Summary
The First Quarter FY17 QCMR provides an updated financial outlook, reflecting higher-than-expected tax revenue, which contributes to a General Fund revenue projection of $4.15 billion. The revenue increase is largely attributed to higher Wage Tax and Business Privilege Tax collections, although locally generated non-tax revenue declined slightly. Obligations have also risen to $4.22 billion, $37.0 million above the Five-Year Plan, primarily due to increases in employee benefits, staffing costs, and departmental expenses. The operating deficit is projected at $72.9 million, compared to the $55.3 million originally estimated. The year-end fund balance is now expected to be $95.8 million, $55.5 million above the initial projection, providing the City with more financial flexibility. The report warns, however, that expenditure growth, particularly in pensions and public safety, continues to be a long-term fiscal challenge.