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Home My WebLink AboutMARCH 30, 2004 MINUTES CITY OF VIRGINIA BEACH "COMMUNITY FOR A LIFETIME" ITY COUNCIL MAYORMEYERA E OBERNOORF, At-Large VICE MAYOR LOUIS R. JONES, Bayside - Districl-l HARRY E. DIElEL, Kempsville - District 2 MARGARE'T L. HIRE, Centervilfe . Di.\'lricl 1 REBA S. McCLANAN, Rose Hall - District 3 RICHARD A. MADDOX, Beach - District 6 JIM REEVE, Princess Anne - District 7 PETER W. SCHMlDT, At-Large RON A. VILLANUEVA, AI-Large ROSEMARY WILSON, At-Large .JAMES L WOOD, Lynnhaven -Dislric/5 SPECIAL FORMAL SESSION CITY HALL BUILDING 1 2401 COUR7HOUSE DRiVE VIRGINIA BEACH, VIRGINIA 23456-8005 PHONE: (757) 427-43U3 FAX (757) 426-5669 E MAIL:Ctycncl@vbgov,com JAMES K SPORE, City Manager LESLIE L. LILLEY, City Attorney RUTH HODGES SMITH, MMe, City Clerk 30 March 2004 I. SPECIAL FORMAL SESSION - Council Chamber - 4:00 P.M. A CALL TO ORDER - Mayor Meyera E. Obemdorf 1. READING OF THE MAYOR'S CALL FOR FORMAL SESSION II. ROLL CALL OF CITY COUNCIL III. CITY MANAGER'S PRESENTATION FY 2004-05 RESOURCE MANAGEMENT PLAN (Operating Budget and Capital Improvement Program) James K, Spore, City Manager IV. ADJOURNMENT VIRGINIA BEACH CITY COUNCIL CANCELLED: Regular Sessions Regular Sessions April 6, 2004 May 4, 2004 Passover Councilmanic Election And Changed the Workshop of April 20, 2004 to Briefing Special Informal and Formal Sessions MINUTES VIRGINIA BEACH CITY COUNCIL Virginia Beach, Virginia 30 March 2004 Mayor Meyera E Oberndorf called to order the SPECIAL FORMAL SESSION for the VIRGINIA BEACH CITY COUNCIL in City Council Conference Room, City Hall, on Tuesday, March 30, 2004, at 4:00 P.M. Council Members Present: Harry E Diezel, Vice Mayor Louis R. Jones, Richard A. Maddox, Mayor Meyera E Oberndor}: Jim Reeve, Peter W Schmidt, and James L. Wood Council Members Absent: Margaret L. Eure {Entered: 4:08 P.M.} Reba S. McClanan Ron A. Villanueva {Entered: 4:05 P.M.] Rosemary Wilson {Entered: 4:08 P.M. -2 - MAYOR'S CALL TO SPECIAL SESSION: ITEM # 52437 The Mayor read the CALL TO SPECIAL FORMAL AND CLOSED SESSION: "THE HONORABLE MEMBERS OF CITY COUNCIL In accordance with the Virginia Beach City Code Section 2-21, and by the authority vested in me as Mayor of the City of Virginia Beach, I hereby call a SPECIAL FORMAL SESSION of the VIRGINIA BEACH CITY COUNCIL on Tuesday, March 30, 2004, at 4:00 P.M. in the City Council Chamber, City Hall Building, 2401 Courthouse Drive. The purpose of this SPECIAL FORMAL SESSION: City Manager's Presentation: FY 2004-05 Resource Management Plan (Operating Budget and Capital Improvement Program) Sincerely, s/Meyera E. Oberndorf Mayor" March 30,2004 Citye>f Virgir:da Beach MEYERA E. OBERNDORF MA'IOR MUNICIPAl CENTER BUILDING 1 2401 COURTHOUSE DAIVE VIRGINIA BEACH, VA 23456-9000 (757) 427-4581 FAX (757) 426-5699 MOBERNOOOCITY.VIRG1NIA-BEACH.VA.US March 2, 2004 THE HONORABLE MEMBERS OF CITY COUNCIL In accordance with the Virginia Beach City Code Section 2-21, and by the authority vested in me as Mayor of the City of Virginia Beach, I hereby call a SPECIAL FORMAL SESSION of the VIRGINIA BEACH CITY COUNCIL on Tuesday, March 30, 2004, at 4:00 P.M. in the City Council Chamber, City Hall Building, 2401 Courthouse Drive. The purpose of this SPECIAL FORMAL SESSION: City Manager's Presentation: FY 2004-05 Resource Management Plan (Operating Budget and Capital Improvement Program) Sincerely, ~ Meyera E. Oberndorf Mayor cc: Mayor and Members of City Council James K. Spore, City Manager Leslie L. Lilley, City Attorney Ruth Hodges Smith, MMC, City Clerk Charles W Meyer, Chief Operating Officer Susan Walston, Chief of Staff Steven Thompson, Chief Financial Officer David Sullivan - Chief Information Officer Diane Roche, Assistant to the City Manager for Communications and Media Relations ~ ---,,~_. -- .----r.,-.