Monthly Financial Report - April 2015

Page updated on Jun 12, 2015 at 3:09 PM

Presented to City Council by City Manager Mark B. Jinks on Wednesday, June 10, 2015.

Click here to download to original report.

Report Summary

Both General Fund revenues and expenditures track similarly to previous months in the 2015 fiscal year. Slow revenue growth due to the regional economic slowdown continues to be a concern that staff carefully monitors. At the end of April, with two remaining months in the 2015 fiscal year, City General Fund revenues are still projected to come in below the amount budgeted.  However, the amount of expenditure savings currently projected for year-end is expected to be sufficient to keep expenditures below projected revenues and therefore the City’s budget is in balance. Staff will continue to monitor this and adjust expenditures as necessary.  In the attached statements of revenues and expenditures, bond refunding proceeds and expenses are included in April, however they have been excluded from the body of the report in the current year and prior years due to amounts and timing varying from year-to-year and therefore  distort revenue and expenditure analysis.

As of April 30, 2015, ten months into the fiscal year, General Fund revenues totaled $432.9 million, or 66.8% of the budgeted revenue which is 2.9% above the four-year average of revenue received. After adjusting to exclude debt proceeds received through the bond refinancing, the City revenues are 2.4% below the four year average. Property taxes have not changed materially since last month. The next significant collections for property tax will occur in June when the first-half real property taxes are due. Revenue projections continue to remain consistent with the previous forecast. Noticeable variances in revenues including Business License, Communication Sales and Use, Real Estate Recordation, Admissions, Other Local Taxes, Revenue from the Fed. Government, Revenue from the Commonwealth, Fines and Forfeitures, License and Permits, Revenue from Use of Money and Property, and Other Revenue are detailed in the Revenue section of the report.

As of April 30, 2015, General Fund expenditures totaled $495.0 million, or 76.4% of budgeted expenditures. After adjusting for expenditures related to the bond refinancing, the City has spent 2.7% more than the four-year average.  Personnel expenditures are 4.4% lower than the four-year average percent of budget spent to date, whereas non-personnel expenditures are 4.4% more than the average.  Overall, expenditures are still expected to come in below budget, as well as below the revenue projection.

The economic indicator highlighted in this month’s report is the unemployment rate. Additional economic, revenue, and expenditure charts are also available on the City of Alexandria website at: alexandriava.gov/FinancialReports. Attached are General Fund revenue and expenditure tables produced by the Finance Department.

Revenues

As of April 30, 2015, ten months into the fiscal year, General Fund revenues totaled $432.9 million, or 66.8% of the budgeted revenue which is 2.9% above the four-year average of revenue received. The increase in revenue is due to refunding bond proceeds, which are used to purchase the refunded bonds listed on Attachment 2 of the comparative statement of expenditures and transfers by function. The budget for the refunding bond proceeds has not been appropriated and will be appropriated in June. After adjusting for the bond refinancing, the City revenues are 2.4% below the four year average. Property taxes have not changed materially since last month. The next significant collections for property tax will be in June when the first-half real property taxes are due. Revenue projections continue to remain consistent with the previous forecast. Noticeable variances in revenues including Business License, Communication Sales and Use, Real Estate Recordation, Admissions, Other Local Taxes, Revenue from the Fed. Government, Revenue from the Commonwealth, Fines and Forfeitures, License and Permits, Revenue from Use of Money and Property, Other Revenue are detailed in the table below.

FY15 and Historic Monthly Revenues - April 2015

*4-year average data comes from FY 2011 - FY 2014 data.

April YTD Revenues

*4-year average data comes from FY 2011 - FY 2014 data.

NOTE: Revenue charts exclude refunding bond proceeds so that revenues can be compared accurately year to year.

Revenue Variances in Detail

Revenue Variances in Detail - April 2015

Revenue Variances in Detail - April 2015 2


Expenditures

As of April 30, 2015, General Fund expenditures totaled $495.0 million, or 76.4% of budgeted expenditures. The City spent $74.1 million dollars over the month of April, but $33.8 million was spent on refunding bond expenses of which the budget has not yet been appropriated (this is an item in the June supplemental ordinance).  As attachment 2 indicates, the City has spent 8.0% more than the four-year average, but this variance is skewed by the size and timing of the accounting for refunding bond expenses.  Adjusting for the refunding bond expenses, the City has spent 2.7% more than the four-year average, but 0.4% less of its budgeted expenditures than at this point in FY 2014.  Expenditures adjusted for the refunding bond expenses are used in this month’s report in order to compare expenditures to past years. Personnel expenditures are 4.4% lower than the four-year average percent of budget spent to date, whereas non-personnel expenditures are 4.4% more than the average. The charts below compare the current fiscal year to last year’s percent of budget expended for non-personnel, personnel, and total expenditures. Noticeable variances in expenditures from the four-year average include departments with vacancies, Housing, Cash Capital, and Cash Match for grants. Variances are detailed in the table below. Overall, the City is still on track to keep expenditures within budget for FY 2015, but expenditures continue to be monitored to ensure that the City’s expenditures remain lower than revenue collected.

FY15 vs FY14 YTD Expenditures - April 2015

Percent of budget expended is 0.4% lower than in FY 14, excluding refunding bond expenses.

YTD Personnel Expenditures - April 2015

At this point in the fiscal year, the City YTD personnel costs are 2.8% lower than this month last year. These costs have been consistently lower than in FY 2014. Salaries and benefits are 4.4% below the four-year average.

YTD Non-Personnel Expenditures - April 2015

YTD non-personnel expenditures are 3.2% higher than this point in FY 14, excluding refunding bond expenditures.

NOTE: Refunding bond expenditures are not included in charts so that expenditures can be compared year to year.

Expenditure Variances in Detail

Expenditure Variances in Detail - April 2015


Economic Indicators

Unemployment Rate

Alexandria's unemployment rate (not seasonally adjusted) declined year-over-year to 3.6% in March 2015 from 3.9% in March 2014, and the number of employed increased by 1,614 persons over the same period. The State unemployment rate (seasonally adjusted) has remained relatively flat since November 2014 and stands at 4.8% as of March 2015, indicating that job creation is barely keeping up with and perhaps even slightly lagging behind growth in the labor force.  The U.S. unemployment rate (seasonally adjusted) declined again in the first quarter of 2015 to 5.5% as of March 2015, a significant year-over-year decrease from the March 2014 rate of 6.6%. This was the second such year-over-year decrease in a row.

Unemployment Rate - April 2015

Source: U.S. Department of Labor, Bureau of Labor Statistics

Through March 2015

*Alexandria unemployment is not seasonally adjusted, while U.S. and Virginia are seasonally adjusted.

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