AGENDA DATE: 10/7/2015
TITLE:
Title
FY 15 Unaudited Annual Financial Report (UAFR) and FY 15 Annual Economic Indicators Report (AEIR)
BODY
SUBJECT/PROPOSAL/REQUEST: FY 15 Unaudited Annual Financial Report (UAFR) and FY 15 Annual Economic Indicators Report (AEIR)
ITEM TYPE: Regular Information Item
STAFF CONTACT(S): Foley, Letteri, Davis, Burrell, Breeden, L., and Allshouse, S.
PRESENTER (S): Betty Burrell
LEGAL REVIEW: Yes
REVIEWED BY: Thomas C. Foley
BACKGROUND: The attached FY 15 Unaudited Annual Financial Report (UAFR) (Attachment A) provides preliminary information about the County’s General Fund operations and Fund Balance as of June 30, 2015. The attached FY 15 Annual Economic Indicators Report (AEIR) (Attachments B and C) provides an overview of general economic conditions in the County in FY 15, as well as a forecast of these conditions in FY 16.
STRATEGIC PLAN: The UAFR supports the County’s Mission: To enhance the well-being and quality of life for all citizens through the provision of the highest level of public service consistent with the prudent use of public funds. The AEIR supports the Aspiration/Goal of Economic Prosperity.
DISCUSSION:
Unaudited Annual Financial Report
The attached Unaudited Annual Financial Report (UAFR) provides preliminary information about the County’s General Fund operations and Fund Balance as of June 30, 2015. The attached Annual Economic Indicators Report (AEIR) (Attachments B through D) provides an overview of general economic conditions in the County in FY 15.
The UAFR reflects year-end data through June 30, 2015, the end of FY 15. The revenue information in the attached UAFR is organized in a way that is consistent with the revenue section of the County’s budget document. Expenditure data is presented following the format of Exhibit 12 of the County’s Comprehensive Annual Financial Report (CAFR). Line item titles in the UAFR match the line item titles in these two documents. The columns in the UAFR show FY 15 Adopted Budget revenues and expenditures, Revised Budget revenues and expenditures, as well as Year End actual revenues and expenditures. Each of these Year End figures subsequently is expressed as a dollar difference from, as well as a percentage of, the amount of the relevant dollar amount in the FY 15 Revised Budget.
Highlights of the attached report include:
Details of the significant revenue and expenditure variances are found on pages 2-4 of the UAFR.
FY15 Fund Balance & Use of FY15 Fund Balance
The General Fund estimated FY15 ending fund balance will be approximately $39,521,031. After reserving the portion of fund balance necessary to maintain the County’s 10% fund balance policy and future approved/planned uses of fund balance, the anticipated balance of $3,050,788, which is equal to 1.25% of the FY 15 General Fund budget, will be available for FY 17 budget, capital projects, or other uses.
The Schools Division estimated FY15 ending fund balance will be transferred to the General Fund-School Reserve fund balance in accordance with the County’s fund balance reserve policy. The $2,816,261 estimated fund balance is below the 2% maximum reserve and will be available for School Division purposes subject to appropriation by the Board of Supervisors.
Annual Economic Indicators Report
The FY 15 Annual Economic Indicators Report provides an initial overview of general economic conditions in Albemarle County at the end of the fiscal year, and presents a preliminary glimpse of the expected state of the economy in FY 16. Table I allows a multiyear comparison of data. Highlights from the report include:
§ General economic activity, as measured by the preliminary tax revenues in six representative streams, appears to have risen overall at a fairly robust rate. Changes in these streams ranged from -3.94% in Inspection Fees to +24.05% in Transient Occupancy Tax. Note that these figures are tentative and subject to revision. The information in Table I suggests that the County’s economy grew generally at a relatively strong pace in FY 15.
§ Albemarle County’s average monthly unemployment rate declined from 4.65% in FY 14 to 4.26% in FY 15. This 0.39 percentage point (pp) drop in the rate, while encouraging, still did not bring down the County’s unemployment rate to the 3.0% rate that staff currently considers to be the “frictional” unemployment rate. In FY 16 the average monthly unemployment rate is expected to be 4.31%. Technically this number would be a slight increase over the FY 14 figure, but the projected rise actually could mask an improvement in the labor market since, as the County’s jobs base grows, people who previously dropped out of the market might return to seek employment and, consequently, would be included again in the official unemployment numbers during the time that they look for work.
§ The average monthly total number of jobs in Albemarle County appears to have grown between FY 14 and FY 15. This situation represents a reversal of the net loss that occurred between FY 13 and FY 14. The County is estimated to have experienced a net gain of 544 positions between FY 14 and FY 15, with the number of positions rising from 50,246 to 50,790. Note that the FY 15 total jobs number is an estimate because final numbers are not yet available from the VEC, and the nature of the jobs data is such that the total figures do not necessarily reflect a rise in full-time, permanent positions. The projection for FY 16 is that the County will experience a net gain of 1,264 jobs, resulting in a total jobs base of 52,054. This performance would be the best since FY 12, when the County gained 1,072 positions over the previous fiscal year. Note, also, that jobs data is by place of employment while the unemployment rate, discussed previously, is by place of residence. The two numbers can sometimes move in the same direction.
BUDGET IMPACT:
Revenue and expenditure data contained in the UAFR reflect the state of the County’s budget-to-actual performance as of June 30, 2015.
Data shown in the AEIR reflect economic variables that impact the County’s current and future revenues and expenditures.
RECOMMENDATION:
Recommendation
This report is for information only and no action is required by the Board
ATTACHMENTS:
A - Unaudited Annual Financial Report
B - Annual Economic Indicators Report
C - Annual Economic Indicators Report - Table I