Loading...
HomeMy WebLinkAboutMARCH 24, 2026 FORMAL SESSION MINUTES rrGN1A BFA11 rJ�4 f p r� � Z. aa�414 qs '9AE:,:Bc e U, oUft N"MoNf' VIRGINL4 BEACH CITY COUNCIL Virginia Beach, Virginia MARCH 24,2026 Mayor Robert M. Dyer called to order the CITY COUNCIL FORMAL SESSION in the City Council Conference Room, Tuesday, March 24, 2026, at 3:00 P.M. Council Members Present: Michael F.Berlucchi,Stacy Cummings,Mayor Robert M.Dyer, Barbara M.Henley, David Hutcheson, Cal "Cash" Jackson-Green, Dr. Amelia N. Ross-Hammond, Robert W. "Worth"Remick Joashua F. "Joash"Schulman and Rosemary Wilson Council Members Absent: Jennifer Rouse—Arrived at 3:07 P.M. 2 ADD ON LEADING THE WAYAWARD ITEM#78144 3:00 P.M. Mayor Dyer welcomed Monica Croskey, Deputy City Manager. Ms. Croskey expressed her appreciation to City Council for their continued support and distributed copies of today's presentation, attached hereto and made a part of the record. Mayor Dyer expressed his appreciation to Ms. Croskey for the presentation. March 24, 2026 Resident Survey • Survey is: • Random-sampled • Statistically significant • Demographically representative (race, age, gender) • Geographically representative (across all 10 districts) • Since 1999, ETC Institute's Direction Finder° Survey has been administered to nearly 2.3 million residents in all 50 states Resident SurveyResults — Leadingthe WayAward �NG 7�� . • Satisfaction with overall quality of services (Virginia Beach Etc` 74.8%, National Average 49%) 4 W AR9 r P Top 10%of communities • Satisfaction with customer service provided by employees with over erall 00 quality and residents for the overall quality (Virginia Beach 71.6%, National Average 39.4%) value of services provided to residents NATIONAL TOT' PERFORMER • Satisfaction with the value residents think they receive for 202; 4 local taxes and fees (Virginia Beach 47.9%, National Average 32.9%) z gaaAja isieach VA City Council's leadership and support in ensuring Virginia Beach remains a community for a lifetime 2 Resident Survey —Results 20 points or more • Overall quality of parks & recreation programs & facilities (+38.9 percentage points) E1'C ' As a place to live (+38.0 percentage points) pro'�Frd`. • Overall quality of customer service received from City employees (+32.2 percentage points) u 9WAF • Overall quality of police services (+26.5 percentage points) • Bulky item pick-up (+26.1 percentage points) • Overall quality of services provided by the City (+25.8 percentage points) • Overall appearance of Virginia Beach (+25.1 percentage points) • Overall quality of public schools in Virginia Beach (+24.6 percentage points) • Overall image of Virginia Beach (+24.2 percentage points) • Overall quality of Virginia Beach Library services (+24.1 percentage points) • As a place to raise children (+23.0 percentage points) • City waste disposal & recycling centers (+22.3 percentage points) • As a place you would recommend family & friends to visit (+21.7 percentage points) • Efforts to ensure the community is prepared for emergencies (+20.8 percentage points) Virginia Beac 1, yl • Overall quality of sanitary sewer services (+20.4 percentage points) City Council's leadership and support in ensuring Virginia Beach remains a community for a lifetime 3 3 CITY COUNCILS BRIEFING PROPOSED FY2026 27 RESOURCE MANAGEMENT PLAN(Budget) ITEM#78145 3:05 P.M. Mayor Dyer welcomed Kevin Chatellier, Director—Budget and Management Services. Mr. Chatellier expressed his appreciation to City Council for their continued support and distributed copies of today's presentation, attached hereto and made apart of the record. Mayor Dyer expressed his appreciation to Mr. Chatellier for the presentation. March 24, 2026 a • r, WO WANO City of Virginia Beach Proposed FY 2026-27 Resource Management Plan Kevin Chatellier, Director of Budget and Management Services March 24, 2026 r� 1 .