Board of Supervisors Budget Work Session   3/7/2017

Just a few introductions before we start our budget meetings for this afternoon.

Claudette Borgersen is our clerk, sitting back in the back.

Beside her is Travis Morris, our deputy clerk.

And our officer today is Lieutenant T. Wells.

Thank you very much for being here.

And I'll ask everybody to introduce themselves because it's a great mic check.

So today is our 2017-18 operating and capital budgets.

And if I could, Madam Chair, members of the board, just make a few introductory comments before turning it over to Laurie who will be doing most of the driving today as she often does for these work sessions.

This is work session number four.

People ask, well, when does the budgeting get fun?

And this would be it.

So we'll try to make that transition.

As you know, you receive the county executive's recommended budgets, a balanced budget, and then spend

the first several work sessions really working through that budget.

Making comments, reacting, we capture that information in the list that we prepare and then answer your questions that you've received some of those responses and we get to this point where then it transitions significantly from the county executive's recommended budget to the board's proposed budget obviously then for purposes of advertisement prior to your adoption.

And so there is this point where this transition occurs where we hope that it continues to be collaborative.

It is true that you have received a budget that is balanced on revenues and expenses.

There are choices that were made, as you know, by staff.

and bringing that budget to you.

And as is often the case, no exception this year, board members are asking about things that then when you add them up actually add expenses to the budget.

And then there's an obligation obviously also to find resources to support those expenses or then change of mind.

So I just wanted to reiterate that staff maintains its position to help the board work through these challenges.

Ultimately it is your choice, your choices for the proposed budget, your choice for the tax rate that you want to advertise, but I just wanted to let you know that our role is always to continue to kind of help work through those choices so that you have the best information available in making the choices that you have to make.

So today when Lori is working through part of the work session, which is talking through some of the items that you specifically mentioned, you'll see that also included some recommendations from staff.

It doesn't necessarily mean that that's the only solution, but it certainly is a way to try to get the conversation started.

Okay, thank you, Doug, for that introduction.

As Doug said, today is our fourth work session.

I always like to start these work sessions by looking ahead at what's in front of us and kind of grounding ourself in the current agenda.

And so today's March 7th, we're gonna do two things.

We're gonna begin to discuss items that you placed on the list.

Individual board members place items on the list for further discussion.

So we're gonna start working through that list

We have a three-hour work session till six o'clock today.

The most important thing of the day is that you finalize your tax rate for advertising.

Again, this isn't the final tax rate.

This is the tax rate for advertising for the public hearing.

Some places call it a cap, but it's your tax rate for advertising.

And we have to do that today to meet legal requirements and deadlines associated with the public hearing.

So there might be a place and time, Madam Chair, that I'll signal it, look at the clock and go, you know, we might have to move off the list and get to this topic.

I'm gonna try to work through everything, so you'll have all this information before you do so, but just be mindful that that is the outcome of today's meeting.

And then you'll see, and we'll talk about this slide later on what comes next.

So here's how we're going to work through today.

We're going to discuss items placed on the list from previous work sessions.

We also have a staff item placed on this agenda that is a consideration of beginning the salary compression remedy included in the fiscal year 18 recommended budget in May.

And we have a slide on that, and we'll go through that when we get to that place in the agenda.

I might have on there a break if needed.

Sometimes it's a good place to break from the time when you go through the list and before you do the proposed tax rate for purposes of advertisement.

So if we don't need that and you want to work right through, I will leave that up to the chair.

And then we'll go to next steps.

So as we start, I just think it's important at this point to just ground ourself again in the county executive's recommended budget.

You recall that the total budget, which is a combination of all the funds, is a $397 million budget.

It's balanced.

As Doug mentioned, revenues and expenditures are balanced.

I wanted to just bring this slide back for you today, too, since you'll be talking about real estate tax rate.

As you know, the real estate tax rate, the current rate, is 0.839 per 100 of assessed value.

And this budget, this recommended budget, is based on the current tax rate.

It's also based on a 2.87 overall increase in calendar year 2017 reassessments, an assumption for the second part of the fiscal year of a 2.5% increase in reassessments for calendar year 2018.

Each penny on the real estate tax rate, sometimes we look at it this way, yields about $1.7 million in estimated collectible real estate tax revenues.

We also like to mention the lowered or effective tax rate would be

.809 per 100 assessed value.

And it's important to also note we have a tax relief for elderly program and that's funded in the recommended budget of $910,000.

The other thing I wanted to mention is we had these main areas of focus in the recommended budget.

Again, this is just a touch point.

The focus of the recommended budget is to implement the board's approved strategic priorities, to drive transformation, to support our quality organization, make thoughtful investments in the future, and meet our mandates and obligations.

So again, just a little background of all those other work sessions.

That's all wrapped up in three slides for you.

So here's the items on the list that we've identified.

You may have other items you want to discuss or items you would like to add, but these are the ones that we had taken down as notes in the OMB office.

So what we're gonna do is go through each one as Doug had recommended where we go through the item and then we talk about the staff recommendation for your consideration.

I wanted to mention that at the March 28th work session that we added,

We were gonna discuss the fire rescue fund and we thought we also could add the scenic gateways at that time.

Staff would have more time to work on that.

So if that would be all right with the board, we would add that to the 28th meeting for consideration.

So if everybody's fine with how we're moving forward, I'll just start through the list.

So the first item on the list, Bill will take a few of these and then he'll come back, will come back to me for some of the other items.

Thank you, Laurie.

We'll begin with the healthcare analyst position, which was a recommended addition.

