Your Tools for Managing the Future
By Sharon R. Bock, Clerk & Comptroller

In January 2005, I took office as your Clerk & Comptroller. Since then, I have had many opportunities to speak to you – government and business leaders, citizens and civic groups. One message has been very clear over the past 2 ½ years – you want to understand how your local government works and you want to actively participate in shaping the future of Palm Beach County. As your independent, elected County Accountant, Treasurer and Auditor, I am in a unique position to provide you with accurate information and analysis of county finances.

My highest priority is to provide public education and awareness that promote transparency and accountability in County government. Information helps us play an active role in our county government and be empowered when we speak to or cast a vote for our elected officials.

Our office currently offers three tools to help citizens, businesses and government officials understand Palm Beach County finances and economic health: The Palm Beach County Economic Index, Checks & Balances: Your Guide to County Finances and the FY2006 Comprehensive Annual Financial Report.

The Palm Beach County Economic Index

The Palm Beach County Economic Index is an exciting, new financial tool which was developed to gauge the County’s current and future economic health. The Index, first unveiled in March at an Economic Forecasting Conference with former Federal Reserve Chair Dr. Alan Greenspan, will help government and elected officials, business leaders and citizens make financial decisions and better prepare for changes in our economy.

The Clerk & Comptroller’s Treasury department invests the County’s taxpayer dollars and will use the Index to implement best practices in investing public funds.

Click here to find out more about the Palm Beach County Economic Index in this edition of Your Public Trustee.

Checks & Balances: Your Guide to County Finances

Another tool created to help you participate in the County’s future is Checks & Balances: Your Guide to County Finances, a first-ever, citizens’ report produced by our office to help you understand how Palm Beach County funds are managed and spent. The easy-to-read guide covers important topics like your property tax bill, how the budget is created, what the County owns and owes, and much more. Click here for more information about Checks & Balances.

FY2006 Comprehensive Annual Financial Report

Checks & Balances is based on financial information contained in the more-detailed FY2006 Comprehensive Annual Financial Report (CAFR). The County budget, prepared by the County’s Office of Financial Management and Budget, is a prospective view of how tax revenues will be spent. The CAFR, prepared by the Clerk & Comptroller’s Finance department, is the actual report of how tax revenues were spent during fiscal year 2006, which ended on September 30. It includes audited financial statements of all County operations, including the constitutional offices, and County enterprises such as the airports and solid waste authority. Although it is geared to the finance professional, the CAFR represents the clearest financial picture of our County from which we can draw conclusions about our fiscal health.

This year, for the first time, I, along with my staff of finance, investment and accounting experts, presented key financial highlights of the CAFR to the Board of County Commissioners at its regular meeting on May 1. The presentation was based on our analysis of data regarding the County’s net assets, debt, investments and fund balance. Our analysis led to a suggestion that the County discuss creating debt and reserve policies to promote transparency and accountability in revenue and spending. Click here to see the CAFR PowerPoint presentation.

Final Thoughts

The continued financial health of Palm Beach County depends on long-term strategic thinking and planning. Such planning is enhanced by the availability of valid financial information, advice and interpretive economic tools—something the Clerk & Comptroller’s office is uniquely positioned to provide. The tools outlined in this edition of Your Public Trustee are means by which your government leaders can take advantage of local resources to make important financial decisions that affect the financial future of our County.

With access to the CAFR, Checks & Balances and the Palm Beach County Economic Index, you are empowered to actively participate in the future of Palm Beach County. You are empowered to use this information to make a difference in your community.

Clerk & Comptroller Sharon Bock serves as the County’s Chief Financial Officer, Treasurer and Auditor, Clerk of the Circuit Court, County Recorder and the Clerk to the Board of County Commissioners. Clerk Bock earned her Juris Doctorate and series 7, 63, 65 and insurance licenses.