�3 FY 2026-27 Operating Budget Highlights Expenditures • Maintains current services • Addresses baseline cost increases • Avoids disruption of service delivery • Redirection/realignment of resources to meet emerging needs • Some accounting changes • Programmatic resource realignment • Invests in the workforce and infrastructure Positions • Added with bill payers— 25.68 (EMS, Stormwater, Parking, Waste Management, Public Utilities) • Added through vacancy redirections— (3 Special Events Team, 6 Special Conservators of the Peace, Landscape Services, Watch Desk Specialists, Park Rangers) Revenue • Includes proposed tax relief in line with City Council's direction Total Estimated Appropriations City Capital Projects Public Safety Planning/Public Works/Public 4.1% 14.1% Utilities Convention&Visitors, 13.7% Economic Development 2.1% City General Fund and Flood Parks&Recreation,Libraries, Protection Debt Servic e Aquarium,&Cultural Affairs .kw . ° 3.0/° 4.6% Human Services/Health/Housing 7.5% Financial/General Government Education 7.5 43.4% Total Net Budget: $2,883,974,039 Total City FTEs: 7,780.72 Total School FTEs: 10,579.46 3 City Council Retreat Guidance Tax Relief Invest in Workforce Invest in Capital Projects/Maintenance Backlog Recreation Center Modernization & Aquarium Reduce General Fund Support to Departments (PISC) Streamline Budget Presentations • Health Insurance Premium Parity • Maintain Capacity for Future Capital Projects within dedications Continuing engagement on hotel flat tax 4 Virginia Retirement System (VRS) reduced Combined change = $33.4 million creating �: opportunity for both -_ reductions and investments • Tax Relief • Workforce �p • Infrastructure Real Estate assessments ` . change Baseline Budget Drivers ExemptionTax Programs • Disabled Veterans-Increase$10.2 million total exemption$46 million • Elderly and Disabled-Increase$1.3 million total exemption$16.8 million Line of Duty Pay • Increase of$1.2 million • General Fund increase of$6 million Fuel • Energy •$4.1 million increase Health Insurance • Employer contribution increase of 15%or$9 million Software • Subscriptions • Microsoft, Body-Worn Camera, Drone as First Responder,Voter Registrar software,etc. 6 r, /✓ r ,ry� gFr✓ii F a ,�z�. ,�y x Proposed Tax Relief for Consideration Homeowners/Cost Burdened' 113,535/27,477 Renters/Cost Burdened' 66,408/35,399 2-cent rate reduction $77 savings on median home value Revenue loss = $9.1m (City) $7.9m (Schools) onal AoOeM Estimated Number of Vehicles 495,212 Average Vehicle Value $11,913 Average Vehicles per residence' 2 10.1% local credit $96 estimated savings per residence Revenue loss = $6.8m (City) $6m (Schools) 1 American Community Survey Investment in the Workforce — Compensation Proposed budget includes funding to provide the workforce with a 3.5% increase General Fund total is $17.3 million Employees on step-plan would receive 3% step and 0.5% general increase Employees not on a step-plan would receive a 3.5% general increase January implementation of market salary adjustments for non-public safety positions that did not receive adjustments in current year Public Safety was priority in current year with average adjustments of 11-14%; however, resources did not allow for other adjustments Budgeted reserve for allocation to implement is $7.5 million Investment in Infrastructure — Maintenance Backlogs Existing CIP projects specific to facility maintenance: Fire Stations, Aquarium, Recreation Centers, and Historic Homes Roughly 300 remaining facilities are maintained through two projects which receive $6.3 million combined annually. Various Building HVAC Rehab and Renewal Various Building Rehab and Renewal Proposed additional investment in Municipal Center facilities, Library facilities, Human Services, and Public Works' yard facilities total 9.5 million in year 1. 