HomeMy WebLinkAbout3-23 RESOLUTION113 West Mountain Street
Fayetteville, AR 72701
(479) 575-8323
Resolution: 3-23
File Number. 2022-239
CONSTRUCTION MATERIALS AND BAD DEBT EXPENSE ACCOUNTS:
A RESOLUTION TO APPROVE A BUDGET ADJUSTMENT IN THE AMOUNT OF $325,000.00 FOR THE
CONSTRUCTION MATERIALS AND BAD DEBT EXPENSE ACCOUNTS WITHIN THE WATER AND SEWER
FUND
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS:
Section 1: That the City Council of the City of Fayetteville, Arkansas hereby approves a budget adjustment, a copy of
which is attached to this Resolution, in the amount of $325,000.00 for the Construction Materials and Bad Debt
Expense Accounts within the Water and Sewer Fund.
PASSED and APPROVED on January 3, 2023
Attest:
GLto F I rrrrr,r
f-R1[ I I,�rrff
��~:�■•� {;lTy� ' i�' ram..
Kara Paxton, City Clerk Teasurer =�� f )�
�rr�rrrt�tytf►►►
Page 1
CITY OF
Pow,
FAYETTEVILLE
ARKANSAS
MEETING OF JANUARY 3, 2023
CITY COUNCIL MEMO
2022-239
TO:
Mayor Jordan and City Council
THRU:
Susan Norton, Chief of Staff
Kevin Springer, Budget Director
FROM:
Timothy Nyander, Utilities Director
DATE:
December 15, 2022
SUBJECT:
WATER AND SEWER CONSTRUCTION MATERIALS AND BAD DEBT EXPENSE
ACCOUNTS
RECOMMENDATION:
Staff recommends approval of a budget amendment for the Construction Materials and Bad Debt Expense
accounts within the Water & Sewer Fund.
BACKGROUND:
The Construction Materials account in the Water Distribution Maintenance program will come up short on
funding for the remainder of 2022 expenses. The Bad Debt Expense account in the Utilities Financial Services
division also needs additional funding to cover anticipated bad debt expenses for the remainder of 2022.
DISCUSSION:
Due to high materials costs for the construction materials that supply the Water & Sewer warehouse and in-
house construction jobs, the Construction Materials account within the Water Distribution Maintenance
program will need additional funding to cover 2022 expenses.
Between early 2020 and late 2021, the City suspended all collection activities on delinquent utility bill balances
due to the financial strain the covid-19 pandemic placed on customers — no penalties were applied to
delinquent balances and no delinquent balances were placed with the City's collection agency during this time.
Thus, there was a 2-year backlog in utility accounts that needed to be dropped to bad debt when the City
resumed collection activities in 2022. As of August 30th, all 2020 and 2021 bad debt has been dropped/placed
with the City's collection agency. The 2-year backlog exhausted all budgeted funding and thus additional
funding is needed to cover 2022 bad debt that will be dropped before the end of 2022.
BUDGET/STAFF IMPACT:
Staff requests a budget amendment - $295,000.00 from Division 730 - Wastewater Treatment Plant and
$325,000.00 from Fund Balance.
ATTACHMENTS: 2022-239 SRF WS Const Mat & Bad Debt, 2022-239 BA WS Const Mat & Bad Debt, RES
BUDGET ADJUSTMENT FOR BAD DEBT AND CONSTRUCTION MATERIALS
Mailing address:
113 W. Mountain Street www.fayetteville-ar.gov
Fayetteville, AR 72701
Tim Nyander
Submitted By
City of Fayetteville Staff Review Form
2022-239
Item ID
1/3/2023
City Council Meeting Date - Agenda Item Only
N/A for Non -Agenda Item
12/13/2022 WATER SEWER (720)
Submitted Date Division / Department
Action Recommendation:
Staff recommends approval of a budget amendment for the Construction Materials and Bad Debt Expense accounts)
within the Water & Sewer Fund.
5400.720.4310-5216.00
5400.710.1810-5 319.00
Account Number
N/A
Project Number
Budgeted Item? Yes
Does item have a direct cost? No
Is a Budget Adjustment attached? Yes
Purchase Order Number:
Change Order Number:
Original Contract Number:
Comments:
Budget Impact:
Total Amended Budget
Expenses (Actual+Encum)
Available Budget
Item Cost
Budget Adjustment
Remaining Budget
Water and Sewer
Fund
N/A
Project Title
$ 795,537.00
$ 822,177.27
r—
(26,640.27)
$ 325,000.00
298,359.73
Previous Ordinance or Resolution #
Approval Date:
V20221130
City of Fayetteville, Arkansas - Budget Adjustment (Agenda)
Budget Year Division WATER SEWER (720) Adjustment Number
/Org2
2022
Requestor: Tim Nyander
BUDGET ADJUSTMENT DESCRIPTION / JUSTIFICATION:
A budget amendment is needed within the Water and Sewer Fund's 2022 operations budget to fund additional water
distribution -related construction materials and additional utility billing bad debt expenses anticipated throughout the
remainder of 2022.
RESOLUTION/ORDINANCE
COUNCIL DATE: 1/3/2023
ITEM ID#: 2022-239
Noll y Black
1217512022 &.47 N n
Budget Division Date
TYPE: D - (City Council)
JOURNAL#:
GLDATE: 12/31/2022
CHKD/POSTED:
TOTAL
Account Number
325,000 325,000
increase/ (Decrease)
Expense Revenue
Project.Sub#
Project Sub.Detl AT
v.20221115
Account Name
5400.720.4310-5216.00
100,000 -
EX
Construction Materials
5400.710.1810-5319.00
5400.730.5110-5315.00
520,000 -
(295,000) -
EX
EX
Bad Debt - Expense
Contract Services
5400.720.4000-4999.99
325,000
RE
Use Fund Balance - Current
1 of 1
RESOLUTION NO.
A RESOLUTION TO APPROVE A BUDGET ADJUSTMENT IN THE AMOUNT OF
$325,000.00 FOR THE CONSTRUCTION MATERIALS AND BAD DEBT EXPENSE
ACCOUNTS WITHIN THE WATER AND SEWER FUND
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE,
ARKANSAS:
Section 1: That the City Council of the City of Fayetteville, Arkansas hereby approves a budget
adjustment, a copy of which is attached to this Resolution, in the amount of $325,000.00 for the
Construction Materials and Bad Debt Expense Accounts within the Water and Sewer Fund.