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FROM THE CAPITOL
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Jobs statistics indicate economy still sputtering
How does an economy experiencing slow growth affect Virginia’s local governments? Income and sales tax revenues drive the state budget. Fewer state dollars translate into less state assistance for public education, local law enforcement, and other public services. Fewer jobs hurt consumer confidence, making people feel uneasy about the future and less likely to purchase a home. This hurts local revenue collections. So, what is the job situation in the Commonwealth?
Across Virginia, the unemployment rate rose from 5.8 percent in April to 6 percent in May. Martinsville’s non-seasonally adjusted unemployment rate increased to 16.9 percent from 16.7 percent in April. Unemployment increased in the New River Valley, jumping from 6.4 percent in April to 7 percent in May. In the Roanoke Valley, the rate rose just a bit from 6.2 percent to 6.3 percent. Roanoke City remained flat at 8 percent unemployment.
In the Richmond area, the seasonally unadjusted unemployment rate rose slightly from 6.5 percent in April to 6.7 percent in May. Unemployment in the Charlottesville metropolitan area rose from 4.7 percent to 4.9 percent between April and May. The rise comes after three months of steady declines. For the Danville metropolitan statistical area, unemployment fell from 9.4 percent to 9.3 percent. Danville City dropped slightly form 12 percent to 11.6 percent.
For many areas of the state, the rise in unemployment in the months of May and June reflects the new numbers of college graduates and students entering the labor force. To provide some perspective, the table below shows how the numbers of employed and unemployed Virginians have changed over the past six months.
May 2011 April 2011 March 2011 February 2011 January 2011 December 2010 Perhaps the more telling statistics are the employment figures from May 2008, 2009 and 2010. Three years ago the numbers of employed and unemployed were 3,977,040 and 150,475, respectively. There were roughly 12,000 more Virginians working and about 100,000 fewer receiving unemployment assistance than this past May.
However, the May 2011 statistics are an improvement over the two previous years. In May 2010 and May 2009, the employment numbers were 3,913,330 and 3,920,341, respectively. May 2011 data show more Virginians are working today.
As for the number of unemployed, both May 2009 and May 2010 exceeded this past May by at least 32,000.
Today’s employment and unemployment numbers are clearly not where most Virginians want to see them, although there is slow improvement. The question is can the economy make significant headway? Some forecasters like HIS Global Insight say employment in Hampton Roads will not return to pre-recession peaks until 2015.
If consumer confidence is a true indicator of future economic growth, then the predictions of anemic job growth seem reasonable. According to the June 2011 report of The Conference Board Consumer Confidence Index, consumers remained pessimistic about the outlook for the job market for the next six months. Those anticipating more jobs in the months ahead declined to14.2 percent from 16.7 percent (from May to June), while those expecting fewer jobs remained unchanged at 20.3 percent. The proportion of consumers anticipating an increase in their incomes declined to 13.9 percent from 14.9 percent.
contents
Transportation bills to emerge ... at last
Transportation spending has been exceeding available funding in recent years because fuel tax receipts are getting hammered by decreased driving and more fuel-efficient vehicles. While there is plenty of discussion about the need to find new revenues to support much-needed transportation improvement projects and to maintain existing roads and transit systems, there is no support for even mentioning new taxes in the current political environment.
Is this yet another description of Virginia’s transportation woes? It could be, but isn’t. This is the situation in Washington, where House and Senate transportation leaders are close to introducing transportation authorization bills. Both proposed versions will renew the current federal program, known as SAFETEA-LU, which expired in September 2009 and has been extended by Congress through the end of this coming September.
Although the bills have yet to be introduced, preliminary reports suggest that the House bill will propose to collapse many of the current 101 separate transportation programs. This could streamline federal regulations, reducing costly delays and offering more flexibility for states. The “downside” of the House approach is that the House leadership is looking to cut federal transportation programs by 30 percent in order to close the gap between transportation spending and revenues.
Could this affect the transportation program proposed by Gov. Bob McDonnell and approved by the General Assembly? It might. The state transportation plan assumes the issuance of $1.1 billion in GARVEE bonds, a federal debt bond where states borrow against future federal transportation grants. If federal grants are significantly reduced, the amount of the issuance (as well as the number of transportation projects) could be squeezed tight.
However, because of the crush of must-pass bills on the congressional agenda, it is unlikely that Congress will be able to reach agreement before the emergency authorization expires on Sept. 30. It appears that sitting in traffic will be the most popular transportation option for the summer and for some time to come.
