Monthly Financial Report for the Period Ending November 30, 2010

Presented as a memo to City Council from City Manager James K. Hartmann on January 11, 2011. 

Download Original Signed Memo (PDF)

NOTE:  Click on the headings below or the "online references" to view more detailed economic, revenue or expenditure data.  Click on any highlighted bullet or text to view additional information, including charts and memos.

ECONOMIC HIGHLIGHTS:  

• The Federal Reserve announced that it expects the economy to grow at a rate of 3.0-3.6 percent in 2011.   In real terms, in the 4th quarter 2010, the size of the economy finally should exceed its previous peak in 2007.  However, most of this growth is due to federal expenditures.
• Alexandria’s economy clearly is improving.  Transient Lodging, Meals Tax, and Sales Tax collections continue to be higher than last year’s collections.
• CY 2011 assessed values should be at or perhaps above the preliminary projected 1.7 percent assessment increase announced in October.  
• On December 17, Governor McDonnell introduced his amendments to the current 2012-2012 biennium budget.  There were few significant implications to Alexandria’s budget other than some possible reductions to Comprehensive Services Act funding for foster care and special education services to disadvantaged youth and some other non-General Fund social service revenues.

REVENUE HIGHLIGHTS:  

Year-to-Date Revenues: As of November 30, 2010, actual General Fund revenues totaled $253.1 million, which is 1.7 percent higher than FY 2010 revenues for the same period last year.  Most of this increase is related to the other local taxes category.

• Business License Tax: The increase in this category reflects a change in the timing of payments due to an increase in the number of businesses on quarterly payment plans.
• Licenses and Permits:   The category decrease is due to the transfer of approximately $3.8 million in new construction fees from the General Fund to a special revenue account beginning July 1, 2010, where they will be used to cover the cost of Code Enforcement’s New Construction Division, which is now self-financed from these permit fees.
  

EXPENDITURE HIGHLIGHTS:  

Year-to-Date Expenditures: As of November 30, 2010, actual General Fund expenditures totaled $187.9 million, an increase of $4.9 million, or 2.7 percent, above expenditures for the same period last year. Personnel expenditures remain on par with last year.  These personnel expenditures are just slightly higher than the budget primarily because turnover savings are deducted from the budget on the first day of the fiscal year, while the savings are realized during the year.  Also, funds to pay for the implementation of pay adjustments due to the Watson Wyatt Study, which were effective July 1, 2010, were appropriated in the supplemental appropriation ordinance in December and will be reflected in the December report presented next month. Non-personnel spending increased 4.1 percent. For most departments, differences in spending patterns for non- personnel this early in the year reflect the timing of bill payments and not necessarily changes in spending patterns.  We are closely monitoring and controlling these expenditures to be at or below budget.

• Fire:  The Fire Department is projected to be as much as $0.7 to $1.0 million over budget due to overtime expenditures, primarily due to a large number of firefighter and medic vacancies in the department.  Recruits to fill the vacancies have been hired but are still in training and are not expected to go on the street until late this fiscal year.  The size of the overall deficit may be less if these recruits complete their training sooner.  The department will continue to monitor overtime and other expenditures and revise the projections as needed.
• Debt Service:  The increase reflects budgeted debt service for bonds issued in June 2009.
• Schools:   The City will provide approximately 76 percent of the estimated funds required to operate the City public school system in FY 2011. 
  

ONLINE REFERENCES (ATTACHMENTS):

• Online Reference 1: The Economy 
• Online Reference 2: Comparative Statement of Revenues 
• Online Reference 3: Comparative Statement of Expenditures