The report is required by ordinance code and shows financial statements and a narrative — not an audit — for the three months that ended Dec. 31. The start of the fiscal year was Oct. 1.
The City is projecting an overall general fund surplus of $15.2 million, but the number does not include the more than $11 million Brown has proposed in legislation for economic development Downtown and Duval County. That legislation, Bill 2013-89, has been introduced to City Council but has not yet been reviewed.
According to the report, the $15.2 million also does not include a $4.2 million discrepancy between the administration and Jacksonville Sheriff's Office over projected expenditures. The report states the administration has the projected expenditure at $4.5 million, while the sheriff's office has it at $8.7 million, a difference of $4.2 million.
The sheriff's office is anticipating hiring 30 additional corrections officers and additional police officers in addition to absorbing 40 police officers previously funded through a federal grant, the report states.
When the economic development allocation and sheriff's discrepancy are combined, it leaves about a $1.7 million surplus that is negated by a projected $1.7 million deficit in revenues, the report states.
Property taxes continue to be a strain on general fund revenue.
"The overall unfavorable variance in the General Fund revenues is mostly driven by shortfalls in ad valorem taxes. Final taxable values were less than preliminary values, resulting in an approximate $1.8 million shortfall in ad valorem taxes for FY 2012/13," the report states.
Property taxes were adjusted downward by $3.4 million in fiscal 2011-12 through a Council-approved ordinance presented on behalf of the administration. The report also states it is uncertain if the administration will again seek the same solution for the current fiscal year.
Also contributing to the general fund revenue shortfall were "aggressive" projections made by the administration that are not on track to be fulfilled.
Among them, a projected shortfall of just under $238,000 for occupational licenses, which would be offset by miscellaneous revenue, and fire protection inspection revenue that is "significantly under budget" as of the first quarter.
Revenue was projected at more than $1.8 million, but during the first quarter a little more than $175,000 was collected making the year-end projection "optimistic," according to the report.
"We continue to express our concern over the Department's aggressive revenue budget," said the report, referencing the City Finance Department.
It also refers to the "at length" discussion during the August budget hearings regarding several of the projected revenues, including the fire inspection revenues.
"While the overall General Fund appears to be in adequate condition, we do note that many of the Administration's current projections will likely be adjusted as the fiscal year progresses," the report states.
The office recommends deferring the appropriation of any current-year savings –– which would include the $11 million Brown has proposed for economic development that will come from debt savings.
David DeCamp, Brown's spokesman, on Tuesday said the administration is still reviewing the report and will consider it as guidance, but also will continue to review revenues as the fiscal year progresses.
Asked if the $11 million for economic development should be deferred, as the auditor's office recommends for current-year savings, DeCamp said the mayor "is committed to reinvesting those savings into Downtown and economic development."
The City's general fund appears to be in "adequate condition" three months into the fiscal year despite concerns about Mayor Alvin Brown's revenue budget, according to a City Council Auditor's Office report released Friday.