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Home My WebLink About101607 TOWN HALLTown Hall Meeting Town Hall Meeting City Budget, City Budget, Community Choices Community Choices October 16, 2007 “Our community’s budget confronts big questions that affect all citizens. As the city changes, its needs change. It’s important that we hear what the public thinks about these important issues and offer an opportunity to exchange ideas” Mayor Meyera Oberndorf 2 What is the City’s budget? ? A great many think the budget is all about real estate taxes. ? In reality, it is about meeting the expectations of our citizens. ? We see the City’s budget as delivering services. . . + + + + + +++ 3 Budgetary Boundaries ? Dillon Rule –We can do what the General Assembly allows us to do . . . and no more ? The Budget Must Balance ? School Budget: Revenue Sharing Formula ? Personnel Laws ? Council Policies & Dedications ? State & Federal Mandates 4 Where the money comes from . . . Federal $1,723 M $111.0 State 6% FY08 $494.9 29% Real Estate $493.2 29% Other Taxes 262.4 Personal 15% Property $138.5 8% Permits, Fines & Charges OPERATING BUDGET $223.0 13% 5 Revenue Projections for the General Fund FY 08FY 08 FY 09 FY 10 AdjustedProjectedProjected Original Real Estate$ 474.9$ 471.5$ 485.6$ 500.2 Personal Property137.0130.9136.4143.7 General Sales55.756.859.362.2 Utility42.239.640.040.5 Business License45.041.944.446.9 Franchise 4.75.35.65.9 All other local revenue153.1155.6159.1160.6 State90.0*90.090.490.4 Federal25.025.025.225.3 Total General Fund$ 1,027.6$ 1,016.6$ 1,046.0$ 1,075.7 -11 million+1.8%+2.8% *still assessing impact of Governor’s recent cuts 6 Regional Real Estate Tax Rates Rate Reduction 2008 Real Estate Tax CityRateSince 2004 Portsmouth$1.2619¢ Norfolk$1.1129¢ Newport News$1.1017¢ Hampton$1.0621¢ Chesapeake$1.0622¢ Suffolk94¢14¢ Beach89¢33¢ Virginia 7 Personal Property Tax Rates in Hampton Roads TAX RATETAX ON PER ASSESSMENT PERCENT$10,000 LOCALITY$100 BASEOF RETAILVEHICLE Portsmouth$5.00 Loan Value78%$390.00 Norfolk $4.50 Loan Value78%$351.00 Suffolk $4.25 Loan Value78%$331.50 Hampton$4.25 Loan Value78%$331.50 Newport News$4.25 Loan Value78%$331.50 Chesapeake$4.00 Loan Value78%$312.00 Virginia$3.70 BeachLoan Value78%$288.60 Prince William County$3.70 Average Trade-In 87%$321.90 8 Where the money goes . . . to provide services . . . Both City and Schools Financial & Administration FY08 4.0% Debt Service Education as a % of Budget 6.3% Virginia Beach50% Economic Vitality Hampton47% 4.4% Chesapeake44% Health & Human Newport News39% Services Norfolk32% 7.9% Portsmouth31% Suffolk29% Museums, Recreation, Open Space & Libraries Education 4.7% 50.0% Building & Infrastructure Maintenance $1,723 M 8.2% Trash Collection 1.7% Public Safety Transportation 11.4% 1.4% 9 Major types of expenditures . . . Debt Service FY 08 Both City and Schools 9% CIP Pay-go 4% Operations 25% Personnel 62% $1,723 M 10 FY08 Budget -City Only Debt Service $110,234,729 $861M 13% Capital Outlay $8,381,901 1% Personnel $437,681,090 51% Operating 6,299 FT Accounts 670.18 PT $304,785,407 35% Miscellaneous Management FICA Fringe Benefits 8% 5% Retirement Fringe Benefits 0% >1 11% 26% Life Insurance 1% Professional & Health Insurance Technical Contracted 9% 24% Manpower Other Personnel 2% Costs Skilled & 2% Supervisory Unskilled 7% Full-time 9% Overtime 67% 2% Clerical Protective 6% Part-time Services 3% 18% by Account Structureby Type of Employee 11 FY 2008 Budget -City Only Debt Service 13% Capital Outlay 1% Personnel 51% Operating Accounts Medical Svcs & Supplies Supplies 35% Technology 12% 2% SupportVisitor Promotion & Miscellaneous 3%Events 2% 4% Bld Maint. & Repair Refuse Disposal 2% 4% Print Shop 1% Public Assistance City Garage 15% 6% Contractual