Board of Supervisors Budget Work Session #2   3/13/2023

The supervisors who are present today are Supervisor Ann Mallek of the White Hall District, Supervisor Ned Gallaway of the Rio District, Supervisor Jim Andrews of the Samuel Miller District, Supervisor Diantha McKeel of the Jack Jouett District, Supervisor Bea LaPisto-Kirtley of the Rivanna District, and myself, Supervisor Donna Price of the Scottsville District, and we do have a quorum present.

I'd also like to mention that representing the county here

Richardson, our County Executive, Mr. Steve Rosenberg, our County Attorney, and Ms.

Claudette Borgerson, our Clerk of the Court.

At this time, I'd like to turn the floor over to the Chair of the Albemarle County School Board, Ms.

Colson.

Good afternoon.

Thank you for having us here.

We're really excited.

to go quickly down the line over about who we have as well.

We have myself, chair in the Rio district.

All right.

And I believe, are there, we have two school board members in attendance as well.

Let me also introduce and thank our officers from Albemarle County Police Department, Officer Brian Miller and Nathan Weathers.

At this time, I'll turn the meeting over to the Chief of Budget, Mr. Andy Bowman.

Yes, I'll have just a couple of very brief announcements.

Today, there are two topics for the work session, the public schools operating request and then the joint capital improvements program and debt program.

We've allotted the time headed into this.

The board's discussion will dictate that, where it goes.

About one hour for the schools and then two hours for the CIP with a break in between.

Final comment I'll make is just with the awareness of the public who may be listening as the board of supervisors and school board know this well.

When it comes to the appropriation of the school budget, the total amount and the appropriations for the board of supervisors under our form of government were their authority.

The school board will make programmatic decisions within that total amount, and that's where the school board authority is.

That's something we've discussed many times with the board, but just wanted to set the stage for why certain discussions may be today that may be different when the board alone may be talking about them or when the school board alone may be talking about them.

All right, thank you.

But before Ms.

Carlson, in just a moment, I do also want to make sure that we recognize our chief financial officer for the county, Ms.

Nelsie Bird, who's also here.

Thank you.

Yes, so we have, not going to lie, we have a little bit of a lengthy presentation.

It will be up here.

Hopefully, it will be where you're looking and not just at me.

I'm going to be reading off of a script and I'm going to be bouncing back and forth with Dr. Acuff as we take you through this.

So, good afternoon.

I'm Katrina Paulsen, chair of the Albemarle County School Board, and I'm accompanied by Dr. Acuff, who graciously volunteered to present with me today.

Ms.

Judy Lee was not available, so that's the vice chair.

She would normally be here.

And we also have school division staff on hand to answer questions after the presentation.

And before we begin, I would like to take a moment to share our appreciation.

Thank you for allotting time to listen to us and to go through the budget presentation and thank you for your ongoing commitment to high quality education.

We certainly feel that as a school board, so thank you.

The funding request we are sharing with you today represents our collective efforts to support our strategic plan learning for all through fiscally responsible budgeting.

In support of the school division's mission to ensure that every student succeeds, our theme this year is we will know every student.

It reflects our commitment to provide student-centered learning that is interest-based and highly engaging to help children succeed.

I was supposed to have a clicker, but...

Every year we begin our budget development process by engaging members of our community, including students, staff, families, and community members and partners.

Our planning incorporates the ideas we hear from our stakeholders, and that feedback becomes the foundation on which we develop our budget.

One of the goals of our strategic plan centers around affirming and empowering communities and that truly is the driving force behind our budget development process as we move towards adoption each spring.

This just kind of represents the continuum of engagement that we get as we make our way towards budget adoption and what you see.

I'll just keep talking in the meantime until it clicks through.

So there's five primary goals that we try to go through.

We'll start at one here.

It's counterclockwise.

But the first one, develop a budget that advances the school division's mission.

Two, provide a plan that supports competitive benefits and salaries and reflects market adjustments.

Three, develop a responsive and systemic approach to operations

that reflects best practices and ensures long-term financial stability.

Then four, align our proposals with the school division's strategic plan and our school board priorities.

And then five, incorporate metrics such as logic models, performance measures as a management and decision-making tool to make sure that we are being effective with the money spent.

Our strategic plan, Learning for All, was newly adopted at the beginning of the last school year.

And as I've mentioned, it's the root of our budget development decision-making.

In support of our vision, mission, and values, Learning for All includes three strategic goals, Thriving Students, Affirming and Empowering Communities, which I mentioned before, and Equitable Transformative Resources.

