HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 02/10/2009 - ECONOMIC HEALTH/FINANCIAL ISSUES UPDATE DATE: February 10, 2009 WORK SESSION ITEM
STAFF: Mike Freeman FORT COLLINS CITY COUNCIL
SUBJECT FOR DISCUSSION
Economic Health/Financial Issues Update.
EXECUTIVE SUMMARY
The overall economic goal for the City is to balance high quality economic development with
quality community and environmental goals. The City has strong partnerships with diverse
organizations, strategic marketing and promotion of the area to new and expanding businesses, and
the City continues to focus on retaining and growing quality primary jobs while also focusing on
retaining and building the retail sector.
In 2009, the City will face challenges such as broad economic slowdown, decrease in sales tax
collections, decrease in use tax collections, and potential financing difficulties for developers.
Fort Collins is not immune to the global economic climate,yet we have economic strengths unique
to our community. We have a highly educated workforce, an innovative and globally-focused
university, supportive culture for entrepreneurs, and diverse industries.
2009 will also bring economic opportunities to Fort Collins. Colorado State University's focus on
research and development and commercialization of research will nurture and expand start-ups that
most likely will stay in Fort Collins. The City's collaboration with the Downtown Development
Authority will result in new projects that benefit the whole community and differentiate us from
other regional communities.
GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED
The presentation will focus on providing an economic and financial update to City Council. The
discussion will focus on highlighting overall revenue collection for 2008 and strategies for achieving
economic health in 2009. Staff will address suggestions and questions from City Council.
BACKGROUND
In 2004, City Council appointed a group of community representatives to develop a set of
recommendations intended to address the economic vitality and sustainability of Fort Collins.
Members of the "Economic Vitality and Sustainablity Action Group"(EVSAG) met for two years
and created an economic strategy map for the City to follow in order to achieve economic success
and longevity.
February 10, 2009 Page 2
A major outcome of EVSAG was the Economic Action Plan. The Action Plan consists of four key
strategies for economic health:
• Diversify the economy
• Build partnerships
• Support business expansion and attraction
• Be proactive on economic issues.
City Council is updated periodically on implementation of the Economic Action Plan. Financial
updates are also provided to give an overall picture of economic health, in the community and the
City's organization.
ATTACHMENTS
1. Power Point Presentation outlining 2008 revenue collections and economic health priorities
for 2009.
ATTACHMENT 1
City Council
Economic and
Financial Update II
February 10 , 2009
F�t`
Collins
Background
• City Council asked for regular updates on economic
and finance issues
— 1st update : December 2008
— 2nd update : February 10 , 2009
• economic health goals and objectives for 2009
and a review of 2008 revenue collections
— 3rd update : Summer 2009
ort C F ollins
1
ECONOMIC ACTION PLAN STRATEGIES
• Four key strategies :
- Business incubation, retention, expansion and
attraction
- Be proactive on economic issues
- Build partnerships
- Diversify the economy
• Overall goal - high quality economic
development, balancing growth with
environmental and quality community goals
-_-- - - _ - Fort Collins
BUSINESS INCUBATION , RETENTION ,
EXPANSION & ATTRACTION
• RM12 building , fundraising , program expansion
• Participation in the NCEDC BR& E program
- 50 primary employers interviewed in 2008
• UniverCity Connections - interview downtown
primary employers
• Brokers meetings and property owners support
• Support for North College URA projects
For Collins
2
BE PROACTIVE ON ECONOMIC ISSUES
• Historic designation issues for commercial projects
• Pursue a new URA at Prospect and College
• South College Redevelopment options and plan
— Identification of redevelopment sites
Fort` Collins
BE PROACTIVE ON ECONOMIC ISSUES
• Foothills Mall options
— Vision and proactive planning
• Infrastructure investments that support economic health
— 1 -25/392 Partnership
— Fort Collins - Loveland Airport
City of
Fort Collins
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BE PROACTIVE ON ECONOMIC ISSUES
• International Council of Shopping Centers
Conference — May 2009
• Business communications strategy
— eNewsletter , fcgov. com/business and
fortcollinsinnovation . com
F�t` o ins
be
BUILD PARTNERSHIPS
• Sustain/grow State/Federal
employment 2
• Colorado State University
— Office of Economic Development
— Research Foundation
— Ventures
— Superclusters C0104a
• Rocky Mountain Innovation Initiative
strategic plan
• NCEDC site selection inquiries University
• UniverCity Connections
City of
Fort�i1s
im
BUILD PARTNERSHIPS
• FortZED Implementation
— Department of Energy grant
— Department of Local Affairs grant
— Green Dining Week promotion
— FortZED 50 FORT
— Fortzed . com web site =D
ZF
imilL
DIVERSIFY THE ECONOMY
— Clean Energy
• SWOT analysis
• Energy and Engines Lab expansion