~._-- -3- C IT Y MANA G E R 'S PRE S E NT A T ION FY 2004-05 RESOURCE MANAGEMENT PLAN (Operating Budget and Capital Improvement Program) 4:00 P.M. ITEM # 52438 The City Manager advised the FY 2004-05 Resource Management Plan reflects a balanced budget recommendation. This Budget has been both challenging and unprecedented as the General Assembly has not adopted a State Operating Budget. The City Manager introduced Steve Thompson, Chief Financial Officer, and Catheryn Whitesell, Director - Management Services. The City Manager extended appreciation to Catheryn and her staff having worked shorthanded through this difficult Resource Management Plan. Three (3) members of her staff lefi for other opportunities. Steven Thompson, Chief Financial Officer, advised according to the City's Charter, the City Manager is required to present a financing plan that balances the current services and needs against current revenues by April First. The staff is assuming the General Assembly will adopt a Budget prior to the start of the fiscal year. However, if the State is unable to do so, contingency plans are being developed and necessary adjustments will be brought forward to City Council. The Fiscal Year 2004-05 Resource Management Plan lays out the programs and services to be offered to the community for the next fiscal year, reflecting programs such as Police and Fire services, mental health services, road maintenance and education. Funds are provided to maintain infrastructure and to construct new facilities. The Resource Management Plan also tries to address the needs of today's community without pushing the cost onto future taxpayers. A Community Budget meeting was held in the Fall (attended by over forty (40) citizens) to determine the most important issues the City should address in next year's budget and the manner in which they should be funded. The citizens wished the City to address transportation, education, human services and public safety and to examine a user fee or use tax approach to raise needed revenues. Of theftfteen (15) items, City Council identified in their August Retreat, as high priority, fourteen (14) are addressed in someform in the Resource Management Plan. The demand for the City's services are increasing. More homes are being built requiring roads, schools and trash collection. Costs to meet demand are increasing. Asphalt costs have increased 8%, steel for building repairs and construction has increased by 20-30% within the last month. The City also faces a 28% increase in the mandated retirement rate. The unexpected increase in real estate revenues allowed the City to avoid major service reductions to address increasing costs. Real estate tax revenue is only 28% of the total $l.4-BILLION Operating Budget. The growth in appreciation is the highest since the 1980's and is attributable, in large part, to low interest rates and scarcity of developable land. The growth is expected to last for at least another year; however, as interest rates rise, the overall housing market should level out to historic trends. Relative education, the City is providing $171-MILLION more than is required under the State's Standards of Quality. Without additional support ji'om the taxpayer, the School system would not achieve the Standards of Learning (SOL). Virginia Beach Schools have achieved 95% accreditation. Other state programs also receive this type of support, including Human Services, the Constitutional Officers, the Health Department and Transportation. Given the short term nature of these increases in real estate, the lack of a reliable state partner in the delivery of services and the growing demand from the community for services, the staff is not comfortable in recommending any type of tax restructuring or rollback. Last Fall, Management Services worked with Video Services to produce a video illustrating the wealth of services provided to taxpayers in Virginia Beach. This video is intended to run on Channel 48 over the next several months. The video entitled "Working Together With You" and "What do You Value?" was shown to City Council. March 30, 2004 - 4 - C I T Y MAN AGE R 'S PRE S E N TAT ION FY 2004-05 RESOURCE MANAGEMENT PLAN (Operating Budget and Capital Improvement Program) ITEM # 52438 (Continued) Catheryn Whitesell, Director - Management Services, advised the Budget strives to build on what exists while enhancing some service areas. Mrs. Whitesell referenced: Major Initiatives New Facilities Correction Center expansion Juvenile Detention Center Oceanfront Library Convention Center Schools will receive $47.6-MILLION in new funding- $28.2- MILLION from the Revenue Sharing formula The Juvenile Detention Center and the Correction Center are scheduled to open this Fall. Staff and supplies for these two (2}facilities increased the budget by $7-MILLlON. The replacement of the Oceanfront library is