Before we get to looking at the specific expenditures, we may want to step back and think about who we are as a school division.

ACPS currently employs 2,648 staff members, half of whom serve the division in a teaching capacity, such as classroom teachers, speech pathologists, school counselors, instructional coaches, and librarians.

About 43% of our employees are classified staff.

And that includes teaching assistants, bus drivers, custodians, maintenance and food service staff, office associates, human resources staff, and other support staff.

Administrators make up the remaining 7% of our workforce and include principals, assistant principals, central office, and other leadership personnel.

So now who are our learners?

and diverse learners through preschool through 12th grade, 40% of whom are students of color.

More than 1,700 of our students, or 12.4%, are eligible for special education services.

Over 4,300 of our students, or 31%, are economically disadvantaged, meaning their households meet the income

Eligibility criteria for free and reduced-cost school meals.

And greater than 1,500 of our students, or 11%, are English learners, meaning that their first language is other than English.

and they have been participating in a special program with our schools for learning English.

Our students are also internationally diverse, representing nearly 100 countries of origin and more than 70 home languages.

Every day our drivers, us drivers, who we dearly appreciate, travel over 10,000 miles to safely transport our students to and from school

and our child nutrition team serves an average of 1,900 breakfasts and nearly 6,000 school lunches every day.

Our commitment to our class sizes is reflected in our average class size of 18.6 in elementary schools, 19.9 in middle schools, and 20.1 in our high schools.

Last spring, 94.3%

which means within four years of starting ninth grade, 64.5% of our graduates earned an advanced diploma.

In comparison, the statewide on-time graduation rate was 92.1% with only 52.9% across the state earning an advanced diploma.

Does everyone know what an advanced diploma is?

Aha!

It's earning 26 credits, 4 credits of which they pass both the course and the SOLs.

Last year, over 35% of our high school students enrolled in an AP class, 25% of our high school students took an AP test, and nearly 22% of our high school students participated in a dual enrollment course.

Overall, our dropout rate looks good at 3.9% compared with 5.2% for students across Virginia.

So now, as Ms.

Kalls said, our funding request is built along our strategic goal, more closely, I think, than ever before.

So let's focus on our first goal, which is that of thriving students.

This goal seeks to ensure both the academic and social-emotional growth of all students.

and by developing learning experiences that inspire engagement.

What does this look like in terms of money?

How do we support these policies?

1.2 million of our increase in expenditures is allocated to regular loans.

Based on our staffing standards, this supports adding 14.4 FTEs in response to changes in the projected enrollment and demographics.

Another 1.1 will allow our Office of Special Ed to respond to an increase in the level of intensive support services currently required by our students with disabilities.

Just under three-quarters of a million dollars is proposed to support the addition of eight FTEs to address current and projected enrollment for the English language learner population.

This aligns with the Virginia Department of Education's recommendations to provide increased support in the secondary level for newcomers as well as the ongoing English language learning support.

Also supported in this thriving students category is a request of over half a million dollars

to expand our school safety initiatives by adding security assistance in our secondary schools.

We've been having people doing security assistance in the schools, but it's been hidden in our instructional numbers.

So this is really carving out non-instructional functions and advertising them separately.

Another 126,000 supports a signing school resource officer, which is a sworn law enforcement officer, as you all know, to our northern feeder pattern schools, which are homed about just under 50% of our school.

And finally, we've included 116,000 to support our mental health services

as we begin to shift funding for our coordinator of mental health services from one-time funding to recurring funding.

You may recall that in 2021 we received a half a million dollar anonymous grant, which they haven't come back to give us another one.

I have to say that's been quite extraordinary so far.

But we're going to have to adopt or assume that budget item in our regular budget.

I'll note that we'll continue to fund our 24 social-emotional learning coaches in the coming fiscal year with one-time moneys.

together, these various changes or budget items to support thriving students amount to about $3.9 million.

I mentioned the change in our enrollment and our change in demographics and how that is driving some

Evers, and then in percentage increases in our current enrollment versus that of 10 years ago in 2012, 2013 school year.

Compared to fall membership enrollment, which is taken every September 30th, enrollment 10 years ago, sorry, compared to fall membership enrollment a decade ago, our total pre-K through 12 enrollment has grown by 707

students from 13,263, 13,970.

That's a 6.9% increase over the last decade.

Over the same period, students with disabilities, enrollment of students with disabilities has increased by 396 students from 1,340 to 1,736, or 37% increase

Economic with disadvantaged student enrollment has grown by 765 students, which exceeds our overall growth in enrollment and represents a 23.18% increase of 3,568 students over 10 years ago to 4,333 students today.

