Little Rock Fourth Quarter 2017 Financial Report Analysis

City of Little Rock Fourth Quarter 2017 Financial Report 1

General Fund Revenues budget % collected - 2017 and 2016 JAN FEB MAR APR MAY JUNE JULY AUG SEP OCT NOV DEC 110% 100.00% 100.24% 100% 99.81% 91.67% 85.59% 92.22% 91.95% 83.33% 78.49% 90% 86.35% 80% 78.82% 66.67% 75.00% 70% 67.26% 58.33% 65.58% 60% 59.32% 50.00% 39.15% 57.68% 50% 47.23% 41.67% 46.30% 40% 39.34% 33.33% 25.77% 32.47% 25.00% 15.30% 32.23% 30% 25.00% 16.67% 7.71% 20% 14.51% 8.33% 10% 7.62% 0% 2017 2017 Budget 2016 2

General Fund Revenues 2017 and 2016 $200,000,000 $194,049,884 $190,254,768 $193,689,741 $180,000,000 $160,000,000 $152,948,514 $148,979,428 $145,537,413 $140,000,000 $120,000,000 $100,000,000 $96,013,442 $90,696,847 $89,038,647 $80,000,000 $60,000,000 $49,551,986 $48,000,708 $48,006,721 $40,000,000 $20,000,000 $0 - - - JAN FEB MAR APR MAYJUNEJULYAUG SEP OCT NOV DEC 2017 2017 Budget 2016 3

General fund Revenues Compared to Amended Budget Variance Favorable (Unfavorable) YTD Amended Budget YTD Prior Year Revenues Revenues REVENUES: 1 General property taxes 2 Sales taxes 3 Licenses and permits 4 Intergovernmental 5 Charges for services 6 Fines and fees 7 Utility franchise fees 8 Investment income 9 Miscellaneous 10 TOTAL REVENUES $28,650,300 101,944,270 11,808,510 9,311,000 10,193,370 2,343,840 27,646,177 306,000 1,846,417 $194,049,884 $28,523,326 101,449,568 11,966,526 9,311,000 10,102,670 2,260,147 27,565,117 254,754 2,256,633 $193,689,741 ($126,974) (494,702) 158,016 $28,611,669 99,746,536 11,297,878 8,625,272 10,087,109 2,678,303 27,840,411 87,454 1,280,136 $190,254,768 0 (90,700) (83,693) (81,060) (51,246) 410,216 ($360,143) Revenues were approximately $360,000 or 0.19% below the amended budget and approximately $3.43 million above the same period a year ago. 4

General fund Revenues Compared to Adopted Budget Variance Favorable (Unfavorable) YTD Original Budget YTD Prior Year Revenues Revenues REVENUES: 1 General property taxes 2 Sales taxes 3 Licenses and permits 4 Intergovernmental 5 Charges for services 6 Fines and fees 7 Utility franchise fees 8 Investment income 9 Miscellaneous 10 TOTAL REVENUES $28,072,500 101,416,870 11,235,660 8,625,400 10,120,020 2,483,840 27,994,177 306,000 1,772,417 $192,026,884 $28,523,326 101,449,568 11,966,526 9,311,000 10,102,670 2,260,147 27,565,117 254,754 2,256,633 $193,689,741 $450,826 32,698 730,866 685,600 (17,350) (223,693) (429,060) (51,246) 484,216 $1,662,857 $28,611,669 99,746,536 11,297,878 8,625,272 10,087,109 2,678,303 27,840,411 87,454 1,280,136 $190,254,768 Revenues were approximately $1.66 million above the original adopted budget. The budget amendment increased net operating revenues by $2,023,000 reflecting increases in property tax revenues, sales tax revenues, licenses and permits, intergovernmental revenues, charges for services, and miscellaneous dedicated pension revenues. In addition, the budget amendment included reductions in estimated fines and fees, and net franchise fee revenues. Of the $2 million adjustment, approximately $1,227,400 was available for general operations and approximately $795,600 was dedicated to the closed Police and Fire pension funds. The amendments were based on updated guidance and actual experience through September. 5

General fund Revenues Compared to Prior Year Variance Favorable (Unfavorable) YTD Prior Year Revenues Revenues REVENUES: 1 General property taxes 2 Sales taxes 3 Licenses and permits 4 Intergovernmental 5 Charges for services 6 Fines and fees 7 Utility franchise fees 8 Investment income 9 Miscellaneous 10 TOTAL REVENUES $28,523,326 101,449,568 11,966,526 9,311,000 10,102,670 2,260,147 27,565,117 254,754 2,256,633 $193,689,741 $28,611,669 99,746,536 11,297,878 8,625,272 10,087,109 2,678,303 27,840,411 ($88,343) 1,703,032 668,648 685,728 (418,157) (275,294) 167,300 976,497 $3,434,973 15,562 87,454 1,280,136 $190,254,768 6

