Proposed FY2021-2022 Operating & Capital Budget Presentation

Proposed FY 2021-2022 Operating & Capital Budget

Suffolk City Council Work Session April 7, 2021

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City Manager’s Message Budget Priorities: •

Maintain and Enhance Service Levels with No Tax Increase

• Protection of Human Health and Safety •

Investment in Public Education

• Employee Compensation and Critical Personnel Resources •

Quality of Life Enhancements

• Compliance with Financial Policies

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FY 22 Proposed Budget - Overview Budget Document Structure: • • • • •

Covers 17 Operating & Capital Funds of the City Total of all funds - $698,039,695 Executive Summary with highlights of each funds Line Item detail for all Funds and Departments Appendix with Supplemental Information:  Personnel Summary by department  Statistical information, graphs, and trends  Summary of Reserve Balances  Financial Policy Compliance Summary  Proposed Budget Related Ordinances

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FY 22 Proposed Budget – All Funds General Fund Capital Projects Fund Debt Service Fund Downtown Business Overlay Taxing District Route 17 Special Taxing District Grants Fund Transit System Fund Aviation Facilities Fund Law Library Fund Road Maintenance Fund Fleet Management Fund Information Technology Fund Risk Management Fund Utility Fund Stormwater Fund Refuse Services Fund Schools Fund

$237,816,531 60,673,312 29,396,660 174,091 1,989,160 660,129 2,431,160 1,078,197 48,847 29,722,740 13,949,849 13,844,606 19,627,218 71,223,777 7,937,478 10,681,077 196,784,863 $698,039,695

FY 22 Proposed Budget Maintain and Enhance Service Levels with No Real Estate Tax Increase • Proposed Real Estate Tax Rate: 

$1.11 Citywide



$.105 Downtown Business Overlay Taxing District



$.24 RT. 17 Taxing District

• 3rd lowest in region

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FY 22 Budget Highlights Protection of Human Health and Safety • College Drive Fire Station  Phase I hiring - 18 firefighters in FY 22 (9 months funding)  Construction in FY 22 with projected opening in FY 23 (late fall of 2022)  Phase II hiring – 18 firefighters in FY 23

• Additional funding for Community Health Partners  Suffolk Health Department $175,655  Western Tidewater Community Services Board $111,383  Western Tidewater Free Clinic $10,300

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FY 22 Budget Highlights Investment in Public Education • $3M increase in local support for Schools Operations • Fully funds Suffolk Public Schools request of $65.3M

• $3.575M in capital funding for major systems repairs/replacements • $10.4M budgeted for schools debt service

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FY 22 Budget Highlights Employee Compensation and Critical Personnel Resources • 2.5% cost-of-living adjustment recommended effective July 1 • 47 new full-time positions to address new facilities, growth, and service demand New Facilities  Fire & Rescue  Parks and Recreation Citywide Growth/Service Demand  Road Maintenance  Human Resources  Assessor  Police  Community Development  Sheriff  City Clerk  Commissioner of Revenue  Capital Programs  Finance  Social Services  Information Technology  Risk Management  Public Utilities

18 7 25 4 3 2 2 2 1 1 1 1 1 1 1 1 1 22

9 months - College Drive Fire Station – Phase I staffing 6 months –Bennett’s Creek Recreation Center

Converted from part-time

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Per capita staffing below levels 10 years ago

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FY 22 Budget Highlights Employee Compensation and Critical Personnel Resources • Overtime funding added to reflect actual Fire & Rescue and Police OT expenses • Part-time funding included for Bennett’s Creek Recreation Center and other Parks and Recreation facilities that have been underfunded for several years

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FY 22 Budget Highlights Quality of Life Enhancements • FY 22 Capital Budget includes all projects in first year of CIP • $30M bond issuance for General Government capital projects • $5.6M allocated for compliance with Capital “Pay-Go” Policy including $1M from Unassigned Fund Balance • Numerous projects move forward across a number of service areas that will directly benefit citizens: 

Public Safety - College Drive Fire Station, and Ambulance and Fire Apparatus Replacements, CAD System Replacement



Public Buildings and Facilities - Central Library and Human Resources Building Renovation for Schools Administration Office



Parks & Recreation - Water Access – Nansemond River, Lone Star Lakes, Cedar Hill Slope Stabilization



Transportation – Nansemond Parkway/Wilroy Road Flyover, RT. 17 Crittenden Rd. Intersection, Nansemond Parkway/Bennett’s Pasture Rd. Intersection, RT 58/Manning Bridge Rd. Intersection, and various others



Village and Neighborhoods, Downtown and Open Space



Stormwater – Citywide, Jefferson Street, and Steeple Drive Drainage Improvements



Public Utilities – Water and Sewer Infrastructure

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Compliance with Financial Policies Policy Requirement

FY 21 Budget

FY 22 Projected

Capital Pay-Go

3.0%

3.2%

3.1%

Debt as Percentage of Assessed Value

4.0%

2.0%

1.9%

Debt as Percentage of General Gov't Exp.

