City Council Budget Work Session / Special Meeting   2/1/2024

Thomas, will you please call the roll?

Here.

Here.

Yes.

Yes.

Yes.

Based on the compliance with the policy, is there motion?

I would move to approve his participation remotely.

Is there a motion to approve or amend the agenda?

I move for approval of the agenda.

All opposed say no.

I know.

And are you going to introduce them?

and this allows for the after the fact and a good education opportunity for the community to try to make sure you do what you need to do, get your permits before you make the change.

So in the packet that we have, so there are several tables.

Yes.

The table you're referring to is the one with the blue in it?

So for example, the first one on Attachment 1, it was an update to the table title based on the new code, but the fees remaining the same.

Blue on it.

Yes.

Michael?

I do not know.

would that, would it still be, I guess I could imagine the mail-in costs, it would still make some sense to say, because that's sort of the actual cost that we're incurring, but the $840 to a certain extent is sort of the fee we picked out of the air to assign to that rather.

I don't know how that will look, and then we have the new information from the retreat, so we'll work with that.

I have a follow up for that question.

Sorry, I was thinking

But the state allows us the opportunity to recoup those fees, and so we just have continued to show them on the schedule.

How often does this happen?

does a public hearing happen?

One that the applicant requests that we would charge for.

It just provides an opportunity to account for that.

Would that have happened like three times?

Three or four times?

Would that be an example?

I mean, we're, yeah.

We have to have

The reason that we're bringing the fee schedule to you at this time is so that when it becomes effective on the 19th, an applicant is able to come in and find the correct line, and it lines up in the systems.

We'll have a chance to give some input.

And that as well as doing the data research behind the scenes that one needs to do to make that happen.

You mentioned something about the aftermath or something.

After the fact, yes.

So is that like, do we get from what I'm hearing is that some applicants, they do things kind of knowing and kind of asking for permission afterwards?

And it's an opportunity for education and to, you know, there's usually a lot of logistics when someone has worked before.

That's part of it.

They just have to get it.

And don't do that again and come to us first.

So I now close the public hearing and now we can decide on these counselors if there's no other questions, I'll take a motion.

Yeah.

Let's get a second on it first.

I'm sorry.

Sure.

Second.

That's per resident or who gets

Thank you.

I'm not sure if it was like everybody or just nearby.

Thank you.

And so as far as coming back with what you've done, your research, you may be talking like next 18 months, next year, you have any idea?

I don't at this point.

You ought to feel comfortable working with this.

So we'll see.

The reader will call on this.

Yes.

Yes.

Yes.

Yes.

The next item.

And so we're here for public hearing on on that as well.

Yes, sir.

It is, but right now we're just getting questions.

Oh, okay.

Any clarification, questions, counselors?

So, I don't know what we'd do about that.

Well, you all have another opportunity to work through that.

And our attention at the time was

With all the other stuff that had gone on, that poor Scribner.

Yes, with all sympathy to the Scribner.

Yeah.

I like it the way it is.

So I guess now now is probably a good time if you want to to

So you're not in an audience anymore yet.

But we should wait and collab with the public hearing for our discussion, right?

Not questions at this point now.

Thank you.

Michael?

No clarifying questions for me.

If not, I'll close the public hearing and bring it back to council for further discussion.

Zoning rewrites, zoning changes period, or slow moving agents change.

So I'll be voting just what I think is the correct policy this evening, although I understand and respect where everyone else is coming from.

And so that's, that is what I thought we had.

Yes, yes.

commercial in the R neighborhood.

Does anybody remember what the vote on that was?

We were taking a head count and I don't remember whether it was, I think it was four to one.

I remember it being not everybody.

And I also feel like honoring the spirit of what we worked on as a group last fall would mean that we go back to what we actually decided.

So I think I'll abstain on this and then advocate for a more fulsome discussion about this sooner rather than later.

But I am open to talking about it.

And one of the things we batted around was the question of whether SUP is a good thing or not.

I agree with you.

And that presents a model that's a different approach, and so maybe we look at that and see what else that can do.

I may have a little bit of flashback, so listen.

So if I could just for my purpose of managing all of this stuff.

Thank you.

Thanks, boss.

Sam comes in and saves.

We can look at that whole picture in a dedicated discussion.

So all in favor, please.

and BSP to make.

I'll second that.

And not wanting to throw the script under the bus at all because I know we were doing a real number on you.

Yeah.

All obscene.

Yes.

Thank you.

And with that, I'm going to stop sharing and turn it over to Mr. Vandiver.

So the market is really believing strongly that next month when the Federal Reserve meets that we're going to start seeing some rate cuts.

91% of... Vibes?

Vibes, yeah.

That's right, yeah.

So that's sort of the balance that we're trying to strike in the portfolio right now with our advisor.