City, County, and Blended City and State Sales Tax Percentage Growth (excluding the impact of the increased local rate) Sales Tax Percentage Growth 15 10 5 0 Mar. 16 Mar. 17 Jun. 17 June. 16 Sept. 16 Sept. 17 Dec. 16 Dec. 17 -5 -10 -15 City Mo. % Blended 12 Mo. % County Mo. % Blended Budget Est. Blended Mo. % Note: Blended sales tax results represent the total sales tax received by the City, including the City s share of the County sales tax, the City sales tax, and the State Turnback. 7

Blended Sales Tax Percentage Growth Collected over the Last Twelve Months Sales Tax Percentage Growth Last Twelve Months (excluding the impact of the increased local rate) 12 8 8.81 6.41 4 4.60 1.77 1.71 3.24 1.64 1.50 1.41 1.34 2.11 2.51 0.51 1.79 1.10 1.08 0.90 0.35 0.11 0 -1.16 -0.53 -2.32 -0.65 -5.69 -4 -8 Mar. 17 May. 17 Jul. 17 Sept. 17 Nov. 17 Jan. 18 Blended Mo. % Blended 12 Mo. % Budget Est. 8

Sales Tax Percentage Growth Comparison to Budget and Prior Year Sales & Use Tax Collections % % % Month Collected Amended Budget Amended Budget Change from Budget Variance Var. from Budget Inc (Dec) Prior Year 1 2 3 4 5 6 7 8 9 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 2017 YTD 7,599,154 7,760,233 8,856,402 7,965,881 8,992,583 8,544,183 8,321,702 8,496,475 8,313,523 8,361,927 8,248,955 9,988,509 101,449,528 7,599,154 7,760,233 8,856,402 7,965,881 8,992,583 8,544,183 8,321,702 8,279,753 8,676,097 8,480,937 8,463,415 10,003,929 101,944,269 2.11% -5.69% 8.81% 3.24% 6.41% 2.51% -0.53% 1.94% 1.94% 1.94% 1.94% 1.95% 2.20% 216,722 (362,574) (119,010) (214,460) (15,420) (494,741) - - - - - - - 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 2.62% -4.18% -1.40% -2.53% -0.15% -0.49% 2.11% -5.69% 8.81% 3.24% 6.41% 2.51% -0.53% 4.60% -2.32% 0.51% -0.65% 1.79% 1.71% 10 11 12 13 9

Revenue Provided by New Sales Tax 2017 Tax Receipts Prior Year Tax Receipts Month Collected March April May June July August 7 September 8 October 9 November 10 December 11 January 12 February 13 For Sales in the Month of January February March April May June July August September October November December YTD Total 5/8 Cent Operating 2,348,813 2,392,937 2,753,987 2,467,110 2,688,996 2,649,800 2,581,691 2,623,937 2,573,044 2,605,146 2,565,154 3,116,310 $31,366,925 3/8 Cent Capital 1,409,288 1,435,762 1,652,392 1,480,266 1,613,398 1,589,880 1,549,015 1,574,362 1,543,826 1,563,088 1,539,092 1,869,786 $18,820,155 New Tax Proceeds 3,758,101 3,828,699 4,406,380 3,947,376 4,302,394 4,239,680 4,130,706 4,198,299 4,116,870 4,168,233 4,104,246 4,986,096 $50,187,081 5/8 Cent Operating 2,306,847 2,538,545 2,482,492 2,408,535 2,491,718 2,561,329 2,585,077 2,517,968 2,655,126 2,587,555 2,591,617 3,063,187 $30,789,996 3/8 Cent Capital 1,384,108 1,523,127 1,489,495 1,445,121 1,495,031 1,536,797 1,551,046 1,510,781 1,593,076 1,552,533 1,554,970 1,837,912 $18,473,997 New Tax Proceeds 3,690,956 4,061,672 3,971,987 3,853,655 3,986,748 4,098,126 4,136,124 4,028,750 4,248,202 4,140,088 4,146,587 4,901,099 $49,263,993 % Inc (Dec) 1.82% -5.74% 10.94% 2.43% 7.92% 3.45% -0.13% 4.21% -3.09% 0.68% -1.02% 1.73% 1.87% 1 2 3 4 5 6 Month Collected For Sales in the Month of 2012 Total 5/8 Cent Operating 28,992,457 29,220,016 29,608,840 30,773,111 30,789,996 $180,751,345 3/8 Cent Capital 17,449,867 17,573,702 17,849,353 18,430,387 18,473,997 $108,597,462 New Tax Proceeds 46,442,324 46,793,718 47,458,193 49,203,498 49,263,993 $289,348,807 5/8 Cent Operating n/a 28,992,457 29,220,016 29,608,840 30,773,111 3/8 Cent Capital n/a 17,449,867 17,573,702 17,849,353 18,430,387 New Tax Proceeds n/a 46,442,324 46,793,718 47,458,193 49,203,498 % Inc (Dec) n/a 0.76% 1.42% 3.68% 0.12% 14 15 16 17 18 19 2013 Total 2014 Total 2015 Total 2016 Total Grand Total - Life to Date 10