Detention Services Services 1% 14% Insurance 7% $305M Tax Exemption 5% Utilities Contributions to 17% Outside Agencies Employee Training 4% 1% 12 FY 2008 Budget -City Only Debt Service 13% Capital Outlay 1% Personnel 51% Operating Accounts Outstanding Debt By Purpose 35% Projected to June 30, 2008 (Total Debt $1.215 Billion) Storm Water 1.7% Water and Sewer 14.4% General Government 57.5% Schools 24.2% $110M Agriculture Reserve Program 13 2.2% Growth in Services AnnualGrowth Rates2000-2005 Population 0.5% Medicaid Recipients6.4% Food Stamp Cases5.8% Fire & Emergency Calls5.2% Prisoners4.8% Foster Care Cases3.0% Number of Vehicles2.2% Police Officers & Fire Fighters1.9% Special Education Students1.4% Households0.9% Police Calls0.8% Children Receiving Child Care0.8% 14 Under Funded State Programs There are $ 464.6 million in mandates in the budget, however only $123 $341.7 million in revenue to cover them 20% City Treasurer’s Office$ .9 Courts$ .9 Commonwealth Attorney$ 1.1 State Health Department$ 2.7 Human Services$ 22.5 State Recycling Requirements$ 5.6 Storm Water Management $ 14.0 Requirements Sheriff & Jail Operations$ 10.1 Schools$ 161.4 Local Choice vs. “Must Fund” State Funding Shortfall$ 219.2M creates = 40¢on Real Unfunded Mandates Estate Tax Rate 15 So what does it all mean? $ 1,046.0 million FY 09 Projected Revenues: General Fund only Less: Schools portion of the revenue sharing formula395.7 million City debt service44.5 million All other Council dedicated revenues61.3 million Tax Relief for the Elderly15.0 million City Compensation (includes previous year rollover)11.5 million GASB 45 requirement: health care liability7.7 million Amount available for departments$ 510.3 million Current year’s budget for departments $ 528.1 million (including inflation) Potential impact to services($ 17.8 million) Increased CIP pay-as-you-go($10.0 million) Potential impact to services ($27.8 M) 16 Community Demographic Trends . . . 2000 to 2006 ? Household income is $61,333 in 2006, up from $48,705 in 2000. ? Families in poverty remains flat from 5.1% in 2000 to 5.4% in 2006. ? Elderly in poverty has declined from 4.7% to 2.6%. ? Children in poverty increased from 8.6% to 10%. ? There are more women than men (51.1% vs48.9%). ? Elderly as a percentage of population is up from 8.4% in 2000 to9.8%. ? Below age 18 population has dropped from 27.5% to 26.2%. ? Percent of the population who drives alone remains virtually constant from 82% to 81.8%. ? High School graduation has improved from 64.9% to 82.7%. ? 31.1% of the population has a college education vs. 28.1% in 2000. ? Crimes per 1000 population has decreased from 41.8 to 33.6 17 Community Economic Trends . . . ? Slowdown in Housing Market ? Credit market is in flux ? Foreclosures are up 25% from last year ? ARMs are resetting to higher percentages ? Residential building permits are down ? Vehicle registrations are flat ? Inflation has increased from 2.5% to 3.7% ? Unemployment remains lower than state & national levels ? Energy costs are increasing ? Tourism & Military stabilizing factors ? Discretionary spending uncertainty 18 Initial Budget Initiatives for the Next Budget Year ? Review of all City vacancies ? “Zero-basing”all operating accounts ? Departmental targets set at 94% of need ? Simplifying accounting structure ? Expanding use of performance monitoring to ensure results 19 Questions for Tonight . . . 1.The budget is a reflection of the community’s needs and choices about services . . . a.In our community, are there services that can be reduced or should be added? b.What changes and/or needs within the community should we be anticipating? 2.What alternatives to the real estate tax might we consider? 3.What other budget initiatives can you recommend? 20