Most notably, we gained 490 English language learners compared with 10 years ago, a 45.3% increase, where we were serving 1,048 English learners a decade ago.

We are now serving a population of 1,538 English learners.

And now this question.

The second goal of our strategic plan supports affirming and empowering communities.

This goal includes fostering culturally responsive environments that respect and champion the life experiences of our stakeholders, supporting both their physical and mental health, and actively empowering our students, their families, and our employees to engage in our school community.

Our funding request includes a total increase of about 570,000 in support of affirming and empowering communities.

And we'll go through them up here.

276,000 of our increase is intended to expand access for pre-K students to EDEP child care services, to reduce EDEP wait lists, and to mitigate hiring challenges.

You're going to ask me on the mark.

It's extended day educational programming.

It's after school programming.

It's for children that stay at the school and receive services after school.

Nearly 170,000 will fund an executive director to assist in the development, administration, and supervision of the Albemarle Foundation for Education.

That is something we're very excited about.

It's meant to increase our partnerships in the community and hopefully become another funding stream for our schools.

$115,000 is allocated to hiring a dedicated Title IX coordinator who is responsible for the administration, supervision, and monitoring of the school division's compliance with federal Title IX requirements, which are ever expanding in the legal field.

I'm looking at you, Mr. Rosenberg.

So we're going to get help with Title IX.

And the last item includes 10,000, another one I'm excited about, to pilot a student voice fund, which is an initiative that will encourage students to apply for funds to address a problem currently facing our school division.

I don't know if you guys recall from a few years ago, we had a student that addressed mental health.

He got a mental health bill passed through the state that had impact throughout the state.

And we would love to encourage students to continue to pursue ideas like that and make a positive change.

We mentioned earlier that affirming and empowering communities is the driving force behind our budget development process, but our work to engage our community extends far beyond budget planning and decision making.

Every school year, our school division leaders connect with our stakeholders and strive to build and strengthen those relationships through a variety of engagement efforts.

Some of them are listed in this little circle.

We have community forums and information sessions.

We have culturally responsive teaching, which is a way that helps our teachers and our staff emphasize building positive learning partnerships with students and their families.

We have advisory groups, including our newly operational employee voice and action committee, EVAC for short.

We have stay interviews conducted by our human resources department, which Dr. Haas, correct me if I'm wrong, those peer exit interviews where you're asking people why they're leaving.

I think this is asking people why they're staying so that we can continue to do all those positive things and keep people.

And we have school board meetings, public hearings.

We also have been doing a lot of big push to have town halls and community engagement with Mr. Irizarry doing a lot of work there.

So we have a lot of outreach to our

And now I will jump to the strategic plan goal number three.

The third and final goal is supporting equitable, transformative resources.

This goal is all about attracting, developing, and retaining high quality staff, developing sustainable and modern facilities, infrastructure, and equipment, and equitably distributing resources to transform learning experiences and opportunities.

By far, the biggest portion of our expenditure increase is invested in supporting equitable transformative resources.

And that starts with nearly $9.5 million to fund a 5% salary increase for all employees and adjustments to our step scale for teachers.

And this is a reflection of our belief that our employees are our greatest and most valuable resource.

Additionally, our request includes $1.4 million to support continued improvements to our substitute program.

I spoke to you all about that at the quarterly report.

Improvements to date include the hiring of school-based subs as regular employees, pay increases for daily substitutes, and hiring a substitute coordinator.

This proposal supports a second phase of that which would include an increase in operational funding and the addition of 10 school-based substitutes.

One point two million of our request supports a restructure of differentiated staffing

Traditionally, schools have used differentiated staffing allocations to reduce class size and provide intervention services.

Our proposed restructure adds staffing to ensure consistent and transparent allocations to schools to support lower class sizes at our most at-risk schools.

A full-time reading specialist for every school, which exceeds the requirements of the new Virginia Literacy Act, and extra staffing to support tiered supports for students.

Nearly

A quarter million of our request supports additional building services staff to maintain continued use of HEPA air filters in our classrooms, clinics, and school buses.

And our request also proposes $61,000 to hire a records analyst responsible for establishing and maintaining a digitally secure student records storage system and $43,000 to permanently fund a half

Half-Time Employee Management Analyst in our Fiscal Services Department.

That was initially added using one-time pandemic relief funding, so we'll be opera-realizationing.

I cannot say it safe for me, making part of our operational budget.

Judy would say, talk around the word that you can't name.

In total, our expenditure increase in support of equitable transformative resources is $12.4 million.

So now I want to switch to talking about investment in our workforce.

