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Report regarding a resolution approving the South San Francisco Conference Center Authority Fiscal Year 2025 - 26 Budget. (Jim McGuire, South San Francisco Conference Center Authority Executive Director)
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RECOMMENDATION
It is recommended that the City Council of the City of South San Francisco adopt a resolution approving the South San Francisco Conference Center Authority Fiscal Year 2025-26 Budget.
BACKGROUND/DISCUSSION
The South San Francisco Conference Center Authority (“Conference Center Authority”), which includes members Mayor Flores and Councilmember Nicolas, reviewed and approved the Fiscal Year (“FY”) 2025-26 Budget at its regular meeting on April 21, 2025.
The FY 2025-26 Budget includes a total revenue projection of $5,558,813 and a total expenditure request of $3,544,693, which is the third consecutive year that the Conference Center Operations Projected Revenue will exceed Operational Expenditures. The Conference Center Authority projected it will end up with a surplus of $125,815. In three (3) years since the Conference Center Authority’s Net Income was budgeted to be in the red by $238,000, the FY 2024-25 Net Income will end up with over $341,000 surplus.
The Conference Center Authority’s FY 2025-26 Budget includes a hotel occupancy projection of 67%. It is anticipated that FY 2024-25 year-end occupancies will be approximately 65%. The Bay Area's hotel occupancy still lags all other major market destinations in the United States, while industry experts are hopeful for a full recovery in the years 2026-27.
The Conference Center Authority’s expenditure request reflects a continuation budget; however, funds have been increased in A&G, Operations Services, and Sales and Marketing due to more business coming into the building than last FY and with the large inflation factor including contract labor, the current administration’s tariff policies and other uncertainties. Property taxes and lease budgets cover the Conference Center Authority’s requirements.
This year’s Capital Improvement Budget includes funds for ten (10) projects, including: A New Meat Slicer, Water Fountain Station Replacements, Replace Broken Herman Miller Executive Chairs, Air Wall Refurbishment, Six (6’) Event Tables, Purchase New Table Skirts, Dishwasher Replacement, Upgrade Front Office Area, HVAC Unit for the Oyster Point Room, Lobby Sunshades. The full list of Capital Improvement projects is included in the FY 2025-26 Budget Document and sets forth a proposal of $423,000 in expenditures.
The Conference Center Authority’s fund balance increased by $398,733 and the FY 2024-25 projected ending unrestricted fund balance is approximately $4,396,387 (which is back at pre-pandemic levels) and indicates that the Conference Center Authority can operate and pay its expenses without General Fund subsidies.
An overview of the FY 2024-25 Year End Budget and FY 2025-26 Proposed Budget is included in the table below:
FISCAL IMPACT
The South San Francisco Conference Center Authority Fiscal Year 2025-26 Budget approval will not impact the City’s budget as it does not include General Fund subsidies.
CONCLUSION
The South San Francisco Conference Center Authority recommends the Fiscal Year 2025-26 Budget to the City Council for their review and approval.
ATTACHMENT
Attachment 1: FY 2025-26 Proposed Budget