10.0%

7.9%

7.3%

Unassigned Fund Balance

15.0%

18.9%

22.5%

Policy Goal 15%

$60.7M

15%

FY 22 Proj. Fund Balance

$91.2M

22.5%

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General Fund

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General Fund Revenue FY 21 Budget

General Property Taxes Other Local Taxes Fees, Charges, Misc.

State/Federal Fund Balance/Fund Transfers

FY 22 Recommended

Incr./ Decr.

Percent Change

$ 140,246,364

$ 149,969,846

$ 9,723,482

7%

45,100,000

47,706,203

2,606,203

6%

8,455,299

8,299,003

(156,296)

(2%)

27,390,334

27,910,832

520,497

2%

3,907,451

3,930,647

23,196

1%

$ 225,099,449

$ 237,816,531

$ 12,717,082

5.6%

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General Fund Revenue General Property Taxes – 7% increase - $9.7M • Real Estate – 6% increase - $7.1M  Reassessment value increase – 4.20%  New Construction increase – 1.15%  Public Hearing required for “Effective Rate Increase” due to reassessment growth of 1% per Section 58.1-3321 of State Code

• Personal Property - 10% increase - $2.4M • Public Service Corporations – 4% increase - $200K

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General Fund Revenue Other Local Taxes – 6% increase - $2.6M • Sales and Use – 19% increase - $2.2M • Lodging – 40% increase – $400K

• Recordation – 22% increase – $400K • Meals – 2% increase - $200K • Motor Vehicle License – 4% increase - $100K • Communication Sales - 18% decrease – ($500K) • Admissions – 100% decrease – ($250K)

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General Fund Revenue Other Revenue Sources • State & Federal – 2% increase - $520K

• Permits, Privilege Fees – 9% increase - $125K • Charges for Services – 1% increase – $50K • Miscellaneous/Recovered Costs – 20% decrease – ($332K)

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General Government Expenditures FY 21 Budget General Government

$

Judicial

11,358,194

FY 22 Recommended $

12,599,163 $

Increase/ Decrease

Percent Change

1,240,969

11%

9,347,456

9,941,365

593,909

6%

Public Safety

65,282,430

70,500,924

5,218,495

8%

Public Works

5,515,804

5,585,287

69,483

1%

Health & Welfare

15,545,111

16,140,696

595,585

4%

Education

62,775,180

65,775,180

3,000,000

5%

Parks, Recreation, and Cultural

11,528,733

12,786,651

1,257,917

11%

Community Development

7,291,692

7,659,796

368,104

5%

Other Public Services

1,242,101

1,231,512

(10,589)

-1%

35,212,748

35,595,957

283,209

1%

Non-Departmental $

225,099,449

$

237,816,531 $

12,717,082

5.6%

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Tax Dollar for City Services

Education and Related Debt Public Safety Debt Service Health & Welfare General Government Parks, Recreation, & Cultural Judicial Community Development Public Works Capital Pay-Go Non-Departmental Local & Regional Organizations

32¢ 30¢ 7¢ 7¢ 5¢ 5¢ 4¢ 3¢ 3¢ 2¢ 1¢ 1¢ $1.00

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FY 22 General Fund Expenditures Primary Drivers: •

Personnel and Benefits     

$ 6.5M

25 FTEs (Bennett’s Creek Rec./College Drive Fire Station) 15 FTEs (Support Positions to address City growth/service demand) 2.5% Cost-of-Living Adjustment (COLA) Part-Time funding for Bennett’s Creek Recreation Center and other rec facilities Additional Overtime funding for Fire & Rescue and Police Department

•

Support for Suffolk Public Schools

$ 3.0M

•

Information Technology

$ 2.1M

 

•

Maintenance Contracts Debt Service – Public Safety Radios

Health & Welfare   

$ .4M

Foster Care Western Tidewater Community Services Board Health Department

•

Capital Pay-Go

$ .4M

•

Other Operating Expenses

$ .2M

 

Maintenance Contractor/Repair and Maintenance – Capital Programs and Facilities Comprehensive Plan Update and Compensation Study

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•

DBOD $174,091 0%  No change to tax rate of $.105 per $100 of assessed value  Continued enhanced street sweeping, refuse collection, and landscaping services in the downtown

•

Route 17 Special Taxing District Fund $1,989,160 0%  No change to tax rate of $.24 per $100 of assessed value  Funding for debt service of transportation improvements in the taxing district  Reserve for future capital projects in the taxing district

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•

Aviation Facilities Fund  

•



•

Operating cost of the Suffolk Executive Airport General Fund transfer - $109K

Road Maintenance Fund 

$1,078,197 2%

$29,722,740 3%

$670K increase in State funding for addition of 12.4 lane miles to system $2.7M from Fund Balance for equipment purchases and transfer to capital

Transit System Fund $2,431,160 26%  $292K increase in State/Federal operating and capital assistance 

Preliminary planning for new Transit Operations Facility

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•

Consolidated Grants Fund $660,129 0%  Local match funds to leverage State/Federal grants

