Title
Consideration of and action on a recommendation to City Council to amend the Fiscal Year 2023-2024 Budget for the Crime Control and Prevention District for the repayment of sales taxes to the State Comptroller's office.
Body
Summary:
In November 2023, staff received notification from the State Comptroller's office that the Crime Control and Prevention District (CCPD) was overpaid in sales taxes in the amount of $391,122.41. This was discovered through an audit by the Comptroller's office of a taxpayer located outside of the city limits who erroneously remitted sales tax to the District for the reporting period of October 2011 through December 2016 and was not the results of an error made by the City of Deer Park or the CCPD. The District entered into a 63-month, interest-free payback arrangement with installment payments of $6,208.00 deducted from monthly collections.
Staff consulted with our auditors about how to properly record this transaction on the general ledger. Their recommendation was to record a long-term debt liability for the full amount of the overpayment with the other side of the entry being recorded as expense. When monthly collections are received from the Comptroller, the revenue would be grossed to the full collection amount and a debit would be made to the liability account to draw it down.
Following their recommendation, $391,122.41 must be coded as an expense to the CCPD. As this was an unexpected event, this transaction was not budgeted for. In order to prevent the District from exceeding its budget, a budget amendment is required. The additional appropriation would be funded by the unassigned fund balance of the CCPD.
Fiscal/Budgetary Impact:
Add $391,122.41 to the Fiscal Year 2023-2024 budget for the CCPD (Account No. 820-900-45990, Misc. Operating Expenditures), to be funded by the unassigned fund balance of the CCPD, which is available for this purpose.
Recommended action
Approve the recommendation to City Co...
Click here for full text