I thought I would take just a couple of minutes, though, to provide some background information about what we're now doing.

I do, first of all, want to emphasize

both the complexity and the volatility of this program.

As I think you all know, the healthcare market generally is very much a changing and very much, in some cases, unpredictable environment.

There's also been a number of programmatic changes that we've introduced that

You don't always know how that's going to play out.

You can't look at history always to be able to determine with certainty what it's going to look like in the future.

So it's complex, it's volatile.

What I wanted to mention is that in the current environment our chief of financial management monitors the healthcare fund on a monthly basis and this includes analysis of both current and historical data and both revenue and expense data to the extent

We have it and we can understand it.

But as I said, even with that data, as you look across at the charts that that results in, it doesn't create this sort of linear trend.

It's very volatile and we just need to bear that in mind.

This is a large fund.

I think, as you know, our annual expenditures in health care for all those associated agencies that are part of the board's plan approach $30 million.

I think it's in excess of $30 million now.

So the complexities that are associated with this are we look to our financial OMB staff to monitor and to really be the responsible party to the Board of Supervisors in terms of providing advice and critical information so that you can maintain a solvent plant.

Critically important.

This is one of a number of funds that the Finance and OMB Office monitors on an annual basis.

I would pause here to say that we're very proud of the work that those departments have done.

They have developed and honed skills that are necessary to really do this well.

Through their guidance and recommendations, we've maintained a AAA status within the county, which says a lot, and it has to do with a lot of these practices, so I just wanted to emphasize that.

Since we are talking about the notion of utilizing the funds in a healthcare program to support a position or some enhanced services, it doesn't need to be made as a part of this budget process.

So I wanted to be clear about that, if that becomes the source of whatever it is we decide to do here.

If the source of funding to either support this position or some other methodology for enhancing our way of monitoring this program, it's going to come from the healthcare fund.

It's not going to be a budget decision.

And what I'll also mention is, as you know, we're also looking at the option of local choice.

And obviously, if we moved in that direction, you know, a decision about hiring a position would really not make sense at this point.

So, we're also wanting to point out that one of the additional steps that you might take at this point is what's called an actuarial study.

and that's about really understanding the population of lives that we are insuring.

Not necessarily the individuals but really going a deeper, taking a deeper dive and really understanding age brackets, the health histories and on the basis of that information you can really assess your risk.

Okay, so you can then inform such things as how much is an appropriate fund balance to reserve?

How volatile might these plans be?

What about stop-loss programs?

All of those things would be informed by an actuarial study.

So one of the suggestions might be here that that's what we ought to do right now.

We ought to utilize some of these funds in the health program, do an actuarial study.

The other thing we're suggesting is let's look at best practices around the state.

Let's look at other localities.

Let's engage our health care consultant.

Let's engage our financial consultant and ask them about monitoring techniques and make sure that we're bringing back to you both best practices that are sort of ongoing as well as these special kinds of analysis.

We have not done an actual, we are doing all of the analysis.

I apologize.

We have, yes.

We're just looking at every possible avenue for maybe new practices, new methods, anything we might do to enhance what we're doing.

My confusion from reading this was I didn't know if you were recommending it or not.

So that would be helpful when we do the next one to say, we know the board brought this up and here's why we think this is a great idea or we don't.

And part of that research may be that the best way to proceed could be hiring a health care consultant.

Well, I suspect one solution may be that we continue to use OMB finance staff to do the analysis, maybe as it might be embellished or improved, but also to think about periodically, maybe annually, doing an actuarial study.

because your population will change.

Great, okay.

I think, Madam Chair, members of the board, most importantly because we are in the process of evaluating continuing to be self-insured as opposed to using another program like the Virginia Healthy Choice Program, local choice program,

then the consideration of what direction we go with our whole insurance program is really going to inform whether in fact that we want to then also invest in additional analysis for self-insurance.

So it just doesn't make sense.

And because healthcare decisions are made in the fall anyway is what you're getting at.

Can I just ask, the next position we're about to look at is the Assessor position.

I don't see it on my blue sheet of all the staffing changes.

Is this, this was proposed by board members during our discussion.

Is that not correct?

Okay.

I want to be clear.

We were going over the Finance Department's budget.

Someone brought this up.

Is there a need for an additional Assessor position?

I brought up the healthcare brick, someone who could do some analysis and have it paid for by our healthcare plan.

Great.

Okay.

Okay, let me move to this real quickly.

Just a bit of background here.

Again, as I think you all realize, since 2005 and prior, it continually changes the whole environment of assessment changes and the complexity of the changes, different properties, etc.

In 2005, for example, we were on a biannual assessment program, and we had approximately 38,000 parcels, residential parcels, and 4,900 parcels in land use.

At that time, the assessor's department had 14 FTEs.

In 2007, the requirement was added county code to reassess annually, as you know.

In 2009, requirement was added to county code to revalidate all parcels in the land use program biannual.

In 2017, today, we now have 45, almost 46,000 parcels, which is an increase of approximately 21% over the 2005 time period.

And today, the Assessor's Office has the same number of FTEs, namely 14, despite significant increased work volume.

If we were to apply that linear function of 21% increase to staff, that would equate to two additional staff.

They're doing the best they can.

I was just going to ask what the effect of the technology.

I know Peter's described a new system that they're using.

Lots of jobs are being eliminated by using good technology.

Peter Lynch, County Assessor.

Madam Chair, yes, we are peddling very fast.

But the effect of all this, and I just wanted to correct one thing that Bill said, that was total parcels, not residential parcels, but total parcels.

Thank you.

