Board of Supervisors Meeting Agenda and Packet – FY25 Budget   6/4/2024

All right, we will call to order this June 4th meeting of the Nelson County Board of Supervisors.

It is a continued meeting, and we will start out tonight for our budget public hearing with a presentation from Linda.

Good evening, Chairman Parr, board members, members of the community.

for the fiscal year 2024-25, which is July 1, 2024 through June 30, 2025.

This is our public hearing on the budget.

The presented FY 25 budget is based upon, bear with me just a moment, let me get you onto the right screen.

Okay, it's not forwarding,

The presented FY 25 budget is based upon budgetary information at the time of public hearing advertisement.

State budgetary decisions may affect the final general fund budget and the school division operating budget presented for the board's approval.

The school division budget presented is based upon the original general assembly recommended budget proposal.

Tax year 2024 tax rates have all been or remain the same.

The real estate and mobile home tax rate is 65 cents per hundred dollars of assessed value.

And as I said, this hasn't changed since last year, but it really has not changed since 2022.

The per penny tax rate equivalent is based on the FY 25 projected real estate tax revenue of just under $21 million.

So the per penny amount is equal to $321,386.

Tangible personal property tax rate is $2.79 per $20 of assessed value.

And this again is also unchanged from 2022.

over $6 million for FY 25 and anticipated decrease of 1.2% below the FY 24 amended budget.

And this is due largely to a decrease in vehicle value over last year.

The machinery and tools tax rate is $1.25 per $100 of assessed value.

It too remains unchanged since 2022.

The revenue yield is estimated at $75,000

The advertised budget for the public hearing contains transient occupancy tax revenue based upon the July 1, 2024 rate of 7% as approved by the Board of Supervisors.

This is an increase from the 5% previously and is expected to generate around $468,000 more than in FY24 for a total of just under 2.3%.

Budget funds for the county include the general operating fund, the school operating textbook and cafeteria funds, debt service fund, capital fund, Piney River water and sewer enterprise, and broadband enterprise funds.

The county's fund accounting system tracks these budgetary and financial activities within the funds.

The board is considering proposed budgets for each of the funds listed.

The general fund often supports other funds as is

A brief overview of the two largest funds, the General Fund and the School Fund, will follow later in the presentation.

The Capital Fund is reserved for capital projects.

Funding for initial architectural and engineering expenses of two such projects are included in the FY 25 Capital Fund budget.

One of those projects is the Nelson County High School

Remediation Project funded at a little over $2.4 million.

And secondly, the Department of Social Service Building Project funded at a little over $1.6 million.

These figures are after the cost of issuance expensed at almost $88,000 in current FY24.

The estimated total project costs for these are $25 million

for the high school and $9.5 million for the VSS building.

Total project costs will be incorporated in the budget once they are determined.

The remaining funds are generally projected, they generally project oriented or related to the enterprise opportunities.

and Lauren Seward, Broadband Operations.

The broadband fund to date has been overseen by the broadband authority.

Final stages of implementing broadband network services throughout Nelson County prompted the broadband authority to proceed with dissolution and termination effective June 30th, 2024.

Effective July 1st, 2024, the broadband fund will be managed by the Board of Supervisors as an enterprise fund within the county budget.

The FY24-25 General Fund budget compared to the FY23-24 amended budget as of February 2024.

Compared to the current year budget as amended through February, the proposed General Fund budget reflects a decrease of a little over $2.2 million or a negative 4.32%.

The budgeted revenues and expenditures are balanced at $49,530,187

Budgetary decreases from FY24 to 25 are primarily due to budget reductions in capital outlay transfers to other funds and capital projects within the general fund.

First, we'll take a look at the FY25 proposed revenues of 49.5 million.

Local revenue

consisting of the general property taxes and other local taxes makes up 80.1% of the overall budgeted revenue as you can see in the big blue slice of the pie here.

Total anticipated local revenues are, and I said that wrong, it's like a whole combination of the pie, sorry.

The total anticipated local revenues are $39.6 million, state revenues account for 10%

and Federal 2.7% of $1.3 million.