9 FY 2026-27 Schools Operating Highlights Compensation • • • • Revenue Fringes • Allocates funding • 5.2% average pay • (52.75) net • Baseline revenue toward baseline increase for reductions growth reported cost increase such teachers • 40.18 Reduction $33.9 million as grant matches, • 4.2% average for in Grant Funded • TBD - Additional software licenses, non-instructional positions State revenue by increased staff • 5.0 Increase in House or Senate maintenance, • Tentatively open Transportation Bill ($8-23 million) supplies, etc. to employee related positions • Employer health premium • 3.55 Reduction in premium increases to Instruction contributions ensure health 3.5 Reduction in increased 15% fund sustainability Administration 10 Health Insurance Premiums Employee contributions have not been raised since 2019 as the Health Fund had sufficient fund balance to meet growing cost and needs of health plan. Healthcare cost are projected to grow by 8% next year with future years potentially growing by 10% annually. Based on projections, there is a need to increase both employer and employee contributions in January 2027 to ensure the health fund remains sustainable: Proposed employer contribution increase of 15% Proposed employee contribution increase of 10% Hypothetical Premium Impact Example An employee receives a 3.5% general increase in FY 2027 and does not change health plan selection Employee health contribution increases 10% - Per . . Salary 60,000.00 62,100.00 2,100.00 80.77 Health (11265.88) (11392.47) (126.59) (5.27)* Net $58,734.12 $60,707.53 $1,973.41 * Health contribution occurs over 24 pay periods Public Safety • # . • ■ Its 4 .. .—Beach Region The City's overall efforts to prevent crime 65.9% 55.3% 48.6% Feeling of Safety - City Parks 73.5% 60.9% 54.6% Quality of Police Services 79.5% 60.3% 53.0% Quality of Fire Services 90.9% 85.3% 76.2% Quality of EMS Services 83.8% 77.7% 70.5% Quality of service provided by 9-1-1 operators 76.4% - - Police - Conservators of the Peace (6 FTEs reclass) Park and Recreation - Park Ranger Program (3 FTEs redirected) Fire - SCBA ($10 million), Additional funding for Fire Apparatus ($9 million year-1) Emergency Medical Services - 12 FTEs (EMS Billing Fund) ECCS - Watch Desk (4 FTE reclass), Al Quality Assurance Tool (vacancy savings) Public Works - Special Events Team (3 FTEs Redirected and 3 reclass) 13 Parks & Recreation, Library, and Human Services Alt antic ationa Resident Satisfaction Beach Region Average Overall quality of Parks & Recreation programs and facilities 88.1% 48.9% 49.2% Mowing & tree trimming along City streets and public areas 71.6% 60.9% 55.4% Overall quality of the City's Library services 88.0% 70.2% 63.9% Library as a resource for access to digital resources and materials 83.0% - - Overall quality of customer service received from City employee 71.6% 36.3% 39.4% Parks & Recreation Landscape Staffing and Park Maintenance (12.5 vacancy redirects) Library Books and Materials - $350,000 Improve digital access for Virginia Beach residents through non-resident charge Human Services Benefits Program Assistants (2 FTEs) Family Support Specialist (1 FTE) 14 Development Services & Code Enforcement Resident Satisfaction Results Virginia Atlantic National Overall quality of new development in Virginia Beach 30% - - Variety of housing options in the City 32% - - Overall Appearance of Virginia Beach 79.8% 63.9% 54.7% Enforcement of junk and debris cleanup on private property 36.2% 45.1% 52.5% Enforcing exterior maintenance of commercial/business property 42.8% 48.9% 46.3% Enforcing mowing & cutting of weeds on private property 44.7% 44.3% 46.1% Planning Zoning Ordinance Update ($1.75 million) Housing and Neighborhood Preservation Code Enforcement - Technology Pilot Federal Revenue realignment - Code Enforcement returned to General Fund creating capacity for additional housing restoration grants. 