Were 38,000 increased to 46,000 or so.

And the effect, it's kind of a multiple effect.

We have been doing things in the office to increase efficiency.

and the computer system helps a little bit.

It helps us analyze properties.

But also we're trying to reorganize our urban properties so that we can assess them more efficiently.

I was told when I came here we were doing mass appraisal one at a time in the urban areas.

I'm sorry, in the rural areas.

That is not mass appraisals, so there's nothing efficient about that.

It was fine back in 2005 when they looked at every property every two years and they had the staff for it and they had a biennial.

and they only had reviews every two years.

This entire block of time we're in right now, all the way through to the end of summer, we'll be taken up with reviews and appeals for the Board of Legalization.

That happens every year now when, during biennial reassessment, it happened one time during the one year and then the off year, you have the entire year to work on reassessment again.

I believe the problem initially was there was no change made to make up for the fact that the extra work was created in the initial process of changing to annual reassessment.

Then the revalidation of the land use was added on top of that with still no more staff.

I believe, I kind of compare this to a house that has deferred maintenance.

It's fine, but over time without that work getting done, it kind of starts to get shabby and fall apart.

My office is getting to that point where it needs help.

So yes, the simple answer is we've been running like crazy.

My staff has been working very hard.

In the past, I provided a report last year and I don't remember what that is.

It was a pretty small percentage.

This year because of the system change and the changes we're making to the processes, there are some more, there's additional changes and I actually budgeted that again.

The thing that bothers me, this is the thing that really touches our folks, who we work for.

And if we're not doing this right, then a lot of people get frustrated, like they have been.

at this time, which is different.

I understand this is a different time, and I do get that.

I personally would be very much, and we have talked about the land use for quite a while, and how we do have folks

And if I can just respond to that comment.

It takes, it doesn't take one visit to a property to see if it's in compliance.

It might, but in some cases it takes visit after visit to make sure that nothing is happening agriculturally, you don't do everything constantly all year long.

I will remind, when the revalidation was adopted, which I worked on for 15 years to be there at that point, Doug's predecessor did say, we think we can manage this.

And we all knew that it was just gonna be coming back in a couple of years, but I was so glad to get four votes to actually start the program that I was willing to just look the other way.

So I'm very happy to try to follow up now.

because it really does have to be run.

And my argument to the folks in the country years and years ago when they were ready to string me up about this, and I wasn't even on the board, was if we're not running this perfectly, we'll lose the whole thing.

And that is always a concern.

So they understand, the bonafide farmers understand the huge benefit that they receive from this, and also they understand the contribution that they make to the county.

Staff has in addition recommended, should the board be interested in pursuing this, a funding strategy.

that would include a one-time adjustment to our transfer to capital.

We have made an additional $1.2 million transfer out of the general fund ongoing revenues into capital for one-time expenditures in 2018.

We would propose to reduce that by $73,000, which would pay for it in 2018.

I would support this as well.

I would propose that we not worry about where the money's coming from right this second.

Right, that's right.

That's probably a good idea.

One, two, three.

Brad does, too.

Well, I actually wanted to comment.

I do think that this position is meritorious.

I think we need it.

I don't have any doubt about that, but I'm concerned about hitting one-time CIP funds, and I do, I would urge us to put this in the parking lot.

and to do exactly what Ann said and revisit this in March and figure out how we're going to go ahead and fund it.

I certainly think it's reasonable to have this conversation further when we talk about resources for all of these.

As I indicated in my opening comments, we're trying to not just talk about the expenses, but also kind of give some suggestions on where we think revenues might come from.

This $1.2 million is ongoing revenue.

It's just been identified in FY18 as a one-time contribution to the capital program.

So I just want to make that distinction.

And it would seem like to me, Board, that what we can do, there are some of these that we're automatically saying we're not going to go forward with, such as the first, the health care.

So as we go through these, we can figure out the ones that we want to put in, if we could say another parking lot, the ones that we're really interested in, and that way at least we're clearing our

the deck a little bit here of some of these.

Is that fair?

So we're interested in this one.

Sounds good.

Okay, I'm going to pick up the next one.

There was a suggestion that we add the additional funding for Java as an item on the list for further discussion.

And you may recall, I think this was our very first meeting on the 23rd of February, we talked a little bit about funding for Java.

So I just want to give you a little bit of the background and we'll quickly come

with the recommendation.

So as you recall, Java requested an increase of 60,000 for the addition of a full-time options counseling position.

So they were fully funded in what they received last year and they requested additional funding of 60.

The fiscal year 18 recommended budget included an increase of 30 for them to hire that person as a part-time position instead of full-time.

So what we could do, it could be added as a full-time position per your request.

Just a little bit about what is options counseling.

It's an interactive decision process provided to their clients to offer support in the identification and access to appropriate resources.

So our recommendation is if you would like to provide this 30 for Java, it certainly can, you can do so, and the funding source we had recommended for this particular one

is something in your budget called reserve for contingencies.

You have a $300,000 reserve for contingencies in your budget.

Now that's really reserve for contingencies that occur after July 1.

Usually we put 250,000 in this account.

This year there's 300 in it.

So a smaller change of 30 from the OMB staff's perspective, it seems like that could be a source that you could use for that.

You could use it for anything you'd like.

but we often don't want to do a whole lot of use of it before the budget's even adopted.

Is that right?

I think that's a wise move to put it in the parking lot.

I would just move it in with an assessor position.

As long as we get four votes here.

So Norman?

Yes.

So all of us are with that one.

Great.

We're moving along pretty well.

