APRIL 14, 2020 CITY STAFF PRESENTATIONS U
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VIRGINIA BEACH CITY COUNCIL
Virginia Beach, Virginia
April 14, 2020
On March 12, 2020, Governor Northam declared a state of emergency due to COVID-19, as a result, the
normally scheduled City Council Workshop for Tuesday, April 14, 2020, is CANCELLED. However, City
Staff appeared in the City Manager's Conference Room and gave the following presentations (attached
hereto and made a part of the record). The presentations were broadcasted on cable television, vbgov.com
and Facebook Live:
• COVID-19 UPDATE
Dr. Demetria Lindsay, Department of Public Health
Erin Sutton, Director—Emergency Management
• CITY MANAGER'S FY 2020-2021 REVISED PROPOSED OPERATING BUDGET AND
CAPITAL IMPROVEMENT PLAN
David Bradley,Acting Deputy City Manager
Kevin Chatellier, Co-Acting Director—Budget and Management Services
Jonathan Hobbs, Co-Acting Director—Budget and Management Services
Amanda Barnes, MMC
City Clerk
City Manager ' s
Revised Budget
FY 2020 - 21
RESPONDING TO THE IMPACTS OF COVID-19
Guiding Principles 2
Maintain Current Level of Service with Least Amount of
Community/Service Disruption
0.), new initiatives and programs eliminated or delayed
Some existing programs delayed
Targeted reduction of existing positions
Position the Revised Budget for Flexibility
Do not recommend budgeting for attrition
>- Uncertainty surrounding the short- and long-term economic
impacts require budgetary flexibility
Guiding Principles (cont'd) 3
Revised budget does not include any major tax
increases and maintains tax and fee adjustments
shown on p. 76 of the Executive Summary, which
include:
0. ERU rate increase of 3. 5 cents a day previously
approved by City Council to address recurrent flooding
-Two cents reduction in the Sandbridge Special Service
District rate
Annual increases in recreation center fees
Revenue Assumptions 4
Month of Transaction Occurring
July August September October November December
Sales 75% 80% 85% 90% 95% 100%
Hotel 50% 60% 70% 80% 90% 100%
Meals 25% 80% 85% 90% 95% 100%
. Revised revenue estimates assume impact of COVID-19 will be
longer lasting within our local economy
Gradual return to "normal" occurring in December
General Fund Fund Balance
General Fund Fund Balance Policies:
General Fund Fund Balance remain between 8-12% of the
following year's revenues
• Use of Fund Balance is for one time occurrences and not to
support on-going needs
Estimated General Fund Fund balance as of June 30, 2020
• Originally Proposed FY 2020-21 reflected as 10.30%
• Revised Proposed FY 2020-21 projects to be 8.45%
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Revenue Im act by Fund
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Originally
Proposed FY 21 Revised FY 21 Difference
General Fund $ 737,070,021 $ 709,699,196 $(27,370,825)
Schools $ 458,949,640 $ 438,551,631 $(20,398,009)
TIP Fund $ 41,943,213 $ 29,559,555 $(12,383,658)
TAP Fund $ 13,276,751 $ 9,642,000 $ (3,634,751)
Sandbridge SSD $ 478,031 $ 478,031 $ -
Sandbridge SSD Pay-go $ 4,576,341 $ 2,582,922 $ (1,993,419)
Open Space Fund $ 3,398,220 $ 2,145,629 $ (1,252,591)
ARP Fund $ 5,187,624 $ 5,133,253 $ (54,371)
Parks & Rec Fund $ 43,627,805 $ 43,417,814 $ (209,991)
All Other $ 837,104,155 $ 837,104,155 $ -
Total $ 2,145,611,801 $ 2,078,314,186 $ (67,297,615)
Compared to FY 20 $ 64,999,074 $ (2,298,541)
Approaches to Balance Budget 8
► Due to anticipated loss of $67.3 million in revenue, an equal
amount of appropriations must be reduced or replaced by
an alternative funding source in order to maintain a
balanced budget
In order to maintain balanced budget
Reductions in some previously approved programs
RP. Emphasis on deferring or eliminating new initiatives
0. No compensation increases
100. Reviewing potential use of fund balance to maintain services
General Fund Impact
Reduction of Current Services io
Operating Budget
► 15 Vacant Firefighters (Burton Station)
► 2 Vacant Paramedics (Burton Station)
8 Vacant Police Officers ($3 million )
2 Vacant ECCS Call takers
Executive Assistant in CM Office (30 FTEs)
Administrative Support in Budget
,- Human Resources Analyst
Vehicle Replacement Program
Reduction in Originally Proposed CIP 11
► Eliminated Year 1
► 9-063 17th Street Improvements II
► 9-081 Strategic Growth Area Projects
► 3-697 City Software Upgrade/Replacement Plan $ 10 . 6 million
► 2-184 Rural Rd Recurring Flooding, SLR & Resiliency
Delayed until FY 2021 -22
k, 3-047 Landfill #2 Phase I Capping
