For Immediate Release

April 11, 2011

Dublin, Ohio First Quarter Income Tax Revenues Show Significant Growth

(Dublin, Ohio) - City of Dublin income tax collections for the first quarter of 2011 are up by $1.2 million, or 7.39 percent, as compared to the first quarter of 2010.

Dublin City Manager Marsha Grigsby presented the figures to Dublin City Council April 11 as part of a first quarter financial update. The report shows first quarter income tax collections surpassed the first quarter budgeted revenues by $1.9 million.

“While these figures have exceeded our projections, and are very encouraging, we are mindful that the nation is still in a state of financial recovery from the down economy of the past two years,” Grigsby said. “The increases allow us to continue to plan for the future, especially where the City’s five-year Capital Improvements Program is concerned.”

The projected income tax revenue for 2011 totals $65.9 million. Of that total, 75 percent, or $49.4 million is programmed in the General Fund and 25 percent, or $16.5 million is programmed in the Capital Improvements Tax Fund. “For the 2012-2016 Capital Improvements Program update, we currently anticipate projecting the income tax revenues for 2011 will be consistent with the 2010 actual income tax revenues,” Grigsby said. “We will continue to closely monitor collections and make a revised projection prior to preparing the 2012-2016 CIP.”

Traditionally, the City takes a conservative approach when projecting income tax revenue. Coupled with the uncertainty of the economy, the 2011 income tax revenues were projected to remain level with the 2009 income tax revenues. The City experienced a decline for the first time in 2009. Income tax revenues rebounded in 2010, increasing 4.46 percent over 2009.

The City’s practice is to maintain a year-end balance equal to or greater than 50 percent of the General Fund expenditures. Based upon the year-end performance, the 2010 General Fund year-end balance increased to nearly 76 percent from the 2009 year-end balance of nearly 65 percent.

“Even with the decline in income tax revenue, the 2009 year-end balance increased from the 59.8 percent balance at the end of 2008,” Grigsby said.

The General Fund target balance or reserve was established and has been maintained for the purposes of being able to take advantage of opportunities as they arise or to make appropriate adjustments in the case of a downturn in revenues.

Other highlights of the update show:

• Income tax revenues from withholding accounts recorded in the General Funded Capital Improvements Tax Fund are up 4.65 percent compared to the first quarter of 2010. (Note: the final year of revenue sharing with the Dublin City School District was 2010; once adjusted for the impact of revenue sharing, income tax revenues from withholding accounts are up 3.51 percent.) Income tax revenues from withholding accounts generally comprise approximately 80 percent of the City’s total income tax collections.

• Hotel/motel tax revenues increased 4 percent in 2010 over 2009. This upward trend has continued for the first three months of 2011.

• Service payments from tax increment finance (TIF) districts reflect substantial growth with approximately a 21 percent increase in revenue. The growth in TIF payments is attributed in part to development around Dublin Methodist Hospital, Emerald Parkway, Woerner-Temple Road, Shamrock Crossing and at Bridge and High streets. (Note: the Phase II area of the McKitrick TIF was converted from a “straight” TIF to a “non-school” TIF; thus, service payments show a decrease for this specific TIF.)

“As a result of the first quarter, we are optimistic that the outlook for 2011 is more favorable than projected in the 2011 Operating Budget,” Grigsby said.

 

For more information

CONTACT: City Manager Marsha Grigsby @ 614.410.4420 or Community Relations Communications Officer Nancy Richison @ 614.579.2612