New Economic Tool Now Available Online
By Carter Hammer, Chief Financial Officer, Clerk & Comptroller

Will Palm Beach County's job growth stay strong? Has the building boom gone bust? How much do hurricanes impact our economy? Make the Clerk & Comptroller’s new Palm Beach County Economic Index your source for those answers! The Index, which will appear quarterly in the Clerk & Comptroller’s Your Public Trustee newsletter, is now available at www.mypalmbeachclerk.com. While there are many indices, the Palm Beach County Economic Index does the analysis for you, providing easy-to-understand information about not only the current state of the local economy, but its likely performance eight to 10 months in advance. This new financial tool is one source for useful information that can help governments, businesses and citizens gauge the County’s current and future economic health. It can help when making important decisions from opening a new business to relocating your family. “Being prepared for changes in the local economy’s performance and being aware of economic trends give local governments and businesses a critical advantage in managing resources and planning for the future,” said Clerk Sharon R. Bock. “As the Chief Financial Officer for Palm Beach County, it is my priority to provide a source of useful financial information presented in a format that is easily understood and used.”

How Trends are Tracked

The Palm Beach County Economic Index is comprised of two indices—“coincident” and “leading”. The coincident index provides a snapshot of the Palm Beach County economy as it exists now. It does this by considering changes and trends in areas such as jobs, passenger tallies at Palm Beach International Airport, retail sales, bed taxes and consumer confidence ratings. The “leading index” projects how the economy will perform over the next several months by tracking items such as the number of residential building permits, initial claims for unemployment insurance and consumer expectations. Both use current information to evaluate our County’s current and future economic conditions.

The Man Behind the Numbers

The Palm Beach County Economic Index was developed by Dr. Stephen Fuller, the Director of the Center for Regional Analysis at George Mason University’s School of Public Policy in Fairfax, Virginia. For years he has conducted research and analytical studies on economic, demographic, social and policy issues impacting the current and future growth of regional economies. Dr. Fuller first created an economic index for Fairfax County, Virginia, 13 years ago. At that time, he needed other counties to compare with his Fairfax data, and he picked Palm Beach County as one of them. The two are perfect comparison counties because of similarities in income, growth and their economies. Capturing and interpreting economic information for an index takes many years. Even though the Palm Beach County Economic Index is just being unveiled, it is solidly built on 13 years of past economic information.

Carter Hammer joined the Clerk & Comptroller’s office as Chief Financial Officer in February 2007. He holds a Bachelor’s of Business Administration in International Finance degree, a Master’s in Business Administration and a Master’s in Accounting.

Partly Sunny Skies Forecasted for Palm Beach County Economy
Economic Update – Second Quarter 2007
By Dr. Stephen Fuller, Director of the Center for Regional Analysis at George Mason University, and Arnfield P. Cudal, Investment Analyst, Clerk & Comptroller

Palm Beach County’s healthy job market and low unemployment are expected to sustain growth through 2007 and the first quarter of 2008 after a slowing trend that started around mid-2006.

County Mirrors U.S. Economy

The forces dampening U.S. economic growth, such as reduced construction activity, rising gas prices and sliding home prices, are impacting Palm Beach County’s economy. With a local economy heavily dependent on tourism, construction and government spending; the significant drop in residential building permits, as seen in this graph, weighs heavily on the economy’s growth.

Real Estate Rebounding?

Housing concerns and a broad decline in home values are also influencing the local economy. According to the Florida Association of Realtors, median home prices in the West Palm Beach – Boca Raton Metropolitan Statistical Area (MSA) peaked at $405,500 in June 2006 and bottomed out at $365,500 last September. However, there is some good news. Since then, median prices inched up to $375,100 in March 2007. The number of homes sold through realtors reached its lowest level in January 2007 with 496 sales but, since then, has increased to 725.

Slower Spending

Consumer spending waned in March after two greater-than-expected months of robust activity in January and February. While passenger volume at Palm Beach International Airport increased in March, decreased spending and lower hotel occupancy suggest that passengers are going through the airport without staying at local hotels or staying long enough to spend money within the County.

