Budget Message. Background

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Derrick Carpenter
5 years ago
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1 Budget Message Welcome to the proposed fiscal year 2018 budget which is the second year of the biennial FY2017/2018 budget. As James City County works to incorporate our newly adopted Strategic Plan, it is imperative that all residents understand that our budget process will need to accept and anticipate changes. These changes may happen due to policies from the various levels of government as well as economic factors that can alter the second year of a biennial budget. We are prepared to ensure policy mandates from federal and state government does not impact or derail our local actions as we move our County forward. The Board of Supervisors has directed County Administration to actively fix aging infrastructure and maintain current property values. The current Board of Supervisors direction is to continue to reduce our debt portfolio so the County s first Strategic Plan can be fully implemented over a period of time and not affect the current tax structure. Forty-four operational initiatives have been detailed in the Strategic Plan. During this year s budget process, James City County will determine the path to address each initiative as well as detail a financial plan to afford our capital needs today and in the future. The Board of Supervisors has created a plan for a bright future in James City County. Community involvement in our open and transparent Strategic Plan process was critical to define the needs of our County and most importantly, citizen input was incorporated into the vision for the future as community meetings were held to hear the citizens of our great County. The County team coordinated stakeholder meetings with 55 County residents, 17 business professionals and James City County top managers that allowed for discussion in various areas of interest as it related to shaping the future of this historic County. At four public open houses and through online communications through the project website, over 500 citizens provided direct input on all the goals and actions set out in the Strategic Plan. Background During calendar year 2014, the Board of Supervisors passed a resolution to begin the planning process to complete its first Strategic Plan. This plan incorporates James City County s Comprehensive Plan and 5-year Capital Improvement Plan which allows for a biennial budget process that considers specific operational and capital initiatives. These elements tie into a funding plan to achieve the seven goals approved by the Board of Supervisors. The Strategic Plan will address areas of concern in a systematic approach that will be measured through performance indicators defined on the County website for citizens to gauge progress. During the FY2016 budget process, particular focus had been placed on several strategic initiatives: Water Education Stormwater County Appearance Economic Development Fiscal Health Each of the above goals are still being actively implemented and have been incorporated into our Strategic Plan 2035 Leading the Way. A-1

FY2018 Budget This second year of the FY2017/2018 budget begins to align County funding to the Strategic Plan and goal areas.

authorized spending and broad organizational goals. The first chart shows how each fund is budgeted based on the revenue streams of James City County.

2 FY2018 Budget This second year of the FY2017/2018 budget begins to align County funding to the Strategic Plan and goal areas. The FY2018 budget has a slightly different look and feel as it incorporates additional best budgeting practices established by the Government Finance Officers Association (GFOA). It includes the County s strategic planning to provide a longterm perspective for service delivery and budgeting, thus establishing logical links between authorized spending and broad organizational goals. The first chart shows how each fund is budgeted based on the revenue streams of James City County. Revenue is apportioned by category for a total of just over $228M, an increase of 1.4%. The General Fund is the major fund for the County and totals $196,250,000 in FY2018, a $2.8M increase over the previous year. General fund revenues are expected to increase by 1.4% or approximately $2.8M. This is $300,000 less than originally planned. A-2

This trend is mirrored at the state level as the Commonwealth of Virginia lowered its estimate for State Sales Tax for Education, which directly impacts the School Division.

3 General Property taxes, including real estate and personal property are the principle drivers for this increase. This is due to growth as there are no tax increases and there has not been a reassessment. Other local taxes, such as sales tax, are performing less than expected. This trend is mirrored at the state level as the Commonwealth of Virginia lowered its estimate for State Sales Tax for Education, which directly impacts the School Division. Sales tax and Sales Tax for Education estimates are the principle reason for overall revenues performing less than originally planned. The School Division receives the greatest portion of General Fund dollars with the second largest portion going to public safety. A-3

Of the $2.8M revenue increase, 75% or over $2M is allocated to the School Division.

Constitutional Officers also receive a sizable increase. All of these functions are mandated by the state and are state supported.