The year ending balance of $3,577,427 in FY24 makes up 7.22% of total revenues for FY25.

It includes FY24 carryover funds of $3.2 million consisting of $128,138 in ARPA grant funds,

for the American Rescue Plan Act funds, $2,025,537 in capital outlay, $662,994 in non-recurring contingency, and $410,758 in miscellaneous carry forward and non-recurring costs.

The remaining $350,000 is planned for transfer to the Piney River water

Local revenue comparative from FY24 to 25 shows an overall increase of just under $1.6 million.

Again, this local rate revenue makes up about 80.1% of the total general fund budget of $49,530,987 at just under $39.7 million being the local revenue portion.

To give a little deeper look at this in the local, the general property taxes of $28 million

$405,249 accounts for 71.6% of all local revenue.

Of these revenues, public service tax, personal property tax, and mobile home tax are each anticipated to decrease in FY 25.

The net result of this category is negative $78,992 overall less revenue in FY25 than in FY24.

Real estate tax is anticipated to increase by $285,000 in FY25 due to increased home building and values.

A decrease in

and a decrease of 1.18% in personal property taxes combined together are projected at negative $367,193 below FY24.

Personal property taxes are projected to decrease by $71,902 due to an overall decrease in vehicle values, but machinery and tools tax is estimated to increase by $2,800.

In other local revenue, most of the other local revenue categories anticipate increases or at a minimum level funding.

Utility taxes are expected to increase by $37,000 and recreation taxes are projected to increase by $50,000 due to favorable interest rates on borrowing.

Meals taxes is expected to increase by $239,000 or 17.7%

while lodging tax is anticipated to generate an increase 26% in revenue for FY 25, projecting a $468,000 overall increase due in part to the 7% transient occupancy tax rate effective July 1st, 2024.

Permit fees, port fines, and forfeitures are expected to increase by a total of $150,626 offset

Offsetting declines in expenditure refunds and overall miscellaneous revenues totaling $113,480.

And if you notice, I'm just going right down this page here, so if you're trying to follow along.

Interest on investments is projecting an increase of $845,860 over the FY24 budget.

This is 169.3%

due to increased rates on investments.

In state revenue, FY24, we have 5.2 million.

FY25 estimates are 4.9 million with an overall decrease of $335,608 or 6.36%.

The estimated state revenue is currently 10% of the total general fund budget in FY25.

The overall decrease in state revenue is due to almost 75% decrease at $579,000, decrease in other categorical state aid which primarily consists of grant funds.

The FY 25 state grant funds will be appropriated as they are received in FY 25 and this will include asset forfeiture proceeds,

four for life grants, fire program funds, and various other grants.

The budget includes state reimbursements of shared local expenses for constitutional offices reflecting the state's share of a 3% salary increase that has been proposed for those offices.

A similar comparison of federal revenue has the FY24 budget at 1.7 million, FY25 estimates at 1.3 million, with an overall decrease of $384,661, or minus 22.22%.

Federal revenue makes up 2.7% of the total FY25 general fund budget.

Generally, federal sources include social services funding, Children's Services Act funding,

The payment in lieu of taxes relative to national forest land located in Nelson from the U.S. Bureau of Land Management and various federal grants.

The decrease reflected here is primarily due to a negative 23 percent reduction in federal categorical aid in the form of ARPA grant funds, the American Rescue Plan Act Economic Stimulus Fund, available through

All sources of the FY 25 revenue are listed.

We have the local at $39.6 million, state at $4.9 million, federal at $1.3 million, and year ending balance to carry forward at $3.5 million for a total of $49,530,187.

The local, state, and federal revenues and non-revenue sources together with prior year-end announcement of all projected revenues supporting the FY 25 proposed general fund expenditures.

The year-ending balance of $3.5 million FY 24 makes up 7.2% of total revenues for FY 25.

It includes FY 24 carryover funds of $3.2 million consisting of the $128,138 in ARPA grant funds,

A little over $2 million in capital outlay, $662,994 in non-recurring contingency, $410,758 in miscellaneous carry-forward and non-recurring costs, with the remaining $350,000 planned for transfer to the Piney River water and sewer

The FY 24-25 general fund budget compared to the FY 23-24 as of February shows the FY 24 budget being just under $52 million, the FY 25 budget being just under $50 million, the decrease being $2,235,452 or negative 4.32%.

