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City of Raleigh

Introductory Section

Economic Conditions and Outlook

T

he information presented in the financial statements is perhaps best understood when it is considered from the

broader perspective of the specific environment within which the City operates.

Raleigh continues to be widely recognized by independent sources as one of the nation’s most attractive

metropolitan areas. Recent accolades include:

--One of the 7 Hottest Startup Hubs Outside of Silicon Valley (February 2016 – Mattermark)

--One of the 100 Best Cities for Recent Graduates (March 2016 –

NerdWallet.com

)

--3rd Best City for Young Professionals (March 2016 – Forbes Magazine)

--3rd Best City for Young Families (February 2016 –

ValuePenguin.com

)

--5th on list of America’s Next Boom Towns (January 2016 – Forbes Magazine)

The Raleigh area’s excellent business environment, its nationally ranked universities, and the outstanding health

care facilities are some of the many attributes that attract people to the area. The mild climate, diverse work force

and proximity to Research Triangle Park, a nationally recognized epicenter of innovation in more than a dozen

industries, combine to make the City a great place to live. The City has experienced steady growth in population,

land area and commercial activity over the past several years, becoming the 42nd largest city in the United States.

As the capital of the State, the City derives its economic profile from a diverse combination of business and

employment centers, including Federal and State government, higher education, information technology, scientific

research, healthcare and retail trade. The City is the home of the principal executive, judicial and regulatory offices

of State government, as well as six public and private institutions of higher education, including North Carolina

State University, the largest university in North Carolina.

The City’s new strategic plan has provided

priorities and guidance in developing

budget recommendations, as reported

to Council during the fiscal year 2016-

17 budget process. As a result, budget

resources are directed to investing

in public safety, arts and cultural

resources, economic development and

transportation, as well as expanding vital

services and focusing on organizational

excellence. Financial projections for fiscal

year 2016-17 show signs of continued

revenue growth, specifically in sales tax

and property tax revenues, while user fee

revenues for water and sewer services,

stormwater management, and solid waste

services remain steady. The property tax

revaluation process conducted at the end

of calendar year 2015 resulted in an 8%

increase in the property tax base, but the

fiscal year 2016-17 budget includes a decrease in the property tax rate from 42.10 cents to 41.83 cents per $100

valuation. Locally, the unemployment rate at June 30, 2016 was 4.4%, which represents a decrease from the June

2015 rate of 5.1%. Median family incomes, as shown on the following page, has decreased slightly from $78,800 in

calendar year 2014 to $76,600 in calendar year 2015. The overall decline in median family income over the past

few years is consistent with a nationwide decline of 8% from the period of 1999 to 2014, when adjusted for inflation.

Fiscal year figures as of June 30

* State and U.S. rates have been seasonally adjusted since 2013

Five-Year Unemployment Rate

City

State

US

12.0%

10.0%

8.0%

6.0%

4.0%

2.0%

0.0%

2012 2013* 2014 2015 2016

7.5%

9.6%

8.2%

8.3%

6.9%

7.5%

6.4%

5.2%

6.1%

6.1%

5.1%

5.3%

5.2%

4.4%

4.9%