Electric Franchise Fees Year 2017 KWH 260,447,619 233,056,734 228,362,262 223,094,193 227,891,831 269,812,553 320,565,047 330,602,385 301,979,644 291,456,388 237,954,138 234,995,484 3,160,218,278 Year 2016 KWH 259,258,098 247,699,091 232,597,141 217,963,088 223,509,849 259,834,639 353,096,870 352,175,995 322,655,502 299,147,441 244,784,961 242,631,872 3,255,354,547 2017 Revenue 1,013,721 908,686 885,328 910,848 941,331 1,220,034 1,459,771 1,511,235 1,367,665 1,175,572 975,657 958,097 13,327,946 $ 2016 Revenue 1,041,800 1,000,706 939,021 874,677 904,713 1,160,822 1,561,048 1,558,828 1,419,864 1,168,022 958,577 953,792 13,541,870 $ Usage Incr (Decr) Revenue Incr (Decr) -2.70% -9.20% -5.72% 4.14% 4.05% 5.10% -6.49% -3.05% -3.68% 0.65% 1.78% 0.45% -1.58% Month January February March April May June July August September October November December 0.46% -5.91% -1.82% 2.35% 1.96% 3.84% -9.21% -6.13% -6.41% -2.57% -2.79% -3.15% -2.92% The original adopted budget was $12,670,390, a 6.4% decrease from last year s actual results. The amended annual budget was $13,203,390 or 2.5% below prior year actual revenue. Year-end results were approximately $124,600 above the amended budget. 11

Gas Franchise Fees Year 2017 Mcf 883,054 663,761 549,375 426,383 323,148 305,502 266,676 236,926 278,795 271,303 415,303 588,727 5,208,953 Year 2016 Mcf 745,039 854,432 626,901 449,206 328,727 290,535 249,687 231,718 235,574 247,943 300,417 589,232 5,149,411 2017 Revenue 569,112 418,528 335,564 212,346 142,795 118,386 103,549 96,486 103,409 113,375 216,851 378,977 2,809,376 $ 2016 Revenue 455,268 465,977 320,871 201,647 113,541 101,593 83,116 81,948 87,054 93,513 146,549 375,950 2,527,027 $ Usage Incr (Decr) Incr (Decr) 18.52% -22.32% -12.37% -5.08% -1.70% 5.15% 6.80% 2.25% 18.35% 9.42% 38.24% -0.09% 1.16% Revenue Month January February March April May June July August September October November December 25.01% -10.18% 4.58% 5.31% 25.76% 16.53% 24.58% 17.74% 18.79% 21.24% 47.97% 0.81% 11.17% The original adopted budget was $3,178,000, representing a 25.7% increase from 2016 actual results and a decrease of 2% from 2015 actuals. The amended budget was $2,828,000 or 12% above last year s results. Year-end results were approximately $18,600 below the amended budget. 12

General Fund Expenditures Budget % Expended - 2017 and 2016 JAN FEB MAR APR MAY JUNE JULY AUG SEP OCT NOV DEC 110% 100.00% 100% 100.29% 91.67% 99.84% 90% 89.70% 83.33% 73.68% 89.37% 81.70% 81.69% 75.00% 80% 73.52% 66.67% 70% 66.88% 58.33% 58.53% 66.35% 60% 59.15% 50.00% 40.37% 50% 49.40% 48.80% 41.67% 32.19% 39.63% 33.30% 24.86% 40% 32.13% 25.00% 30% 24.13% 16.67% 7.42% 20% 14.61% 8.33% 14.60% 10% 7.30% 0% 2017 2017 Budget 2016 13

General Fund Expenditures 2017 and 2016 $200,000,000 $194,230,599 $193,672,575 $187,256,760 $180,000,000 $160,000,000 $146,068,181 $138,717,919 $143,187,313 $140,000,000 $120,000,000 $100,000,000 $94,065,219 $96,382,645 $93,401,890 $80,000,000 $60,000,000 $48,191,323 $46,504,714 $47,010,029 $40,000,000 $20,000,000 $0 JAN FEB MAR APR MAY JUNE JULY AUG SEP OCT NOV DEC 2017 2017 Budget 2016 14