— Biotechnology/Bioscience
• RM12 space , CSU Research
Innovation Center
— Software
• GIS
— Uniquely Fort Collins
• Be Local , Shop Fort C st Fort Collins
5
RETAIL PRIORITIES
• Foothills Mall redevelopment
• Front Range Village lease up
• 1 -25/392 mixed use development
• Shields & Lemay Safeway Center
F�t` o ins
RETAIL PRIORITIES
• North College Redevelopment
— King Soopers Marketplace
— Brighton Development Company
• Mason Corridor Related Redevelopment/S . College
— Wal - Mart/Toys- R- Us/Wild Oats/Whole Foods Center
— Choice Center/Capstone
City of
Fort Collins
6
2008 Target Industry
Employment Update
First and Second Quarters of 2008
F�t`
Collins
im ism
Biotechnology
• From 2007 to 2008 the Bioscience Cluster expanded
by 101 positions (5 . 9 percent )
• Manufacturing component expanded by 122 jobs
( 10 . 3 percent)
• Research component contracted by 21 jobs ( -3 . 8
percent )
City of
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Source: Colorado Department of Labor and Employment and CSU Regional Economist
ort Collins
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Clean Energy
• Majority of clean energy job creation within Larimer
County occurred in Fort Collins
• Larimer County portion of the cluster added 179 jobs
( 8 . 2 percent )
— 150 new jobs in Fort Collins (8 . 3 percent increase )
— The largest company within the cluster , Woodward
Governor , posted the strongest gains in
employment
Fort Collins
Technology Cluster
• 251 new jobs , 4 . 2 percent increase
• Software
— 236 ( 14 . 1 percent)
• Hardware
— 16 ( 0 . 4 percent )
Fort Collins
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Software
• Gains in wages
— Valued at $ 8 . 6 million
— 15 . 1 percent increase
• Custom computer programming services industry
— 139 new jobs ( 35 . 1 percent)
• Technology Cluster employers increased from 124 to
143
Fort Collins
17 Source: Colorado Department of Labor and Employment and- CSU Regional Economist
Hardware Employment Level Change Percent Change
2005 2006 2007 2008 2007-2008 2007-2008
51458 41442 41352 41368 16 0 .4%
Software Employment Level Change Percent Change
2005 2006 2007 2008 2007-2008 2007-2008
19473 19639 1 ,676 15912 236 14. 1 %
Clean Energy Employment - Fort Collins Specific Level Change Percent Change
2005 2006 2007 2008 2007-2008 2007-2008
15542 13693 15815 15965 150 8.3%
Bioscience Cluster Employment Level Change Percent Change
2005 2006 2007 2008 2007-2008 2007-2008
15307 15316 1 ,727 1 ,828 101 6%
Fort Collins
9
CITIZEN SURVEY RESULTS
City' s Performance on Economic Health
• Overall support of businesses in Fort Collins
• 58 % " good " or "very good "
• Overall economic health in Fort Collins
• Four in ten people " good " or "very good "
Fort` Collins
CITIZEN SURVEY RESULTS
City' s Performance on Economic Health
• 25 % reported that overall job growth was "good " or
"very good "
• 44 % reported overall job growth was " average "
• 31 % of residents thought that job growth was " bad " or
"very bad "
City of
Fort Collins
10
CITIZEN SURVEY RESULTS
City' s Performance on Economic Health
• Residents < 10 years gave more favorable ratings
than residents > 10 years
• Full -time or part-time students were more likely to
give positive ratings to areas of the economy than
were non -students
For
�tf
2008 Revenue Update
Fort�i1s
61
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Sales Tax Revenue
• Total 2008 sales tax collections ended 0 . 4 % higher than
2007
• Factors contributing to the growth in 2008 :
- Restaurant Sales ( + 5 . 5 % )
- Food Stores ( + 3 . 9 % )
• Retail categories that will challenge growth in 2009 :
- Auto Dealers & Service Stations were down 6 . 9 % in
2008
- Home Furnishings & Consumer Electronics were
down 0 . 7 % in 2008
F�t`
Collins
Use Tax Revenue
• Total 2008 use tax collections decreased 18 . 0 % from
2007 .
• Use tax from building permits and auto registrations
declined sharply in the fourth quarter of 2008 .
— Building permit use tax decreased 30 . 5 % in 2008 .
— Automobile use tax decreased 12 . 0 % in 2008 .
• Auto sales and construction activity are expected to
continue to slow , impacting use tax collections in 2009 .
City of
Fort Collins
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Sales & Use Tax Audit Revenue
• 2008 - $ 17661 , 900
• 2007 - $2 , 754 , 300
• 2006 - $ 7015400
0 2005 - $ 177657300
9 2004 - $ 171937600
• 2003 - $ 6443200
0 2002 - $ 171627300
F�t` ollins
Investment Earnings
Interest Rate Total $ General Fund Average
2005 actual = 917577982 9951157 3 . 34%
2006 actual = 137137000 178281494 4 . 34 %
2007 actual = 155767000 272541812 4 . 91 %
2008 budgeted = 15 , 200 , 000 2 , 0437866 4 . 75%
2008 YTD = 1455015696 159085301 3 . 91 %
2009 budgeted = 14 , 000 , 000 11936 , 294 4 . 50 %
2009 projected = 770007000 170007000 2 . 30 %
City of
Fort Collins
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Other Major General Fund Revenues
Property Taxes :
• Collected $ 16 . 21VI in 2008 .
— 10 . 9 % increase over 2007
— consistent with the amount budgeted
• 2007 was a reappraisal year
— the assessed valuation increased by 9 % .
— property tax levy was collected in 2008
Payments in Lieu of Taxes Pilot :
• Collected $6 . 81VI in 2008 F� Cottins
t` �
Closing /Questions
City of
Fort Collins
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