This change is primarily due to FY 25 budget reductions in capital outlay, transfers, and capital projects primarily, excuse me, preliminary costs budgeted in FY 24 within the general fund for the DSS office building project.

Ongoing project costs are budgeted directly in the capital fund for FY 25.

And here we have another chart showing

our expenditures by major category.

The FY 25 general fund expenditures equal revenues at the $49.5 million.

In looking at how revenue dollars are spent, this graph shows major categories of expenditures as a percentage of the total budget.

The largest category of expenditure shown is for education at the 30, excuse me,

This represents $19,156,889 which includes $2,117 for the Piedmont Virginia Community College.

In addition to the $19,154,772 allocated to the Nelson County Public Schools in FY25, the county will contribute debt service payments for the schools in FY25.

$838,263 for a total of $19,993,035.

This total has been reduced from the FY24 total by a retired debt of $1.1 million for the Nelson County High School and Middle School building construction project.

The FY25 county support for Nelson County Public Schools includes funding for four school resource officers from the general fund budget.

This cost is included in the public safety category at approximately just under $314,000 of which the county will receive partial state grant revenue funding in FY 25 at just under $93,000.

The balance of the $221,294 for SRO salaries and benefits

F-125 expenditures by major category as a percentage of the total budget.

Again, the largest expense within the general fund is $19.1 million or 39% of the total budget for the school division.

Next is public safety operations at just under $9 million or about 18% of total budget.

Third is governmental operations at just over 8 million or 16% of the budget.

Included in this are general government and judicial administration, public works, parks and recreation, and community development.

Next are health and welfare at 9% and agency non-departmental at 3%.

Agency and non-departmental includes the remainder of the FY24 COVID-19 American Rescue Plan Act funds of $128,138.

Capital outlay is budgeted at 4%, or just over 2 million.

Refunds and unallocated contingency reserve of 1.3 million make up the 3% of the general fund budget.

Piney River Water and Sewer Fund

has $350,000 allocated in a transfer from the general fund to replace one of the sewer pumping stations, and a debt service transfer of $3.3 million covers debt service payments in FY25 and adds $1.1 million of the FY24 declining debt to the reserve fund, increasing future debt capacity for capital projects for the county and schools.

A few expenditure highlights.

and personnel, we have a 3% salary and benefit adjustment included or the greater of an equity adjustment from management advisory group pay study implemented in FY24.

This comprehensive pay study was completed by management advisory group and implemented July 1st, 2023.

At that time, employees earning below the minimum pay range on the approved pay study scaled for their

The proposed FY25 budget allows an across-the-board salary increase to all employees at 3%.

Secondly, an 11% increase in health insurance premiums occurred for this fiscal year.

In an effort to minimize costs, the board elected to offer employees the option of a high deductible health plan in addition to the current Key Advantage 250 and Key Advantage 500 plans.

The high deductible plan also allows employees the optional advantage of utilizing a health savings

The FY 25 BRS employer rate contribution changes are as follows, and they're listed here.

The first is a defined benefit retirement contribution decrease.

This has in FY 23-24 been 11.47%, and this will decrease to 10.77% for employees and their benefits.

and the Virginia Local Disability Program, which is available, an available benefit to the VRS employees under the hybrid plan, that will be decreasing from 85 percent, point, excuse me,

We do have one new position that will be added this year and that is a full-time Assistant Director of Special Projects position in the Tourism and Economic Development Department, which is included in the FY 2020 budget.

There is a 14.2% increase in regional jail costs at the top of the list.

The regional jail cost increases are due to higher utilization of the services there.

The Albemarle-Charlottetail Regional Jail uses a five-year average prisoner population to help smooth out annual increases.

However, with annual utilization on the rise, average annual costs will also increase.

The Nelson County's obligation for construction costs are anticipated to begin in FY25 as well.

