James City County Increases Revenue Projection, Supes Start Budget Talk

Wednesday, January 26, 2011

At their budget retreat Saturday, James City County supervisors were told economic recovery will be slow, but they also heard the county has added an extra $3 million to its 2012 budget and business owners seem optimistic about 2011.

Though a few million dollars have been added to the fiscal year 2012 budget plan, staff cautioned supervisors that the county isn’t seeing significant improvements in all areas yet and that local economic recovery will be a slow process. County Administrator Robert Middaugh pointed out that national economic recovery would be very slow due to unprecedented job losses and low consumer confidence, though President of the Greater Williamsburg Chamber and Tourism Alliance Dick Schreiber offered results of a survey of members that showed local business operators are more optimistic looking at the year ahead.

Assistant Finance Director Sue Mellen told the board that general fund revenues are now projected to be about $2.2 million higher than expected, so the fiscal year 2012 budget has been increased by $3 million, bringing the total budget from $160.9 million up to $163.9 million.

The biggest factors contributing to the extra funds are an expected increase in general property taxes and additional sales tax funds for education from the state, which will add $1.2 million.

New construction has been on the rise over the last year, Mellen told supervisors, but the value of the permits is still lower than two years ago. Construction has been more residential than commercial projects, but staff said recently they’ve seen more applications for future commercial building plans.

Sales taxes are still down, Mellen said, which is a concern because it indicates businesses still aren’t doing well. For 2012, the county is projecting sales taxes slightly lower and meals and lodging and business taxes are expected to remain flat.

Mellen pointed out that community services numbers have decreased mostly due to less collected in fees, especially at the James City County Williamsburg Community Center. Middaugh suggested trying to get the word out about the facility to residents through the county’s cable channel, website and other means.

Schreiber shared results of the Alliance’s second annual economic outlook survey, which gauges how Alliance members feel about economic conditions in the Historic Triangle in 2011. More than 235 members responded to the survey.

The results of the survey showed that business owners were feeling more confident than they were at the same time last year. More members expected to expand their business in the coming year, and the number who do not plan to expand went down, which Schreiber says shows that members are more optimistic.

Few businesses plan to relocate outside the area, according to the survey, and respondents expect to be increasing the number of local jobs, which “is very good news for the economy,” according to Schreiber.

More respondents expected revenue growth in the coming year, and expected to spend more.

In all, “things are moving in a positive direction,” Schreiber said regarding the data.

Schreiber also discussed the Alliance’s new sports marketing plans for the upcoming year, and he told supervisors the new sports marketing committee has already given two grants out of its $75,000 fund.

The proposals the group is currently working on could generate 69,000 room nights if they’re all accepted, and Schreiber said the sports marketing effort is “the best collaborative effort we’ve been involved in.”

Middaugh pointed out that the deal wasn’t the best for the county, because the county has several sports venues available but limited hotels and restaurants compared to its Triangle neighbors. “We need revenue capture,” he said of the regional sports marketing effort, since there isn’t enough return to cover the county’s expenses in paying to operate the venues and revenues would likely go to Williamsburg and York County.

Middaugh said he expected the other localities to help James City County for the events to be worthwhile.

In all, Middaugh said he is “cautiously optimistic” about the upcoming year. While it seems things are looking better, he told supervisors the county needed to be cautious going forward and that it shouldn’t start new programs or take on ongoing expenditures this year.