More Jobs

Employment in Palm Beach County, however, remains healthy. Over the past year, 9,500 new jobs were added to the County and the local unemployment rate is 3.27 percent. This gain mirrors the national job growth rate of 1.6 percent over this same period.

Hospitality Industry

The hospitality industry, one of the mainstays of the local economy, overcame any lingering effects of the previous years’ hurricane threats by performing strongly in January 2007. Yet despite the strong first quarter recovery, receipts are still below the previous year’s levels. February’s hospitality industry seasonally-adjusted performance is off 15.3% from the previous year and points to the broader weakness in the local economy.

Eye on the Economy

Palm Beach County’s economic growth, which exhibited a slowing trend beginning in mid-2006, rebounded in March. The broad decline during the last half of the year was caused by a gradual decrease in passenger volumes at Palm Beach International Airport, decreased hotel revenues, and, perhaps the prediction of an active hurricane season that never materialized. However, the healthy job market and low unemployment are expected to shore up growth through 2007 and the first quarter of 2008. There will be several key factors to watch, including the economy’s ability to compensate for higher gas prices, which are not expected to ease until September. The ability to weather an uncertain housing market will also be important, as well as improvements in the construction and tourism industry. Of course, lower interest rates and another uneventful hurricane season wouldn’t be bad for the local economy either! Click here to see the Index or the full report from Dr. Stephen Fuller.

Dr. Stephen Fuller is developer of the Palm Beach County Economic Index and director of the Center for Regional Analysis in Virginia.

Arnfield Cudal holds a Master’s Degree in Business Administration and is the Investment Analyst for the Clerk & Comptroller.

Interpreting the Indices

The Palm Beach County Economic Index
“Business Cycle Indicators”

The Leading Index (top lines in chart) shows what should happen on the Coincident Index (bottom lines in chart) looking forward 8 to 12 months. A good example of this is shown in the highlighted area around 2001 and 2002. Right before the highlighted area you’ll see that the Leading Index starts heading south – forecasting a downturn in the economy (note where the jagged line crosses the thinner line). The dip in the Leading Index happens about 8-12 months before it actually happened on the Coincident Index. So what is it predicting for 8 to 12 months from now? This chart predicts improvement in the local economy.

How can this information help you?

• Business owners: Use the Index to help you make decisions about future business expansion.
• Governments: The Index can guide County budget and debt discussions.
• Residents: Use the Index to understand the effect of a hurricane on Palm Beach County. Hurricanes Frances & Jeanne are responsible for the first sharp dip circled on the chart. The other circle is Hurricane Wilma. The Index illustrates the hurricanes’ hit on our local economy and the recovery that followed.

Palm Beach County Coincident Index

This Chart shows the percentage increase or decrease over the same month the previous year. As of March, 2007, the local economy rebounded from a slowing trend that began around the middle of last year. Last October’s numbers highlight the effects of Hurricane Wilma the year before.

Palm Beach County Leading Index

This chart shows percentage increases over the same month the previous year, indicating a positive, relatively stable trend in the economy, which is likely to continue over the next few months.

Click here to see the actual economic data used to compile the Palm Beach County Economic Index.

Excess Money? Clearing up Confusion
By J. Anthony Beard, Treasurer, Clerk & Comptroller

There has been a lot of talk recently about Palm Beach County’s perceived “surplus” of $2+ billion. In fact, Governor Charlie Crist recently told a group of taxpayers that Palm Beach County Commissioners should “give it back.” In reality, they can’t. The $2+ billion refers to the County’s cash and investment portfolio. While some of the money is, in fact, reserves, most of the money is restricted and earmarked for payments approved in the County’s budget, leaving not a lot of excess. This article explains where the money in the cash and investment portfolio comes from, where it goes and how it’s invested to benefit Palm Beach County citizens.

