F.C. Council, Schools Hear Upbeat News On Revenue

The annual joint meeting of the Falls Church City Council and School Board, kicking off another annual budget cycle, was held in the library of the new Meridian High School Monday, where upbeat preliminary revenue and expenditure projections for the coming period were heard. (Courtesy photo)

The City of Falls Church is expecting a whopping overall revenue growth for the coming fiscal year of 8.4  percent, all those attending the annual F.C. City Council and School Board joint meeting learned Monday night.

The ballooning of single family home values to an average value of $899,000, the highest in the region, is the primary driver, but the City is also enjoying robust growth in business and other taxes deriving from the continued boom in large scale projects that contribute to the overall number.

That, and news the City schools’ completion of the state-of-the-art new high school has come in on time and under budget, such that the schools will return $100,000 in bond funds to the City, made for an upbeat overall forecast for the City andits schools for the coming period.Even with the pressing need to make up for having fallen behind in compensation levels at the schools and in the City,alike, there is the prospect for yet another significant tax rate cut come the spring along the lines of the one last time which saw the rate dip from $1.355 to $1.32 per $100 of assessed valuation.

This past Monday’s joint meeting heard presentations of this preliminary data from Schools Superintendent Peter Noonan and City Manager Wyatt Shields and City Chief Financial Officer Kiran Bawa.

Based on this information, the City Council is expected to make formal budget guidance and this coming Monday’s meeting, the last of the year, which it will make on top of some more immediate needs, addressing the compensation levels of City, including police, employees to address the manpower shortages that have shown up recently.
The Council meeting will begin with a half-hour reception at 7 p.m. to honor the newly elected and re-elected Council members, being incumbents Marybeth Connelly, David Snyder, Debbie Shantz-Hiscott and first time elected Caroline Lian and departing Council member Ross Litkenhous.

To hear Superintendent Noonan say it, the Schools will come in below what the Council guidance can be expected to be, something less than a 6.2 percent increase in the transfer from the City to the schools.

But while the City’s overall growth projection is 8.4 percent (translating into $7 million in new revenue), Bawa noted that outside factors, including the stated intent of incoming Virginia Governor Glenn Youngkin to eliminate the grocery tax, a demand that school resource officers and possibly even nurses be hired for all schools, and the current inflation rate of 6.2 percent, could cut into that.

But the mood is definitely upbeat at City Hall and school headquarters alike. The overall situation “is a testament to the fact that our policy of encouraging mixed use development is working,” said Council member Letty Hardi. “This is all very positive news,” Councilman Litkenhous chimed in.

It comes even as the robust hike in home values (8 percent for residential) does not compare with the much higher growth rates annually in the period between 2002 and 2006, when the average boost every year was adove 17 percent.
Pressure on the current growth centers on the need for immediate relief in compensation levels, and the City staff met with leaders of the City’s Employee Advisory Council (EAC) to divine some parameters for that Tuesday. The outcome of that will be factored into the formal budget guidance the Council will tackle this coming Monday.

Shields noted at the joint Council-School Board meeting this Monday that the pay freeze that has been in place the last two years, and the consequential loss of critical manpower in public works and policing that have been the result.  
Shields concurred that public safety is “a very high priority for us,” and Noonan echoed that sentiment for the schools.
Noonan did caution that while the schools are almost fully staffed now, “the pipeline for new hires coming out of the universities is just not there” due to Covid and hiring pressure elsewhere. “Are we going to get the new job applicants we will need?” he asked rhetorically.

Speaking to the equivalent on the City side, Shields said that manpower losses in the Department of Public Works have been significant and “it has been difficult to retain police, as it is tough to be an officer now.” Manpower pressures are also great for the public sector in information technology and even for school bus drivers and crossing guards.
There have been positions that have remained open for over a year, he said.

Noonan noted that the Meridian High School football team made its deepest run into the postseason in years and this year’s projected budget will mark the third consecutive year when it will come in below the City’s organic revenue growth level. As far as the high school construction, “We’re all but done here,” he said, except for some outdoor amenities held up by supply chain issues, and allowing for the schools’ ability to hand back $100,000 in bond funds to the City.

While enrollment levels remain down since the pandemic, the rate of drop is declining rapidly, and 2,431 students for the whole system has been projected by the Weldon Cooper Center at the University of Virginia, which has been a reliable consultant with the City schools for 15 years.

He noted that for the system’s roughly 500 employees, compensation levels in terms of steps (at a cost of $950,000) and cost of living adjustments ($400,000 per one percent rise) include a 10 percent increase in health plan cost hikes and additional resources are called for to address the mental and emotional health of students and employees alike from the pressures of the pandemic.