Our school board recognizes the importance and value of competitive compensation.

It bolsters our recruitment, hiring, and retention efforts.

You may have noticed in an earlier slide that our retention rate for teachers is currently 82.9%.

that does exceed statewide retention rates, which are 80.5%.

Our teacher vacancy rate is 2%, which is nearly half the state average of 4% and considerably lower than multiple school divisions that actually struggle with rates ranging from 10 to 20%.

We're doing well there.

In the current school year, we've worked to improve the salaries of our employees through multiple efforts, starting with a 6% compensation increase for all employees last July,

Then in December, our school board approved a one-time $1,000 bonus for all regular employees who were at least 0.7 FTE and a $750 bonus for all regular employees who were less than 7 FTE.

Also in December, we implemented the first phase of recommendations that came out of our compensation study.

We increased starting pay for bus drivers to $21.50 an hour and implemented a step scale

that provides annual compensation increases based upon years of experience.

We also improved pay for school nurses who hold a registered nurse license and increased compensation for positions identified as hard to fill.

And those were all recommendations out of our compensation study where we had a big gap over what we were paying versus what they might get in a competitive market outside of our schools.

This spring we will move forward with the second phase of recommendations from that compensation study, which includes increasing pay for all positions identified as four to 10% below the market midpoint.

And we're planning to make adjustments to positions that warrant reclassification based on an ongoing review.

So that will be the second part.

And we plan to continue that investment into 2023, 2024.

This funding request supports a 5% salary increase for all employees plus adjustments to the teacher step scale and recognizing the value of our health benefits as part of a competitive employee compensation package.

In support of a needs-based budget that prioritizes equitable, transformative resources, we also want to bring attention to our unfunded capital needs.

Fully funded projects in green, partially funded projects in yellow, and unfunded projects in red.

We're thrilled that certain projects not on this list that have been funded before are moving forward, including an expansion of improvements to Mountain View Elementary School and

Planning for the Construction of a Second High School Center, and as you see in this capital budget summary, two elementary schools to be funded in the next five years.

With much appreciation for your partnership and support of those projects, please know that we consider all of the projects on this list critical needs over the next five years.

While the operating budget we are proposing moves us forward in many ways, our work will be severely hindered in the absence of an infrastructure that provides adequate capacity and optimal learning environments.

We believe that funding the renovations we've requested through a phased multi-year approach would elevate the school division's aging schools to modern standards to include electrical updates to accommodate technology, improved access to natural light in classrooms,

Adherence to the Americans with Disabilities Act, updates to outdoor learning spaces, and reconfiguration of spaces to improve function, efficiency, and safety.

With regard to our aging buildings, as you probably know, half of our schools are more than 50 years old, with two that are more than 80 years old.

And we haven't built a new school for more than 20 years.

I think it was 2002 we built Baker Butler, which now I think has

I don't know if it's six or ten classrooms in trailers and that will be the second elementary school issue that we address.

Beyond the renovation needs that are normal consequence of aging buildings, our current capacity needs require the use of nearly 80 mobile classrooms across the division for classroom instruction, auxiliary services, flex space, and storage.

This means that nearly half of our students currently attend schools that are over 95% capacity.

And based on the guidance of regional partners,

our county's population, as you know, is projected to expand, increase by 30% over the next 30 years.

We have shared in the past the combined strategy of continually expanding facilities,

built in the mid or early years of the 20th century and then adding more classrooms to make capacity means it's not sustainable.

It is neither in the past educational interest of our students nor representative of a thriving, prosperous county.

In the spirit of collaboration, we're asking for your partnership to fund a robust, needs-based capital spending model that supports future growth and prosperity of our county.

We've now reviewed our increases based on our three big strategic goals.

And so here is a look at our total increase in expenditures organized by expense category.

First is a baseline adjustment that reduces our increase by more than $10 million, most of which is because we've eliminated one-time funding costs that were in our current budget.

$4 million is for technical and non-discretionary expenses, including an employer rate increase for health insurance, a half a million dollar transfer to the Children's Services Act,

and the increase in our transmitted pay tax, a payment to Albemarle County for shared licensing services that includes our employee time and attendance system, and an overall increase in the cost of goods and services.

We've talked about the proposed $9.5 million, the investment in employee compensation as well as the $4.3 million

It's attributable to involvement and demographic shifts.

The 680,000 allocated to transitioning includes the items we've discussed so far, transistor full-time teaching and EDED, filter replacement mental health, and half of all

New proposals, fully new proposals, totaling nearly $2.5 million is less than 1% of our funding requests.

