City Reports Revenue Gains for FY 2011, Increased Fund Balance

By GEORGE BROMLEY
Falls Church Times Staff

September 20, 2011

Falls Church CFO Richard La Condre advised the City Council yesterday evening that revenues for FY 2011 (July 2010 – June 2011) exceded estimates by $2.2 million.  He attributed the gain to increases in sales tax revenues, business licenses, and personal property and real estate taxes.

The higher revenues, combined with lower than anticipated expenses and unexpended grants, result in an increase of the City’s fund balance from by $4.1 million to $6.759 million.  The new balance is 10.2% of revenues.  The City’s goal is to raise the fund balance to its policy level of 12%.

La Condre said that he is cautiously optimistic, but that the surplus doesn’t necessarily translate into an economic turnaround.  The CFO estimated that inter-jurisdictional costs soon would increase 5% and contractor and utility costs 3%.

City Manager Wyatt Shields said that puts Falls Church in a “solid position” for the current fiscal year, but that FY 2013 is more uncertain.  He recommended devoting the gains to fund balance restoration.

Five Wards or Three?

The Council continued its discussion of a propsed ordinance that would reduce the number of voting wards from five to three.  Registrar David Bjerke and Board chair Margarette Shovlin briefed on the proposal, which was introduced at the September 6 work session.

The plan would close the Scout House (Ward 3) and the American Legion Hall (Ward 5) and leave the remaining wards with nearly equal numbers of registered voters.  Mr. Bjerke noted that since his staff is limited it would be more efficient to manage three wards, especially in case of an emergency, such as the recent earthquake on primary day.

While Thomas Jefferson School (Ward 1), Oakwood Apartments (Ward 2), and the Community Center (Ward 4) have good climate control, the Scout House does not, making it difficult for officials working a 16 hour day.  The building is also small, which sometimes forces voters to wait in lines outside the building.

Vice Mayor Dave Snyder said that he would like the public to receive more information on the proposal and recommended holding a town hall meeting before any action is taken.  Mayor Nader Baroukh and Councilwoman Robin Gardner concurred.  The mayor said that managing fewer wards makes sense, but stressed the need for a comprehensive implementation plan.

The City currently has 8,500 registered voters.  Virginia Code allows up to 5,000 in a single ward.  Ms. Shovlin said that around 3,700 Falls Church voters would be affected if the plan is approved.

Motorcycles May be Coming to FCPD

Police Chief Harry Reitze briefed the Council on a proposed ordinance that would allow the use of police-seized assets to purchase a motorcycle, a storage shed, and necessary equipment. The motorcycle would be used for traffic enforcement and calming and emergency response.  A second motorcycle may be obtained through a federal grant.

In response to a councilman’s question the chief said that the motorcycles used by the Sheriff Department are owned by individual deputies, so they cannot not be shared with the police.

Fiscal Policy Changes

The Council discussed a proposal that would update the City’s fiscal policies.  The most significant change calls for maintaining an unassigned fund balance of 17% of expenditures.  The proposal also recommends establishing capital reserves for the General Fund and the Water Fund.

A total of $10.5 million would be required for the reserves, $7.5 million for the General Fund, at the rate of $1 million per year beginning in FY 2013, and $3 million for the Water Fund in FY 2016.

Mr. Shields said that the objective is to move away from the happenstance of funding the Capital Improvements Program based on the status of the fund balance.  Mr. Snyder countered that he was concerned that the reserves would be built up only to be raided for something else.