Boston Ends FY15 with a $7.4M Surplus

Revenues $44.8M over budget, spending exceeded appropriations by $37.5M

The City of Boston ended FY15 with a $7.4M General Fund operating surplus, slightly smaller than the $9.5M surplus in FY14.  The surplus is due to the fact that actual receipts exceeded budgeted revenues by $44.8M or 1.6%, which was greater than the $37.5M that actual spending exceeded final appropriations.  The General Fund surplus represents 0.27% of city spending of $2.77B.

Expenditure

The $37.5M in spending over appropriations is driven by three main factors.  Snow removal costs were expected to greatly exceed the budget, but federal reimbursements helped limit the General Fund spending to $19.9M over its appropriation.

Police and Fire Department overtime costs contributed to a combined departmental deficit of $24.2M.  Police overtime spending as a percent of total departmental spending has grown each year since FY10 and requires greater scrutiny.  Court judgments and legal claims paid by the City exceeded its budget by $6.2M in FY15.

 Revenue

The City’s prudent practice of conservatively estimating its revenues once again produced a revenue surplus at year end.  Actual receipts of $2.780B in FY15 were $44.8M over budget estimates.  The excise surplus of $25.6M included room occupancy ($15.0M), motor vehicle ($11.1M) and meals ($2.9M) and shortfalls in aircraft fuel (-$2.3M) and other small accounts.  Building permit receipts were $23.7M or 84.8% over budget.  State aid was $5.1M less than expected due mainly to the state only funding the charter tuition reimbursement at 63.5% of its full obligation.

For the fifth year in a row, the revenue surplus allowed the City to forego using non-recurring revenues budgeted for operations.  The City was able to use recurring revenues instead of non-recurring revenues totaling $40.8M, which included the full $40M free cash appropriation and cemetery trust fund receipts of $772,800.  Unlike last year, the City did take into receipt the entire $19M that was budgeted from the parking meter fund.