2 February 5-6, 2016

Transcription

1 February 5-6, 2016

2 Our Priorities for the Community Fiscal Responsibility and Reducing the Tax Burden Education Infrastructure Economic Development Public Safety Service Excellence Annual Planning Meeting February 5-6,

3 Each year, the Board adopts a budget anchored by its financial policies and bond enhancement strategy. In 2015, these efforts were recognized by all three ratings agencies. S&P: Upgraded to AAA Fitch: Upgraded outlook from stable to positive Moody s: Upgraded to Aa1 3

4 We Are a Responsible, Accountable Stafford maintains lowest cost per capita compared to our six peer localities. Annual Planning Meeting February 5-6,

5 Stafford facilitated the addition of over 500,000 square feet of new, or newly built out, space for more than 100 businesses/developers in Stafford s jobs grew to over 41,358 in Over the last 10 years, business revenue has increased by 60% - reaching nearly $75 million in Virginia Employment Commission reports that the County s unemployment rate dropped to 3.8% in December. 5

6 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% Stafford Leads Peers in Job Creation (%Cumulative Growth of Average Employment) Source: Virginia Employment Commission (2Q2005-2Q2015) Stafford Loudoun Prince William Spotsylvania Albemarle Hanover Fauquier -5.00% %

7 Note: Assumes level population and inflation growth in future years, and current estimated FY17 revenues. 7

8 Real Estate Assumes effective rate, new growth of 2% Personal Property Based on reports from the National Automobile Dealers Association (NADA), depreciation of older cars is expected to be at normal levels. NADA reports that new cars sales are robust nationwide. Stafford continues to see healthy, but more modest growth. Annual Planning Meeting February 5-6,

9 Consumption Taxes Sales tax 2% higher than FY15 Meals tax 8% higher than 15 We believe the additional retail and dining options opened in the County have contributed to this trend. FY17 projections assume that these revenues will be higher than FY16 budget, reflecting current trends. Annual Planning Meeting February 5-6,

10 Development Fees Recordation Taxes Activity is strong in the current year. FY17 projections assume the trend continues. Annual Planning Meeting February 5-6,

11 FY15 Actual FY16 Budget FY16 Revised Estimate FY17 Projection FY16 Budget to FY17 Projection Real Estate * Personal Property Sales Tax Meals Tax Development Fees Recordation State Revenue Other (0.1) *Assumes effective rate, includes an allowance of slightly less than 1% total assessed value for appeals. Not included: revenue for shared services for field maintenance. Note: Due to rounding, numbers may not add up precisely to totals provided. Annual Planning Meeting February 5-6,

12 Baseline plus Department Requests Debt Service - County 1.05 Cash Capital (per Board's financial policies) 0.26 Corrections - required increase for Jail 0.93 Schools - Supt's request (includes 2% COLA and market scale adjustments) % COLA for County employees 1.00 VRS rate adjustment (0.50) Managed attrition (add back FY16 reduction) 1.07 Pay Study 1.5 Health Insurance 0.0 New Personnel - Sheriff (1st year of public safety staffing plan) 3.03 New Personnel- F&R (1st year of public safety staffing plan) 1.36 New Personnel - non public safety 0.63 Equipment replacement/upgrades, new initiatives, inflationary 1.26 Parks - Embrey Mill - full year's operating and personnel 0.32 Library (includes partnership with Germanna) 0.11 Partner Agencies - Request 0.33 Partner Agencies - FRA 0.08 Partner Agencies - Germanna 0.15 Total Projected Expenditure Increase: 13.8 Projected Revenue Increase: 7.5 Gap: (6.3) Note: Assumes Schools pay cash for school buses and financial system as recommended by the Superintendent. Due to rounding, numbers may not add up precisely to totals provided. $million Annual Planning Meeting February 5-6,

13 Sheriff Year 1 Year 2 Year 3 Total Sworn and Civilian Positions Estimated Yearly Cost $ 3,030,500 $ 2,094,000 $ 2,052,500 $ 7,177,000 Fire & Rescue Year 1 Year 2 Year 3 Total Sworn and Civilian Positions Estimated Yearly Cost $ 1,355,000 $ 1,299,000 $ 1,300,000 $ 3,954,000 13