Thank you.

Thank you.

I mean, concerning other than kids?

And so, you know, it's those unknown things that you just don't know.

Is that essentially consistent with what we have in years past?

That's an unscientific answer, but I'll take unscientific at this point.

Experience-based.

So we'll take the next few minutes and we'll turn it over to our city assessor, Mr. Davis, to give you a briefing on the general reassessment.

But the accurate number for the residential was 4863.

So in the GIS where the assessments are listed, when it says year 23, is that what just came out, or is that

Oscher

What would cause a house to stagnate where the assessment would either, that would not go up?

That hasn't happened.

If it's like one house on a block, then it's probably like something's wrong with the house.

It's something that's been singled out more than likely about that particular house.

Oschrin.

Sure.

Has that really been an issue with your without work?

all of the information, at least the assessment information, not the detailed information available online.

Do you have a sense of like the percent of people that don't like their assessment and come back to talk to you about it?

Now that's people that actually filed a formal administrative appeal rather than just calling on the phone or sending an email or anything like that.

What was the result of those appeals in general?

Yeah.

And the question I

So I'm just curious if data is more granular is available.

But I can, I can resend that to you if you didn't receive it.

I'll go and check again.

Okay.

So the next section will take us

Any of those that are, you have questions on?

Yeah, can you, what does number eight mean?

We negotiate through allocations to these various bodies so that they perform that work on our behalf.

So what are some contractors?

Well, it's OAR.

for providing fundamental services that we were funding through not the competitive process, but based on an application of their needs.

And again, these are viewed as things that need to be done, must be done, and certain instances, obligations that need to be met whether we do it ourselves or we fund others to do it so that we don't have to.

And in many cases, their programs that we, along with other jurisdictions, have contracted mutually to undertake.

So I'll just remind you of that.

Right.

Any other questions here or clarification?

We'll get a chance to look at that in the later work session.

All the specifics, yes, that is forthcoming in the budget presentation.

And 10 is basically like rainy day fund?

So we don't get to a point where we aren't acknowledging that that because it's a percentage that goes up every year, we want to acknowledge that that happens and make sure we're budgeting for it.

Okay, thanks.

moving on.

14% is a policy that is is a sufficient working capital for the general fund.

Okay.

How much are we getting in meals tax about $12 million?

We had originally budgeted that at 15.6, and we bumped that up slightly for 25 to 16.8.

So it equates to about $3 million.

And you can see how that correlates with our revised numbers for 24, the 171 to the 167.

And we're projecting FY2025 numbers to be up another roughly four million on top of the revisions.

So what was the surplus this year?

I just thought I have too many numbers made 9.3.

It's a different number from this.

And then the gray column on the right is where we have revised the projections based on what we currently know today for 24.

Correct.

and then the landfill reserve.

That is a reserve that we have had on the books.

Correct.

Is this

We don't anticipate anything huge.

Yeah.

Pupil transportation and maintenance that they contract with us.

So the receipts are actually more like $19 million.

That's correct.

That's why I was confused about the net.

That's what we have to spend.

Surplus for this past year?

The surplus is the result of not spending what was budgeted last year or receiving more in their one-time funds.

It's pre-20 million.

10 to 12 million of the 16 that we just talked about on the prior slide.

That would be ongoing.

Ongoing.

anything else you want to say?

So those three things, when you add them up, they certainly are exceeding what we have for new revenue.

Could you just explain some about how that's a fundamentally different situation and the implications for the budget because of that?

Did that answer your question?

Yes, thank you.

So I just want to share that with you that that's probably the juncture that we find ourselves at.

I'm trying to figure out how to word it.

that would be what I would be willing to consider in prioritizing especially the implementation of company class because I think that's something that I prioritize as important for running this organization but there is still a sizable gap of about three million, three to four million dollars.

Schools are funded at 12 million.

Okay, so just.

Correct.

And one extra, that is with no departmental requests.

Outside of what we have been able to integrate into the CIP, that's what we pretty much have been able to accommodate with what the other expenditures are.

It's about 18 to 20 million, you said three, four million dollars more than.

Yeah.

This is what we need to be paying to get the staff back to where we want them to be and to the level of service that our citizens expect.

So it all comes together when hopefully down the road we will see that and that we will have a happier workforce as I look at those that are in this room because then we can more or less deliver on many of the things that we've been unable to deliver on at least on the timing and to the degree that we would like to.

So Sam, I know that in previous you talked about the collective bargaining and the class and comm.

Yes.

I don't know what percentage of that will look like if that's the 10 to 12 is the minimum of basic that we have to do.

And if I look at the fact that I have three bargaining units that are hopefully satisfied, and the rest of the workforce is not, then how am I to expect that I'm going to be able to get them all to perform at a high optimal performance?

