Monthly Financial Report - May 2015

Page updated on Jul 21, 2015 at 11:06 AM

Presented by City Manager Mark B. Jinks on July 16, 2015. 

Click here to read the original signed memo.

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 May, with one month remaining in the 2015 fiscal year, General Fund revenues somewhat recovered from the fall projections, as reported in the FY 2016 budget deliberation. That coupled with expenditure savings, including savings from the bond refunding, the City’s budget is in balance. In the attached statements of revenues and expenditures, bond refunding proceeds and expenses are included in May, 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. 

Although, City General Fund revenues are still projected to come in below the amount budgeted, revenues will at least equal or exceed the FY 2015 revenues projected when the FY 2016 budget was adopted; FY 2015 expenditures will be less than what was projected when the FY 2016 budget was adopted; and General Fund (GF) Fund Balance should increase by a yet-to-be determined amount by the time the FY 2015 books are closed and audit completed.

As of May 31, 2015, eleven months into the fiscal year, General Fund revenues totaled $474.5 million, or 73.1% of the budgeted revenue which is 0.1% above the four-year average of revenue received. The increase in revenue is primarily due to refunding bond proceeds, which provide savings and 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 was appropriated in June. After adjusting for the bond refinancing, the City revenues are 5.1% below the four year average. Although real property taxes appear to be 5.6% below the four-year average, it is important to note the due date for the first-half real property taxes are due on June 15th and the majority of the collections will not be reflected until next month.

As of May 31, 2015, General Fund expenditures totaled $532.0 million, or 82.0% of budgeted expenditures. After adjusting for expenditures related to the bond refinancing, the City has spent 1.9% more than the four-year average.  Personnel expenditures are 4.1% lower than the four-year average percent of budget spent to date, whereas non-personnel expenditures are 4.5% more than the average.  Overall, expenditures are still expected to come in below budget.

The economic indicator highlighted in this month’s report is Unemployment Rates and Alexandria Labor Force. 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.

Revenues

As of May 31, 2015, eleven months into the fiscal year, General Fund revenues totaled $474.5 million, or 73.1% of the budgeted revenue which is 0.1% above the four-year average of revenue received. The increase in revenue is primarily due to refunding bond proceeds, which provide savings and 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 was appropriated in June. After adjusting for the bond refinancing, the City revenues are 5.1% below the four year average. Although real property taxes appear to be 5.6% below the four-year average, it is important to note the due date for the first-half real property taxes are due on June 15th and the majority of the collections will not be reflected until next month. Revenue projections continue to remain consistent with the previous forecast. Noticeable variances in revenues are detailed in the table below.

 FY15 and Historic Monthly Revenues - May 2015

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

May YTD Revenues - May 2015

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

Revenue Variances in Detail

Revenue Variances in Detail - May 2015

Revenue Variances in Detail 2 - May 2015


Expenditures

As of May 31, 2015, General Fund expenditures totaled $532.0 million, or 82.0% of budgeted expenditures. The City spent 7.1% more than the four-year average, but this variance reflects the accounting for refunding bond expenses that were appropriated in June.  Adjusting for the refunding bond expenses, the City has spent 1.9% more than the four-year average, but 0.6% less of its budgeted expenditures than at this point in FY 2014.  The refunding bond expenses were adjusted in prior years and are used in this month’s report in order to compare expenditures in past years. Personnel expenditures are 4.1% lower than the four-year average percent of budget spent to date, whereas non-personnel expenditures are 4.5% 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 various departments with vacancies, General Cash Capital, and Cash Match for grants 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 - May 2015

Percent of budget expended is 0.6% lower than in FY 14, excluding Refunding Bond Expenses.

YTD Personnel Expenditures - May 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 4.6% below the four-year average.

YTD Non Personnel Expenditures - May 2015

YTD non-personnel expenditures are 2.5% higher than this point in FY14, 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 - May 2015


Economic Indicators

Unemployment Rates

Alexandria has the second lowest unemployment rate in the Washington Metropolitan Area in April 2015. While Arlington County had the lowest unemployment rate of 2.9%, the District of Columbia had an unemployment rate of 6.7%, the highest among the jurisdictions that make up the metropolitan area and was the only jurisdiction with a rate higher than the national rate of 5.4%. The remaining jurisdictions in the area had rates ranging from 4.8% in Prince George’s County to 3.6% in Fairfax County and Loudoun County. All jurisdictions had lower unemployment rates in April 2015 than in April 2014. 

Alexandria Labor Force

The total civilian labor force (not seasonally adjusted) is 94,524 in April 2015 of which 91,339 were employed and 3,185 were unemployed. When comparing April 2015 to April 2014, the City’s labor force increased by 2.1%, the number of individuals employed increased by 2.3%, and the number of individuals unemployed decreased by 3.5%. Although these indicators show positive signs on the economy, it is important to note that based on data from the Virginia Employment Commission more than half of the growth in the number of individuals employed have been attributed to the food service and retail industries which has the lowest average salaries by industry type.

 Regional Unemployment Rates - May 2015

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

Regional Unemployment Rates 2 - May 2015

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

Alexandria Labor Force 2- May2015

Source: Virginia Employment Commission

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