Fairfax County officials Monday said revenue from the 4 1/2 percent local sales tax in January fell about 12 percent behind projections for the FY 2002 budget.
January was the first month of the third quarter in the fiscal year.
To compensate, County Executive Anthony Griffin asked the Board of Supervisors to approve spending cuts totaling $6.1 million: $3 million from capital programs, $1.7 from the county’s vehicle replacement fund, and $1.4 million in other cuts, said Public Affairs Director Merni Fitzgerald.
“We were hoping the downward trend would correct itself, but sales tax revenue is down 12 percent in the month of January,” she said.
“We get numbers two months after the fact. If the sales tax revenue is correcting itself, we won’t see the increase for two months.”
A revenue shortfall of $12.9 million in FY 2002 had been predicted in the county, and was reflected in the advertised budget plan for FY 2003, Fitzgerald said.
Since then, another shortfall of $3.4 million has materialized for a
total shortfall of $16.3 million. Sales tax revenue this year is off by 6.3 percent, Fitzgerald said.
As a funding source, the local sales tax supplies about one-third of the 14.3 percent slice of the budget pie from local taxes.
By comparison, revenue from real estate taxes supplies about 57.4 percent of Fairfax County’s total revenue.
The bill for costs incurred by the events of Sept. 11, 2001, is about $7 million for public safety overtime pay and anthrax investigations, Fitzgerald said.
The total budget shortfall on the year is actually $23.3 million, Fitzgerald said.
The county has saved less than $1 million in reduced costs for natural gas due to the mild winter. The costs of terrorism more than offset any savings in the funds budgeted for snow removal, Fitzgerald said.
Griffin has requested a $3.2 million cut in spending for informational technology and capital projects and $1.7 million reduction in the vehicle replacement fund.
A decrease in projected costs for photo red lights and audit adjustments will yield about $1.4 million in savings, under Griffin’s proposal.
The total yield from the 4.5-cent local sales tax was projected at $126.9 million in FY 2003.