Could you like take for you, not trying to tell me what your job is, but could you, in this, this is for the class in college.

Sure.

What that would then communicate to people who you know have got this objective data that were not paid enough and you're just going to wait to make a toll.

It's a bit more challenging.

And I think that just like we faced that with the city school project in like a aha moment, maybe that's what we're having here.

The assessment increases are what actually carried us to a place where we were able to do that.

Affordability.

So I think from what I'm hearing that we're going to have to find a way to reduce the current expenses or find new revenue sources, which we have on the one or two tours for that.

Is that later, or when do we do that?

the things that I would imagine that you're thinking about, but you can give me something specific and I can tell you what.

March 5th.

March, yeah.

Then we'll all be delivered to you.

So I don't know if that's internal or me, but... Yeah, it may be, because it's an error message.

Thanks.

Well, at least my understanding is that to this point, even given this dire news, the CIP is fairly well funded in terms of the projects that we've, so just for people to be aware from a project perspective, in large scale investment perspective, I think we're still in pretty good shape, which is a positive

But I didn't leave with any of those bigger conversations at this moment because I felt like I had enough to exceed what we already had coming in.

But I think it's good for people at home to know that.

Sure, that makes sense.

The CIP part of things, from what I've, conversations that you and I have had, it sounds like that is in a good place.

That's great.

But we have.

5th.

March 5th.

Yeah.

OK.

And when you say balanced by in order for us to present, you're talking about the pack, the budget book.

Correct.

So that the budget book can be sent to the printer and prepared because they're not going to have time to make changes in the meantime.

We could still make changes post that.

Between proposed and adopted.

After the fifth.

So the balance for the proposed budget.

I have to have a balanced budget so that we can facilitate bringing it to you.

the heads up from us if I'll appetite individually for raising the taxes.

So that we know that or I have I have an extra exercise that I get to work on for the next few days with no sleep.

We want guidance from all those or the main choice?

It has to be printed?

I'm not going there either.

So we have both, but even to put a PDF together, it's a 300-plus page bulk.

Ensuring accessibility for the version that we'll go live as well.

So a question on the

Do you have a ballpark of what that number is once you factor in the contribution to schools, as well as our real estate tax relief programs, just so we kind of have a practical idea of what one cent is actually providing us to work with?

The schools would get 40% of that, so if we just did a million that'd be 400.

There.

You make us do tough math on the fly.

So I work out to about $30,000 per million per per penny on the real estate rate.

So practically we'd be looking at, if it was a million, around 600,000 is what we actually get from one cent.

It's not going to happen by virtue of the formula.

Mule's tax, has that been 6.5 for a while?

That's been raised three times since I was first elected.

I think the first time was in 2020.

We raised it by one half of one percent, either in 2020 for the coming fiscal year or in 2021 for the coming fiscal year.

It had been raised in either 2017 or 2018, I'm pretty sure.

Well, I'm just thinking you need some direction tonight, right?

in New Revenue Week can work with to balance the budget.

I appreciate all the hard work that you all put into this, but I kind of find it hard to talk about revenue increases when we don't have a full list of what our expenditure options are.

If you click on that and then there's a summary at the top and you can

So basically keeping things flat would be not changing the number of FTEs or not going up or going down in a hypothetical units sort of staffing level whereas most of your costs are staffing.

If I start to take positions, then the flexibility of their reuse is not there.

Do we ever take money out of the investment accounts?

So that cash is already accounted for.

No.

It's actually performing work in a sense is the way to look at it to generate money.

How much of our surplus this past fiscal year was due to vacancies?

And we, in budgets past, we did budget for some attrition savings, but certainly not seven million dollars or so.

Has there been a serious effort done to get that right number in this projection?

I would actually be able to get it right size and we would have a real number.

What is it really supposed to be doing as opposed to what you thought you were supposed to be doing?

What do we accept it?

Is that the number that Michael?

Yeah.

It may not be advisable, but it is possible to use art money to make the difference.

Kristen and I have talked about taking a look at where we are with ARP and looking at what options may be available to just free some of that up for flexible spending but for one-time flexible spending.

It's either we're going to have to make some bets on the future, or we're going to have to not pay people what they need to be paid, or we're going to have to jack up taxes.

so it's it's balancing that with and what else comes down the stream because this ship pretty much is still when you pass the ordinance and decided that that's that's the tough part of where we are that is where that D word that y'all don't like that I use the discipline where it comes in it gets to be a little more challenging to make other decisions because we made this decision and it's now trying to figure out how we implement it and as comfortably and as responsibly and as

I just offer that caution from my experience.

I think we can find something that is only a couple million dollars.

So I would strongly caution you not to use one-time money for this.

Lloyd, did you want to chime in on the one-time funds?

to us in various ways are typically paying in the neighborhood of $1.10, $1.11, $13, which is where we were before we went on the tax cutting binge 15 years ago.