The Money Trail

Money in the County’s cash and investment portfolio comes from a variety of sources including property taxes, user fees, and gas, sales and tourist taxes. The Clerk & Comptroller’s Treasury Department invests County funds that are not needed for immediate use to maximize their earnings potential until they are needed.

Interest income on the cash & investment portfolio helps reduce the tax burden on Palm Beach County citizens. In fiscal year 2006, interest income on investments totaled over $88 million, the equivalent tax savings of approximately $68 per citizen countywide.

Behind the Numbers

There are other sources of funds for the cash and investment portfolio. Funds from County enterprises, such as the Palm Beach International Airport, Solid Waste Authority, and Water Utilities, accounted for $554 million of the countywide cash and investment portfolio at the end of fiscal year 2006. Agency funds from constitutional officers, including the Clerk & Comptroller, Tax Collector and Property Appraiser, totaled roughly $60 million and represent fees, fines and funds held in escrow by these agencies. Internal service funds, which include risk management insurance funds, account for about $90 million of the portfolio. Palm Beach County is self-insured against many risks and maintains its own risk management insurance funds in an effort to save taxpayers money.

Governmental Funds

Totaling $1.56 billion as of FY2006, governmental funds are the largest portion of the County’s cash and investment portfolio. As seen in the graph below, a majority of those funds are pledged to specific projects and purposes and cannot be spent freely.

Of the $1.56 billion in governmental funds in FY2006, the amount available for general government operations was $393 million, the bulk of which was incorporated into the County budget for operating purposes. The sources of some of the funds in general government operations place certain restrictions on use of the funds. For example, gas tax money is used primarily for County road programs. The following graph shows the sources of funds in the general government operations category.

The Conclusion

Out of all the funds that make up the County’s $2+ billion cash and investment portfolio, property taxes are the only funds that could technically be “given back” to citizens. They represent $223 million, or 9.84% of the portfolio, which equates to about $173.17 per citizen in Palm Beach County. Currently the County’s Office of Financial Management and Budget holds $125 million in unbudgeted reserves. That money along with the other funds in the portfolio are invested until required for use to maximize earning potential.

The Clerk’s Treasury Department takes great pride in watching over the assets of the citizens of Palm Beach County and will continue to efficiently manage the County’s investment portfolio. More detailed financial information about the portfolio can be found in the FY2006 Comprehensive Annual Financial Report (CAFR) available at www.mypalmbeachclerk.com.

Treasurer J. Anthony Beard brings more than 15 years of experience in the field of finance to the Clerk & Comptroller's office. He holds degrees in Finance and International Business and has been accepted into the MBA program at Northwestern University’s Kellogg School of Management.

Portfolio Profile: Quarter-end Results
By Felicia Landerman, Investment Manager, Clerk & Comptroller

Palm Beach County’s investment portfolio performance is exceeding expectations. The investment portfolio, which is managed by the Clerk & Comptroller’s office, had an overall book yield of 5.01 percent as of March 31, 2007, outperforming the Investment Policy Committee’s benchmark of 4.54 percent. With investments totaling $2.206 billion, the Clerk & Comptroller’s office generated approximately $864,000 in interest income in March.

In an effort to fine-tune the performance analysis of the portfolio vs. relative benchmarks, the Investment Policy Committee chose to adjust the County Investment Policy’s benchmark at its January meeting. The committee changed the measurement of the index (the moving average of the 2-year Constant Maturity Treasury) from a 48-month to a 24-month moving average. As illustrated in the Portfolio vs. New/Old Benchmarks graph, the portfolio’s historical pattern of yield change is more closely matched to the 24-month moving average of the index, although the portfolio is currently outperforming both the 24 and 48 month measurements. The Clerk’s Finance Department continues to monitor the relevance of the benchmark’s measurement period to ensure that it continues to alert us to portfolio performance variations resulting from changing market conditions.

Felicia Landerman is a Certified Treasury Professional and the Investment Manager for the Clerk & Comptroller’s office. She holds a Master’s degree in Business Administration.