Tiger in your tank: 3rd round of transportation grants available
The U.S. Department of Transportation announced a third round of TIGER grants. The Transportation Investment Generating Economic Recovery (TIGER) program has provided $2.1 billion for 126 transportation projects in all 50 states. In the previous two rounds, the federal government received more than 2,500 applications requesting more than $79 billion for transportation projects.
This round includes $527 million for innovative transportation projects that have a regional impact. Of this amount, $140 million is set aside for rural communities. Projects will be selected based on their ability to contribute to the long-term economic competitiveness of the nation, improve the condition of existing transportation facilities and systems, improve energy efficiency and reducing greenhouse gas emissions, improve the safety of U.S transportation facilities, and improve the quality of living and working environments of communities through increased transportation choices and connections.
Unlike the previous two rounds, the grants cannot be used for planning, preparation, or design of capital projects.
Applicants are required to submit a “pre-application” prior to submitting a final application. The pre-application system will open on August 22, 2011 and close by the close of business on October 3, 2011. The U.S. Department of Transportation will host a half day seminar and webcast providing information and guidance on the application process on July 18 from 1-4 p.m. For additional information, check out http://www.dot.gov/tiger. The official notice in the Federal Register can be found in Volume 76, No. 127/Friday, July 1, 2011/Notices, pages 38719-38740.
State’s triple ‘A’ rating risk exposure could trickle down to local governments
Moody’s Investors Service reported last week that a downgrading of federal credit ratings would put the highest rated state and local governments at greater risk of downgrades than similarly rated corporate or structured finance projects. That’s because credits indirectly or directly linked to the federal government’s rating would move in lockstep with any negative outlook or downgrade on the sovereign credit.
These would include pre-refunded municipal bonds with debt service payments backed by Treasury bonds held in escrow. Moody’s currently rates 15 states and more than 400 local governments AAA, and notes that if those governments retain their credit score subsequent to a federal default, they would hold ratings one or two grades higher than the federal government for the first time in U.S history.
The Treasury Department projects that the United States will exhaust its borrowing authority under the debt limit on Aug. 2.
State chamber president to speak at luncheon
All VML Annual Conference attendees are invited to register for the Monday, Oct. 3, conference luncheon featuring Virginia Chamber of Commerce President and Chief Executive Officer Barry DuVal. The luncheon is sponsored by the Virginia Local Government Management Association (VLGMA).
DuVal, selected as the chamber’s leader in April 2010, is a former mayor of Newport News, former state secretary of commerce and trade, and the founding president and CEO of the Hampton Roads Partnership, a regional organization designed to advance the economic interests of Southeast Virginia.
His luncheon speech will focus on the importance of local governments and businesses working together for the greater good of the state’s communities.
Business executive to speak at prayer breakfast
Chris Lansing, president of Ted Lansing Corp., will speak at the VML Annual Conference Prayer Breakfast on Tuesday, Oct. 4, in Henrico County. The breakfast is held each year in honor of the league’s past presidents.
In addition to serving as president of one of the nation’s largest wholesale distributors of exterior building supplies, Lansing is active in civic affairs. He serves on the Southern Region Board of the Boy Scouts, the Board of Trustees at Southern Virginia University and the Board of Directors of the Polynesian Cultural Center in Hawaii.
Lansing is an elder with the Church of Jesus Christ of Latter-day Saints in Richmond. He also is a regional representative of the church in Virginia. Lansing is a graduate of the Marriott School at Brigham Young University.
Mayors Institute scheduled Oct. 1-2
Registration materials for the annual VML Mayors Institute will be sent next week to the offices of league member local governments, as well as to mayors and board chairs.
The institute will be held Oct. 1-2 at the Ramada Plaza Richmond West in Henrico County. The program will begin on Saturday at 8:30 a.m. and will conclude Sunday at 11:30 a.m., in advance of the start of VML’s annual conference.
Topics to be covered at the institute include the state/local partnership, council evaluation of the manager and clerk, and community financial literacy.
The conference is designed for mayors / board chairs and vice mayors / vice chairs.
Williamsburg’s Tuttle to lead VLGMA in 2011-2012
Williamsburg City Manager Jack Tuttle II has been elected president of the Virginia Local Government Management Association for 2011-2012. Tuttle was elected at the VLGMA annual conference held last month in Virginia Beach.
Also elected as officers were Staunton City Manager Steve Owen, president-elect; Poquoson City Manager Randy Wheeler, first vice president; Gloucester County Administrator Brenda Garton, second vice president; Goochland County Administrator Becky Dickson, third vice president; and Abingdon Town Manager Greg Kelly, secretary. Lynchburg City Manager Kim Payne is immediate past president.