So this next item is one, the neighborhood planner position.

This one's a little unique in that staff had recommended adding this as a conversation that we had, I believe, on February 27th.

And then a couple of the board members, I think two at once, had put this on the list for further discussion.

So basically, the little background on it is this is a dedicated resource to help address the growing urban neighborhood engagement liaison needs created by increasing development activity.

Community Advisory Committees and Strategic Plan Priorities.

The estimated cost for this position would be $87,108.

And as you know, there's a growing service level needs generated by the Community Advisory Committee's Strategic Plan Priorities of Urban Redevelopment

and Revitalization that generates projects like the Rio 29 small area plan and master plan updates.

And so here's staff's recommendation.

Again, we look for resources for you to consider, because I know we're not considering it today, but on our next meeting we will have to actually balance the proposed budget.

So here's a recommendation for this one for your consideration.

So we recommend that you do include this position in your proposed 18 budget.

The funding source could utilize 87,000 of the 200,000 we currently have included in the budget to support the implementation of the $1.4 million neighborhood investment funding initiative.

If additional, here's our thought on this, and we thought well that position could help support that initiative.

Now if you find due to the timing of when these projects come along, if we find that we need to replace that money, you do recall that this particular fiscal year we're living in now,

could likely have excess revenues over expenditures as of June 30th.

We do go through the audit first.

Our practice here is you wait for the audit to make sure all the numbers lock down.

And then in November, you receive a CAFR, and you receive the information on audit.

And at that point, there may be additional fund balance available from the current fiscal year that you could replace that money with.

And we think that the timing of that, being November, might work well with the timing of how the neighborhood program will proceed

So we wouldn't be doing this until November.

No, you would start but you could replace the money by November and we think that the money could hold up the level of need that you need to support until then.

No, no, no.

We actually put an additional 200,000 in the recommended budget to support the 1.4.

So this does not take anything away from the 1.4.

But it might take away from some of the support costs, the soft costs that we call it, of getting the projects going.

We're just not sure depending on the type of projects.

and how that program will move forward exactly what's needed.

So that's just a thought.

Question.

So this neighborhood planner position is not one of the two on the blue sheet?

No, it's not.

Well I'm enthusiastic about this because this is exactly what I was hoping we would see out of the neighborhood initiative program so I think it's a great idea, it's a good way to use the surplus funds, it's probably more cost effective as I think Commissioner Sheffield, Supervisor Sheffield, sorry Brad, and I had discussed

earlier about this, I think it's a great idea.

The $200,000 that was included in this budget as additional support for the NIPI neighborhood improvement funding initiative program is ongoing money.

And so that 200 would be reduced by the amount needed to support this position.

So the caveat is that if in fact there is additional support resources needed to support the neighborhood improvement program, then when the audit is complete, we can work with the board to identify any of the resources needed at one time.

Yeah, so it just sounds like it's going to come out of that every year as long as we continue to have this fund.

And if we don't continue to have the fund, then we have

The 200 is ongoing.

So to the extent that our change is made or there's a need to revisit what our overall stats are, then we would do that as part of the budget process going forward.

So the 200 is ongoing?

I just want to make sure, clarification for myself, that this is not a support administrative position.

This is actually an urban planner.

Professional planner position.

Whether it's a principal planner or a senior planner, I'm not sure how it works out, but it's at that level.

And it's not likely that one individual position is going to support, for example, all seven of the CACs.

But I was just getting at the fact that this is not just another support person for, not for the CACs, because I know they're struggling to help support the CACs right now, but that this is actually a planning position, someone who's experienced in urban planning.

That is correct.

And where would that fit in with the community development in general?

Yeah, the hierarchy within the planning, within the community development, you know, has the planning director, and then so that this

I think that that position would fit in the hierarchy of the planning director along with other senior and principal planners.

So the assignment of who would be working on what, I would, frankly, at this point, leave to the director.

What do you imagine the relationship with the small area plan since that's urban?

and one of the resources that you provided last year, for example, to outsource site planning with you, which is being done in part by the TJPDC.

That's freeing up the staff to work on your priority of the classification.

So it is an alignment of resources and staff to accomplish your goals and your priorities.

So I would see this fitting in similarly.

You're counting on us to

to implement and achieve your priorities, we have to apply good leadership and good management to make that happen.

To the extent then that we think that this is a resource that enables us to do that, we think that, we hope that we're right.

If we're not, if we just can't, we'll have to have that conversation with you too.

That's great.

a planner who is now in inspections because everybody got scrambled during the recession and all got to be doing new jobs.

But now that the projects have begun to heat up again, this is a really important gap in our ability for people to have intimate knowledge of some number of the CACs and be able in their head to know the whole playing field.

It makes it so much more efficient for them to come out to the meetings and to understand where they've come from and where they are.

Now, and I really look forward to this happening.

People are always saying, oh, we missed Rebecca so much.

Yeah, that's right.

So we have nodding of heads for this one to go on the list?

Yep.

Are we good?

Yep.

Everybody's nodding.

I don't think we need to wait until in the spring on this.

That would be my recommendation.

I would agree on that too.

Before we move off of that point then, that would then come back as soon as possible with an appropriation recommendation to use FY 17 money to get that position hired potentially sooner.

If we had someone who could start actually on July 1st, that would be huge, when the money was there also.

As opposed to waiting.

And I think that's what Rick's getting at.

That's what I'm hearing.

Alright, thank you.

So the next item that was put on the list was a park and recreation position.

It wasn't really clear.

I think this is one, Liz, you might have mentioned about parks and recreation.