scheduled to open in the Fall and requires nine (9) new staffmembers due to its increased size and service capacity. The Convention Center is scheduled to open in the Spring of 2005 and additional staff has been included for the grand opening of the facility. For this upcoming fiscal year, the majority of the costs associated with the Convention Center will be incurred by the major project revenue streams, however this cost will have to transition to the General Fund in FY 2006. Proposed in the School Board's adopted Budget are: Opening of a Visual and Performing Arts Academy at Salem High School Additional staff to address data entry issues at the elementary schools Additional security positions Opening of a Fourth year-round school at Point-O- View Elementary School Major Initiatives (Continued) Enhancements to Emergency Response without a tax increase Ten (1O) new Police officers through federal grant Four (4) fire stations are being replaced: First Landing, Chesapeake Beach, Thalia and Blackwater Stations Expanded services to elderly/disabled Assistance to low income mothers March 30, 2004 - 5- C IT Y MANA G E R 'S PRE S E NT A T ION FY 2004-05 RESOURCE MANAGEMENT PLAN (Operating Budget and Capital Improvement Program) ITEM # 52438 (Continued)) Within the City's Budget, additional staff is being proposed for the Emergency Response within the existing tax rate. This additional staffing and support to the Volunteer system will ensure that a minimal of eight (8) ambulances are staffed at all times and will have the capacity to add ambulances if the call volume warrants. Program Reductions Libraries closed on Sundays, except Central Elimination of drop-off recycling centers Elimination of weekend mosquito control services Elimination of consumer affairs Reduced graffiti abatement Elimination of thirty-seven (37) staff The total reductions in current services are $6.8-MILLION. FY 2004-05 RESOURCE MANAGEMENT PLAN Appropriation by Capital Budget Operating Budget Total Less: Transfers Net Combined Business Area to the CIP Operating and Capital Budgets Economic Vitality $ 13.7 $ 78.6 $ 92.3 $ (5.0) $ 87.3 Safe Community $ 8.3 $ 163.7 $ 172.0 $ ( 4.1) $ 167.9 Family & Youth $ 1.2 $ 86.4 $ 876 - $ 87.6 Opportunities Cultural &Recreational $ 16.4 $ 53.7 $ 70.1 $ ( 4.2) $ 65.9 Opportunities Quality Education & $ 51.4 $ 727.4 $ 778.8 $ (6.9) $ 77/.9 Lifelong Learning Quality Physical $ 82.7 $ 233.4 $ 316.1 $ (26.3) $ 289.8 Environment Quality Organization $ 3.6 $ 56.0 $ 59.6 $ ( 0.1) $ 59.5 TOTAL $ 177.3 $ 1,399.2 $ 1,576.5 $ (46.6) $ 1,529.9 March 30,2004 - 6- C IT Y MANA G E R 'S PRE S E NT A T ION FY 2004-05 RESOURCE MANAGEMENT PLAN (Operating Budget and Capital Improvement Program) ITEM # 52438 (Continued) Educational funding, both operating and construction, remains the highest priority and receives over fifty (50) percent of the funding. Quality physical environment, which represents road maintenance and construction, water and sewer pipes, trash collection and building maintenance, receives nineteen (19) percent of the total. This area is substantially funded through state funds. both for new road construction and maintenance. Of the revenues that support these programs, the major growth is in real estate tax revenue. There has been three (3) years of above trend growth, with normal year-to-year growth in this one revenue being in the four (4) to six (6) percent range. This increase in revenue is based on increases in residential and commercial assessments as well as new construction. Of the $46-MILLION in new revenue, $10-MILLION is related to new construction. Overall revenue growth of 6.7% City/School Revenue Sharing grew by 9.6% "Non-Formula" revenues grew by 6.1% 6.2% increase in State and Federal revenues related to specific programs - 599 funds were reduced by $2-MILLION Excluding School Revenues, city revenue growth is 5.7% In addition to the Formula Revenue Sharing, there is substantial growth in the State and Federal revenues. These revenues are basic aid, State share of sales tax, Federal Impact Aid to Schools, assistance in medicaid payments to human service clients and Department of Transportation payments to support road maintenance. These revenues total $503-MILLION and cannot be used for purposes other than their intended use. State Budget Proposed budget based on Governor's