The association also elected six new members of its executive committee. They are: Herndon Town Manager Arthur Anselene, Hanover County Deputy Administrator Joe Casey, Harrisonburg Assistant City Manager Anne Lewis, Purcellville Town Manager Rob Lohr Jr., Vienna Town Manager Mercury Payton, and Prince George Deputy County Administrator Pamela Thompson.
VLGMA is a state affiliate association of the International City/County Management Association. VML serves as its secretariat.
NLC policy amendment and resolutions due Aug. 12
All member local governments of the National League of Cities are invited to submit amendments to the National Municipal Policy and resolutions for consideration as a part of NLC’s annual policy development process. The deadline for submissions is Friday, Aug. 12.
The National Municipal Policy is a permanent statement of NLC’s position on national matters divided into seven policy chapters. Each policy and advocacy committee considers the submitted policy amendments to develop and revise policies within its corresponding chapter. These items are then addressed at NLC’s annual business meeting held at the Congress of Cities in November.
Resolutions address timely issues or specific pieces of legislation and are annual statements. These statements expire after one year unless action is taken to renew it or incorporate it into the Municipal Policy.
Policy amendments and resolutions must be submitted in writing to the attention of Stephanie Spirer at NLC: spirer@nlc.org; fax 202/626-3043; or mail NLC, 1301 Pennsylvania Ave., N.W., Suite 550, Washington, D.C. 20004.
To view the current NLC municipal policy, visit www.nlc.org/nmp. To receive a copy of the guidelines for submission, call or e-mail Sprier at NLC.
NLC’s City Showcase to celebrate achievements
July 31 is deadline for accepting applications
The National League of Cities is accepting applications for the 2011 City Showcase, NLC’s premier program celebrating city achievements. Successful, creative programs from cities and towns across the country are encouraged to submit an application to participate.
The City Showcase celebrates cities for their achievements and provides city leaders and staff with the resources and networking opportunities they need to learn and grow.
Through the City Showcase, NLC recognizes and showcases city programs that form creative collaborations, implement new processes or make efficient use of resources to improve city functioning and enhance the quality of life for their residents.
The centerpiece of the City Showcase activities will take place during NLC’s Congress of Cities and Exposition in Phoenix, Nov. 9-12. Representatives from selected programs will engage in conversations with attendees about their implementation strategies, successes and lessons learned. They will also have the opportunity to display their information in the exhibit hall.
Participating cities will be honored by NLC in a conference-wide event and recognized in conference publications. Selected city programs will also be showcased on NLC’s website and highlighted in Nation’s Cities Weekly and other venues.
City Showcase programs are selected for their innovative practices and for their contribution to a collection of programs that demonstrates a wide range of geographical locations, city sizes and topic areas.
Programs that address a variety of topics relevant to cities will be considered, but emphasis will be placed on programs that are aligned with one or more of the conference’s 2011 concurrent conference topics:
- Green Cities
- Economic Development
- Infrastructure
- Your City’s Families
At the Congress of Cities and Exposition, participating programs are highlighted as models and educators. Program representatives will display and discuss their successes with conference attendees, providing them with innovative ideas for planning and problem solving in their own communities.
Both participating programs and conference attendees will benefit from this exchange of innovative ideas.
According to Laura Cisneros, of San Jose, Calif., “it is rewarding to attend a conference where we meet leaders from throughout the United States who we can learn from, network with and discuss the issues we are all facing today. You leave the conference with new ideas, new insights and new connections to make us more effective in our role.”
Representatives from participating programs will also have the opportunity to talk with one another about their successes, challenges and solutions and form ongoing connections with their peers from across the country.
The City Showcase is “a great way to connect with other municipalities around issues we face every day and find new and innovative solutions,” said 2010 participant Sandra Seader of Longmont, Colo.
Programs selected to participate will be provided with two free registrations to NLC’s Congress of Cities and Exposition in Phoenix. Southwest Airlines, the official airline of the City Showcase, will make it possible for some participating cities to fly to Phoenix to share their successes with conference attendees. The cost of the exhibit space is covered by NLC. Additional scholarships may be awarded to participating programs for display and other travel expenses.
Applications are available at http://bit.ly/kpOOGk. The application deadline is July 31. Applicants will be notified during the month of August if they are selected.
Details: For more information about the City Showcase, contact Lara Malakoff at malakoff@nlc.org or Will McGahan at mcgahan@nlc.org.
… Lara Malakoff
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