Funding to constitutional officers, mental health, jail services and education continue to be borne by the localities who are constantly challenged to

4 Of the $2.8M revenue increase, 75% or over $2M is allocated to the School Division. Other regional entities, such as the Virginia Peninsula Regional Jail and Colonial Behavioral Health, receive the next largest portion. Constitutional Officers also receive a sizable increase. All of these functions are mandated by the state and are state supported. However, local tax dollars augment these offices because the state has not allocated enough funding to adequately provide these services. Funding to constitutional officers, mental health, jail services and education continue to be borne by the localities who are constantly challenged to creatively afford to provide quality public services. To show the budget in another way, the annual James City County tax on an assessed home valued at $300,000, has a yearly payment of $2,520. The graphic shows the monthly break down for a cost of $210 with $ (54%) allocated to the School Division. A-4

5 Goal: Modern Infrastructure, Facilities and Technology Systems Modernization of our current County facilities will be an overarching task. Facilities including buildings, roads, stormwater rehabilitation and construction projects, technology improvements and business process enhancements will affect each resident and business owner in our great County. Rapid growth requires us to pay attention to our infrastructure as numerous stormwater projects are planned over the next five years in addition to enhancing technology platforms to handle steady growth. As we continue to address our changing population as well as improve our prospects for growing our business community, investments to our infrastructure are needed. Funding has been identified while using sustainable approaches that maintains the County s fiscal health. A-5

The County s 5- year capital improvement program totaling $75.7M includes an overwhelming focus on Capital Maintenance. There is continued funding for the Enterprise Resource Software replacement.

In the spring of FY2019, there is anticipated borrowing for replacement projects that have a life span greater than 20 years.

6 The County s 5- year capital improvement program totaling $75.7M includes an overwhelming focus on Capital Maintenance. There is continued funding for the Enterprise Resource Software replacement. Estimated costs for software and technology infrastructure replacement over the next five years exceeds $4.4M as we look to replace several platforms that have existed for over 20 years. In the spring of FY2019, there is anticipated borrowing for replacement projects that have a life span greater than 20 years. This includes the Rawls Byrd Elementary and Jamestown High Schools HVAC replacements, the Lafayette High School roof replacement and the replacement of two fire apparatuses. The County s Stormwater Advisory Committee and staff annually review needed stormwater projects. The County averages approximately 15 projects per year throughout the entire County. In FY2018, $2,634,000 is allocated to stormwater projects. A-6

Goal: Expanding and Diversifying Local Economy This is a major challenge for all localities. James City County is competing with numerous jurisdictions who have significant incentives to offer.

This budget will focus on opening areas for economic growth by funding roads and infrastructure that encourage strategic development. in funding provided by the Commonwealth of Virginia.

This offsets the burden of the County taxpayer.

7 Goal: Expanding and Diversifying Local Economy This is a major challenge for all localities. James City County is competing with numerous jurisdictions who have significant incentives to offer. Current plans are to identify sites and understand the market factors that would most benefit our community. This budget will focus on opening areas for economic growth by funding roads and infrastructure that encourage strategic development. in funding provided by the Commonwealth of Virginia. The budget supports our plan to continue to allocate $1.5M as a match for road improvements which allows for additional state revenue sharing opportunities. This offsets the burden of the County taxpayer. Current projects include the Longhill Road widening and undergrounding of utilities, Centerville/News Road intersection improvements and Hicks Island Road bridge replacement. These projects and others total over $28M This goal also supports entrepreneurial innovation such as the Billsburg Brewery opening at the Jamestown Marina. This is another opportunity that further revitalizes areas of James City County. The budget also continues to fund events and programs that encourage visitation to the County including the LPGA Kingsmill Championship, the Williamsburg Harvest Celebration and our summer concert series. The renovation of the Amblers House at Jamestown is a new project that will be funded with tourism dollars to allow future opportunities for tourism partnerships. A-7

Goal: Protected Community Character and an Enhanced Built Environment This is a far reaching goal that looks at the County s historical significance, growth potential and maintains our quality of

James City County has more than 15,000 potential dwelling units within the Primary Service Area (PSA).

