COUNTY OF ALBEMARLE

 

EXECUTIVE SUMMARY

 

 

AGENDA TITLE:

FY10 First Quarter Financial Report

 

SUBJECT/PROPOSAL/REQUEST:

First Quarter Financial Report for the three months ending September 30, 2009

 

 

STAFF CONTACT(S):

Messrs. Tucker, Foley, Davis, Wiggans, and Walters, and Ms. Vinzant

 

 

LEGAL REVIEW:   Yes

 

 

AGENDA DATE:

December 02, 2009

 

ACTION:                  INFORMATION:   

 

CONSENT AGENDA:

  ACTION:                INFORMATION:    X

 

 

ATTACHMENTS:   Yes

 

 

REVIEWED BY:

 

 

BACKGROUND:

The attached Financial Report provides information on the County’s General Fund operations and Fund Balance as of September 30, 2009.  The financial report includes a bar chart that compares current fiscal year revenue and expenditure data with data from the previous fiscal year.

 

STRATEGIC PLAN:

Goal 5: Fund the County’s future needs.

 

DISCUSSION:

($ in Millions)

  1. Attachment A: General Fund Financial Report:
    1. Revenues:

Revenues, excluding Transfers and Fund Balance Appropriations, are estimated to total $211.333 million; $5.731 million (2.6%) less than revised appropriations (hereinafter “Budget”).  Combined with the use of $2.541 million in transfers from other funds and $0.146 million in fund balance; Revenues, Transfers, and Use of Fund Balance will total $214.020 million; $5.802 million (2.7%) less than Budget.

 

Most national indicators suggest the recession is nearing an end, with some analysts suggesting the economy may have already hit bottom.  However, once the recession ends, the recovery is expected to be very slow by historical standards, particularly in the labor market.  Nationally, the October unemployment rate jumped to 10.2%, the highest since 1983.  In Virginia, the unemployment rate for September was 6.6%.  The bottom is near for output, not employment.  Leading indicators, consumer confidence, and manufacturing benchmarks demonstrate improvement.  Inflation and the federal funds target rate remain very low. 

 

Following is a brief revenue analysis for the FY10 fiscal year:

·         Real Estate Tax revenues, without one-time estimated revalidation collections, are projected to be $1.428 million (1.3%) less than appropriations.  The Budget was prepared based on an estimated negative reassessment rate of 2.0%.  The 2010 reassessment rate is now estimated to be a negative 3.75%.

 

·         Personal Property Tax revenues are estimated to be $1.397 million (6.6%) less than Budget.  The decrease is due to a decline in values and consumer spending.  The impact of the Cash for Clunkers program is thought to be minimal, merely accelerating the timing of purchases that would have happened naturally.  NADA has indicated that January 2010 values should approximate January 2009 values.  Business equipment spending appears to be starting a slow process of recovery.

 

·         Delinquent Property Taxes & Fees are estimated to exceed Budget by $0.138 million (6.3%).  Delinquent fees implemented in FY08 and FY09 have improved delinquent tax collections.

 

·         Sales Tax revenues are estimated to be $1.000 million (8.0%) less than Budget.  Taxpayers continue to minimize discretionary spending due to economic uncertainty. However, economic sources believe that discretionary spending will increase in 2010.  It should be pointed out that increased business development in surrounding localities has shifted taxable sales from Albemarle to these other localities.

 

·         Business License, BPOL, revenues are estimated to be $0.591 million (5.9%) less than Budget. BPOL revenues are dependent upon economic activity.

 

·         Utility Tax revenues are estimated to be $0.828 million (8.8%) less than Budget.   The decrease is primarily due to decreased industrial and commercial activity combined with moderate weather.

 

·         Food and Beverage Tax revenues are estimated to be $0.350 million (6.1%) less than Budget.  Consumers are continuing to eat more at home and visiting restaurants less frequently while minimizing discretionary spending.

 

·         Other Local Tax revenues are estimated to be $0.739 million (7.2%) less than Budget.  Public service tax, vehicle license fees, transient occupancy fees, and recordation fees continue at a pace less than Budget due to current economic conditions.