14 Last year, staff engaged with Titan HR to conduct a classification/compensation study. 103 positions were compared to public sector and/or private sector positions 10 jurisdictions were included in the public sector comparisons As a result of the study: 70+ positions were reclassified to be more competitive with the market. Stafford s pay scale was adjusted by 2% to keep up with market changes. Any employee who fell below the new minimum of his/her job was brought up to grade minimum. 14

15 Phase II implementation of the class/comp study would align employees with where they should be on the pay scale. It would cost $1.5M (General Fund) to move employees to where they should be An individual review will be made to affirm these increases prior to implementation Approximately 290 employees will receive an increase based upon the standards stated above 15

16 We have seen an uptick in turnover rates, particularly in public safety Calendar year 2015 had the highest turnover in the last 5 years We are taking a closer look at exit interviews and other data to help us determine the underlying cause(s) of this increase Annual Turnover for Last 5 Years Average All Departments/Funds 9.60% 10.00% 7.00% 10.10% 11.20% 9.58% Public Safety* 9.00% 11.33% 5.45% 5.35% 13.85% 9.00% *Public Safety turnover determined by averaging statistics for Sheriff and F&R 16

17 General Fund Non-Public Safety Positions per 1,000 Residents and Full-Time Position History Positions per 1, Positions Fiscal Year 17

18 FY12, non public safety staffing level stood at 2.5 per thousand residents. It currently stands at 2.3 per thousand. Staff would like the Board to consider a non public safety staffing metric. 18

19 Reassessment 19

20 16,000,000,000 14,000,000,000 12,000,000,000 10,000,000,000 8,000,000,000 6,000,000,000 Commercial Residential 4,000,000,000 2,000,000, Tax Base Percentage Year Residential Commercial

21 The average 2016 assessment of a home in Stafford County is approximately $282,000. (The average assessed value in 2014 was approximately $269,000). The average value of home that existed Jan. 1, 2014 and has had no improvements made is approximately $279,

22 The Code of Virginia requires the effective tax rate to be advertised when a reassessment results in a 1% increase in the value of the total taxable real property. (Previous year s total assessment less new construction x 1.01%)/Forthcoming total assessment = Effective tax rate $.99 is the 2016 Effective Tax Rate Average Tax Bill 2016 = $2, $.99 = $2, $.99 = $2, Change in Assessed Value Agricultural -1.41% Residential 7.00% Multifamily 24.82% Commercial 5.74% Total Increase 6.94% 22

23 The Board s financial policies include measures for debt capacity. Per the policies: Outstanding debt will not be more than 3% of the assessed value of real estate. Debt service will not exceed 10% of the budget. Debt service will not increase by more than the 5 year rolling average increase in the budget. Annual Planning Meeting February 5-6,

24 Previous years calculations assumed budget growth of 3% or more in the outer years. Recent growth has been below that amount, so to be consistent, we have reduced growth projections to 2.5% in the early years and 2.75% in later years. The result is that debt capacity is lowered to $318M, a reduction from the Adopted CIP ($327M). As usual, all projects might not be able to be funded as requested. Annual Planning Meeting February 5-6,