Next, the budget includes operational funding to provide 80% of the cost of a tanker truck for former fire department and a power load system and cot for the Nelson Emergency Medical Services ambulance acquired from Rockfish Volunteer Fire and Rescue.

IT and network expenses include a network server replacement, network penetration testing, IT microwave network upgrade and replace microwave batteries DC plant, radio communication improvements at Wintergreen, and finally a circuit cord audio-visual system replacement.

Full funding to Nelson County Emergency Services

As is the purchase of six new sheriff's vehicles and the equipment required for those vehicles.

All of the aforementioned costs continue to increase sharply while deliveries still experience delays.

In other highlights, the budget also includes contribution increases to the following agencies.

Nelson Local EMS Council, Thomas Jefferson Soil and Water Conservation District, Jefferson Madison Regional Library, Java Jefferson Area Board of Aging, Foothills Child Advocacy Center, Community Investment Collaborative, which is the Central Virginia Small Business Development Center, and Rockfish Senior Meals.

Some requests actually reduced for FY 25 upon their request, and some of them,

making the net increase for agencies just over $21,000.

Capital project funding, the second on the list here, includes $300,500 reserved for schools, $2.4 million for the Nelson County High School renovation project, and $1.6 million for the DSS building project.

The balance of $419,730 is unallocated reserve.

Miscellaneous capital outlay, aside from those items included for public safety and emergency services previously mentioned, includes historic property set aside, voting machine replacement and Department of Elections security compliance, and replacing the transfer station tipping floor.

Total capital outlay funding is just over $2 million.

Transfers.

Transfers are the transfer of general fund monies for other purposes.

Transfer funds include funding set aside for the next reassessment for the Department of Social Services or BPA fund, for school nurses and school operations, for the debt service fund, for Piney River water and sewer, et cetera.

FY 25 transfers total just over $25 million.

Also included are contingency reserve, $1,275,432 with $612,438 generated from recurring revenue and $662,994 from non-recurring revenue or carryover.

Non-recurring contingency funds are best used for one-time expenditures.

Recurring contingency funds can be used for one-time expenditures without impacting future operations.

The budget allowed here is $32,365,576.

To compare this with the FY23-24 budget year, it is a decrease of $2.3 million or minus 6.7%.

The 1845 advertised budget based on an enrollment of 1,430 students reflects an overall decrease of $2,328,819 or minus 6.7%.

The decrease is largely due to the increase in expenditure

This grant was fully appropriated at $2.4 million approximately.

$1.4 million of this grant is anticipated to be requested for use in FY 25 and is not presently included in the total FY 25 budget shown here.

FY 25 school fund revenues

State, Federal, and other categories with the total being $32,365,576.

In addition to the local operating funding of $19,154,772, an increase of $610,000 over FY24, the school division also received

for field trips, dual enrollment, telecommunications rebates, et cetera, is projected at $718,187.

State funding included here reflects an anticipated decrease of $427,432 and is based upon the original General Assembly recommended budget proposal.

Regular federal funding is anticipated to remain level for FY 25.

The amount represented here includes carryover COVID-19 stimulus relief funding of $504,993 from FY24 into FY25.

The FY25 local contribution to schools.

As noted previously, one of the largest components of the general fund budget is the local contribution to schools.

Including debt, about 51% of local funds within the general fund budget are allocated to schools, which equates to 40.8% of the total general fund budget.

The local contributions to school operations and the school nurses for FY25 is funded at $610,000 more than in FY24 versus the school

The county will also fund $838,263 in existing school-related debt with additional debt associated with the Nelson County High School renovation project to be determined.

Given the total contribution, not including debt, approximately 92.8% or $0.60 out of every $0.65 in real estate tax revenue supports the schools.

Including existing school debt, this percentage increases to 96.8% or $0.63 out of every $0.65 in real estate tax revenue in FY 25.

With estimated FY 25 school enrollment

The proposed level of local funding provides a per-pupil local expenditure cost of $13,395.

FY 25 local education funding of $19,154,772, coupled with state, federal, and other funding for schools of $13,210,000,

$32,365,576, which is the budget for the schools.

And this equates to $22,633 cost per pupil in FY 25.

