Down to the Wire, F.C. Council in 4-Way Split on Its Annual Budget

April 23, 2014 6:18 PM12 comments
Tuesday night's joint F.C. City Council and School Board meeting. Among those not shown are Council members Dan Sze and Nader Baroukh and City Manager Wyatt Shields.

Tuesday night’s joint F.C. City Council and School Board meeting. Among those not shown are Council members Dan Sze and Nader Baroukh and City Manager Wyatt Shields.

It’s down to crunch time, almost literally, for the Falls Church City Council to assemble a majority of four votes or more to pass its Fiscal Year 2015 budget by midnight this coming Monday.

At press time, there are four distinct proposals that the seven Council members have crafted for consideration at Monday’s deadline meeting. It feels a bit like four people and their baggage fitting into one compartment of a revolving door.

What makes it worse is that all four proposals are quite distinct from one another. At an early point in Monday’s Council work session when it looked like there would be only two options, the City’s Chief Financial Officer Richard LaCondre quipped that at least there weren’t four, like last year. He spoke too soon. When it turned out to be four again, he quietly shook his head.

Falls Church City Manager Wyatt Shields Tuesday night put numbers to the four options the F.C. City Council wound up with Monday, and presented them to a meeting of the Joint Council-School Board working group, to which five Council members showed up at the School Board offices.

Option 1 calls for holding the tax rate at its current level of $1.305, involving $920,000 in reduced spending and $680,000 in use of Fiscal Year 2014 surplus, with general budget reductions and School Board request reductions each at $319,000. This is the plan preferred by Councilman Phil Duncan.

Option 2 holds the tax rate at $1.305 by using funds from the sale of the water system, with $219,000 in general governments operations no significant School Board request reductions. This is the plan preferred by Vice Mayor David Snyder.

Option 3 increases the tax rate to $1.335 with general government reductions of $219,000 and no significant reductions in the School Board request. This is the option preferred by Nader Baroukh and Karen Oliver.

Option 4 keeps the tax rate at $1.305 with $720,000 in spending reductions, including a $219,000 reduction in both the general government and School Board funding requests, and use of $200,000 of unassigned fund balance. This is the plan preferred by Daniel Sze.

Sze originally proposed using a small portion of the unassigned fund balance to bridge the gap to keep the tax rate flat and fully fund the schools. But he offered an alternative of a $219,000 School cut in an unsuccessful attempt to reach a consensus right then and there last Monday.

Council member Marybeth Connelly also argued about using fund balance money to keep the tax rate flat and fully fund the schools. But she did not sign onto any of the four options. Nor did Mayor David Tarter, who tried to manage the swelling number of alternative approaches, except to say that he wanted to keep the tax rate flat.

But Shields and LaCondre remained adamant that “one time money” should not be used for operating budget expenses, and they identified both fund balance and water sale proceeds as in that category.

Snyder, on the other hand, argued that “one time” water sale proceeds could be used to pay for “one time” capital improvements if it was used to pay a year’s debt service on past capital improvements, which is about $5 million.

On dipping into the fund balance, which City staff insists be maintained at 17 percent of annual budget expenditures (or roughly $13.6 million) as a “rainy day fund,” Sze said that for many taxpayers, “It’s raining already.”

School Board chair Susan Kearney cautioned the Council members present Tuesday night that she did not believe anyone on the School Board would endorse any plan that calls for reducing their budget request even by a little.

This Tuesday’s meeting also focused on how plans for capital improvements in the schools would provide for the continued explosive growth in school enrollment that’s expected. She said her board worried that its budget request was based on a “mid-level enrollment growth forecast,” but that if it turns out to be higher than that, then that will pose even greater pressures on the schools’ budget.

  • philduncan

    When Mr. Sze first brought forward his budget proposal at Council’s work session Monday, I listened carefully and was intrigued by it, but I felt I needed to know more about its details before I could definitively rule it in our out of consideration. Since then, I’ve had a thorough discussion with Dan about his plan, and gotten input on it from City staff. I am persuaded that the Sze Plan is worthy of support. It handles the City’s reserve account, FY14 surplus and water-sale revenues in a fiscally responsible manner; it provides a modest increase in funds to improve delivery of City services; it gives a generous increase in funds to sustain excellence in our growing school system; and it holds the tax rate level.

    • tbva

      Mr.
      Duncan, could you more fully explain the math? At the work session the flat tax
      Sze plan was described as: 282G in debt service savings, saving 219G via
      gov’t cuts, saving 219G via school cuts and 200G in use of fund
      balance to fill the remaining gap. This math does not seem to align with the
      current description. Last discussion also mentioned restructuring the school
      bus acquisition which could keep around 54G in school operating budget to
      use for purposes other than a bus.

      • philduncan

        @ tbva: I want to respond to your query for details, but let me do
        so with the caveat that none of the below should be taken as Holy Writ. City staff will present Council with details on the Sze Plan in the next couple of days, I expect.

        With that said, here’s my “rough draft” understanding of the plan’s basic outline:
        — Hold the tax rate level at $1.305.
        — Deploy FY14 projected excess revenues ($680,000) in the
        FY14-15 budget.
        — Hold the unassigned fund balance at or near the top of
        Council’s policy range (policy is that the UFB should be 12 to 17 percent of total City expenditures). Because the UFB currently is well above policy range, this frees up about $1.7 million to deploy in the FY14-15 budget.
        — Savings from a reduction in debt service costs yields
        $282,000 that can be deployed in the FY14-15 budget.
        — Allocate $200,000 into FY14-15 to cover administrative
        costs of closing out the water-sale deal in the summer.

