FY 2020 Budget Forecast: Balancing Efficiencies and Priorities for Residents

FY 2020 Budget Forecast With Both County and FCPS seals.

The fiscal year (FY) 2020 Budget forecast was presented by Fairfax County Government and Fairfax County Public Schools (FCPS) representatives on Tuesday, Nov. 27, to a joint meeting of the Board of Supervisors and School Board. Each November, the county and FCPS announce their budget forecast to residents, county agencies, the business community and elected officials. The forecast includes expected tax revenues and significant funding needs for the upcoming fiscal year budget. By state law, the county must have a balanced budget.

More than half of the county’s general fund budget is disbursed to FCPS. County government and FCPS are working together to provide our residents with the most efficient use of tax dollars, while also providing our high-level of services. The budget forecast for FY 2020 is similar to what we experienced last year – disbursement requirements (expenses) continue to increase for both county and FCPS budgets to address community priorities, population growth and employee compensation. Our combined revenue growth will not be able to cover all our priorities.

However, the county executive has a strategic plan and efficiency initiatives underway and office vacancy rates, jobs and other key economic indicators are improving.

 

Bottom Line Forecast for FY 2020

Based on data available to-date, county revenue growth is projected at 2.9 percent, which generates $156.67 million in additional revenue for FY 2020 (begins July 1, 2019). After reserve savings, this leaves $159 million to cover:

  • $124.24 million in county funding priorities.
  • $120.29 million in FCPS disbursement requirements (funding needs), offset by $22.1 million in projected increases in FCPS revenue.
  • $6.36 million in reserve requirements.

As a result, a budgetary shortfall forecast for FY 2020 is $54.33 million for the county and $15.60 million for FCPS, which must be addressed before the budget is adopted in May 2019.

FY 2020 Budget Forecast Summary:

Summary of budget forecast for FY 2020 showing forecasted expenses and net balances.

 

County Budget Revenue Forecast

Real estate tax revenue accounts for approximately 65 percent of the county’s general fund budget. Budget impacts from real estate taxes include:

Residential Real Estate: Home values in the county are projected to increase 2.14 percent in FY 2020.

  • Home prices are up 2.2 percent through this October.

Commercial Real Estate: Commercial (nonresidential) property values are projected to increase 2.41 percent in FY 2020.

  • As of mid-year 2018, the direct office vacancy rate is 16.1 percent – the lowest level since 2012.
Learn More About County Budget

 

FCPS Budget Revenue Forecast

FCPS receives more than 71 percent of its funding from the county government. In FY 2019 that amount is 52.8 percent of the county’s general fund budget, or close to $2.3 billion. In addition, FCPS receives state and federal funding.

The FY 2020 forecast for non-county revenue, includes increases of:

  • State Revenue: $18.1 million
  • State Sales Tax: $4.5 million
Learn More About FCPS Budget

 

Joint FY 2020 Budget Forecast Presentation

 

FY 2020 Budget Timeline

FY 2020 Budget Timeline

Watch to learn more about our county’s budget process:

 

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