General Fund Expenditures Compared to Budget Variance Favorable (Unfavorable) YTD Amended Budget YTD Prior Year Expenses Expenses EXPENDITURES: GENERAL GOVERNMENT: 1 General Administration 2 Board of Directors 3 Community Programs 4 City Attorney 5 District Court - (Criminal) 6 District Court - (Environmental) 7 District Court - (Traffic) 8 Finance 9 Human Resources 10 Information Technology 11 Planning and Development 12 TOTAL GENERAL GOVERNMENT 13 PUBLIC WORKS 14 PARKS & RECREATION 15 RIVERMARKET 16 GOLF 17 JIM DAILEY FITNESS & AQUATICS 18 ZOO 19 FIRE 20 POLICE 21 HOUSING & NEIGHBORHOOD SAVINGS FROM AUTHORIZED BUT UNFILLED POSITIONS 23 TOTAL EXPENDITURES $31,228,387 343,453 606,395 1,795,596 1,280,975 516,636 1,213,470 3,555,346 1,715,690 4,397,125 2,455,714 49,108,787 1,062,875 10,187,486 1,151,840 2,482,978 911,778 6,571,455 48,315,409 68,697,801 5,182,166 $30,897,380 338,245 590,483 1,759,449 1,159,864 496,027 1,188,481 3,535,299 1,726,030 4,316,077 2,419,364 48,426,698 953,122 10,109,910 1,234,673 2,482,546 901,166 6,571,274 48,990,914 69,453,081 5,107,213 $331,007 5,208 15,912 36,147 121,111 20,609 24,989 20,047 (10,340) 81,048 36,350 682,089 109,753 77,576 (82,833) $28,387,496 348,347 539,277 1,768,811 1,279,133 625,802 1,314,121 3,395,517 1,602,026 3,816,838 2,296,740 45,374,107 983,482 9,536,790 1,183,258 2,507,606 896,482 6,836,332 47,859,568 66,906,762 5,172,374 432 10,612 181 (675,505) (755,280) 74,953 22 0 0 0 0 $193,672,575 $194,230,599 ($558,024) $187,256,760 15

General Fund Year-End Summary Variance Favorable (Unfavorable) YTD Amended Budget YTD Amount SUMMARY: 1 REVENUES 2 EXPENDITURES REVENUES OVER (UNDER) EXPENDITURES 194,049,884 193,672,575 193,689,741 194,230,599 (360,143) (558,024) 3 377,309 (540,857) (918,166) OTHER FINANCING SOURCES/(USES): 4 CARRYOVER - PRIOR YEAR 5 TRANSFERS IN 6 TRANSFERS OUT 2,200,000 10,451,236 (13,028,545) 541,742 10,453,645 (13,030,045) (1,658,258) (a) 2,409 (1,500) REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING USES 7 $0 ($2,575,515) ($2,575,515) 8 BEGINNING FUND BALANCE 9 ENDING FUND BALANCE 23,174,193 $23,174,193 23,174,193 $20,598,678 0 ($2,575,515) (a) The adopted budget called for the utilization of $2.2 million in prior year earnings (carryover). Of this amount, $541,742 was available in a contingency special project from 2015 revenues that was transferred into the General Fund. The remaining $1,658,258 had been closed to the unrestricted General Fund balance in previous years. Utilization of this portion of the carryover reduced unrestricted General Fund balance, but does not impact the $10 million restricted reserve that the Board of Directors has established. 16

General Fund Authorized but Unfilled Positions and Vacation/Sick Payouts Vacation/Sick Payouts $1,000,000 2017 amended budget $1,063,534 YTD Savings from Authorized but Unfilled Positions $7,000,000 2017 adopted budget requirement $7,000,000 Achieved - 9/29/17 98 budgeted positions unfilled in the General Fund at year-end 17

General Fund Authorized but Unfilled Positions Last Twelve Months 170 155 154 153 151 150 150 148 148 160 Police Recruit 150 131 130 School 140 Police Recruit Police Recruit 130 School School 120 110 98 98 100 90 Aug. 17 Feb. 17 Jun. 17 Sept. 17 Jan. 17 Apr. 17 Oct. 17 Dec. 17 Nov. 17 Mar. 17 May. 17 July. 17 Actual The number of vacant positions in the General Fund decreased from 143 (December 2016) to 98 (December 2017). The number of vacant Police Officer positions declined from 62 (December 2016) to 21 (December 2017). 18