So just wanted to share with you what's already in their budget and a recommendation from staff for you to consider.

So one thing that, just as a background, we are recommending converting an existing part-time temporary wages to a part-time permanent position.

So it's a very small amount, under $10,000.

But we've also added $90,000 to address park and recreation's needs, and we say in there, which may include staffing.

And they're doing a community recreation needs assessment to help establish their priorities for future development of facilities, programs, and services.

So we were thinking along the lines, possibly where you were, that we know that there's some staffing needs in that department, but we weren't exactly sure what exactly the staffing would be, so we placed 90,000

into their budget as a holding place for potential staffing.

So maybe that you suggested even an additional funding than that, but we just wanted to mention that that's already there.

Our recommendation is that we would implement staffing adjustments after they complete their needs assessment and a subsequent organizational assessment of Parks and Rec, and the funding source would come from that 90,000.

as fast as the Parks Department can actually do it because they have their process that they have to go through.

So I just wanna make sure that that $90,000 is gonna be enough to do that if the board decides that we really want to try to get that open faster.

Bob Krickenberg, Director of Parks and Recreation.

To answer your question in regards to staffing for hedgerow, those staffing needs have already been identified within our capital request.

Part of this $90,000 is reflects back to several years ago when we countywide developed a department resource plan in terms of identifying future staffing needs.

We felt that

And so this is potentially in addition?

No, if you're referring to this community needs assessment, this is basically an overall parks and rec master plan.

It identifies not so much actual facilities and how they would function and operate, but it identifies our current services.

It identifies the level of our services, identifies unmet needs that the community would like to see.

Marketing analysis, revenue recovery, it's just a wide range of information that we pull back from this.

In terms of hedgerow, we're doing our own sort of internal assessment.

Doug has information on that for us.

Yeah.

Staffing, yes.

That's been identified.

My question is in terms of having done this internally, does that include in there annually a cost for maintenance of the bike trails or are you going to rely upon volunteer organizations to maintain the trails?

The only thing I would like to see before signing off on this is to see the blueprint, to see what is actually being proposed here from an operational standpoint for the park.

For hedgerow?

Yeah, for hedgerow.

We can provide that information.

If I could, let me try to break this down a little bit.

The staff is ready to have a separate conversation with the board, probably not today, but soon, about the hedgerow project.

and what that project would entail, what the steps are, how quickly we can get going and where the money is going to come from.

It's a CIP project that has not yet been approved into the CIP.

The staff is working pretty hard over the last week to bring that to a place where we're ready to have a full conversation about how to work with the board to make that project a reality.

The request for, the $90,000 request in the recommended budget was more general at the time, anticipating that the needs assessment that was going to be completed would inform how best to allocate resources generally for support for park recreation.

They have a number of needs that had already been identified.

They had a vacant assistant director position, for example,

has remained vacant for a number of years, I'm not sure, actually over six years.

They have some succession planning concerns, considering the seniority of their senior leaders in that department that we're concerned about.

But as opposed to putting a particular position in the budget, knowing that they were going to be completing this needs assessment, the last of which was done in 2004, we just thought it was reasonable to kind of keep our options open.

So somewhere in there, there's this connection that we need to make between the hedgerow project,

I think I'm less confused than I was five minutes ago, but just to make sure.

So I see this being described as two parallel tracks.

One is the needs assessment and the long-term decision about how you're going to rearrange or not.

and the other, which I think needs to stay separate, is the new person to get those central southern urban parks.

I mean Arrowhead and Hedro, you always describe as going together because you like to lump the geography for management stuff.

We know that that need is there like three years ago.

So I would support the parallel track.

So we need the hedgerow person and that's part of the CIP discussion whenever that is.

So that's going to happen.

I'm pretty sure I'm clear, but I just want to make absolutely positive.

This discussion about the CIP project and hedgerow, which could include the additional

I was going to recommend that we park it, but not end of May.

I was going to address this a little bit later.

Okay, thank you.

Okay, thanks, Bob.

So we're taking, for this particular one, we're taking staff's recommendation for this.

Well, not the recommendation that's here, but the recommendation that Doug just gave us.

Yes, right, just so we're clear.

I hate to belabor this, but what you just said does not include any further discussion about an additional person because the 90,000

is separate from that additional person as Ann just said in her parallel track very well.

Thank you very much Ann, you described that very well.

I may have dug a hole.

Well, you could have, so I'm not trying to at all be anything but clear.

What I'm hearing and reflecting is the $90,000 identified in the recommended budget

The headrail conversation which has come along much more recently has a capital component and will have an ongoing maintenance component.

That, in my view, is not reflected in this 90,000.

I thought I heard Bob say that the hedgerow position is already in this year's budget.

It's identified in the CIP.

Okay.

Clear as mud, everybody.

Are we good?

It's coming out of Crozet.

All right.

Good.

We're going to get, all right.

So, Lori, go ahead then.

This is another item that a board member asked us to put on the list for future conversation.

It's a consideration of a dedicated penny on the tax rate.

Our understanding of it is that there would be a tax rate increase and that would be dedicated to capital as a concept for the board to discuss.

And so Bill's gonna take it from here.

There's a couple slides on it.

Thanks, Laurie.

Yes, as you know, this

budget includes a fair amount of resources going into the capital plan, a total of $33 million for fiscal year 18.

And this chart summarizes the various sources of those revenues.

I think you recall we had excess revenues from fiscal year 16.

This proposes $6.9 million of that will go into the fund.

We did receive one-time funding compensation from VDOT, as you may recall, for easement properties of $669,000.