15 Other Areas of CommunitySupport Regional Grants FY 2025-26 Reconciliation Direction Community Organization Grant Committee recommendation forthcoming FY 2026-27 Proposed Budget holds funding in a set aside reserve pending further City Council discussion and direction Beach Events Holiday Lights Additional festivals programmed 16 Citywide FundingRequests Listed in Operating Budget document in the "Requested But Not Funded" Section Current Services and New Services Across all funds total unmet funding requests by departments of $22,178,739 million and 123.84 FTEs 17 FY 2026m27 to FY 2031m32 City Manager's Proposed Capital Improvement Program Programmed CIP Buildings&Assets 10% Coastal Projects Schools 3% 18% Economic and Tourism Development 6% Information Technology 4% Parks and Recreation fn 6% try -p k Stormwater&Flood Protection 23% Roadways � 18% Water&Sewer Utility 12% $5.3 billion total, including appropriations to date 19 FY 2026-27 through FY 2031-32 CIP Summary Year-1 CIP Appropriations: $409.8 million Projects 10 New 5 newly reflected as fully funded For the first time in 3 years, no new projects delayed/deferred Projects that were fully funded in FY 2025-26 remained funded Revenue $35.8 million in additional State/Federal revenue secured $156 million in charter bond capacity preserved for future utilization 20 CIP Highlights — Parks & Recreation Virginia Atlantic National Resident Satisfaction Results Beach Region Availability of trails and pathways 73% - - Overall quality of Parks & Recreation programs and facilities 88.1% 48.9% 49.2% Physical conditions of City parks, trails, and outdoor facilities 87% - - Modernization Plan Fee increase from $120 to $125 Great Neck Recreation Center construction funding in FY 2027-28 Design of Princess Anne and Bayside Recreation Centers Lynnhaven Restroom: $250,000 FY 2026 Reconciliation 21 CIP Highlights — Economic Development Virginia Atlantic National Resident Satisfaction Results AverageBeach Region Use of Economic Development incentives to support economic opportunities for residents 34% - - Familiarity with City's plans for development & growth 34% - - Resort Parking: $25 million The Dome Maintenance: $3 million (reflected in Buildings & Assets) Pembroke Square Public Parking: $5.5 million (supported by SSD) Atlantic Avenue Street Improvements: Revised project down $7 million Town Center Garage Maintenance: $7.3 million (supported by TIF) 22 CIP Highlights — Roadways I i —1 - 1 Virginia Atlantic National 'Resident SatisfactionResults Beach Region Overall conditions of major City streets 54.4% 56.6% 50.1% Ability to predict travel time to places in Virginia Beach 59% - - Maintains previously fully funded projects Cleveland Street Phase IV: $2 million General Booth Boulevard / Oceana Boulevard Intersection: $1.2 million Providence Road: $787,405 Fully Funds Lookout Road Sidewalk: $622,153 (speed enforcement) Woodstock Road Sidewalk: $2.7 million (speed enforcement) Holland Road Phase I: $11.9 million Independence/Edwin Drive: 8.7 million Leverages State/Federal Revenue 23 CIP Highlights — Building Infrastructure Courthouse Investments: $20.2 million (year one) Aquarium Modernization: $3 million (year one) capped pending future City Council decision and direction Library Maintenance: $3.6 million (year one) Human Services Maintenance: $4. 