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Receive a report on the Solano County 2012 Index of Economic and Community Progress
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Published Notice Required? Yes ____ No _X _
Public Hearing Required? Yes ____ No _X _
DEPARTMENTAL RECOMMENDATION:
It is recommended the Board of Supervisors receive a report on the Solano County 2012 Index of Economic and Community Progress.
SUMMARY:
The Solano County 2012 Index of Economic and Community Progress was prepared by the County Administrator's Office in partnership with the Solano Economic Development Corporation. The 2012 edition includes technical assistance and objective analysis by Dr. Robert Eyler, a principal at Economic Forensics and Analytics in Petaluma. He is also Professor and Frank Howard Allen Research Scholar of Economics and Director of the Center for Regional Economic Analysis at Sonoma State University.
The Index tracks key indicators that are shaping the local economy. Any description of the local economic picture depends upon the lens in which the economy is view. The 2012 Index examines the local economic condition from three perspectives. The long view goes from 2000 to 2012, which compares the end of the 1990s cycle to the recent recovery. The recession view goes from 2006 (the peak year) to 2010 (the bottom year) in the local employment market. The recovery view represents changes since 2010. The document is available online at www.solanocounty.com/economicindex <http://www.solanocounty.com/economicindex>.
FINANCIAL IMPACT:
The cost of staff time to compile the 2012 Index and the $5,000 to Economic Forensics Analysis for technical assistance and objective analysis was part of the FY2012/13 Adopted Budget.
DISCUSSION:
The Solano County Index of Economic and Community Progress is a project that was launched in 2007 after a series of economic summits identified a need for more fact-based information to guide efforts by leaders in both the public and private sectors to expand the long-term viability of the Solano County economy. Three comprehensive editions were produced for 2008, 2009 and 2010 by the consultant Collaborative Economics for the County of Solano and the Solano Economic Development Corporation. These insightful documents provided an objective analysis of key indicators shaping the local economy.
In 2011, the Index became a project for County staff, in cooperation with the Solano EDC, to maintain as a web-based report and update throughout the year. The Index was expand to include comparisons in many instances to the Sacramento Area, the rest of the Bay Area, California and the United States. The 2012 edition includes the technical oversight of Dr. Robert Eyler of Economic Forensics and Analytics.
Some of the key findings from the 2012 Index are:
• Between 2000 and 2012, employment among firms located in Solano County experienced a dramatic roller coaster ride, climbing to a peak gain of 13,300 jobs in 2006, plunging for a loss of 11,800 jobs between 2006 and 2010. Jobs then climbed back up for a net gain of 3,067 jobs between 2010 and 2012. Over the long view of 2000 to 2012, Solano County had a net gain of 4,367 jobs from firms located in the county.
• Relative to 2000, Solano County has been better in retaining local industry jobs than the rest of the Bay Area, the Sacramento Area, and the state. Solano County's modest 1.4% gain was better than the 0.3% increase in the Sacramento region, 4.3% decline in the rest of the Bay Area, and the 6.4% decline across the state.
• As noted in the 2011 Index, total local employment in Solano County has not kept pace with the growth the county's labor force. Between 2000 and 2012, the county's labor force (residents actively seeking employment) increased by 23,650 or 12.2% while the number of employed residents increased 10,650 or 5.8%. As a result, the number of unemployed residents increased from 9,000 in 2000 to 21,983 in 2012. The analysis points to the significant impact the greater regional economy has on Solano County, which has historically been an exporter of labor. The 2011 American Community Survey estimates 71,517 Solano residents work outside of Solano County.
• In 2010 constant dollars, gross domestic product (GDP) - the sum of consumer, government and business spending - increased by $3.1 billion or 28.3% between 2001 and 2010. Between 2006 and 2010, the county's GDP declined by 2.6%. Leading this growth was the private sector: Goods Producing sectors gained 34.8% and Service-Providing sectors gained 29.1%. Between 2006 and 2010, these sectors declined 7.5% and 2.2% respectively. The Government contribution to the GDP grew by $439 million or 28.3% between 2001 and 2010, including growth of $97 million or 3.6% between 2006 and 2010. (2010 is the latest available data at the county level and changes to the industry classifications by the Bureau of Labor Statistics compromise the ability to make comparisons prior to 2001.)
• After adjusting for inflation, the median sales price for homes in Solano County was $218,000 in December 2012, up $31,701 or 17% from December 2011. Compared to the housing peak in June 2006, the median home price has declined $326,133 or 59.9 percent.
• Lenders recorded a total of 3,897 notices of defaults in Solano County during 2012, down 1,240 or 24.1% from 2011. At 696 for the fourth quarter of 2012, this represents the lowest quarter for notices of defaults in the county since the fourth quarter of 2006 and the sixth consecutive quarter of quarter-over-quarter declines in notices of defaults.
• The housing market collapse and the Great Recession shrank two critical sources of local government revenues to 75% of their peak revenues. In inflation adjusted dollars, taxable sales peaked in Solano County in 2006 at $7.2 billion and declined in 2010 to levels not seen since 1999. During the recession years of 2006 to 2010, taxable sales in Solano County declined $1.8 billion or 25.4% The first three quarters of 2011 are up $211 million or 5.4%. Assessed property values in Solano County did not peak until 2007, reaching $51.2 billion in inflation adjusted dollars. By the close of the assessment rolls in early 2012, property values had declined $13.2 billion or 25.6%.
ALTERNATIVES:
The Board could chose not receive this report; however, this is not recommended as this is an opportunity for the Board to learn about the economic indicators shaping the local economy.
OTHER AGENCY INVOLVEMENT:
The report was prepared by the County Administrator's Office in partnership with the Solano Economic Development Corporation. Technical assistance and objective analysis was provided by Economic Forensics and Analytics.
The 2012 Index will be presented at the Solano EDC membership breakfast on March 28 at the Hilton Garden Inn in Fairfield.
CAO RECOMMENDATION:
APPROVE DEPARTMENTAL RECOMMENDATION