We were up around $1.13 and it was about 2004 or something like that.

But ultimately, as I'm looking at the various taxes that we impose and the places where we're sort of right smack in the middle on meal taxes and lodging taxes, both of which we've raised in the last couple of years, and we're on the slightly higher end of the personal property tax rate, that the place it still keeps us actually in the lower, we're focused about the 40th percentile, would be to raise our real estate tax rate to a dollar.

So we don't know what this is in the actual functional context of people's wallets because this is not the complete picture of what folks are paying.

Most of those cities are taxing at a higher rate than we are.

I know that Lynchburg just reduced theirs and one fell swoop from 111 to 89, and I'm nervous about how that's going to play out for them, but until a year and a half ago they were up there as well.

We just, we have to place it in the full context.

Well, Buna Vista doesn't have its own real estate tax rate, but I know.

I thought it did.

It's a township.

There's a meals tax rate on it.

No, it's an independent city, but regardless.

Natalie's point is absolutely right that we can't look at this one chart and make all of our decisions from this one chart.

I'm just saying, if you all want some guidance from me tonight, my guidance tonight would be to look at the possibility of a 4 cent raise in the real estate tax rate.

I mean, an increase I wouldn't show on the amount, but that is something I would certainly entertain.

I'm not saying that's, gee, wonderful, but easier to talk about this year than it would have been last year.

I don't

Yeah, I had it, you know, an increase there and maybe looking at not as much as an increase for real estate tax, but it's something I think that a mixture we can we can play with.

So you think there's going to be a penny for lodging and three pennies for real estate?

Yeah.

We've already put it in the CIP

Tracy and Sam, it looks like there's, you know, some support to, you know, as we move along to, and I know that you feel like you want some more information.

A couple versions of that with actual.

Based on our practice of what goes where, what share of it goes in different places.

Should we decide we want to go this route versus.

Scenarios for that.

But here's what other things is as a possible option.

Yeah, so I thought we increased that a year or two ago.

I don't like touching that.

Yeah, so I was interested in.

I think it was before your time, if I remember correctly, but it was like a year before.

And the property tax is just pretty small.

How do we feel about that?

So for me, I was looking at some type of mixture between real estate and lodging.

We need to hear more to what are we doing, real estate and

and the rest of you feel about that?

And I'm thinking that was really helpful.

It is helpful.

So I am still interested in diving deeper into the expenditure side of things as well.

Another meeting coming where you're going to be in the same moment.

I can't possibly answer that question tonight.

We are not going to advertise until March.

It is not an advertisement that we will do something.

And it's a notification to the public that you're considering doing it.

So for the month of March, you would then have to decide if you don't want to raise taxes, you get the job of figuring out how to cut out the four, three to four to five million dollars or whatever it turns out to be out of these scenarios.

to just be as frugal as possible, but if we can't realistically get to a balanced budget without raising the taxes, I'm willing to raise the taxes.

But keep in mind, you probably have, you know, a four to six million dollar bill that you already know exists for next year's budget.

that gives us another four and a half million dollars for next year as well.

That's the sort of step change you're going to have to make on a revenue side.

So that's another reason why we want to hurry it up.

So prepare yourselves for that conversation.

So I have no fear of that discussion.

And any good negotiating tactic that is asking for more first.

Yeah.

I mean, I wanted to get what they need for sure.

Absolutely.

So how do we ensure we aren't shut out if the general assembly makes positive changes that help us handle the situation?

But it could potentially make these discussions next year once it's approved by the public a little bit easier.

Not on the operating side though, because those would be resources that we would be talking about for our CFP.

But the 10 million a year and how that impacts our debt service payments, I mean, I think would be meaningful.

That would be where there is some relief that they could be redirected, but that wouldn't be a lot.

This would be a balanced budget with no revenue increases while fully funding everything, which is just an astounding fact, but that obviously will not save us this immediate budget cycle.

Yes.

So we would know how the impact would affect people personally before we make a decision.

Yeah.

You want to get right on that, Todd?

The housing assistance

And I do want to give a shout out to you and the comms team for putting that video out there.

So thank you for that.

So you, Kristi, did you have some more slides?

I think that was it.

There are a few more.

There were some appendix if questions came.

I'm sorry.

Thank you.

If you have questions.

And the relief programs for elderly, disabled veterans?

The program that we're speaking of now is for, you know, only 65 years of age or older, or permanently disabled.

And if they were part of the program last year, they need to read it.

If you're a new applicant or you didn't apply last year, you need to apply.

It's just whether or not you'd like to re-up or re-apply.

That's right.

All right.

Oh, well, I will let them know you said that.

Thank you.

I didn't see it.

I know we talked about it.

Thank you.