By a narrow 4-3 margin, the Falls Church City Council Monday night adopted an $80.6 million budget for the coming Fiscal Year 2015 that keeps the real estate tax rate flat at its current rate of $1.305 per $100 of assessed values while cutting the School Board request by $216,000 and dipping into the City’s unassigned fund balance by $200,000. The compromise was proposed by Councilman Dan Sze.
The 4-3 vote included Mayor David Tarter and Council members Phil Duncan, Marybeth Connelly and Sze voting “yes” and Vice Mayor David Snyder, Nader Baroukh and Karen Oliver voting “no.”
While the Schools’ request was cut by $216,000, Mayor Tarter noted that amount is less than one percent of their total budget and still adds up to a 9.1 percent increase over the Schools’ budget total last year. The package also cuts the general government budget by $219,000 below City Manager Wyatt Shields’ request.
But the most controversial component of the vote was its inclusion of $200,000 to balance the budget to be taken from the so-called “unassigned fund balance.”
This was strongly opposed by Shields and F.C.’s Chief Financial Officer Richard LaCondre, who warned throughout the budget deliberations that began the middle of last month that using “one-time money” for operating expenses was a ticket to fiscal doom.
Baroukh and Oliver were also adamant in opposition to any dipping into the fund balance. Even though the current fund balance is 17 percent of the City’s annual operating costs of $80 million, or $13.6 million, such that $200,000 is a tiny drop in the bucket, it is the “slippery slope” that such a move represents that is the danger, Baroukh argued.
“This is the first time a Falls Church City Council has ever proactively dipped into its fund balance,” Baroukh said. “It kicks difficult decisions down the road and sets a precedent.”
But the move was far from being a violation of City fund balance policy, which calls for the fund balance to be maintained in a range of 12 to 17 percent. Others argued that holding the balance at 17 percent is far too conservative.
It was announced Wednesday morning that the School Board will convene Thursday night to decide how to alter its budget with the $216,000 cut. Superintendent Dr. Toni Jones and most members of the School Board were present in the audience for Monday’s vote. Dr. Jones, teacher Amanda Blanchard, teacher Joel Block (vice president of the Falls Church Education Association) and Henderson Middle School PTA president Doreen Ruyak all spoke during the public hearing in favor of full funding for the schools.
But there were others who spoke against it, including one group of five citizens who came forth to argue that who argued that funding the schools is “not sustainable,” and urged the consolidation of the system with a large surrounding system. “We feel sometimes we are living in the School System of Falls Church, not the City of Falls Church,” one said.
In defending his winning budget option, Councilman Sze said “this maintains the tradition of great schools and a well designed city.” By holding the tax rate at last year’s level, five cents less than Shields recommended last month, Sze said the needs of the 10.4 percent of the City’s population living on fixed incomes and 28 percent who are federal workers who’ve lived with no pay raises in many years are also taken into account.
Almost everyone’s June tax bills will be higher, nonetheless, as appreciated assessed values and the add-on of a stormwater management fee included for the first time will drive them up even with a flat tax rate.
“The FY2015 Budget and Capital Improvements Program (CIP) are the product of a great deal of discussion, work, and public input,” said Mayor David Tarter in a statement issued Wednesday by the City on the budget . “I believe that they balance the needs of the government, schools, and tax payers for the coming fiscal year.”
According to the City, the adopted budget increases funding to the City government by 3.2 percent and to the school system by 9.1 percent. It makes use of a $680,000 projected surplus from FY2014; $200,000 of the Fund Balance; and $282,000 of excess bond proceeds to pay for debt service.
The City Council also acted to double the amount of tax relief for eligible seniors and persons with a total disability from $2,000 to $4,000, and expands the income eligibility for tax relief. A flier containing information about tax relief will be included in the June tax bills, and interested property owners may contact the City Treasurers office to learn more about the program, a City statement said.
In addition to approving the operating budget for FY15, the City Council approved an ambitious Capital Improvements Program as recommended by the Planning Commission which includes: $15.9 Million for expansion of the Mount Daniel Elementary School. The School division is in the planning and design phase now, and approval for this project will be on the ballot for public referendum this November.
Other capital improvements OK’d in the budget include information technology for E-911 dispatch, general government, and schools; a local match for new state transportation projects which will allow for pedestrian improvements in commercial districts, bridge reconstruction, bus shelters, sign replacement, and street paving; pedestrian accessibility and safety improvements including traffic signal management system to improve traffic flow through the City; $1.5 million for storm water improvements to address flooding issues and improve water quality; $1.1 million for open space acquisition for future park land; $100,000 for improvements to the new Howard E. Herman Stream Valley Park; and funding for possible expansion of the Mary Riley Styles Library deferred to 2017, pending additional information on the most cost effective options
Additionally, in separate actions Monday, the Council raised fees on building permits by 20 percent with the goal of covering a higher ratio of the costs to conduct plan review and inspections for new development in the City. A portion of the higher fees will be used for technology upgrades used for plan review and inspections.
Sewer fees were increased by nine percent to pay for treatment plant upgrades at the Arlington County Four Mile Run Treatment Plan and the Alexandria Treatment Plant to meet Chesapeake Bay goals for nitrogen and phosphate removal.