third quarter financial update - vancouver, washington · housing market: new residential and...

Third Quarter Financial Update

October 26, 2015 Vancouver City Council Workshop

Lloyd Tyler, Chief Financial Officer

Natasha Ramras, Deputy Finance Director

• Brief economic update

• City of Vancouver General Fund Revenues compared to Forecast

• City of Vancouver General Fund Expenditures compared to budget

• Brief Financial information related to other funds

Agenda

Third Quarter 2015 Financial Update - 2

Gross Domestic Product is the broadest measure of aggregate

economic activity. It encompasses every sector of the economy.

US GDP

3

• Unemployment rate continues to decline, reaching 5.1% national in September of 2015

• City unemployment rate reached 6.3%, the lowest rate since September 2007

Unemployment

4

• The Index is based on consumer perceptions of current business & employment

conditions, as well as consumer expectations for the following six months.

Consumer Confidence

5

The S&P/Case-Shiller Home Price Indices are the leading measures of U.S. residential real estate prices,

tracking changes in the value of residential real estate both nationally as well as in 20 metropolitan

regions.

Housing Sector: Case/Schiller for Portland Metro

6

Housing Market: New Residential and Commercial Permits


• Locally, increased activity in the

residential and multi-family sectors

• Commercial constructions remains

volatile

• Economic conditions in the US have clearly improved since the Great Recession:

• Growth in the economy in 2014

• Falling unemployment

• Rising home prices

• Some risks to the economy remain nationally and globally:

• Very low inflation, potential deflation possibility

• Strong dollar impacting US production, but the cost of imports is down

• China growth slowdown

Economic Overview Summary


• Overall revenues are coming in above forecast by an estimated $4 mil,

if the trend continues

• Sales Tax is the best performing revenue in dollar terms

• Expenditures are higher than “normal” for the time period, but in line

with budget

General Fund: Executive Summary


General Fund: Executive Summary

10

• Coming in very strong for the second year: auto sales, general sales and construction sales are

the fastest growing categories

• Annual increases of this magnitude are not likely to be sustainable long term

Revenues: Sales Tax

11

0.000

5.000

10.000

15.000

20.000

25.000

30.000

35.000

2007 2008 2009 2010 2011 2012 2013 2014 2015

$, i

n m

illio

ns

Quarterly Sales Tax Collections

First Second Third Fourth Forecast

New revenue: $220K/yrfor Local Revitalization Financing

• In 2015 major change – Internal Support services moved to a separate fund, only direct charges

proportionate to the work performed for direct service-providing departments remain

General Fund: Expenditures

12

• Revenues are coming in stronger by approximately $4 million by the year end

• Expenditures are on track, but savings should be minor

• The current 2015 -2016 Budget anticipates utilizing $3.7 million in fund

balance; because of the increased sales tax revenues, no fund balance is

likely be utilized for the current adopted budget.

• Other Changes in Revenues:

• State-shared revenues: gas tax, marijuana enforcement revenue;

• IPD <1% , thus the property tax increase will be 0.251% instead of 1%

= will forego ~$300K in annual on-going property tax revenue.

General Fund: Big Picture


• Revenues and expenditures in other funds are on track

• Development-related and real estate-market related revenue is coming in stronger than

anticipated (REET)

Other Funds

14 0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Quarterly REET Collections in the Street Fund

First Second Third Fourth Forecast

$, i

n m

illio

ns

• Investment interest continues to be very low – returns are under 1% on

up to 3 year US Treasuries; (The City can only invest in US Treasuries,

federally-backed agency securities and other relatively risk-free

investments.)

• The City has $100.7 m of G.O. debt outstanding and approximately

$31 m of revenue bond debt

• No funds were on interfund loans at the end of the third quarter

Other Items


Questions?

• Lloyd Tyler, Chief Financial Officer

(360) 487-8469

• Natasha Ramras, Deputy Finance Director

(360) 487-8484


third quarter financial update - vancouver, washington · housing market: new residential and...

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