25 Agency Projects Opening Date Public Safety Parks, Recreation & Community Facilities Public Works Current Year Cost Fire & RescueTraining Center ,000 6,120, ,294,000 Fire & Rescue Station 14 6,540, ,540,670 Fire & Rescue Station - New ,000 9,317, ,944,000 Park at Embrey Mill - Phase 3 0 2,963, ,963,000 Duff McDuff Green Park 0 0 7,466,000 5,932, ,398,000 Patawomeck Park Phase ,243, ,243,000 New and Renovated Park Amenities 1,333,000 1,333,000 1,333,000 1,333,000 1,333,000 1,333,000 1,333,000 1,333,000 1,333,000 1,336,000 13,333,000 Animal Shelter 5,348, ,348,000 Courthouse Addition 0 0 2,350,000 12,123,000 14,528, ,001,000 Library # ,000,000 1,000,000 Transportation Transportation Bonds 0 9,507, ,025, ,000 7,363,658 1,000,000 5,210,261 10,580,000 20,891,739 55,828,401 Subtotal FY17 Proposed County Projects FY16 Adopted County Projects FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024 FY2025 FY2026 Total This Period $13,221,670 $13,803,743 $11,323,000 $26,533,000 $20,354,000 $9,323,658 $11,650,000 $6,543,261 $11,913,000 $23,227,739 $147,893,071 $15,941,630 $13,803,483 $11,332,088 $25,527,088 $20,354,000 $3,360,000 $11,650,000 $6,543,261 $12,916,000 $0 $121,427,550 ($2,719,960) $260 ($9,088) $1,005,912 $0 $5,963,658 $0 $0 ($1,003,000) $23,227,739 $26,465,521 Schools Moncure Elementary Rebuild 11,431,000 16,431,000 1,000,000 28,862,000 Ferry Farm Elementary Rebuild 1,000,000 14,701,000 14,702,000 1,000,000 31,403,000 Elementary #18 1,000,000 17,434,000 18,434,000 High School #6 5,000,000 35,606,000 35,606,000 76,212,000 North Stafford Library 2,214,000 2,214,000 Mt. View HS Addition 7,316,000 7,316,000 Hartwood Elementary Renovation 1,000,000 10,000,000 10,795,000 21,795,000 Drew Middle School Renovation 1,000,000 1,000,000 Fleet Services 750,000 5,887,000 6,637,000 Infrastructure 4,050,000 2,900,000 3,350,000 3,400,000 3,455,000 3,400,000 4,900,000 5,135,000 4,700,000 4,450,000 39,740,000 Subtotal FY17 Schools Projects FY16 Adopted Schools Projects Total All FY17 Projects $22,797,000 $22,545,000 $19,051,000 $18,102,000 $5,205,000 $9,287,000 $4,900,000 $11,135,000 $51,306,000 $69,285,000 $233,613,000 $20,039,000 $17,574,000 $15,960,000 $15,415,000 $3,950,000 $7,296,000 $7,900,000 $40,242,000 $50,307,000 $0 $178,683,000 $2,758,000 $4,971,000 $3,091,000 $2,687,000 $1,255,000 $1,991,000 ($3,000,000) ($29,107,000) $999,000 $69,285,000 $54,930,000 $36,018,670 $36,348,743 $30,374,000 $44,635,000 $25,559,000 $18,610,658 $16,550,000 $17,678,261 $63,219,000 $92,512,739 $381,506,071 Bond Funded Summary (master lease not included) FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024 FY2025 FY2026 Total County $13,221,670 $13,803,743 $11,323,000 $26,533,000 $20,354,000 $9,323,658 $11,650,000 $6,543,261 $11,913,000 $23,227,739 $147,893,071 39% Schools $22,797,000 $22,545,000 $19,051,000 $18,102,000 $5,205,000 $9,287,000 $4,900,000 $11,135,000 $51,306,000 $69,285, ,613,000 61% Total Borrows Availability Limit Cumulative (Deficit)/Surplus $36,018,670 $36,348,743 $30,374,000 $44,635,000 $25,559,000 $18,610,658 $16,550,000 $17,678,261 $63,219,000 $92,512,739 $381,506,071 33,261,000 31,377,000 27,292,000 40,942,000 24,304,000 46,348,000 40,199,000 29,854,000 18,992,000 25,653, ,222,000 (2,757,670) (7,729,413) (10,811,413) (14,504,413) (15,759,413) 11,977,929 35,626,929 47,802,668 3,575,668 (63,284,071) Note: yellow highlights indicate change from adopted CIP; green shows change from joint FAB presentation 25