8 Goal: Protected Community Character and an Enhanced Built Environment This is a far reaching goal that looks at the County s historical significance, growth potential and maintains our quality of life for residents in James City County. This goal incorporates many tenets of the current Comprehensive Plan with the notion to maintain our community charm coupled with our continued growth. James City County has more than 15,000 potential dwelling units within the Primary Service Area (PSA). However, the Board of Supervisors understands the need to protect our community character with strategic growth. The Board has adopted a plan to address needed enhancements to road infrastructure, public utilities and technology platforms which have been necessitated by our growing population. In this budget we are recommending a Building Permits Examiner position to address the increased number of plans received. A-8

Goal: Exceptional Public Services Excellent services are a requirement for a great and ever-changing community such as James City County.

Two police officer positions are included to address increased calls. A change in career ladders within the Fire Department is intended to retain a qualified EMS staff.

Additionally, tuition assistance for eligible employees will be increased to a maximum of $5,250 per year.

9 Goal: Exceptional Public Services Excellent services are a requirement for a great and ever-changing community such as James City County. Increased calls for police and the changing nature of calls for rescue and emergency medical services due to population growth are being addressed. Two police officer positions are included to address increased calls. A change in career ladders within the Fire Department is intended to retain a qualified EMS staff. We will continue to attract and retain a quality work force by including a merit based pay raise from 0-4% as well as funding a health insurance increase of 3.5%. Additionally, tuition assistance for eligible employees will be increased to a maximum of $5,250 per year. A County-wide volunteer program will be expanded as a way to improve efficiency and enhance service delivery. According to nationalservice.gov the average rate of a volunteer hour in 2015 in Virginia was $26.09 per hour. One hundred volunteers working an average of 20 hours per fiscal year equates to $52,180 in savings. A-9

Goal: High Quality Education James City County supports high quality education by primarily focusing on its core fiscal responsibility to fund our excellent public school system.

Growth in James City County has also left an impact on our school district. The opening of James Blair Middle school will be felt in FY2019 as we begin to staff this 600 student facility.

10 Goal: High Quality Education James City County supports high quality education by primarily focusing on its core fiscal responsibility to fund our excellent public school system. There are many facets of education that play a significant role to maintain a healthy community from education for youth to continued education for those in the current and future workforce. Growth in James City County has also left an impact on our school district. The opening of James Blair Middle school will be felt in FY2019 as we begin to staff this 600 student facility. Since 2009, the James City County contribution to schools has increased at a rate 16 times greater than the contribution by the Commonwealth of Virginia. The School Division approved their budget of $132,046,604, a 3.5% increase over FY2017. The increase is mostly attributed to an increase in the mandated costs by the Virginia Retirement System and an increase in the enrollment of English language learners and special education students. The request of local funding from the County is $88,805,397. The FY2018 County contribution to WJCC Schools is $88,123,605 which was included in the FY2018 plan despite the reduction in the Sales Tax for Education transfer from the Commonwealth. This once again highlights the need by localities to step in and fund education for local students. A-10

James City County is now in rare air, being one of 46 counties in the country and the only jurisdiction under a 100,000 population with an AAA bond rating from all three bond rating agencies.

11 Goal: Fiscally Efficient Government The County continues to strive to find innovative approaches in fiscal efficiency. The Board of Supervisors adopted a fund balance policy in May 2015 for the General Fund which ensures that County financial reserves are in order to withstand future economic downturns. James City County is now in rare air, being one of 46 counties in the country and the only jurisdiction under a 100,000 population with an AAA bond rating from all three bond rating agencies. This achievement enabled the County to save more than $11M on our first bond refinance. As we look towards future school sites and building and road infrastructure improvements, our capacity to borrow will be limited to the best rates possible as we have shown Wall Street our financial strength with our strategic financial models. In future critical years, our debt portfolio in FY2020 takes a sharp turn downward thus allowing greater capacity to address our Strategic Plan operational initiatives and capital projects. In FY2023, another critical year, we will be exploring alternative water options and will be presenting those to the Board of Supervisors. The County s financial strength can also be credited to the James City Service Authority (JCSA) which achieved AAA designation from Standard and Poor s rating agency and an upgrade by Moody s rating agency. All financial goals are being set in place to ensure major facility and infrastructure needs can be met within our current financial plans. A-11

Goal: Sustainable Long-term Water Supply The James City Service Authority (JCSA) provides water to the majority of County residents and businesses.

