March 24, 2026 Budget Policy Committee - Mar 24, 2026

meeting

Fairfax County Board Committees 1h 8m 6 speakers 8 agenda items transcribed 1 day ago official recording ↗

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What is the agenda and purpose of the March 24 2026 Budget Committee meeting?

Jeffrey C. McKay 0:04

Gonna go ahead and get started. Uh let me welcome everyone to our budget committee of March twenty fourth, twenty twenty six. And uh it is highly likely that we will finish early uh here today, uh just because we're that efficient. Uh and and and we have that good a staff work. Uh but we do only have one item on the agenda and I'm just gonna remind my colleagues I'm gonna allow staff to go through the whole presentation. Um and then we're gonna allow time for questions from board members. It's really important uh that we make sure everybody have an opportunity to ask their questions and to take advantage of our committee time uh to be able to do that. That that is the point of these committees. And so with that

Jeffrey C. McKay 0:46

Uh the only item on our agenda today is the FY twenty twenty six third quarter review. And to give us a presentation on that, I'm gonna turn uh the microphone over to Phil Hagen. Welcome.

Phil Hagen 0:58

I thank you and good morning, uh Mr. Chairman and members of the board. Uh Phil Hagen, Director of the Department of Management and Budget, also with me here at the table, uh supporting all of your difficult questions. We have Christina Jackson, our Chief Financial Officer, and uh DMB's uh deputy directors, Katie Horseman and Joe LaHate. Um so I'm gonna start walking through our third quarter review. Um so just to to start off here at our overall summary of the third quarter package, our um available balances total fifty two million dollars. Uh point four million of that is the result of fiscal year twenty twenty five audit adjustments that resulted in a slight increase in our um general fund balance.

Phil Hagen 1:38

We also then have uh fifty one point five six million dollars in revenue adjustments coming out of our mid year revenue review, uh which we have a little bit more detail on actually on the very next slide. Expenditure adjustments then total $44 million, as is our practice at our quarterly reviews. We focused on one-time expenses, primarily capital and IT projects. We do have a few recurring adjustments that are included in this package. However, I would note that they are all either supported by uh r by revenue for no net impact on FY 2027, or they represent adjustments that were included. in the FY twenty twenty seven advertised budget and this um right reflects kind of earlier action in order to get those going.

Phil Hagen 2:19

Um so overall there is no net impact on FY twenty twenty seven as a result of the uh adjustments included in this package. You'll see as well we have a $6 million reserve adjustment line there. That was anticipated as part of our FY 2027 advertised budget development. We have been shifting that funding of reserves to one-time sources in order to make sure that we free up as much as possible in the recurring budget for board consideration. And so this $6 million is a contribution to our managed reserve in order to prefund those FY 2027. twenty seven requirements. I would note that the revenue stabilization fund as well as the economic opportunity reserve are anticipated to be at their target levels in fiscal year 2027 based on interest earnings that will post into those funds.

Phil Hagen 3:07

And so after staff recommendations we have a balance of one point six seven million dollars. Um I would also note that in addition to the balance, there's a balance of twenty two point five million dollars in the reserve for economic uncertainty after staff recommendations. You'll see a little later in the presentation we've recommended the use of one million dollars from the the one time balances in that fund. So um here as I said mid-year revenue adjustments total fifty-one point five six million dollars. The largest part of that increase is thirty million dollars in personal property taxes. Um we've seen higher vehicle volume as well as a higher average vehicle levy than we initially expected. Uh we're also seeing the impact of a few new data centers on the business personal property component of that uh tax.

Phil Hagen 3:51

Then the second largest increase is interest on investments. We expect this category to continue to decline as interest rates decrease.