26 The Schools proposed CIP bond-funded projects for years FY17-21 are $14.8 million higher than the same period in the adopted CIP. The cost for Moncure ES increases by $4.7M due to new SCPS Elementary Education Specifications and inflation. 80% of cost increase is due to the change in scope. 20% is due construction cost inflation. In order to open Moncure in September 2019, design work must begin soon. County and School Board FAB committees met last month to discuss options to accommodate the changes to the Schools CIP. Funding to complete school access from Juggins Road will be included in Transportation projects in the proposed CIP. 26

27 Option A Option B Fire Rescue Training Center Move funding to right two years Duff McDuff Green Park - $587,000 Shift funding from FY19 to FY20 New and Renovated Park Amenities - $4,000,000 Remove funding in FY17 through FY19 Ferry Farm Elementary Rebuild - $1,678,000 Reduce number of seats by 200 North Stafford Library - $2,214,000 Fund with cash Schools Infrastructure FY17 and FY18 - $2,849,413 Fund with cash or move to right Duff McDuff Green Park Move funding to right two years New and Renovated Park Amenities - $2,666,000 Remove funding in FY17 and FY18 Ferry Farm Elementary Rebuild - $1,678,000 Reduce number of seats by 200 North Stafford Library - $2,214,000 Fund with cash Schools Infrastructure FY17 & FY18 - $2,849,413 Fund with cash or move to right 27

28 High School #6 is included in the last year of the Schools proposed CIP. Projected cost: $106.3M Staff has begun work with our financial advisors to develop plan to fund the project, including: Setting aside cash to reduce borrow Reducing scope of other projects Pursuing public-private partnerships It is likely that funding this project will use all debt capacity in the affected years. Increased operating costs will include debt service as well as personnel and operating costs. 28

29 Ongoing revenues fuels tax and recordation are not projected to be sufficient to fund recurring transportation operating expenditures. Difference between Revenues and Required Expenditures FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 Gasoline Sales Tax State Recordation Tax Operational Expenses Difference (0.33) (0.45) (0.36) (1.12) (0.93) (0.94) The above deficit does not take into account the required reductions to capital road projects as a result of the lower fuels tax. Annual Planning Meeting February 5-6,

30 Courthouse and Route 1 Intersection Improvement Increase proffers (Abberly): 1.9 Reduce fuels tax (1.9) Courthouse Road Widening Move Revenue Sharing from Brooke 2.1 Move Transp. impact fees from Eskimo Hill 3.6 Reduce bond funding (5.7) Ferry Road Use Tourism Fund revenue 0.4 Reduce fuels tax (0.4) Mountain View Road Phase I Move Revenue Sharing from Stafford Pkwy 0.04 Move Revenue sharing from Brooke Rd 0.37 Reduce fuels tax (0.41) 30

31 Enon Road Reduce to preliminary engineering only $1.5M of previously awarded Revenue Sharing is not used. Brooke Road Reduce project to complete right of way and utilities relocations only $245K of previously awarded Revenue Sharing is not used. Eskimo Hill Road Eliminate project from planning period Tech Center Drive Eliminate project from planning period 31

32 Reductions to fuels tax revenue mean we have less money for matching state funds, and limits borrowing capacity as there is less money to pay debt service. Project Cost Current Funding Additional Funding Required Brooke Road $ 7,213,808 $ 1,640,002 $ 5,573,806 Enon Road 3,629, ,762 3,018,738 Eskimo Hill Road 7,350,000-7,350,000 Tech Center Drive 2,600,000 - $ 2,600,000 18,542,544 Completion of these projects would require finding other revenue sources in order for the timing and scope to remain unchanged. Half of the additional funding requirement could be secured by revenue sharing. 32

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34 Projects selection was based on the Board priorities - Fiscal Responsibility and Reducing the Tax Burden; Education; Public Safety; Infrastructure; Economic Development; and Service Excellence. Considerations included the current condition of the infrastructure, regulatory requirements, capacity needs in the near future and build out, and projects which could spur economic growth in targeted areas of the county. Projects which combined these issues were given a higher priority. (e.g. Falls Run Force Main) As discussed with the Board during the FY16 CIP, the addition of these economic development projects require a large investment that will require rate increases 34

