Oversight Committee provides oversight of Measure T sales tax revenues and expenses. This Measure T Oversight Report provides an update through December 2024. This report includes a recap of all Measure T activities. This Report shows the importance of Measure T revenues to the city’s current and future financial health of the City and supports City Council priorities.
Revenues
The Fiscal Year (FY) 2024/25 adopted and amended revenue budget is $31.4 million and $29.0 million, respectively. The City’s sales tax consultant provides quarterly reports along with revenue forecasts considering various factors such as current economic condition, actual sales, collections, and new economic developments scheduled to open within the current fiscal year. Based on the prior FY 2023/24 final Transaction Sales and Use Tax collections, staff proposed revenue budget amendments during the FY 2024/25 budget update report in August 2024 to amend the adopted revenue budget from $31.4 million to $29.0 million. The table below summarizes Transaction Sales & Use Tax collections through December 2024.
The revenue as of December 2024 is approximately $14.4 million, which represents approximately 50% of the amended budget. The $14.4 million denotes six months’ worth of collections. When comparing the halfway point District Sales Tax receipts to the same period last fiscal year, the current year's revenue is lower by $167,863 or approximately -1.2%. Sales Tax collections for the latter half of the Fiscal Year (January through June) tend to be less than the first half due to holiday shopping Sales Tax collected in December. Based on projections of sales tax receipt collection for the remainder of the fiscal year, the total Transaction and Use tax revenue is projected to be around $28.5 million. Staff will continue to monitor Transaction Sales and Use Tax collections throughout the third quarter and plan to propose budget amendments if collections are projected below the $29.0 million budget.
Expenses
The FY 2024/25 amended operating expenditure budget is $26.1 million as of December 2024. The year-to-date expenditures as of the preparation of this report are $13.4 million, or approximately 51% of the amended budget. The personnel budget of $13.4 million is approximately 51.5% of the total budget. The year-to-date personnel cost is approximately $6.6 million, or 49% of the personnel budget. At the halfway point, personnel cost is slightly below the 50% mark. This is attributable to vacancies that occur throughout the fiscal year.
The Operations and Maintenance category is 24%, below the 50% mark. This is expected as some expenditures are not consistent each month. Capital Outlay expenditures are typically one-time purchases and may not reflect 50% of the budget at this point. As of December 2024, Capital Outlay expenditures have consumed 63% of the amended budget. The table below summarizes the budget and actual expenditures by category through December 2024.
* The amounts reflected in the table above may differ from the March 4, 2025, City Council Mid-Year Budget Update due to the date when the reports were run.
FY 2024/25 Approved Budget Adjustments
As mentioned earlier in the report, Finance staff is not recommending a revenue budget adjustment at this time. We plan to analyze collection data through the third quarter before making any recommendations. However, for the expenditure budget, Finance staff proposed a reduction of $711,300 in the personnel budget due to salary savings from vacancies and unfilled positions. Additionally, staff recommends a slight increase in the Operations & Maintenance and Capital Outlay budgets to account for a rollover not previously included at year-end. Finally, a budget increase is proposed for the Transfers Out expenditure category to support budget adjustments for the Fire, CSD, and Library Districts. Based on the approved mid-year adjustments, the Measure T Fund revenue budget is $29.0 million, while the expenditure budget was reduced to $25.8 million. The City Council received the mid-year budget update on March 4, 2025, and approved the proposed budget adjustments. The table below summarizes the approved budget adjustments along with the amended revenue and expenditure budgets for FY 2024/25.
Expenses highlights
• 67 authorized positions funded by Measure T since inception;
- 31 Police Public Safety Positions
- 15 Fire Public Safety Positions
- 21 Non-Public Safety Positions
• 77% of measure T budget is dedicated to public safety;
• City of Murrieta's 2023 Community Opinion Survey;
• City of Murrieta’s Magazine, newsletter, and program marketing;
• Police vehicles, including upfitting costs;
• Police safety equipment for new hires;
• Police Taser and body-worn cameras, equipment, and license;
• Police License plate reader software;
• Police Drone equipment;
• Fire annual hose test services;
• Fire annual ladder test services;
• Fire EMS Priority Dispatch EMD;
• Fire mapping response system and image trend annual fees;
• Fire PSEC radio system annual subscription and radio installation;
• Fire Mobile data terminals;
• Fire PPE gear and safety equipment (i.e., turnout gear and other Fire Dept services and equipment);
• Fire replacement equipment (i.e., hoses and ladders);
• Wildland fire service agreement;
• Fire emergency software (i.e., table command, pulse point, CAD integration system);
• Fire station annual facilities maintenance and major repairs:
• Fire stations PPE extractors for Fire Stations 1, 2, and 3;
• Fire EMS rental agreement;
• Fire Station 2 and 3 generator replacements.
• Fire Stations maintenance/repairs;
• Economic Development data market research and event marketing;
• Graffiti & weed abatement;
• Vehicle Lease program;
• Establish operating and sustainability reserves.
Operating and sustainability reserves
The City Council’s formal policy calls for Operating Reserves of 25% of the adopted operating budget excluding transfers. The Measure T operating reserve balance of $5.2 million fulfills the City Council operating reserve policy requirement. The Measure T Fund also sets aside funds to fulfill the Operating Reserve requirement for the Fire, CSD, and Library Districts.
In addition to the operating reserve, certain commitments and assignments of fund balance will help ensure adequate financial resources for planned expenses and unforeseen circumstances and events such as an economic downturn, catastrophic events, unanticipated expenses, and one-time purchases. For FY 2024/25, the Measure T fund will set aside $626,487 in various sustainability reserves. In February 2025, the City Council approved the use of the Fleet Replacement Reserve for $100,000 for the purchase of a used aerial apparatus. This apparatus will serve as a dedicated training device prior to receiving a new Pierce Tractor-Drawn Aerial Apparatus for Murrieta Fire & Rescue (MFR). The Total operating and sustainability reserve balances are shown in the table below.
Fiscally responsible budgeting, prudent long-term financial projections, funds oversight, and financial transparency have strengthened the City’s reserves since the implementation of Measure T. It is consistent with the City Council's Goal to maintain a high-performing organization that values fiscal sustainability, transparency, accountability, and organizational efficiency.
Measure T is a general-purpose tax revenue source that supports the City’s operations, including emergency services such as police, fire, and paramedics; street maintenance and improvements; parks and recreation; and maintenance of public facilities, such as graffiti removal and other expenses that support the Murrieta quality of life. The financial report can be found attached to this narrative report.
Report to City Council
In accordance with the resolution that established the Advisory Transaction and Use Tax Citizens Oversight Committee, a biennial report by the Measure T Committee to the City Council on the revenue and expenditures of the Measure T Fund. Staff will work with the Measure T Committee Chairperson to prepare an agenda report to include on a future City Council meeting.
ATTACHMENTS
Attachment 1: FY 2024/25 Budget to Actual Report as of December 2024