That too is being put into the capital fund.

We have our contribution to the capital by formula.

Of course, that is adjusted to reflect the increase in revenues overall.

That total transfer is now at $23.6 million.

We restored, as you might recall, the funding of $700,000 that was taken out several years ago.

$700,000.

And then, as Laurie was just describing, there is a one-time transfer from the general government side of revenues into capital, one time for $1.2 million.

So a couple of other just comments about this year's budgets.

One is to note the degree to which these funds support debt services.

In fiscal year 18, it's $23 million in debt service payments.

The other is to reflect or just to recall the fact that some of these funds support the early borrowing of the bond referendum as we talked about.

It doesn't it doesn't yet It's 1.4 is available to see whether it needs to go to capital or not the capital depending on how the projects go So we just have it ready to go to wherever the direction is that the board decides We just wanted to make that clear wouldn't have to come out of these other funds.

I will note that how many of the items on this page are one time.

They are circumstantial to running a surplus and they don't get at the long, the longitudinal issue of trying to grow the pennies with time to

As I think Lori described previously, we're making progress.

I think as we look at the latter few years, we're starting to come back to that 3% goal.

So one question I have for you is the $33 million in total, to subtract $23 million in debt service from that.

Yeah, it's called capital and debt.

The $10 million that we have left can then be used to borrow $100 million if we want to do projects.

Well, I don't think it would be that simple because portions of it will go into funding equity, portions of it will support future debt.

So you're really needing to balance that plan over a five-year period.

This next chart, there's any number of ways we can present this information prior to illustrate the points, but we've done the best we could here.

As you may recall, when Lori presented the five-year plan,

It projected a certain fund balance at each of the five years going forward based on the activity and the revenues and everything else that would happen in the capital fund.

And that's that first line.

It says recommended budget fund balance.

So in 18 we're at 17 million and then it drops to 1.4 and it holds.

It meets our target of 2 million at the end of that period.

We talked about the

The savings from the interest rate, the fact that we barred early and we identified that as approximately $500,000 per year.

We made the recommendation previously that that be reserved because we know that the market is increasing.

and we think that holding in a reserve is a prudent thing to go forward.

So I'm showing it as a reserve here, which is almost like showing it as a use.

So it's not going to be shifted down to the fund balance in this particular example.

It's held aside.

So in this case, we would recast that fund balance numbers of 17, 1, 2 million and so forth.

If we would add a penny to the tax rate and dedicate it to capital,

That would generate in the early years approximately 1.8 million dollars in additional cash transfer into the capital fund.

And of course it would increase given our projected increase in the value of the pennant.

It would transfer over the five year period approximately 10.2 million dollars.

Those funds can either be used to support pay-go projects, cash projects, cash equity.

It also could be used one time to support a certain amount of borrowing.

So if, for example, in fiscal year 18, if you dedicated the penny, you could decide to borrow as much as 19 to 21 million dollars in projects that would then be supported by that dedicated penny over time.

So I'm not showing those iterations, I'm just saying here is the cash that would accrue to the benefit of the capital fund and then however that might be applied.

It does answer my question.

I hope everyone had a chance to print out also the graph that Laurie provided.

You all did see that and that is something that I think we cannot afford.

not to pay very close attention to seeing what happened beginning in fiscal year eight where no money went in and then essentially the CIP funds were rated and that continued in fiscal year.

It tripled in fiscal year 10, it continued at 11, it continued at 12, and then we started to see a recovery and then in 16 we saw a setback.

So if we don't, in my judgment,

continue to invest in the CIP in recognition of the fact that we've been told last year after we approved the referendum in the same day Dean came forth sallied up to the microphone and let us know that high school was very much a distinct possibility for the school division within the next four years.

I do think just it's good prudent financial management

My concern here, as somebody who has championed a higher tax rate every single solitary year since I got on the board, exactly for this reason, looking at this whole graph and looking at these changes over time for the last several years, what I'm seeing is that this particular year,

with the changes in the mass assessment.

I have folks out there that had a bigger increase in their, moderate income folks with $350,000 houses, I'm not talking about the million dollar homes, that ended up having a higher increase in their, what they're paying out than the times when we raised the taxes three times.

and that's what bothers me about this particular year.

So as a champion of, when I first ran for the Board of Supervisors and went door to door, people say, you're gonna raise your taxes?

And I say, yeah.

And this is the reason why.

Look at what's happened over the last several years.

So I get where you're coming from, Rick, and I agree with you.

What about next year?

Okay, but I'm looking out over five years and I'm saying, understanding the five-year process here, by putting in a penny this year, we may be in a position next year to not have to increase

that capital amount depending on what happens with the courts.

I know part of that is the courts and some of it is also the referendum.

But if we forfeit that opportunity, what I don't want to see happen, I feel a responsibility whether I run for office again or not.

You hand this position off.

We're only here for a period of time.

We have an obligation to think about future people in this position also.

to try to do something that ensures that in four or five years when that decision has to be made, if it is having to be made about a new school and the 70 million dollar cost that we estimate now, that we have prudently gathered some of the resources carefully year by year to have that money available to lessen what otherwise will be a significant

borrowing impact here thereafter in terms of the CIP.

So the more you kind of do pennies to heaven, it prevents one having to pay nickels

or Dimes in the future.

So I agree, I hate to see a tax increase this year so the other side is for us to say well maybe there's a way that we can find 1.6 million in the budget that we can shrink and at the end of the day we end up with a penny for the CIP but we take

McKeel,

Well, and I think some of the work we're doing around business and economic development, Rick, also speaks to this.

