City of Fayetteville

General Fund
Financial Forecast
FY2010-2014
 Financial Forecast
◆ Purpose

◆ General Assumptions
◆ Financial Forecast Projections
◆ Next Steps
 Purpose
◆ What the forecast is…
– 5-Year planning tool to indicate future
trends based on assumptions to
examine long term sustainability
◆ What the forecast is not…
– Not the recommended budget
 General
Assumptions
◆ “The Big Unknowns”
– Economy
– Impact of State Budget
◆ Enhancement of public safety services
– Police
• Add 35 sworn positions (partially funded by
COPS grant)
• Add 2 forensic technicians and 2 crime
prevention specialists (partially funded by
JAG grant)
 General
Assumptions
◆ Enhancement of public safety services
– Fire and Emergency Management
• Add a fire station in North Fayetteville
• Add 24 fire fighter positions (15 at the new
station and 9 at Station 1 – partially funded by a
SAFER grant)
◆ Enhancement of Transit System
– Based on five city comparison, increase per
capita spending to peer group average - $1.35M
in FY2010 plus an additional $1.35M in FY2011
 General
Assumptions
◆ No other significant service enhancements
◆ Continuation of long-term funding
commitments
– Vehicle/information technology
replacement
– Street resurfacing and paving
– Sidewalks construction
– Facilities maintenance/other CIP projects
– Competitive compensation
 General
Assumptions
◆ Includes impact of Fort Bragg
annexation
◆ Gates Four neighborhood is annexed
on November 22, 2009
◆ Future projections generally based
upon FY2009 original budget with
exceptions for specific/significant
expenditures
 Revenue
Assumptions
◆ Ad valorem taxes
– Real and personal property taxes
grow 3% per year
• Assumes no adjustment for property
revaluation
– Vehicle taxes are flat in FY2010 and
grow 3% thereafter
 Revenue
Assumptions
◆ Sales tax
– FY2009 – .3% decline
– FY2010 - Flat
– FY2011-2014 - 3% growth
– Added impact of Fort Bragg and Gates Four
population
– Continue per capita distribution within the
county
 Revenue
Assumptions
◆ Powell bill
– FY2010 revenue is 11% less than FY2009, then
adjusted for Fort Bragg annexation
– FY2011 projects a further 2 % decline with recovery of
2% in FY2012 and then 3% increases in subsequent
fiscal years
◆ Modest growth in electric, telecommunications and
cable taxes
◆ Increased electric franchise tax for Fort Bragg
annexation
◆ Intergovernmental revenues includes SAFER,
JAG and COPS grants
 Revenue
Assumptions
◆ No change in user fee rates with modest
1.5%-3% growth per year for inspections,
engineering and environmental fees
◆ PWC transfer
– General transfer is 3.1% of Electric Fund
net assets
– Streetlight reimbursements for other
companies ends June 2010
 Expenditure
Assumptions
◆ Reflects 3% vacancy rate except for Fire
Department and Mayor/Council
◆ Position changes:
– 24 Fire fighters
– 35 sworn officers
– 2 Crime Prevention Specialists
– 2 Forensic Technicians
– 2 equipment operators (Gates 4
annexation – FY2013)
 Expenditure
Assumptions
◆ Impact of pay increases over the five
year forecast period:
– Police officers – 4.8% to 7.7%
– Police upper ranks - 4.7% to 5.9%
– General employees - 2.3% to 6.2%
 Expenditure
Assumptions
◆ Increases in health insurance rates – 0% in
FY2010, 10% annually thereafter
◆ Average inflation rate for operating costs is
0% in FY2010, 2% in FY2011 and FY2012
and 3% thereafter, and fuel is 7.5% in
FY2011 and thereafter
◆ Includes operating costs for the additional
positions, new fire station and vehicles
 Expenditure
Assumptions
◆ Vehicle/heavy equipment replacements for
FY2010-2014 based on fleet management
recommendations
◆ Purchase 29 vehicles for additional sworn
officers and support personnel
◆ “Operating capital” is $500K for FY2010 and
increases 3% per year thereafter
◆ CIP capital contributions based upon the
Council approved plan
 Financial Forecast
General Fund Revenues and Expenditures
Revenues/ Rev Over
Other Expenditures (Under)
Fiscal Year Sources* Expend
2009 129.0 139.7 (10.7)
2010 135.1 141.6 (6.5)
2011 138.5 144.2 (5.7)
2012 142.0 152.5 (10.5)
2013 144.3 159.8 (15.5)
2014 148.0 168.3 (20.3)
*Other sources consists of fund balance designated for specific purposes such as the
debt management plan, County recreation, as well as loan proceeds
 Financial Forecast
Millions
170

160

150

140

130

120
FY09 FY10 FY11 FY12 FY13 FY14

Revenues & OFS* Expenditures & OFU

*Other sources consists of fund balance designated for specific purposes such
as the debt management plan, County recreation, as well as loan proceeds
 FY2010 General
Fund Expenditures
Other* Remaining
County Rec. 2% Budget
2% 30%

Annex. Rev.
Reimb.
6%

PWC
Agreements
1%
Debt Service
6%
Street
Resurfacing
2%
Transit Police & Fire
2% 49%
 Next Steps
◆ Where do we go from here?
– Develop revenue projections
– Balance expenditure budget based on
projected available resources
– Present recommended budget to Council
on May 4
– Conduct budget worksessions
– Hold public hearing on May 26
– Adopt FY2010 budget on June 8
 Financial Forecast

Discussion and Questions