Clerk’s New CFO

Carter Hammer joined the Clerk & Comptroller’s office as Chief Financial Officer in February, 2007. He holds a Bachelor’s of Business Administration in International Finance degree, a Master’s in Business Administration and a Master’s in Accounting. He is also in the process of earning his Certified Public Accountant and Certified Financial Analyst certifications.

Hammer started his career as a Budget and Fiscal Auditor at the American Embassy in Paris, France. During his more than 15 years in accounting and finance, he’s held controller positions at Motorola, Philips Electronics and, most recently, Park-Ohio Corporation and ILS Technology.

A former resident of Europe and Africa, Hammer speaks English, French and Spanish. He lives in Wellington with his wife and two sons.

Audit Projects Almost Complete
By Alan Bray, Manager of Audit Services, Clerk & Comptroller

Recognizing the value of an independent review, Tax Collector Anne Gannon recently requested that the Clerk’s Audit Services Division conduct a management review of select areas within her office. The audit is nearing completion. Chief Judge Kathleen Kroll also asked Audit Services to perform a review of the Court Technology Fund and the corresponding expenditures of the Court-Related Information Technology Capital Improvements Fund. This report is available on www.mypalmbeachclerk.com.

The Clerk’s office takes great pride in its constitutional duty as “watchdog” of public funds. The Florida Constitution of 1838 established an independently elected chief financial officer to report directly to the citizens and serve as the County’s accountant, treasurer and auditor. The audit function helps to bring accountability and transparency to Palm Beach County government.

Other audits performed by the Clerk & Comptroller’s office include the Convention and Visitors Bureau audit in December 2006 and a separate audit of the County-owned Convention Center in February 2007. Both reports are currently available on the Clerk’s Web site.

The Clerk’s Audit Services Division conducts independent financial and operational reviews of County programs and activities.

Alan Bray is the Manager of Audit Services for the Clerk & Comptroller’s office. He has a Bachelor’s in Accounting and holds a CPA license in Missouri and North Carolina. Alan has 25 years of audit experience in financial services, insurance, health care and government.

Shopping for Records?
By Louis Tomeo, Director of Criminal Court Services

The Clerk & Comptroller’s Web site now offers something new that makes gathering information easier than ever. The online “Shopping Cart” feature allows people to request customized civil and criminal reports. For example, you can request lists of the number of Palm Beach County traffic citations, foreclosures, evictions, divorces and more. Just go to www.mypalmbeachclerk.com and click on Purchase Online Civil & Criminal Reports to place your order. The cost and turn-around time depends on the complexity of the report. Credit cards are accepted and a link to your report is sent right to your e-mail address. This service is very popular with the media, court and legal officials. More than 400 reports have been requested since the “Shopping Cart” was launched in January 2007.

Louis Tomeo is the Clerk & Comptroller’s Director of Criminal Court Services. He has a Master’s Degree in Management and worked at the Miami-Dade County Clerk’s Office for 21 years before joining the Palm Beach County Clerk & Comptroller ’s office in 2003.

“Take Our Daughters and Sons to Work Day” is a huge success.

Kids Take Over Courthouse

On April 26, nearly 200 children swarmed the Main Courthouse in downtown West Palm Beach as part of “Take Our Daughters and Sons to Work Day.” The Clerk & Comptroller’s office, in partnership with the Chief Judge, the State Attorney and Public Defender, hosted an event chock-full of interesting and educational programs for employees’ children. They enjoyed behind-the-scenes tours, as well as K-9 demonstrations and a visit to the inmate holding cells.

Guest speakers included Clerk Sharon Bock, Chief Judge Kathleen Kroll, Public Defender Carey Haughwout, Judges Peter Blanc and Kenneth Stern and Assistant State Attorney Angela Miller.