Budget House Version Schools would receive $1.9-MILLION Jail would loose $1.2-MILLION Senate Version Schools would receive $39-MILLION Additional funding for jail operations $398-MILLIONfrom the State is included in the FY 2004-2005 Resource Management Plan. As the State has not adopted a budget, this is based on the Governor '.I' Budget. The loss of approximately $1.2- MILLION in Jail reimbursement reduces the amount paidfor State prisonersfrom $8 per day to $6 per day. It costs the City conservatively $2] per day to house an inmate in the Virginia Beach Correction Center. March 30,2004 - 7- C IT Y MANA G E R 'S PRE S E NT A T ION FY 2004-05 RESOURCE MANAGEMENT PLAN (Operating Budget and Capital Improvement Program) ITEM # 52438 (Continued) 2004-2005 RESOURCE MANAGEMENT PLAN SCHEDULE Workshop Economic Vitality & Safe Council Conference April/3, 2004 Community Room Workshop Family & Youth Council Conference April/5, 2004 Opportunities/Cultural & Room Recreational Opportunities Public Hearing Proposed FY 2004-2005 Salem High School April 15, 2004 Resource Management Plan 6:00 P.M. Workshop Quality Education & Lifelong Council Conference April 20, 2004 Learning Room Public Hearing Proposed FY 2004-2005 Council Chamber April 20, 2004 Resource Management Plan 6:00 P.M. Workshop Quality Physical Environment & Council Conference April 27, 2004 Quality Organization Room Workshop Reconciliation Council Conference May 6, 2004 Room Adoption ofFY City Council Vote on Resource Council Chamber May 11, 2004 2004-2005 Management Plan Resource Management Plan Mrs. Whitesell advised the FY 2004-2005 Resource Management Plan will be posted on the City's web page www.vbe-ov.comtoday.March30.2004.at5:00P.M.Itwillbeavailabletomorrow.March31.2004.in every hranch lihrary. CD's and manuals of the proposed Resource Management Plan were distrihuted to City Council. A two-page spread will be run as City Page in the Hampton Roads Section of the Virginian- Pilot. There has been a $2-MILLION "hit" relative the 599 funds. Therefore, the City eliminated the proposed replacement of the Police helicopter. Information relative the elderly and disabled tax relief will be provided. Additional staff is being added in both Mental Health and the Social Services area to address issues re the disabled and elderly populations Relative the recommendations of the Senior Citizens Real Estate Tax Relief Task Force, a chart reflecting the dollar amounts to reach the State Maximum over five (5) years shall be provided. Information relative eosts shiftedfrom the State to the loealities i.e. Jail reimbursement, Police Officers and Deputy Sheriffs shall be provided. The City Council was favorably impressed relative the new "pocket" card outlining the FY 2004-05 Proposed Resource Management Plan. March 30, 2004 .._...._,.._--,_.._--,-.-_.._.._.-'_._._..."...._-~_.- --~_...~ .......,-,--_.-._-_._~_.__.._-_.__.. - 8- C IT Y MANA G E R 'S PRE S E NT A T ION FY 2004-05 RESOURCE MANAGEMENT PLAN (Operating Budget and Capital Improvement Program) ITEM # 52438 (Continued) Total Compensation 8% increase in Total 28% increase in rate for Retirement (VRS) - $II.45-MILLION 13% increase in Health Insurance - $2.9-MILLION 3% merit, 2% structural adjustment, market and compression adjustments: 1,785 employees will receive compression adjustments Relative the jail, Mrs. Whitesell advised information will be provided concerning whether the State met their obligations concerning the construction portion. The City is providing maintenance and operation costs. Concerning the open space program, cost figures relative maintenance of acquired properties and the amount remaining in this fund shall be provided. Concerning the replacement of the synthetic turffor the hockey fields, information shall be furnished to City Council. The City Manager advised the meals tax is projected to bring in $38. I-MILLION, which is a $2.4- MILLION increase from last year. The City Council sang HAPPY BIRTHDA Y to Councilman Villanueva. March 30, 2004 --.-.----- ..~-~-------"-' - 9- Item III. ADJOURNMENT ITEM # 52439 Mayor MeyeraE. Oberndorf DECLARED the Special Formal City Council Session ADJOURNED at 5:08 P.M. ~__c2"_L~_'L~_ Beverly O. Hooks, CMC Chief Deputy City Clerk ~rlJ . d;;;:::: Ruth H~~ith, MMC City Clerk Meyera E. Oberndorf Mayor City of Virginia Beach Virginia March 30, 2004