City staff report FY25 second‑quarter general fund forecast: revenues near projection, vacancy savings about $5 million

Lisa Cipriano, director of budget and evaluation, presented the Fiscal Year 2025 second-quarter general fund forecast to the Newport News City Council Feb. 25, summarizing revenues and expense pressures through Dec. 31, 2024.

Cipriano said the city’s FY25 general fund budget is $624.2 million (as stated in the presentation) and that second-quarter collections — which capture many of the fiscal year’s major revenue drivers — put the city close to its projected revenue total. She said real estate collections were lagging slightly, personal property tax delinquencies were running about $2.7 million higher than anticipated, and collections for sales and meals taxes were above budget assumptions.

Cipriano flagged machinery-and-tools tax receipts as lagging and said assumptions tied to declining inflation have not yet materialized; she noted recent inflation persistence has kept some revenue lines higher than projected. She described the March BPOL tax collection as an important near-term indicator of local economic activity.

On expenditures, Cipriano said the city has constrained spending where possible and is projecting roughly $5 million in expenditure savings at the time of the report, largely because of vacancy savings. She said contracting and contractual-services pressures — including increased security costs, public-works disposal and contractual labor to cover vacancies — are a notable area of expenditure pressure.

Councilmembers asked for additional detail. Councilman Cleon Long asked whether past-second-quarter surpluses followed similar patterns; Cipriano said prior budgets had been conservative because they were built with recession assumptions and that collection timing differences explain some year-to-year variation. Long also requested a delinquency report and a summary of the city’s use of consulting and other contracts over the last two to three years, to better understand whether contract spending has grown and how it compares with vacancy savings.

City Manager Alan Archer said staff are preparing both reports — the delinquency summary and a contracts/consulting inventory and trend analysis — and that the city treasurer and commissioner of revenue will be included when appropriate. Archer said production of those reports is underway and will be provided to council.

Council members also discussed operational support for public works and noted fewer nonviolent offender work crews are available now than when the city operated the city farm; the sheriff’s office participation was described as reduced relative to earlier years.

Cipriano closed by noting the city is monitoring federal policy uncertainty and inventorying federal grant-funded projects so the city is prepared if federal guidance changes. Several councilmembers thanked finance staff for the presentation.