        This produces a budget that increases the general government
        (City) budget for FY14-15 by about 3 percent, and increases the schools budget by more than 9 percent — please stand by for Council to get exact percentages from staff. To put those numbers in context: The City Manager originally requested a general government increase of 3.6 percent, and the School Board requested an increase of 9.8 percent.

        With this plan, a typical City homeowner (with a property assessed at $690,000) will pay approximately $9250 for property taxes and the newly instituted stormwater levy. That’s up from $8500 paid last year.

        As I learn more details, i’ll try to refine the preliminary info. outlined above.

        • tbva

          It’s still nutty. The UFB varies throughout the year so….will someone holler bingo at 17.2? What about when the UFB falls below policy at some time(s) of the year? Also, what is the source of the 200G for expenses asso. w/closing out the water sale, the UFB?
          Looks like this plan has no cuts? This has changed a lot since first described.
          Look forward to your answers after staff crafts the proposals. This is staring to sound like the Paul Simon song…. “please describe the 50 ways”

          • philduncan

            The size of the unassigned fund does fluctuate through the year — it is highest right after tax-collection times, naturally. But the “bingo” date is where it stands at the end of the fiscal year, on June 30, according to the City’s CFO….The Sze Plan would allocate to City and schools increases that are $219,000 under what was requested….And with that, yes, I think we better wait for the full staff report.

          • Alison Kutchma

            Phil: Do you know what the line in the school budget – Other Professional Wages – is for? It’s over $2,000,000.00. Since it looks like it will be virtually fully funded then I assume you all know what it is. Can someone — anyone share that info? Thanks in advance.

          • philduncan

            Hi Alison. Is this information responsive to your question? It’s from the Budget FAQ’s on the schools’ web site (www.fccps.org)

            Can you explain what “Other Professional Wages” means in the budget book?

            Those are positions which are outside the regular teaching positions, but much needed and required by a school division.

            The vast majority are for our special education program.

            Here is a list.

            Special Needs Pre-K Coordinator $85,160

            Special Needs Pre-K Speech Services $27,750

            Mount Daniel Special Education Speech Services $129,920

            Thomas Jefferson Technology Teacher $81,150

            Thomas Jefferson Special Education Speech Services $173,420

            Mary Ellen Henderson MYP Coordinator (.5) $33,840

            Mary Ellen Henderson Technology Teacher $59,260

            Mary Ellen Henderson Special Education Speech Services $68,550

            George Mason Athletics Director, Athletics Trainer, Student Activities Coordinator $237,440

            George Mason Technology Teacher $108,310

            George Mason Dean of Students $28,680

            George Mason Special Education Speech Services $68,550

            SW Guidance Services for At-Risk $63,820

            SW Special Education Teachers $619,000

            SW Interventionist Support, Math At-risk, World Languages, and Elementary Curriculum Support, $289,190

            SW Special Education Psychologist Intern $24,000

            Total = $2,098,040

            (70% of this budgeted amount if for Special Education and/or At-Risk Programs…the remaining 30% is for organizational/managerial/safety positions for the school sites)

          • Alison Kutchma

            Thank you Phil! Thanks for reading and responding!

    • Ira Kaylin

      Phil,

      Why are you being so coy. You have wanted to cut the Fund Balance since you were elected almost 2 years ago.

      You say that you had “gotten input from City Staff”, Please share with us the name of the person with whom you spoke and the content of you discussion. I can not imagine City Staff supporting a $200,000 cut in the Fund Balance.

      The only fiscally responsible budget that does not require significant expenditure reductions is the one presented by the City Manager,

      If you, or other readers, would like a more complete explanation of the negative consequences of the budget proposals you support please read the Feature article in the Falls Church Post Community Info and Comment.

      • philduncan

        Hi Ira. I’m a “no-coy zone” — I will support a budget plan that observes current Council policy, which, as you know, states: “The goal for unassigned fund balance shall be 17%, but not less than 12%, of the actual General Fund expenditures for the then current Fiscal Year.” (source: City’s website, Budget link, “City Fiscal Policies”).

        I did read your FCPost piece; thanks for sharing your thoughts. The only thing that took me aback was the subhed that said we Councilors are on the “Verge of Nervous Breakdown.” Folks on Council and our School Board colleagues are working hard, for sure, but I haven’t seen anyone come unglued. Putting together the City budget and capital improvements plan is always a challenge, but I believe that most of us find it invigorating to see how many citizens have strong feelings about what’s right for our City. Working with the community every year to find the proper balance of taxing, spending, investing, and saving — it’s a great civic exercise, and Council’s most important function.

  • FallsChurchCitizen

    In looking at the schools’ budget request, the most frustrating thing I see is that the fastest-growing item has nothing to do with anything affecting our kids, and it isn’t even salaries. It’s “benefits.”

    FWIW, according to a FCNP article from a couple of months ago, at least 3 members of the school board appear willing to accept a smaller increase than the 9.8% request officially made, suggesting they could stomach a small cut:
    http://fcnp.com/2014/02/26/f-c-school-board-digging-in-wont-cut-budget-to-meet-council-wishes/
    “Sharpe, in an informational show of hands, favored asking for Scenario 3, a 9.8 percent increase, along with Margaret Ward and the board’s student member, Maeve Curtin. Board members Lawrence Webb, John Lawrence and Michael Ankuma were all willing to go with the 8.9 percent increase in Scenario 5.”

    Perhaps the Council could ask the school board to re-examine whatever “Scenario 5″ is.

    • David

      FC residents blindly follow the School Board’s budget recommendation every year. If the Board said it needed $1M, they would automatically agree and say “nothing less than a million!” If the Board said it needed $1bn, the drones would have the same reaction. Just because the schools are a critical component of our community doesn’t mean they should constantly get a green light for every dollar they request. Do advocates really think the schools are the only bureaucracy that somehow operate in a fully efficient way?

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