Often lost in the cacophony of demands for funding from the county budget are the Ten Principles of Sound Financial Management, which first were adopted by the Fairfax County Board of Supervisors on October 22, 1975. (Longtime residents may recall that Alan Magazine was the Mason District Supervisor at that time.) The policies are designed to support the county’s fiscal management and maintain our “triple A” bond rating. Fairfax County is one out of only 39 counties in the nation with “triple A” bond ratings from all three rating agencies (Standard & Poor’s, Moody’s Investor Service, and Fitch Investors Services).
The Ten Principles have been amended from time to time, but the basics remain the same: a dynamic planning policy process; annual budget plans that demonstrate fiscal restraint; positive cash balances at the end of the fiscal year; debt ratios; cash management; internal controls; performance measurement; reducing duplication; underlying debt and moral obligations; and a diversified economy. The most recent amendment was in FY2008, when the Board authorized the use of variable rate debt for short-term debt financing. No changes to the Ten Principles are recommended for FY2015.
The second of the Ten Principles, annual budget plans that show fiscal restraint, includes the managed reserve maintained at not less than two percent of Combined General Fund disbursements in any given year, and the Revenue Stabilization Fund (RSF), for which the target level is three percent. The Board of Supervisors established the RSF in 1999 with the FY2000 budget, and attached some very tight “strings” for withdrawals. Use of the RSF is authorized only when projected revenues decrease by 1.5 percent or more after the budget is adopted; no more than half of the RSF may be withdrawn in any given year; and the RSF must be refilled to its authorized level before any additional withdrawal is permitted. The only time a withdrawal was made from the RSF was in 2009, and it was replenished by the end of the fiscal year. Even with these two sizable funds, the rating agencies have suggested that the county’s reserves ought to be higher.
The Fairfax County Vision Elements and the Board’s Goals and Priorities reflect the stewardship that was established with the adoption of the Ten Principles four decades ago. Quality education, safe streets and neighborhoods, a clean and sustainable environment, vibrant economy, efficient transportation network, and recreational and cultural opportunities are goals reaffirmed by the Board of Supervisors at its retreat in February 2012. Recognizing that the property tax is Fairfax County’s primary source of revenue to support the vision and goals, the Board’s last, but not least, priority is taxes that are affordable.
Board Chairman Sharon Bulova, who also chairs the Board’s budget committee, often reminds that budgets represent and reflect the values and philosophy of a community. The Ten Principles, the Vision Elements, and the Goals and Priorities give excellent guidance. Our challenge is to find the balance that protects and enriches the quality of life for Fairfax County’s people, neighborhoods, and diverse communities, and moves us forward.