•

Law Library Fund $48,847 15%  Operating cost of City Law Library at the Godwin Courts Building

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•

Refuse Fund    

•

$10,681,077

4%

No increase to the monthly Refuse fee - $25.25 Maintains current level of service and addresses increasing SPSA disposal costs $80K reduction in host fee revenue anticipated from SPSA $378K budgeted from Refuse Fund Balance

Stormwater Management Fund

$7,937,478

19%



$1.50 increase to monthly Stormwater fee per ERU from $6 to $7.50



Provides capital funding needed to address stormwater drainage projects identified in the CIP

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• Public Utilities Fund

$71,223,777

17%

 $15.1M in cash funding for water and sewer capital projects --- prevents borrowing which helps mitigate impact on future water/sewer rates  Addresses increases in bulk water contract with cities of Norfolk and Portsmouth  Increase in metered/non-metered water/sewer rates and meter service charge, after two years with no increase except to meter service charge in FY 20  Average customer will see increase of $5.20 per month or 5.4% in combined water and sewer bill not including HRSD charges Water Rate per 100 cubic feet Average Water Bill (5 ccf)

FY 20 $9.71 $48.55

FY 21 $9.71 $48.55

FY 22 $10.41 $52.05

Change $ .70 $3.50

Sewer Collection per 100 cubic feet Average Sewer Bill (5 ccf)

$7.27 $36.35

$7.27 $36.35

$7.31 $36.55

$ .04 $ .20

Meter Service Charge

$11.25

$11.25

$12.75

$1.50

Avg. Combined Bill (Water/Sewer)

$96.15

$96.15

$101.35

$5.20

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•

Information Technology Fund   

$13,844,606

20%

Technology Services for all City departments (Computers, Software, Data Communications, Networking, and Security) $1.3M increase in maintenance service contracts $823K increase in debt service for public safety radios, electronic permitting software, and server updates over the last two years

• Fleet Management

$13,949,849

-9%

 Replacement of critical fleet equipment exceeding useful life and safety standards using $2M from Fleet Fund Balance

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• Risk Management Fund

$19,627,218

-2%

 Funds workers compensation, public safety line of duty act, health insurance, and property/casualty insurance  Continued 80% employer contribution to Health Insurance premium  Compliance with 20% Risk Stabilization reserve policy requirement  Continues to fully fund Other Post Employment Benefit (OPEB) obligations through $729K contribution and claims payments  $3.4M from Risk Fund Balance to provide credit savings to all departments and funds

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•

Proposed Budget

$29,396,660

-1%



Annual debt service for General Government, Schools, and RT 17 Special Taxing District



Includes debt service on new General Obligation bonds to support Year 1 Capital Projects



Policy Compliance:  Debt to Assessed Value 4% Max – 1.9%  Debt to General Gov’t Operations 10% Max – 7.3%

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•

Proposed Budget  

$196,784,863 9%

$4.3M in State funding $3M increase in local funding support Local Funding: $65,332,201 442,979 $65,775,180

 Excludes:  $10.4M for Debt Service for School Facilities  $3.575 capital funding for Major Systems

Repairs/Replacements

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•

Proposed Budget:

$60,673,312 9%

 Funds all projects in first year of adopted CIP  $30M bond issuance for General Government capital projects

 $5.6M allocated for compliance with Capital “Pay-Go” Policy

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FY 22 Budget Summary • No Real Estate Tax increase

• Compliance with all Financial Policies • Additional $3M for Schools operations • Employee Compensation and Critical Personnel Resources  47 new positions across all funds of which 25 positions are for the new Bennett’s Creek Recreation Center and College Drive Fire Station  Part-time funding for new Bennett’s Creek Recreation Center and additional overtime funding for public safety

• Quality of Life enhancements through investments in capital projects  Public Safety  Schools  Transportation

 Library  Parks and Recreation  Village & Neighborhoods

 Stormwater  Public Utilities

• $1.50 increase to monthly Stormwater fee to address stormwater drainage project needs • Modest increase to water and sewer rates, after no increase in FY 21 31

Next Steps • April 7 - City Manager proposed FY 22 Budget Presented to City Council  Motion to authorize May 5th Public Hearing on Proposed FY 22 Budget and Related Ordinances

 Motion to authorize May 19th Public Hearing on Effective Real Estate Tax Increase Due to Reassessment of 4.20%

• May 5 - Public Hearing - Proposed FY 22 Budget and Related Ordinances • May 19 - Public Hearing – Effective Real Estate Tax Increase Due to Reassessment of 4.20%  Recommend adoption of FY 22 Operating and Capital Budget and Related Ordinances

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Budget Information Available • Proposed Budget and Presentation posted to City’s website • Full Budget Document Available for Review:    

City Website Municipal Building - City Clerk’s Office North Suffolk Public Library and Morgan Memorial Library East Suffolk Recreation Center and Whaleyville Community Center

• Citizens can contact Budget Office for assistance or questions at (757) 514-4016 or at BudgetOfficer@suffolkva.us

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QUESTIONS?

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