Chairman Bulova's Remarks on FY 2012 Carryover

Sept. 11, 2012  

The Carryover Review is the process to consider the disposition of unspent funds from the fiscal year that has just ended.  Each year Carryover gives us the opportunity to learn the results of the fiscal year we just ended and to make the first round of changes to the year we have just begun. 

The FY 2012 Carryover Review requires that we focus our attention on two major issues; the first is addressing the projected CSB funding shortfall for FY 2013.  The second is turning our attention to the challenges facing us for FY 2014 which include the looming federal budget showdown and our own revenue projections which continue to reflect very slow growth.

Addressing the CSB budget shortfall during these last several months has been extremely challenging, especially given the importance and sensitivity of the services that are provided by the Community Services Board, coupled with the timing of the discussion (essentially after the FY 2013 budget was balanced and ready for adoption), and the size of the projected shortfall (currently projected at $9.5 million).

Reaching a strategy for closing the projected shortfall has engaged us and the community in a manner that has demonstrated our commitment to the “safety net” of services that we value.  

I think the resolution I am about to lay out –a combination of reductions, re-designs, and consolidations coupled with funding from the Board’s Reserve established to aid in this process- is a good one.  On behalf of this Board I would like to thank members of the Human Services Council, representatives of the Community Services Board, our Human Services Advisory boards, advocates, clients and families for their participation and hard work throughout the process. 

I also wanted to make it clear that these issues are serious multi-year budget issues.  We cannot have this happen again. Addressing the budget issues now and undertaking the Work Plan laid out in the July 3, 2012 memo from the County Executive to the Board will ensure that we can respond very quickly to changing service delivery requirements, reduced revenue collections and increasing fringe benefit costs. 

We also will have to continue to look at these, and all services, critically each year since we will be facing constrained revenues for the foreseeable future.

During the past week I have spoken with each of my colleagues detailing the package I am about to move.  For the listening public, I will provide some specifics on the actions we are taking to close the CSB projected shortfall and to prepare for what we know is going to be a difficult year ahead.

  • It is important to note that this Plan will not delay entry into the Early Intervention services of the Infant Toddler Connection, and we will continue to meet service requirements for our existing clients and new graduates of the Fairfax County Public Schools with Intellectual Disabilities.  
  • While direct Revenue from the Federal Government is about 1 percent or $35 million of General Fund revenue, there are also significant federal grant dollars in the County’s budget and our residents receive important services that are funded by additional federal pass-through dollars, particularly in the human services arena.  

Staff is working to identify potential impacts on the County based on a number of scenarios which may result from federal budget reductions and information regarding these impacts will be provided to the Board as available.

In the meantime this package includes a Reserve of $8.1 million which will give the Board the ability to address changes during FY 2013 that could dramatically impact services.

In addition, given the potential refunds from a number of significant tax appeals that we are currently addressing, the County Executive recommended, and the Board endorses, the establishment of a “Litigation Reserve” of $5 million.  The Board has been briefed in Closed Session about the status of a number of these and staff will continue to bring updates to the Board as new information is available.

The one Consideration item that we have, related to speeding and unsafe driving in neighborhoods is funded from a new Transportation Reserve. 

Based on the challenging FY 2014 budget development process that we face I would like to set the stage with some ideas about how to meet this challenge.  As the Board is aware a Budget Committee has been scheduled for November 27, and at that time we will learn more about the Budget Forecast. 

While the details will change between now and then, we are currently projecting a shortfall for the next several years that will need to be addressed.  To assist in addressing these projected shortfalls, the County Executive is implementing a multi-year budget process to provide more insight into how decisions in the budget year will impact the following year.  

This multi-year budget will serve as a planning tool to provide us with broader perspective of issues and options by providing a more complete outline of issues that need to be addressed as part of the budget process

As one of the components of budget development for FY 2014 and FY 2015, agencies have been asked to identify spending reduction options totaling 5 percent for each year which will be considered as staff develops the budget. 

Another round of budget reductions, on top of multiple years of constrained resources is going to be difficult and I think it is important that the community be informed and engaged as we consider possible impacts to the delivery of services.  To that end, I am working with staff to plan for community engagement opportunities this fall and winter

These meetings will be designed to keep our residents informed about the challenges we face and to get their thoughts about how we will continue to move forward in a way that protects the quality of life we value. 

I will announce dates and times once scheduled.  For any of you with Budget Groups in your districts please work with Chief Financial Officer Susan Datta to make sure they are provided with up-to-date information about this process.

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