CFO presents positive six-month financial snapshot

NORRISTOWN » The current financial outlook for Montgomery County is cautiously optimistic.

That was the message county CFO Dean Dortone conveyed to the county commissioners at their Aug. 9 meeting.

Dortone provided the commissioners with a snapshot of county finances after the completion of the second fiscal quarter, including data on revenue collection, emerging trends and departmental reports ahead of the formulation of the 2019 budget, slated for release Nov. 15.

About 71 percent of budget revenues were collected within the first six months of 2018 with about 48 percent of budgeted expenditures made — which Dortone said is about where the county was expected to be at this time.

On the revenue side, he said home sales have improved from a dip of 7 percent from May of last year to May of this year to lag only about 2 percent yearto-date.

“Overall, we collected about $290 million of the revenue, 68 percent of it is real estate taxes, and obviously the grants follow right behind,” Dortone said.

The county’s real estate collection rate as of June 30 was 96 percent, ahead of the penalty phase for late payment, and the $3.8 million in discounted property taxes for filing ahead of time is close to exactly the amount predicted.

The county has also collected $22 million in dedicated real estate taxes for the Montgomery County Community College.

Taking into account that real estate assessment appeals are currently being processed, Dortone said real estate assessment growth — currently, .26 percent — is about where it should be, although below target growth of .6 or .7 percent, and building activity remains robust, with projects in the pipeline proceeding as expected.

Departmentally, register of wills revenues are up, which Dortone said is typical of a strong economy. Sheriff’s department’s revenues are up moderately as well due to transaction volume. And recorder of deeds revenues are trending flat, but have stabilized over the summer.

Clerk of courts revenue has been trending down due to a declining number of criminal cases which have dropped 11 percent in the last two years.

Prothonotary revenues are also trending down despite across-the-board fee increases, a trend Dortone attributed to an overaggressive budget projection.

Gaming revenue, Dortone said, is trending significantly upward, garnering about $550,000 so far and expected to rake in about $1.6 million this year.

That means nearly $500,000 in pass-through revenue for Mission Kids Child Advocacy Center, Laurel House, and the Women’s Center of Montgomery County.

The county spent about 49 percent of its budget for health care, pensions, salaries and wages over the first six months, spending 62 percent of its overtime budget, with turnover about as expected.

In health care, the financial office is projecting moderate savings. And 50 percent of pension contributions have been moved into the retirement fund.

The county has also paid down about 40 percent of debt service in the first six months of the year; spending $18 million of a budget of approximately $45 million based on a set schedule of principal and interest payments.

“Investment income is strong and expected to continue,” Dortone said.