Monthly Financial Report -- February 2011

Page updated on May 2, 2011 at 11:34 AM

Presented as a memo to City Council from City Manager James K. Hartmann on April 12, 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:  

  • National unemployment reached a 23 month low of 8.8 percent but is still at an historically high level.
  • The national consumer price index increased for the fourth straight month to 2.1 percent.   The core CPI excluding food and energy increased by 0.1 percent to 1.1 percent. 
  • New Business Licenses continue to trail the previous years’ applications.   The three month average through February of 49 is 27.5 percent below this time last year. 
  • Sales and meals tax monthly revenues are up from last year, but transient lodging decreased. Meals tax revenues in November 2010-January 2011 are 5.5 percent higher than November 2009-January 2010.  The three month average for November-January sales tax receipts is up 2.9 percent over the previous year.  Both the transient lodging tax on hotel room rates and the $1 per room fee decreased over the prior year three month period by 5.4 percent and 5.2 percent respectively.  Hotels report that part of this decrease relates to the possible federal government budget impasse-related shutdown, which has caused government agencies and contractors to reduce their travel and training plans.
  • Both residential real estate sales volume and price improved in February.   The three month number of units sold is 28.8 percent higher than last year, and the three month average sales price is 6.0 percent higher.   

REVENUE HIGHLIGHTS:  

Year-to-Date Revenues: As of February 28, 2011, actual General Fund revenues totaled $301.7 million, which is 3.6 percent higher than FY 2010 revenues for the same period last year.  Most of this increase is related to the other local taxes category, which is up 7.0 percent over last year.  The FY 2012 Proposed Budget contains a revised estimate for FY 2011 revenues.  That estimate shows a revenue surplus of $12.5 million or 2.3 percent compared to the original FY 2011 budget estimate of General Fund revenues for $526.1 million, primarily due to real property revenues (due to higher assessments than previously forecast).  As discussed at the October Council Retreat, this surplus was set aside primarily for capital.

  • Business License Tax:  The City’s business license tax was due March 1, 2011.  Collections-to-date in the amount of $11.6 million represent a difference in the timing for payments made by businesses (i.e., paid in late February).  Collections, while higher than in FY 2010, are still being tabulated.  No conclusions about current year collections will be available until the tabulation is complete.
  • Licenses and Permits:  The category decrease is due to the transfer of approximate $3.8 million budget for 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.
  • Revenue from the Federal Government: The City has received $1.2 million in FY 2011 for the Build America Bonds subsidy as compared to $0.4 million in FY 2010.

EXPENDITURE HIGHLIGHTS:  

Year-to-Date Expenditures:  As of February 28, 2011, actual General Fund expenditures totaled $308.1 million, an increase of $11.8 million, or 4.0 percent, above expenditures for the same period last year. The revised budget reflects amounts that were appropriated in the supplemental appropriation ordinance approved in December.  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.  Non-personnel spending increased 5.7 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:  As discussed orally at the January 11, 2011 City Council meeting, the Fire Department is projected to be over budget due to overtime expenditures, primarily due to a large number of firefighter and medic vacancies in the department during the first half of the year The Fire Department is projected to be as much as $1.2 to $1.5 million over budget.  While rate of overtime expenditures has slowed with the ability of the department to use the new recruits to staff shifts instead of using overtime, the department provided unbudgeted staff to respond to a large fire in Prince William and Prince George’s Counties as well as to the February snow emergency.
  • Debt Service:  The increase reflects budgeted debt service for bonds issued in June 2009.  A portion of the interest cost ($1.2 million) is reimbursed from the federal government as part of the Build America Bond program.
  • Schools:  The City currently provides approximately 76 percent of the estimated funds required to operate the City public school system in FY 2011. 

ONLINE REFERENCES (ATTACHMENTS):

 

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