Orange County NC Website
1 <br /> ORANGE COUNTY <br /> NORTH CAROLINA <br /> FINANCE and ADMINISTRATIVE SERVICES <br /> Gary Donaldson,CTP,Chief Financial Officer I 1 405 Meadowlands Dr.,Hillsborough,NC 27278 1919.245.2453 <br /> To: Board of County Commissioners <br /> From: Gary Donaldson, Chief Financial Officer <br /> Date: April 21, 2020 <br /> Re: Financial Report for Third Quarter of FY 2019-20 <br /> OVERVIEW <br /> This FY 2019-20 third quarter financial report summarizes the coronavirus impact on County finances primarily <br /> sales tax, charges for services and occupancy taxes through March 31, 2020. Based on nine-months of fiscal year <br /> activity the General Fund is still projected to end FY 2019-20 with no use of fund balance; contingent on <br /> adherence to the cost containment measures listed in the Manager's Economic Contingency Plan. Further <br /> General Fund detail is included for additional review. <br /> ECONOMY <br /> U.S. Economists concur that the economy's precipitous decline in employment and consumer spending caused by <br /> COVID-19 has led to a recession which started in the latter first quarter of calendar 2020. The duration of the <br /> economic distress and the negative growth trend is contingent on a protracted pandemic,vaccine and re-opening <br /> of the economy.As a result, the County's long-term financial model has been revised to reflect negative economic <br /> growth for the last four months of FY 2019-20 and through the first six months of FY 2020-21; or V-shape <br /> recovery in comparison to the Great Recession's L-shape recovery. Consumer spending which comprises two- <br /> thirds of Gross Domestic Product is a large determinant of gross sales. Our Economic Development Department <br /> management shared this interactive consumer spending by metro areas Model produced by Impact Data Source <br /> which illustrates the COVID-19 lockdown impact throughout the nation. <br /> March 2020 represents the first month of the COVID-19 pandemic's impact on the economy. Sales tax remittance <br /> from the NC Department of Revenue (NCDOR) represents a 3-month lag which means that March Sales <br /> Transactions will be remitted to local governments in June 2020. The chart below illustrates the 3-month lag <br /> from the sales tax transaction to the County receiving that month's sales tax revenue. <br /> MARCH ( APRIL=Vendor MAY= JUNE 15= <br /> Sale Submits Report NCDOR County <br /> Transactions , L Reconciles Receives$ <br /> Orange County Government I 1919.732.8181 <br />