1 million (year one) Municipal Campus: $5 million (each year) Princess Anne High School: $330.4 million total by year six Citywide CIP FundingRequests Listed in CIP document in the "Requested But Not Funded" Section Existing Projects and Additional Funding for projects: Across all sections total unmet funding requests of $547.6 million for 47 projects Does not include balance to complete on all existing projects for Flood Protection Program and Schools 25 Budget Sustainability Limited expansion of services resulting in net new on-going cost Strategic utilization of one-time funding Fund Balance for one-time cost Interest income for one-time cost Tax Relief Credit Sustainable reduction not impacting current service attributable to VRS and higher revenue growth Management of Attrition savings $10 million to balance budget Flexibility for departments to deliver services Utilization in Year-2 of the CIP 26 General Fund Attrition/Vacancy Savings FY 1 • - Actualls Difference Salary and Benefits 531,1461086 5081786,469 22,359,617 Contracted Manpower 121337,582 15,334,836 (21997,254) Overtime 22,918,129 2713191,193 (4,401,064) Net Vacancy • / • • • • r 27 FY 2026-27 Revenues Reducing General Tax Support General Fund department specific local supportedincreases $6.2 million reducing local tax _ . expenj,need.,,Some, notable:, • Aquarium — Revenue increases (PISC) • Cultural Affairs — MOCA Utilities • Planning Department — Revenue increases (PISC) • Economic Development— Expenditure Reductions • City Treasurer — Revenue increases (PISC) (PISC) • Human Services — Revenue increases (PISC) • ECCS — Seven Vacant Positions reduced • Police — Revenue increases (PISC) • CVB — Revenue increases (PISC) • Parks & Recreation — Increased fees and vacancy redirections (PISC) • Public Works — VDOT support and vacancy redirections z 1, FY 2026-27 Revenue Highlights Program User Fee Adjustments Parks & Recreation Fees (various) Varied Varied Library Print Fee Varied (ex. $0.50 per page) Eliminated with maximum number of print Library Non-resident Digital Access - $10 - $35 Aquarium - motorized wheelchair rental - $30 - $40 Waste Management Can Replacement $75 $100 Waste Management Yard Debris Trailer $40 per day $50 per day $75 weekend $150 weekend Water & Sewer Year-4 of 5 Varied Varied 30 Tax Burden and Measures 2026-27 Change Real Estate Tax $3,543 $3,721 $178 Personal Property Tax $441 $402 ($39) Utility Tax $108 $108 $0 Telecomm Tax $92 $92 $0 Restaurant Meals Tax $502 $502 $0 Admissions Tax $180 $180 $0 Vehicle License $60 $60 $0 Stormwater Utility Fee $212 $212 $0 Waste Management Fee $367 $367 $0 Water & Sewer Fee $772 $791 $19 Total $6,277 $6,435 $158 NationalAtlantic Resident Satisfaction Results Overall value that you receive for your City tax dollars and fees 47.9% 31.1% 32.9% 11 local Comparison of Tax Rates Virginia . . Tax/Fee Beach Chesapeake NorfolkHampton News Real Estate $0.97 $1.01 $1.25 $1.30 $1.07 $1.16 $1.18 Personal Property(Vehicles& Business) $4.00 $4.08 $4.33 $5.00 $4.25 $4.50 $4.50 Personal Property (Machinery&Tools) - $0.64 $1.70 $1.50 $0.63 $1.23 $1.25 Personal Property(Boats) - $0.09 - $0.50 $1.50 - $1.00 Automobile License Registration $30.00 $26.00 $31.00 $32.00 $26.00 $35.00 $26.00 Cigarette (per pack) $0.75 $0.65 $0.95 $0.95 $0.75 $0.85 $0.85 Solid Waste Fee(per month) $30.55 - $33.41 $29.16 $30.00 $38.05 $25.30 Meals 6.0% 6.0% 6.5% 7.5% 6.5% 7.5% 7.5% Admissions 10.0% 10.0% 10.0% 10.0% 10.0% 10.0% 10.0% Hotel 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% Hotel Flat Tax $2.00 $1.00 $3.00 $3.00 $1.00 $2.00 $1.00 32 .�... Annual Tax Relief Programs PersonalLocal Vehicle Real Estate ,„ Property Registration • Disabled Veterans • 10% Local Tax Relief 2-year tax • Military Local and Surviving Credit Personal exemption for new • Volunteer Local Spouses Tax Relief Vehicle businesses Vehicle • Elderly and • Business 2-year Disabled Tax Relief exemption • Tax Relief for • Elderly and Disabled Surviving Spouses • Volunteer Rescue • Veteran Tax relief Historyof RE Tax Relief Impact on General Fund Fiscal Year A,R P Outdoor Major General Initiative Projects 2020-21 101.75 3.48 0.90 0.47 - 2.50 - 94.40 - 2021-22 99.00 3.48 0.90 0.47 - 2.50 - 91.65 (2.75) 2022-23 99.00 3.48 0.90 0.47 4.10 2.50 - 87.55 (4.10) 2023-24 