The first official business meeting of the newly-constituted Falls Church City Council saw some fireworks pitting its two new members, sworn in earlier this month, against three more senior members. The issue was a proposal, issued to the Council at 5 p.m. this afternoon, to deny the School Board request for $500,000 in technology upgrade funds in favor of placing almost all the City’s $2.8 million surplus from the Fiscal Year 2012 toward reducing the impact of future bonded indebtedness.
With Mayor Nader Baroukh and veteran Council members Johannah Barry and Ira Kaylin voting for the late-submitted alternate plan, only newcomers Phil Duncan and David Tarter voted against (with Councilmen David Snyder and Ron Peppe absent), giving the new plan a preliminary OK that will still await a final approval with a “second reading” vote in mid-August.
Kaylin was the most eloquent spokesman for the new proposal, saying that insulating the City against prospective global disruptions was the wisest course of action. Duncan, complaining repeatedly about the late 5 p.m. Monday submission of the alternate, opposed the idea, saying he had emails from the two absent members but not disclosing their contents. Tarter said that he felt the surplus funds should be returned to the taxpayers in the form of a rebate.
After all, Tarter argued, a $3 million surplus amounts to almost 10 cents on the real estate tax rate, and the City’s struggling taxpayers should have that returned to them. The surplus grew out of higher than expected real estate assessments in January.
Falls Church School Superintendent Toni Jones was present at the meeting, and was invited by Tarter to comment to the Council. She noted the memo included in the Council’s materials from the School Board that came in response to a request from the Council. It asked for $500,000 of the surplus to be used for badly needed tech upgrades.
She noted to the News-Press afterwards, “We took $600,000 out of our current budget to help meet the Council’s goals for the current fiscal year. When we heard there was a surplus, we hoped to get some of it back. But we remain positive.”
She said that a meeting with Council and School representatives slated for last Friday had been cancelled. But there will be a School
Board work session Tuesday night, and since tonight’s vote was left with an appeal for more ideas before the final vote on Aug. 13, the School Board may discuss the matter then.
Baroukh and Kaylin were careful to point out that the surplus under their plan would be expended equally between the City government and the Schools, only that it would almost all go to mitigating future bonded indebtedness instead of current operational needs. Falls Church City Manager Wyatt Shields said it was very uncommon for such a 50-50 allocation to be approved.
Kaylin, with a background in financial risk management, explained how the financial storm clouds are continuing to gather over Europe, due in part to the U.S. Fed’s “Operation Twist” low interest rate policy, which could have a profound impact on the U.S., including all state and local jurisdictions. He said the bankruptcies of large California cities like Stockton and San Bernardino could spread widely.
“We need to try to get in front of this issue,” he said, adding “I wonder what the state (of Virginia) is doing to protect the Virginia Retirement System.”
Tarter objected to having these issues heaped onto his first Council business meeting, a complaint that set off some glares and sparks on the Council, as did Duncan’s complaints about the late hour of the filing of the new version of the proposed ordinance.
Duncan also called into question a provision in the ordinance that would bind the City to retain its City Hall property in its current use for the entire 20 year duration of a bond for its renovation. That issue, more details about why Tarter’s call for a tax rebate wouldn’t work well, and an expected rejoinder from the School Board all left much up in the air about what a second, and final, reading of the ordinance could look like by Aug. 13.