Well, and the other thing that's kind of interesting is that this graph is really

While I really appreciate the graph, what you don't see in here is in 07, that period of time when the tax rate was dropped by 6 cents.

So we did have that happen because the assessments were going up so high.

Exactly.

But the tax rate was dropped by six pennies.

And so some of what we ended up not being able to support was based on

It decreased in monies from that drop in the tax rate.

And I don't think that's very clearly explained in this graph.

There were some of us who were saying during those years we could be putting into our capital improvement program and building at about 30% less

in our capital improvement program.

But that's water over the dam, and it's too late for that.

I think another issue that's not being addressed with getting the extra penny is that it's not just coming from nowhere.

It's not just dropping out of the sky.

It's coming from our taxpayers and that money is going to be in their pockets.

Many people live on a budget and have a regular salary, put whatever savings they have into their retirement account or paying off their mortgage.

That money is not

Well and this is not quite the same thing but it gets back to the salary increases for our employees.

Our receipts from retail sales went up this year.

The money that stays in people's hands gets circulated.

I do see the sort of constrained two-year plan approach that we have now to be a really good one because there's some bumps that we'll be hopefully smoothing out for that.

I tried not to, I mean I've argued against

and the cuts that we've done in 9 and 10 and supported equalized rates that didn't happen in 11 and 12 because of trying to keep things, baby steps, along.

And while this may not, I mean, I think there's this dramatic increase in capital right now.

And I look forward to savings and success in 17 that will then create a whole lot of wonderful transfer a year from now also.

But I'm happy to say where we are.

I think that there's considerable adjustment that's going on with people and for very good reason.

I mean, I've tried to explain that we've been working for 10 years to get to the point where we are now with our assessments.

And so yes, there have been people who went up a lot.

Mine did.

I always thought it was undervalued before, so it's one of these things you think about.

But the most complaints I've received are people who went out.

They're very alarmed by that.

So this is where we sort of cling to the middle, and if everybody's a little bit miserable, then we've done our job.

Well, I think you're right.

It's sort of consistent.

Steady as you go without doing the extremes.

I think that's right.

And that's what you're getting at, Ann.

I think we are being pretty conservative.

We're keeping our AAA rating.

and putting the money into staff which has been dramatically reduced by 70s positions since 2009 is a really important thing because our population has grown and our needs have grown and we are not doing the job we could do with these new boots on the ground.

Okay, so I guess it sounds like we're ready to move on, Lori, maybe?

Well, I may be the only one, so you need to do your counting.

Yeah, I don't see.

I know.

Exactly.

OK.

I don't want to.

All right.

So we're looking at the cutbacks here.

Another item that board members would like to discuss a little bit further is the planning for potential federal cutbacks.

And a lot of potential risks have been identified.

I see Phyllis here in the audience, if there's any more conversation.

you need to have about social services and you may have more information.

But some of the things that were identified as some potential risks are Department of Social Services funding streams, agencies that depend on federal funding, grants received by the county that are directly from federal government, or some of the pass-through from the state sometimes has a federal source.

So you have to keep that in mind.

The economy overall, you know,

is some potential impacts of changes to affordable care and Medicaid.

So we as a group have talked about a lot of those, staff has talked about a lot of those as potential things that are things that you just have to be thoughtful about.

I did want to also mention the contingencies that you have.

You have the reserve for contingency we mentioned earlier with $300,000 in it.

If we do use a small amount of that for job, that would be a little less, but you do have that reserve for contingencies that you could depend on through the year.

You have your rainy day stabilization reserve of 1.3.

The term rainy day and stabilization are for those types of things that occur throughout a year that you can make some adjustments that year and then the next year you have to do some more long-range planning so you do have that available.

The thing we've already talked about that really did help our capital program this year is that end of year money.

If there are some revenues over expenditures of this year's 17, we believe there will be some because the economy has picked up this year and it has impacted our thoughts about 18.

after your audit in November, those funds could also be available wherever you need it.

So that could be another source of potential funding if you find yourself in a situation to address some of this.

So our recommendation right now as staff for your consideration is that we monitor this continuously.

I think we'll learn more and more along the way as the federal government comes closer to their budget.

and bring back information to the board for further discussion after more information is known.

That's where we're at today.

I think it was a great concern to bring up.

Well, depending on how well we do our job to help Rivanna Station, it may be considerable.

Yeah, it could very well be.

And I think the most

We all agree on that one, Ann.

So I guess that's, thank you very much for that piece.

That'd be great.

I think that's a good idea.

So this next slide is something for you to consider.

This wasn't something that you put on your list.

This is something that staff has put on a list to talk with you about.

In your fiscal year 18 recommended budget, we have what's called a salary compression remedy, and we have discussed that with you.

And you know that the school division also has a salary compression remedy in their budget as well.

So considering how this is really impacting the schools right now,

The school division desires to implement their salary compression remedy May 1 instead of July 1 due to the serious challenges to fill many of their critical positions such as their school bus drivers.

So they have thought that this would be something we should accelerate as soon as we can if the board thinks we should do that.

Due to the principles of commonality, the school division and general government staff recommend implementation of a salary adjustment such as this at the same time.

So that's some other consideration for you.

We do want to provide a note to you that the school division has approved salary adjustments for their food service and extended day enrichment program employee salaries effective in March.

These, yeah, this is very important.

It's a very critical group.

They're doing it in a little bit different way.

If I could just tag onto that just real quickly.

These are the positions that are at the lower grades.

So these are the grades one through four that Remedy actually talked about collapsing.

