On Wednesday, May 31st, City Council held a Finance and Budget Committee Meeting to discuss the annual audit. Committee meetings are not recorded and the VRS team attended in person to learn more about this topic.

Plante Moran presented the 2022 audit to Council, flagged items of note and answered questions.

Livonia is fiscally sound and the 2022 general fund revenue exceeded expenditures by approximately $304,000.

• 50% of the City’s revenue comes from property taxes
• 60% of the general fund is used for public safety

The remaining $8.5M in ARPA funds were allocated to the Senior Center Construction Fund ($4M) and the Building Improvement Fund ($4.5M).

Below are highlights discussed from the following letter: https://civicclerk.blob.core.windows.net/stream/LIVONIAMI/f5e53740-a3e7-4dd7-90c6-025ce1c2b3d6.pdf?sv=2021-10-04&st=2023-06-01T01%3A11%3A46Z&se=2024-06-01T01%3A16%3A46Z&sr=b&sp=r&sig=KYSvUJ2C7PNpr5PZ%2B%2FhgEYByMX950dwB%2F1TgQarVwDg%3D

Court Building Improvement Fund:

Over the last 3 years the fund balance has decreased from $943,000 to $80,000. The annual debt service for the District Court is $550k per year until 2033. It is expected that the fund will run out in 2023 and $200k – $300k will have to be added to the general fund budget.

Reasons for the loss in revenue are attributed to the decline in fines and bond forfeitures.

Legacy Costs:

Livonia’s pensions are well funded by official standards (2022 level was 86%) but down 18% from last year (market related); as a result, the City had to contribute $4.2M to the funds. This includes the Police and Fire Revised Retirement Plan that covers 170 participants.

The City’s post employment healthcare system (VEBA) is 56% funded (the state of Michigan defines an underfunded plan at 40%) and the City had to contribute $3.4M to the fund.

Find an easy reference General Fund Revenue and Expenditure graphs here: https://civicclerk.blob.core.windows.net/stream/LIVONIAMI/bd5d689d-672c-41b7-b64f-8a99022e6549.pdf?sv=2021-10-04&st=2023-06-01T01%3A11%3A46Z&se=2024-06-01T01%3A16%3A46Z&sr=b&sp=r&sig=kdsXsjCY%2F7pVu0Bxksu6UkjlBt%2BzrvdM60KHyKV1q%2BY%3D

Find the complete report here:

https://civicclerk.blob.core.windows.net/stream/LIVONIAMI/eb249ab3-f450-4e3e-809f-c9ad9985eabc.pdf?sv=2021-10-04&st=2023-06-01T01%3A11%3A46Z&se=2024-06-01T01%3A16%3A46Z&sr=b&sp=r&sig=RzMDapDSpz7A1zlAc4Bml8X%2Fu6lXyDcQ6feo0YtpZGc%3D