99.00 3.48 0.90 0.47 4.10 2.50 - 87.55 - 2024-25 97.00 3.48 0.90 0.47 4.10 2.50 - 85.55 (2.00) 2025-26 97.00 3.48 0.60 0.47 4.10 2.50 0.30 85.55 - Grand Total (4.75) - - - 4.10 - - (8.85) (8.85) 3� Retreat Direction to Continue CapacityDiscussion Open ipace Purpos — preservation of land that has been identified as a candidate for future recreational amenities Obligations — debt service ends FY 2027-28, program staff 6.08 FTEs Dedication — 0.17% of restaurant meals tax equal $3.25 million Fund Balance — $12.5 million (excluding CIP funds available) A ffl� q Emma= IF Purpose — promote and encourage the preservation of farmland Obligations — interest payments through FY 2049-50, Stormwater Transfer $990,000 until FY 2044-45, program staff 1.6 FTEs Dedication — 0.6C of the real estate tax equal $5.1 million Fund Balance — $26.6 million Budget Process PolicyDiscussions and Guidance Regional Grants FY 2025-26 Reconciliation Direction for COG review Recommendations forthcoming from committee City Council allocation direction needed School Revenue Sharing Formula Health Insurance Parity Proposed Language Extending through June 30, 2028 Arts and Culture Dedication 20% of Amusement Tax Unallocated Reserve = $4251427 36 Retreat Guidance on Budget Presentations Written executive summaries in lieu of PowerPoints More City Council discussion at workshops Each workshop to be "themed" to the greatest possible extent Week 1: Public Safety, Regional Grants Week 2: Compensation and Benefits, Housing, Human Services, Schools Week 3: Infrastructure, Revenue Sharing Formula Week 4: Economic Development CIP, CVB, Parks & Recreation, Cultural Affairs Staff will be present to answer questions 37 r Budget Adoption Timeline Date Item April 7 Council Workshop April 14 Council Workshop April 15 Public Hearing at Virginia Beach Convention Center April 21 Council Workshop Public Hearing in Council Chambers April 28 Council Workshop May 5 Reconciliation Workshop May 12 City Council Votes on Budget Questions & Discussion Budget Process Timeline- City and VBCPS March 24th VBCPS May 5th City Adopted Council March 24th Reconciliation November January City Manager May 19th City Five Year Budget Proposed Council Adopt Forecast Deliberations Budget December January 26-27 City Council April Governor's Budget Retreat Public Hearings 40 CIP Highlights — Stormwater, FPP, and Coastal Virginia Atlantic National Resident Satisfaction Results Beach Region Avera Overall efforts to protect natural resources and environment 52% N/A N/A Quality and condition of trees and open space in the City 59% N/A N/A Condition and Maintenance of Virginia Beach Beaches 77% N/A N/A Bay Beaches: FY28 - $3.5 million Brigadoon & Chatham Hall Water Quality Projects: FY28 $3.3 million restored Central Resort Drainage Improvements: $11 million in design funding Federal Earmarks for Bow Creek Stormwater Park & Pungo Ferry Bridge CIP Highlights Public Safety / Schools Resident . ResultsBeach Region Overall quality of fire services 91% 85% 76% Overall quality of ambulance services/EMS 84% 78% 69% Overall quality of police services 80% 60% 53% Overall quality of public schools in Virginia Beach 71% 48% 23% SCBA: $10 million Apparatus: $9.4 million Public Safety Equipment: $2.6 million Princess Anne High School: $330.4 million total with construction planned for FY28 42 4 CITY MANA GER'S BRIEFING PENDING PLANNING ITEMS ITEM#78146 4:36 P.M. Due to time constraints, this presentation was postponed. March 24, 2026 S CITY COUNCIL DISCUSSIONANITL4TIVES/COMMENTS ITEM#7814 7 4:36 P.M. There were no City Council Comments. March 24, 2026 6 ADJOURNMENT ITEM#78148 Mayor Robert M. Dyer DECLARED the City Council FORMAL SESSIONADJOURNED at 4.38 P.M. Z ghelius Chief Deputy City Clerk A anda arnes, AMC Robert M. Dyer City Clerk Mayor City of Virginia Beach Virginia March 24, 2026