These employees are in those grades.

These are also self-sustaining funds for the school division, which is a little different.

But it is part of the total budget.

Well, the afterschool does have a fee.

Well it may help to expand the staff they can find for the after school program.

They have a lot of vacancies in those positions.

So we just wanted, just for transparency and clarification, that they believe these adjustments would address those issues with recruitment and retention for that group.

And that's occurring quicker.

So we just wanted to have that, just so you're aware of that.

In cost for the two month time period, again, not this particular group that we just talked about, the self-sustaining fund, but for the other groups of employees,

is being finalized by the HR department.

And they estimate it to be about 74,000 for the schools and around 77,000 for local government.

So that would be the cost if we wanted to implement this in May instead of July.

On the school division, this would be very helpful to them for their bus drivers.

So that was why we put this on the table for you today.

So the staff's recommendation is if this timing adjustment is approved by the Board of Supervisors, an appropriation request would be provided to the board in either April or May, just as soon as we can get the numbers all locked down from HR.

and funding sources for the school division's portion would be the school division's existing fund balance reserve that they say they have available and they would use for this source and the funding source for general government's portion could come from the general government's reserve from contingencies in the current fiscal year.

Where we're in right now.

So help me out just a little bit.

Right, these are for the classified that we, because we have commonality on our classified salary scale.

Just an additional note, it also ties into your approval of the budget since obviously implementing these changes prior to July 1st would necessarily assume that they would be continued funding after July 1st.

That's what this is identifying here is what will be needed for early implementation.

So for us, we're talking about compression.

Yes, ma'am.

all of those areas where throughout the organization we've seen compression problems.

Absolutely, we really need to do this.

In my opinion, issues, everybody on board?

So this is a good one, yes.

I think our timing is good for this next conversation.

But at this point, as we talked about earlier, you have a requirement to set a tax rate, tax rates.

I think we can come back to order.

And Lori, I guess you're still leading this discussion.

That's correct.

So what I have in front of you at this point is a draft motion.

Okay?

So, just to be clear, to make sure everybody, especially the people listening, understand, this is what we'll be advertising.

Once it's advertised, it can go down, but it cannot go up.

That's correct.

To be really clear, and I don't know if you all want to speak to that or...

It's pretty simple.

You summarized it very well right there.

Yeah, it's pretty simple.

But that's not part of the motion.

No, I think Rick was adding it to the discussion part of the motion, which is a typical procedure when you have a first and a second.

The reason I asked was because my mic wasn't working.

Oh, okay.

That's okay.

So I move that the board advertise the quality rate for public hearing .839 per hundred dollars.

Now discuss, sorry.

Did you want to say anything, Fred?

Everybody's okay?

Alright.

Yes.

Aye.

Yes.

Yes.

Okay.

Let's see, we do have a couple of other things.

So we have a motion now for the advertised tax rate and we have voted on it and it passed.

So from the board, matters not listed on the agenda.

Does anybody have anything they'd like to add?

Go ahead and do those motions?

Yeah.

And these are the same numbers we have this year.

We haven't increased any of these, correct?

That's correct.

Those are all the same.

We continue with $4.28 per hundred of assessed value for personal property, personal, business personal property with an original cost of less than $250, and machinery and tools.

Mr. Gill?

Yes.

Yes.

So those will all go for advertisement.

matters not listed on the agenda from the board.

Anybody have anything they would like to discuss, bring up?

I am requesting a traffic study for Frays Mountain Road due to excessive speeding and so Joel D'Onofrio and Kevin McGermott will help with that.

This is just

I rate citizens who have called me the last few days about this and every one of us has places in our districts where we have straight stretches and people like to go 70 in the countryside and it's just one of the many situations where we have irresponsible drivers taking everybody else at risk so that they can get somewhere faster and I'm really tired of it.

So I just had to rant a little bit about that.

Secondly,

Having some town halls coming up, the first one this week, Peter Lynch will be in Crozet to talk about the assessment process.

We will be hosted by the Crozet Community Association on Thursday the 9th of March at 7.30 at the Field School.

The following Monday in Earlysville at Broadus Wood at 7 p.m. and the following Saturday the 18th at the White Hall Community Center at 10 a.m.

and Peter will only be at the first one.

Thank you.

I can say to anybody who is planning one of these, bring Peter with you if he's available.

We've had a lot of people, I've had a lot of people that have complained but then they say they don't want to.

to go through a filing because they think that nothing is going to happen.

They think it's a waste of their time.

And I think we all have to be very clear to folks that this time is different.

And it very well may be good for them to go ahead and do it.

It takes what, fifteen, twenty minutes maybe after getting an appraisal to fill out the paperwork.

I mean it's pretty quick.

But it is the process.

And this is not a realm where elected officials get to have any effect.

I mean this is a completely separate category and this is what we have to get them to do.

And I will add to your comment, Liz, that if people have issues with the assessment and they're not coming forward, we can't assess whether the software is working accurately or not.

It's been really interesting to me because I had a, not really a town hall, it was in somebody's home yesterday with about, I don't know, 15 people or something like that, and everybody there said, theirs went down.

They were far, far, far Southern Albemarle.

but if you get just a little bit up in the Red Hill, North Garden area, everybody's went out.

And then when you get into Ivy, that's when some of the people's houses, the older houses really, the land all went down, but the houses went way up.

We both got home.

You should have taken Peter.

But thank you for being there.

Then we'll move on and then we'll turn it over to our County Executive.

I don't have anything else this evening, Madam Chair.

Second.

Yes.

Yes.

Yes.

Excellent.