The required local contributions to schools based on enrollment of 1,430 students and original

and the recommended budget.

The Local Composite Index, or LCI, is the state's formula for determining a locality's ability to pay.

The higher the index, the lower the amount of funds received from the state.

The LCI for Nelson County in FY 25 is .6645, which means that the county will be paying 66.45%

expected to pay that and the state share is 33.55% for programs such as SOQ or standards of quality, incentive programs, categorical programs, and lottery funded programs.

This is a 7.6% increase in local funding required towards these programs over FY24.

Enrollment also contributes

Enrollment for FY 25 was $1,396, while FY 24 was $1,396, while FY 25 was projected at $1,430, an increase of 34 students.

Nelson County Schools does continue to be well-funded.

Operational funding for schools, including funding nurses for the schools, is proposed at $19,154,772,

which includes the allocated $18,989,837.

Let me get that right.

$18,989,837 for operations and $164,935 for nurses.

For student enrollment of 1,430, this funding exceeds the required Virginia Department of Education funding, the required local share,

of $12,618,196 and the excess is $6.5 million or 51.8%.

This difference represents 31.3% of real estate tax revenue or 20.3 cents of every 65 cent in real estate tax revenue, which the county is giving above

Proposed school fund expenditures by major category as requested.

The left column shows you what the schools requested in their budget.

And the right hand column is what was, let's see, hold on just a moment, is what the increase is over the previous year's budget.

So the major categories and expenditures shown here are based upon the state funding as provided for in the original General Assembly's recommended budget compared to the FY24 requested budget.

This is an overall increase of $1.6 million or 5.29% above the FY24 budget request of $31,149,585.

The FY25 proposed school

of $1,786,000 in local funding due primarily to increased expenditure projections and decreased state and other funding sources.

The Board of Supervisors has allocated $610,000 in new local funding for school division operations in FY 25, funding total expenditures of $32,365,576

The Board of Supervisors provides the local contribution to the school division.

However, the school board and administration decide how these funds are allocated for expenditure within the school division budget.

In addition to this operational funding request, an immediate capital

Nelson County Public Schools is the Nelson County High School renovation project for which a bond anticipation note has been obtained through the Economic Development Authority and included in the county's capital fund budget for FY 25.

The bond anticipation note total included in the FY 25 capital fund budget is $2,456,071

for project implementation while seeking and preparing a long-term funding option, potentially through the VPSA, Virginia Public School Authority.

The total project is estimated at approximately $25 million.

This aligns with the FY24 recommendation from Nelson County Public Schools analysis that these improvements are critical and advanced for completion within three years.

All short and long term debt service costs associated with this capital project will be fully funded through the county debt service fund.

In summary by fund, all the funds that make up the county budget are denoted here totaling just over $95 million.

The general fund, $49.5 million, school fund, $32.3 million, the textbook fund,

$729,537, Cafeteria Fund $240,491, Capital Fund $4.8 million, Piney River Water and Sewer $539,908, Debt Service Fund $6.5 million, and the Broadband Fund $276,138.

Additional information regarding each fund has been provided in the handouts.

But should you have questions or want further information, we will be glad to provide that to you.

Per state code, the board must wait a minimum of seven days following the public hearing before adopting the budget.

This being June 4th, the board may adopt the FY 25 budget as early as the board's next regular meeting on June 11th, 2024.

All right.

Next, we will open the public hearing.

And currently, we have signed up to speak Margaret Claire.

Please state your name and address for the record.

Margaret Claire.

I'm from 560 Belliesville, Lane, Robert, Virginia.

I'm the Director of the Nelson County Community Development Foundation and also the Central District Representative of the School Board.

But I'm just going to speak from the point of view of one of your constituents and a taxpayer in Nelson.

I really want to applaud you for the work you put in.

and it's a big chew and I appreciate your work.

The LCI as you know hit us pretty hard.

The LCI is based on gross income, real property values, also tax, sales tax in the county which all have gone up as evidenced by your increase in local revenues by a million and a half.

What that ends up happening to the school budget is it hit us by a million, $1.1 million, which is what our deficit is right now from what our requested amount is.