Celebrating Juror Appreciation Month

Jurors are the backbone of our justice system. That’s why each year the Clerk & Comptroller’s office honors local citizens who answer the call to duty. Clerk Sharon Bock and Chief Judge Kathleen Kroll hosted a ceremony on Monday, April 30, to kick off Juror Appreciation Month at the main courthouse in downtown West Palm Beach.

Joining the Clerk and Chief Judge in the celebration were Chief Assistant State Attorney Allen Johnson, Public Defender Carey Haughwout, Palm Beach County Bar Association President Manny Farach, Palm Beach County Commission Chair Addie Greene and West Palm Beach Mayor Lois Frankel.

During the month of May, the Clerk’s office also accepted nominations for the Jury Duty Employer Appreciation award, which honors employers for providing both time off and regular pay while employees serve jury duty. This year, the Clerk & Comptroller recognized thirteen employers.

Passport Processing Delays

If you’re planning a trip out of the country… you better plan ahead! The Miami Passport Agency, which processes passport applications throughout South Florida, is reporting delays. The agency was flooded with applications after a change in travel requirements was announced in January, making a passport necessary for all travel outside of the United States. Right now, you can expect the following turn-around time for your passport application:

Regular processing – 12 to 14 weeks
Expedited processing – 4 to 6 weeks

People traveling to Canada, Mexico, the Caribbean and Bermuda who have applied for a passport, but haven’t received it, are in luck. From now through September 30, travelers can visit those countries with a government issued photo ID and official proof of a passport application from the Department of State. To check the status of your application or request official proof of an application, go to www.travel.state.gov or call (877) 487-2778.

The Clerk & Comptroller’s office accepts passport applications at its branch locations and submits the paperwork directly to the Passport Agency for processing. Passport photos are also taken at all branch offices and the central courthouse.

Clerk Takes on Tallahassee
By Nicole Blanton, Executive Assistant to Clerk Bock

Clerk Bock and staff attended Palm Beach County Days March 6-8, 2007, in Tallahassee, FL. The annual trip raises awareness of the Clerk & Comptroller’s office among community leaders and members of the Florida Legislature.

In addition to having a Clerk information booth on the first floor of the Capitol, the Clerk and executive staff met with several Palm Beach County legislators including State Representatives Priscilla Taylor, Adam Hasner and Ellyn Bogdanoff, as well as State Senator Dave Aronberg. Clerk Bock expressed concern to legislators about proposed legislation that would create additional exemptions from access to public records. She also encouraged them to pass H.B. 747, the Real Property Electronic Recording Act, which will create a statewide uniform process for county recorders to accept, store and retrieve property records electronically. The act, which passed the Legislature with unanimous support from Palm Beach County’s legislative delegation, was signed into law by Governor Charlie Crist in June. It is supported by the Florida Association of Court Clerks & Comptrollers.

Meeting and Greeting the Governor

Clerk Sharon Bock meets Governor Charlie Crist at the Forum Club of the Palm Beaches in West Palm Beach. The Governor spoke May 21 to a sold-out crowd of more than 700 about property taxes and other issues affecting Florida.

Photo courtesy of Sarah Alsofrom

Clerk Sharon Bock accepts the “public sector” honor from Commissioner Karen Marcus on May 9 at the Executive Women of the Palm Beaches (EWPB) Women in Leadership Awards luncheon as EWPB President Marilyn Moore looks on. “I am deeply honored to be recognized by a group of my peers. I am privileged to share the values of commitment to community, collaboration of resources and strength of character with every member,” said Bock. The awards are presented annually to outstanding women in the volunteer, private and public sectors of Palm Beach County.

The Voter’s Coalition of Palm Beach County honored Clerk Bock at its 24th Annual Celebration Dinner March 1 at the Westchester Country Club in Boynton Beach. She was recognized for her commitment to public service and transparency in government. “We need Sharon Bock now more than ever in Palm Beach County,” said State Senator Dave Aronberg in his introduction of Clerk Bock. The Voter’s Coalition also honored Palm Beach County Property Appraiser Gary Nikolits.