This became a major point of emphasis when the Department of Environmental Quality (DEQ) requested a 56% reduction for the JCSA groundwater permit (GWP) within the next 10 years.

12 Goal: Sustainable Long-term Water Supply The James City Service Authority (JCSA) provides water to the majority of County residents and businesses. It is the only water utility that relies solely on groundwater. This became a major point of emphasis when the Department of Environmental Quality (DEQ) requested a 56% reduction for the JCSA groundwater permit (GWP) within the next 10 years. Water is the staple for a healthy community as it directly impacts the other six strategic goals. WHAT WE VE DONE SO FAR Our first objective was to ensure that the JCSA had a groundwater permit issued by the DEQ by the beginning of FY The process started in FY2015 when the DEQ issued a request to cut to 3.8 million gallons per day (MGD). On Feb. 7, 2017 the DEQ issued a groundwater permit which allows 6 MGD with tiered increases to 8.4 MGD over the next 10 years. The JCSA implemented a 5-year rate increase that is supported by a comprehensive study that looked at current and future infrastructure needs. The JCSA proposes to move forward with the third year of this increase, as we take a proactive approach to ensure a rate structure that continues to be one of the lowest in the Commonwealth as well as provide quality water to customers. A-12

13 The JCSA has budgeted a return of $2M to its fund balance associated with the well replacement costs at the Five Forks Water Treatment plant. Additional capital has been programmed to replace a portion of their computer infrastructure. As we search for alternative water sources we need to ensure that infrastructure is in place to accommodate that water source. Next steps Since a GWP has been secured until 2027, we can now identify alternative water sources that will secure all long-term needs for our residents. These options will happen within the next three years. The DEQ has been a supportive partner as we develop our plans for the future and our partnership has been productive. Dialogue continues with the Army Corps of Engineers as we look towards approval of our Joint Permit Application. Hampton Roads Sanitation District and its Sustainable Water Initiative for Tomorrow projects present interesting possibilities as the Commonwealth of Virginia has committed to replenishing its aquifers. This is an intriguing option as it would allow the JCSA to continue as a groundwater operation for years into the future. A-13

14 Summary Strategic Plan 2035 Leading the Way Goals Sustainable Long-Term Water Supply Modern Infrastructure, Facilities and Technology Systems Expanding and Diversifying Local Economy Protected Community Character and an Enhanced Built Environment Exceptional Public Services High Quality Education Fiscally Efficient Government Financial planning is a major component for all organizations, and the Board of Supervisors of James City County has strategically looked at the future and approved a plan to move the County forward. Our planning process has provided us with opportunities to detail our future as we begin to implement the capital projects and operational initiatives that have been identified. As our population continues to grow, it is evident that additional funding will be needed for public safety, road infrastructure, potential water needs, education and investment in a work force. A County that covers 172 square miles, a population of more than 75,000 and has averaged two new businesses a month for the past 10 years now faces significant challenges as we strive to protect our current character while balancing our economic diversification. As growth brings opportunities, it is up to your County leadership to manage growth as we incorporate the seven Strategic Plan goals to allow for a strategic path forward. The work completed in the past three years has provided a County blueprint designed through community involvement, Board of Supervisor direction and the great team of James City County. I am pleased to submit the FY2018 proposed County budget as we look towards the FY biennial budget which places our County in a strong financial position to address the numerous aspects of a growing community while protecting and enhancing its character and charm. Respectfully, Bryan Hill County Administrator A-14

CITY OF WILLIAMSBURG MEMORANDUM. Mayor and City Council Planning Commission. From: Andrew O Trivette, Assistant City Manager

CITY OF WILLIAMSBURG MEMORANDUM To: Mayor and City Council Planning Commission From: Andrew O Trivette, Assistant City Manager Date: Thursday, January 11, 2018 RE: Capital Improvements for FY18 Status