And that's a huge amount of money.

And for a budget that is built on people and benefits, that is going to hit people and programs and benefits.

So I'm just asking you to dig into your funds and see where you can find more

Money to support the schools.

I was listening to Ken Burns, I don't know if you know who Ken Burns is, he's a historical, he does a lot of movies about the historical things, you know, Ken Burns.

So he was doing a speech at a, I'm sorry I have to go down my notes for this because

in the conversations that everybody has about the divisions between, in America now, they're so vast, you know, between us and them.

But he said there is no them, there's only us.

So in the feeling of one Nelson, you know, this is us, this is our budget, that bottom line is our budget, it needs, and the laws is really hitting the school's heart.

So I want you to think about that,

Think about who the school serves, everybody in the community, the school is the community.

You guys know that the SOQ positions are very, very underfunded.

The JLARC study proved that Virginia as a state underfunds their schools because of this LCI index well below what is nationally funded for schools.

So anyway,

Thank you.

Jerry Lloyd, 9322 Rockfish Valley Highway, Afton.

I haven't planned on speaking because I've been able to spend a whole lot of time looking at this.

Thank you very much for this budget.

I have probably more questions.

I do like the budget.

I think the budget is fairly well articulated, and so I was really glad.

It looks like someone has done quite a bit of work.

On page nine, though, I wanted to know why.

Why are these revenues decreasing?

The result of this cabinet

Then in the next section under local revenue, where it's talking about tax breaks from lodgings and things of that nature, that seems like it's a pretty significant amount of money from lodging tax.

Is the county seeking out those individuals?

On page 17, I really do appreciate the equity in the benefits of all the employees for the school system and the county.

That is absolutely amazing for you to be able to do that.

That's really pretty good.

Several other communities throughout the state and the country are not even doing 3%.

So for Nelson County to do 3%, that's really phenomenal.

Also on page 17, the assistant director of special projects position and wanted to know if that was a permanent position or just a one year or two year.

It doesn't say whether it's a permanent position.

and then what percentage of the resource officers come from that state grant.

So I just have a question on how do you figure out what percentage of that funding is.

On page 19, I wanted to know how the contributions from

and other things of that nature, how that contribution is determined.

So again, those were just questions.

And then on page 22, does the dual enrollment offset the expenditure that we send to PVCC?

So I know some people do that.

Some school systems actually pay for the full dual enrollment.

And so are we paying dual enrollment in addition to

funding people and then I think compared to the neighboring counties what we pay per pupil I think is really pretty phenomenal even more counting of ourselves.

Thank you.

I guess my biggest comment, I've done a little research on private schools and the state average is around $11,000 for private education and most of those are Christian education.

and attendance of around 15,000 students and their tuition is around $11,000 and they offer, I mean they're pretty much offering everything that a public school is offering with the sports and different things.

Now there are a few extra charges for sports but it's about a third of what we're spending for public education

The State Average, I can't remember, I've got all this stuff printed off at home, but I just came in from North Carolina and didn't have time to bring it with me.

I went through school here in Nelson County, all 12 years of it, and I know that private education is not gonna ever replace public education, but I'm wondering if we could encourage private sources to come in, and if that was available, and they can do it in a third, basically what these schools are doing

are educating these kids for less than what the county is putting in, not taking into consideration what the state and federal inputs are.

But it is a concern that we're spending almost $30,000 per student to educate a kid here in Nelson County.

Thank you.

Come on down.

I just like to request or ask that the board direct the administration to have a look at the school speed zone, maybe seek proposals from Blue Line and ultimately to get to a competitive proposal.

Seems like what we had last fall didn't get

Thank you.

Anybody else want to speak?

Okay.

If not, we will close the public hearing.

and we will move on to, do we have any other business to be addressed this evening?

I guess I should have turned my microphone on a long time ago, shouldn't I?

Sorry.

Anybody else have other business?

All right, then I guess we will adjourn.

because next week is a regular meeting.

So I will entertain a motion that we adjourn.

So moved.

I'll second.

Chair votes aye.

We are adjourned.