35 Additions: Abel Lake Dam Improvements Austin Run Sewer Replacement through Stafford Village] Route 1 Sewer (Hidden Valley to Potomac Hills) Maintenance equipment for operations Projects Accelerated 370 Zone water PS and Centreport Water Tank (2024 to 2019) Aquia Creek PS and FM (2022/25 to 2018/19) Project Removed or delayed to allow for additions/advances Potomac Creek PS and FM - delayed Radio Read Meter Program - removed 35

36 Reasons for need State and Federal Mandates Wastewater Treatment plant upgrades in 2007 operational changes equaling approximately $1 million per year Infrastructure maintenance requirements aged and expanding infrastructure Recovering from years without increases to match inflation Increased customer base, with decreased consumption Meeting financial policies 36

37 FY Approved Rate Increases Percent Growth in Customer base Water Sales Percent Change Actual Revenue Increase Average Monthly User Fee (5,000 gal) Consumer Price Index Change Average User Fee if increased Based on CPI Change Only % 7% 5% 5% $ % $ % 5% 5% 5% $ % $ % 6% 9% 9% $ % $ % 7% 18% 18% $ % $ % 6% 0% 0% $ % $ % 4% 4% 4% $ % $ % 6% 12% 12% $ % $ % 7% -2% -2% $ % $ % 7% 7% 7% $ % $ % 3% 3% 3% $ % $ % 4% 4% 4% $ % $ % 3% -4% 3% $ % $ % 2% 2% 11% $ % $ % 1% -5% 1% $ % $ % 2% 3% 3% $ % $ % 3% 3% 4% $ % $ % 1% 1% 4% $ % $ % 0% -3% 2% $ % $ % 3% 0% 8% $ % $ % 2% -3% 5% $ % $ % 2% 2% $ % $ % $

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40 Option 1-9% across all fees FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 Overall Rate Increase Current 9.0% 9.0% 9.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% Fixed Charges $16.43 $17.91 $19.52 $21.28 $21.92 $22.57 $23.25 $23.95 $24.67 $25.41 Change in Fixed Charge N/A $1.48 $1.61 $1.76 $0.64 $0.66 $0.68 $0.70 $0.72 $0.74 Monthly Residential Bill Variable User fee increase N/A 9.0% 9.0% 9.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 2,000 Gallons per month $31.85 $34.72 $37.84 $41.25 $42.48 $43.76 $45.07 $46.42 $47.82 $49.25 Change in Monthly Bill N/A $2.87 $3.12 $3.41 $1.24 $1.27 $1.31 $1.35 $1.39 $1.43 5,000 Gallons per month $58.83 $64.12 $69.90 $76.19 $78.47 $80.83 $83.25 $85.75 $88.32 $90.97 Change in Monthly Bill N/A $5.29 $5.77 $6.29 $2.29 $2.35 $2.42 $2.50 $2.57 $ ,000 Gallons per month $ $ $ $ $ $ $ $ $ $ Change in Monthly Bill N/A $10.49 $11.43 $12.46 $4.53 $4.66 $4.80 $4.95 $5.10 $5.25 Option 2-4% user fee + fixed fee increase FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 Overall Rate Increase Current 9.0% 9.0% 9.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% Fixed Charges $16.43 $20.57 $25.19 $30.34 $31.25 $32.19 $33.16 $34.15 $35.18 $36.23 Change in Fixed Charge N/A $4.14 $4.62 $5.15 $0.91 $0.94 $0.97 $0.99 $1.02 $1.06 Monthly Residential Bill Variable User fee increase N/A 9.0% 9.0% 9.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 2,000 Gallons per month $31.85 $36.61 $41.87 $47.69 $49.12 $50.59 $52.11 $53.67 $55.29 $56.94 Change in Monthly Bill N/A $4.76 $5.26 $5.82 $1.43 $1.47 $1.52 $1.56 $1.61 $1.66 5,000 Gallons per month $58.83 $64.67 $71.05 $78.04 $80.38 $82.79 $85.27 $87.83 $90.47 $93.18 Change in Monthly Bill N/A $5.84 $6.38 $6.99 $2.34 $2.41 $2.48 $2.56 $2.63 $ ,000 Gallons per month $ $ $ $ $ $ $ $ $ $ Change in Monthly Bill N/A $8.14 $8.78 $9.48 $4.29 $4.42 $4.55 $4.69 $4.83 $

