CAFR 2017

Economic Factors and Next Year’s Budgets and Rates The Greensboro area economy continued to gain strength in several areas including building permit and housing activity. National indicators report a 15.3% increase in the number of permits issued in the U.S. for the twelve month period ending August 2017 compared to the prior year. The number of existing homes sold in the Triad in Q2 of 2017 was up 8.4% compared to last year. Average home prices are also up 4.7% over August 2016 at $192,918. Unemployment decreased from 5.2% in June 2016 to a seasonally adjusted rate of 5.0%, slightly above the national average. Hotel/Motel occupancy taxes continued to increase for the sixth year in a row. Sales taxes grew more than 5.9% compared to FY 2016, partially due to a change in the distribution percentage received from Guilford County which is based on the ad valorem tax rates of municipalities within the County in a given year. The City’s adopted FY 2018 budget for all funds increased $10.7 million or 2% to approximately $535 million, primarily in the infrastructure area for utility improvements, increased debt service payments, and Coliseum improvements. The assessed base value of all real and personal property is projected to grow approximately 5.06% in FY 2018 and includes the results of a county-wide property revaluation, effective January 2017. The FY 2018 budget was adopted with a property tax rate of $.6325 cents per $100 of assessed value (the same rate for the past six years) and includes allocations of $.035, $.0069 and $.5856 to fund transit, housing and general government initiatives, respectively, along with another $.0050 to fund economic development projects, amounting to about $1.4 million each year. Funds for FY 2018 are fully allocated for a variety of items, which should spur additional economic growth. City Council has reaffirmed its intention to continue to maintain the unassigned fund balance of the General Fund at 9% of the 2018 fiscal year budget, or approximately $25.8 million. Budget Highlights for the Fiscal Year Ending June 30, 2018 Governmental Activities: The General Fund budget for FY 2018 was adopted at approximately $286.2 million (up 3.8%) with approximately $10.4 million in increased appropriations over the amended FY 2017 budget. Overall the General Fund budget shows a net decrease of about 14 positions, including 7 positions IT moved to the Guilford Metro Communications Fund and several deletions for vacant positions. The budget also estimates increased projected revenues of more than 5.25% from local option sales tax and 1% from electric utility sales taxes shared with the state. Major budgeted initiatives continue to include economic development and job creation. One half cent on the tax rate in the Economic Development Fund will generate approximately $1.4 million, set aside to serve as the primary funding source to support the Triad Stage, Greensboro Community Development Fund, and the Launch Lab. Additional capital needs in FY 2018 include upgrades at the Public Safety Training Center, the Cultural Arts Building and upgrades for building entry security at various City facilities. Appropriated General Fund fund balance is $6.6 million, or 2.3% of the total budget, but has historically been unused. No significant services or programs were eliminated and few new service enhancements were funded. The budget included a 3% average merit increase for employees. The second year budget for FY 2019 is balanced with a 63.25 cent tax rate, unchanged from the adopted FY 2018 rate.

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