 

·         Other Local Revenues are estimated to exceed Budget by $0.664 million (15.9%).  The surplus is primarily due to increased development fees, agency leases, and other Clerk fees, offset by reduced interest earnings.

 

·         State Revenues are estimated to be $0.390 million (1.7%) less than Budget.  The Governor’s reduction actions exceeded estimates anticipated during the Budget preparation process.

 

·         Federal Revenues are estimated to exceed Budget by $0.191 million (4.6%) due to greater than anticipated public assistance reimbursements.

 

·         Categories with variances of less than $0.100 million have not been analyzed for this report.

 

    1. Expenditures:

The Office of Management and Budget estimates that total fiscal year expenditures, including transfers, will be $214.020 million; a $5.802 million (2.7%) savings from Budget.   The savings include frozen positions, operational savings, and reduced transfers, including schools and capital.

 

                                          i.    Departmental expenditures are expected to total $80.724 million; a 1.1% savings of $0.886 million from Budget: 

·         Administration expenditures are expected to total $10.610 million; a savings of $0.213 million.

·         Judicial expenditures are expected to total $3.800 million; a savings of $0.019 million.

·         Public Safety expenditures are expected to total $28.882 million; a savings of $0.231 million.

·         Public Works expenditures are expected to total $4.823 million, a savings of $0.048 million.

·         Human Services expenditures are expected to total $19.163 million; a $0.079 million increase.

·         Parks, Rec. & Culture expenditures are expected to $6.402 million; a savings of $0.001 million.

·         Community Development expenditures are expected to total $7.044 million; a savings of $0.453

·          million.

 

                                         ii.    Non-Department expenditures consisting of the revenue sharing payment, reserves, and refunds are expected to total $18.365 million; a $0.010 million, 0.1% increase from Budget.

 

                                        iii.    Transfers are expected to total $114.931 million; a 4.1% savings of $4.927 million from Budget:

·         Transfers to the School Division are expected to total $96.732 million, a 3.4% savings of $3.418 million.

·         Transfers to the Capital and Debt funds are expected to total $18.199 million; a savings of $1.509 million.

 

    1. Revenues less Expenditures:

This report indicates expenditures will match revenues for the fiscal year.

.

  1. Attachment B: General Fund Budget Comparison Report:

      The chart report tracks changes in revenues and expenditures over time.

 

                  Revenues:

·         Other Local Taxes, Other Local Revenues, and Transfers from Other Funds show positive growth over FY09. 

·         Real Estate Tax, Personal Property Tax, Sales Tax, Business Licenses, Utility Taxes, State Revenues, and Use of Fund Balance show decreases from FY09.

·         Food and Beverage Tax and Federal Revenues are approximately equal to FY09.

 

                        Expenditures:

·         Administration, Judicial, Public Safety, Public Works, Human Services, Parks & Culture, Non-Departmental, and Education show anticipated increases over FY09.

·         Community Development and Non-School Transfers show anticipated decreases from FY09.

 

  1. Attachment C: Fund Balance Report:

The report indicates that the County:

·         Had a Preliminary Audited FY09 Fund Balance of $19.854 million as of June 30, 2009,

·         Appropriated $0.146 million for Budgeted FY10 Initiatives,

·         Resulting in a remaining June 30, 2009 Fund Balance of $19.707 million,

·         Subsequently reappropriated $0.968 million for uncompleted FY09 projects, and

·         Has Preliminary Projected Unobligated Funds of $18.739 million as of December 2, 2009.

 

  1. Budget Impact:

This Financial Report is based on preliminary (pre-audited) operations for FY09 and three months of financial data for FY10.  The financial information contained in the second quarter FY10 financial report to be presented to the Board in February 2010 will include final audited figures for FY09 plus six months of FY10 financial data.  Staff will utilize these figures as the basis for the FY11 Budget.

 

 

RECOMMENDATIONS:

This report has been prepared for your information.  No action is required.

 

 

ATTACHMENTS;

A – General Fund Quarterly Financial Report

B – General Fund Budget Comparison Report

C – General Fund Balance Report
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