41 Key reference slides to follow 41

42 Workforce Changes Over the past seven fiscal years, a net of sixtyfive (65) non-public safety positions have been eliminated from the General Fund. Staffing levels in Public Safety have increased by fortythree (43) positions as more resources have been allocated to this priority of the Board. 42

43 Adopted Budget General Fund Revenues 209,887, ,879, ,068, ,485, ,149, ,174, ,791, ,015, ,739, ,534,885 Transient Occupancy Tax 410, , E-911 2,490,203 3,036,305 2,833,392 2,832, General Fund Budget 212,787, ,395, ,902, ,318, ,149, ,174, ,791, ,015, ,739, ,534,885 Local School Funding 120,000, ,600, ,367, ,997, ,319, ,082, ,054, ,453, ,139, ,718,256 % of General Fund Revenues 56.4% 56.1% 54.9% 54.7% 53.9% 53.5% 53.9% 53.5% 53.7% 54.1% Local Tax Revenues 175,813, ,648, ,967, ,889, ,245, ,081, ,851, ,263, ,416, ,416,936 % of Local Taxes 68.3% 67.4% 64.8% 63.8% 61.5% 60.3% 60.5% 60.3% 60.7% 61.8% Total School Operating/Grants/Stimulus Budgets (1) 241,197, ,944, ,514, ,531, ,026, ,883, ,604, ,972, ,358, ,219,610 Debt Service 26,208,223 30,282,568 30,592,541 29,260,623 25,625,938 27,388,986 26,203,740 24,729,510 29,191,550 30,463,428 One-Time Operating Capital and School Construction Fund ,097, ,000 Total Local Transfer for Operations 93,791, ,317, ,774, ,736, ,693, ,693, ,850, ,626, ,947, ,045,828 % of County's total budget 44.1% 43.3% 42.3% 42.6% 43.0% 42.2% 43.3% 42.6% 42.6% 42.6% General Fund Local Transfer % of School budget 38.89% 40.94% 40.07% 38.98% 40.27% 40.53% 41.32% 41.31% 41.72% 41.38% Average Daily Membership 26,181 26,114 26,350 26,661 26,745 26,838 26,904 27,229 27,048 27,340 Operating Transfer per student 3,582 3,918 3,900 3,853 3,765 3,789 3,972 3,989 4,139 4,135 Local Funding per student 4,583 5,078 5,061 4,951 4,723 4,810 4,946 5,011 5,218 5,257 Debt Service per student 1,001 1,160 1,161 1, , ,079 1,114 Total School Operating/Grants/Stimulus per student 9,213 9,571 9,735 9,885 9,349 9,348 9,612 9,658 9,922 9,993 Millions $ 150 $ 145 $ 140 $ 135 $ 130 $ 125 $ 120 $ 115 $ 110 $ 105 $ 100 $ 95 $ 90 $ 85 $ 80 $ 75 $ 70 $ 65 $ 60 $ 55 $ 50 Local School Funding Millions $ 290 $ 270 $ 250 $ 230 $ 210 $ 190 $ 170 $ 150 $ 130 $ 110 $ 90 $ 70 $ 50 Total School Operating/Grants/Stimulus Budgets ,400 27,250 27,100 26,950 26,800 26,650 26,500 26,350 26,200 26,050 25,900 25,750 25,600 25,450 Average Daily Membership ,200 10,000 9,800 9,600 9,400 9,200 9,000 8,800 Total School Operating/Grants/Stimulus per student (1) FY2010 and FY2011 budgets include federal stimulus funds. Superintendent's Adopted Recommendation increase $ $ $

44 HISTORY OF BUILDING PERMITS ISSUED Full-Year Statistics 2,000 1,631 1, , , , Townhomes Multi Family Single Family YEAR ( full-year statistics) 44