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Management Discussion & Analysis
<br /> The decline in the net asset position of the pension trust is the result of timing differences in the
<br /> payment of pension benefits and the reimbursement of same from the State of Indiana, as well as
<br /> the cost of healthcare benefits to pension members, not covered by the state reimbursement
<br /> program.
<br /> General Fund Budgetary Highlights
<br /> The City prepares an annual budget for general fund expenditures, which is subject to City of
<br /> South Bend Common Council approval for adoption, before November 15t of the year preceding,
<br /> the budget period, according to state statute concerning the annual budget of second class cities
<br /> and towns.
<br /> The general fund budget applicable for fiscal 2011 is reported as follows:
<br /> Actual Budgetary
<br /> $(whole)
<br /> Original Final Basis
<br /> Variance
<br /> Revenue 63,306,324 63,529,220 60,696,679 (2,832,541)
<br /> Expenditures 63,386,324 64,844,690 62,224,384 2,620,306
<br /> Surplus(deficit) (80,000) (1,315,470) (1,527,705) (212,235
<br /> General Fund revenue was originally budgeted at $63,306,324 for fiscal 2011 with Common
<br /> Council adoption of the 2011 general fund budget on October 25, 2010. During 2011, the General
<br /> Fund revenue budget was increased by $222,896 resulting in an ending revenue budget of
<br /> $63,529,220. The revenue budget may be increased at any time based on updated revenue
<br /> projections and includes an adjustment in the amount of $142,428 for a federal energy
<br /> conservation grant received during 2011.
<br /> During 2011, General Fund revenue achieved amounted to $60,696,679, a deficiency from the
<br /> final budget level of $2,832,541. The primary reason for the revenue shortfall was reduced
<br /> property tax collections due to circuit breaker tax legislation ($1,985,450 less than budgeted)
<br /> along with lower interest earnings on investments, E-911 grant revenue and forfeitures.
<br /> General Fund expenditures were originally budgeted at$63,386,324 for fiscal 2011 with Common
<br /> Council adoption of the 2011 general fund budget on October 25 2010. During 2011, the General
<br /> Fund expenditure budget was increased $1,458,366 resulting in an ending expenditure budget of
<br /> $64,844,690. The expenditure budget increase resulted from an encumbrance roll over at year
<br /> end 2010 to 2011 of$860,993 and additional appropriations of$597,373 (police cars and energy
<br /> grant).
<br /> General Fund spending is reviewed on a monthly basis under the direction of the City Controller
<br /> to ensure spending remains within budgetary constraints. Quarterly reviews are conducted as
<br /> required with general fund department management to review spending projections to ensure that
<br /> annual expenditures remain within the budgetary levels. Budget amendments for cost neutral
<br /> redistribution between expense categories (i.e. personnel, supplies, services, capital) are
<br /> submitted to Common Council at mid year and year end, as required to adjust the budget as
<br /> necessary to prevent any budget overruns in any expense category.
<br /> Additional appropriations for projects, initiatives, or unbudgeted spending requirements within the
<br /> general fund are presented to the Common Council for adoption as deemed necessary by the
<br /> Mayor.
<br /> General Fund expenditures incurred on a budgetary basis, including cash expended and
<br /> outstanding encumbrances as of year end December 31, 2011 amounted to $62,224,384. The
<br /> expenditures and commitments as of year end December 31, 2011 are less than the 2011
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