0. 3-135 Fire Apparatus IV
New Operating Budget Initiatives 12
Deferred Beyond FY 21
All Hillard-Heintze Recommendations
00- HR Staffing to Centralize Functions
Security Office
Employee Training $3.4 million
Public Safety Training/Exercises
Public Safety Building Access Equipment
20 FTEs
Disparity Study Recommendations
FTE and Contractual Services
New CIP Initiatives Deferred or 13
Eliminated
Deferred
Hillard-Heintze CIP Recommendations
3- 166 Facilities Access Systems $ 2 . 5 million
3- 183 City Security Enhancements
Eliminated
4-059 Southern Rivers Water Shed Site Acq . $ 5 .2 million
New Operating Budget 14
Initiatives Eliminated
► Human Resources- Registered Nurse
► HR Training Room Renovation
► Enhanced Defibrillator Replacement
► Market Salary Survey $ 1 . 3 million
► Library Supervisor- Oceanfront
► Stormwater- BMP Crew 14 FTEs
► Stormwater- MS4 Water Quality
► Short Term Rental Program Expansion
Planning Technician- Customer Service
New Operating Budget 15
Initiatives Eliminated (cont'd)
� Sandbridge Lifeguard Services (May-Oct)
Courtroom Audio Video Upgrade
Aquarium Enhancements- Marsh Pavilion $ 1 million
Mobile Co-Responder Team
Child Protective Case Workers 12 FTEs
Urban Forestry/ Landscape Maintenance
Court and Sheriff Part-time FTE conversion
New Operating Budget 16
Initiatives Eliminated (cont'd)
IT FTEs to Support Time Keeping and Scheduling CIP
Mail Clerk FTE
Finance Payroll Specialist $700 k
Homeless Services Analyst and CM Conversion
s Historic Homes Marketing and Planning
► Increase to Atlantic Wildfowl and Lifesaving Museum 8 FTEs
► GF Share of Cost for Landfill Grinder Replacement
► Asset Management Software Data Gathering
New Operating Budget 17
Initiatives Eliminated (cont'd)
► Commissioner of the Revenue PT FTEs
► Real Estate Assessor Office Appraiser
► Increased Contributions to regional organizations: $350 K
► Virginia Arts Festival
► ci.-
STOP Inc. 1 . 8 FTEs
► Hampton Roads Pride
► Eggleston
► African American Cultural Center
All Compensation Increases 18
and Programs Eliminated
0. Public Safety Workforce Dev. Program Year 2
► Supervisor to Midpoint Year 2
► State Court Clerk's Supplement Year 2 $ 13 .6 million
► Sheriff Pay Parity Year 2
► Engineer Recruitment and Retention
► 2.5 % Compensation Increase
► Eliminates $5 million attrition/vacancy savings
Other Known Revenue 19
Changes
Reduction in State revenue for BLD 1 , 2 , 11 Renovation
($ 10 million)
Swap revenue source with Public Facility Revenue Bonds
State Recordation Tax Revenue loss ($ 1 .9 million )
Offset with reduction in payment to HRT
Total Changes in FTEs 20
General Fund Total Reduction :
* 30 Existing Vacancies
� 55.83 New Positions
TIP Fund
7 New Positions
Total reduction of 92 .83 FTEs compared to the
FY 21 Originally Proposed Budget
2I
Impact on Other Funds
Originally 22
Proposed FY 21 Revised FY 21 Difference To Balance:
Reduction in new initiatives,
TIP Fund $ 41,943,213 $ 29,559,555 $(12,383,658) reduction in reserve and replace
portion of lost revenue with fund
balance.
TAP Fund $ 13,276,751 $ 9,642,000 $ (3,634,751)
Reduce marketing and advertising
contracts.
Sandbridge Reduce pay-as-you-go transfer to
SSD $ 5,054,372 $ 3,060,953 $ (1,993,419) CIP Project # 8-026 Sandbridge
Beach Restoration.
Open Space Reduce pay-as-you-go transfer to
Fund $ 3,398,220 $ 2,145,629 $ (1,252,591) CIP Project # 4-306 Open Space.
ARP Fund $ 5,187,624 $ 5,133,253 $ (54,371) Reduce budgeted reserve.
Parks & Rec
Fund $ 43,627,805 $ 43,417,814 $ (209,991) Reduce budgeted reserve.
Impact on Schools 23
FY 21 revised revenues result in a loss of $20.4 million when
compared to revenues shared with Schools in the original FY
21 City Manager's Proposed Budget
›- Working with Schools to better understand the impact of this
loss and plan to mitigate these losses
Recommend School Board provide reconciled budget at April
28 City Council meeting
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Process Moving Forward
Further discussion and possible refinement of impact
on various funds
Particular emphasis and additional analysis required
for the following funds:
TIP
0- TAP
Open Space
Sandbridge SSD
Schools
Process Moving Forward (cont'd) 26
Inquiry into appropriating operating budget one quarter at a time
Teacher Contracts
Appropriating portion of CIP projects
Ongoing interaction with City Council
Virtual Public Hearings - April 22 and April 28
� School Board Discussion - April 28
City Manager ' s
Revised Budget
FY 2020 - 21
RESPONDING TO THE IMPACTS OF COVID-19