School Resource Officer, Title IX Coordinator, Records Analyst, and last but not least, $10 million to pilot the student voice fund.

With a baseline of judge with, pardon?

You said $10 million.

No.

Sorry.

Sorry.

OK.

I'm going on and on.

A very small amount.

I was reading the next line.

With the baseline adjustment, our proposed increase in expenditures over last year totals just under $10.9 million.

With this increase over last year, our total funding request comes to $257.3 million.

And we're currently balanced based on anticipated revenues that include an 8.5%, 8.8% increase in local funding, and a 6.9% increase in state funding.

And there's a couple of ways to look at our total expenditures.

The chart on the left shows our total school fund of $257.3 million and has looked across both school-based and department-based budget.

At nearly 73%, more than two-thirds of the spending is allocated to school-based budgets.

Brown, designated for department budgets.

And school-based budgets, as you might guess, are those that can be tracked to a specific school.

And that is principals, assistant principals, teachers, school nurses, custodians.

On average, these school-based budgets, 93% of them fund FTEs.

It's your people business.

Department-based budgets also serve our schools, but they cannot be linked to a specific school building.

So it's our transportation department,

We're going to switch focus from expenditures to revenues.

This chart shows that about 72% of our anticipated revenue, or 185 million, is coming from local sources, primarily the local government transfer.

About 28% of our revenues, roughly 72 million, is projected to come from the state.

And just 618,000 is budgeted from the federal government.

That little red sliver there.

Compared to our adopted budget for the current fiscal year, we're projecting an 8.8% increase in local revenue and a 6.9% increase in state revenues.

Combined, we are looking for an 8.2% increase in recurring revenues.

While we budgeted about $8.7 million in one-time use of fund balance in the current fiscal year, we have not budgeted any use of fund balance in the next fiscal year.

This will be considered in the coming weeks as we continue to develop any available fund balance projections.

Overall, we are looking at a total budget-to-budget increase of 4.4%, which equates to approximately 10.9%.

We have a slide here on state revenues.

With regards to state revenues, there are several factors contributing to the 6.9% anticipated increase.

For starters, our enrollment is growing and that increases our funding levels in the state.

In some areas, per pupil amounts are increasing, so even if our enrollment remains constant, funding levels per pupil could increase.

Also, sales tax has been strong and we are anticipating an increase in our share of sales tax revenue.

and finally the state is providing a portion of funding to cover a 5% salary increase on July 1st.

Over the last five years we've seen state revenues increase between 4 to 14% and it's important to mention though that the 6.9% increase anticipated for the next fiscal year is still largely subject to change.

and then we're gonna talk about some of these uncertainties.

So more accurately, our balanced funding scenario faces uncertainties and potential challenges.

The timeline for the state budget is unknown.

Last year, the Virginia General Assembly didn't pass the budget until June 1st and it was signed on June 21st, which was 10 days before the start of our fiscal year.

We're scheduled to adopt our fiscal year 24 budget at the end of April, but the reality right now is that we can't rely too heavily on the funding numbers we're getting from the state

This table summarizes some of the key changes included in the House and Senate amendments to the budget.

One area of uncertainty and possibly significant challenge is that both the House and the Senate amendments propose an additional 2% salary increase, so 7% instead of the 5% that we have budgeted.

If this moves forward, it is going to impact our budget, and we would have to bear most of that cost.

And Ms.

McKeel, we talked about that at the quarterly where, although they say they're giving funds, there's a lot that's borne by the localities.

Also, while only in the Senate amendments, there is a change proposed in standards of quality, SOQ, funding that would eliminate a cap on funding support positions.

So while the funding request before you today is balanced at $257.3 million, please understand that circumstances may change and we may face some tough decisions.

And this is our last slide.

Since the superintendent

We have held three budget work sessions as well as a public hearing on our budget.

We will use the coming month to adjust our budget as needed depending more information on state revenues and we're planning to adopt our budget for the fiscal year 2024 on April 27.

and comprehensive.

Just getting on a more personal interest for me, I wanted to know, you mentioned about the increased salary increase for everybody.

And you mentioned that the bus drivers were getting $2,150 an hour.

So I'd like to ask, how is that?

Are there a lot of still?

How many more bus drivers do you need?

The answer to that is that we are making movement on hiring bus drivers.

We are not where we need to be.

and the salary increase.

I do not know the interview data towards who we've hired, whether or not that's been the primary motivation towards getting them hired.

I think the relaxation of the retirement, whether or not they can access retirement, got us a few more bus drivers.

The step pay scale actually is pretty impactful because before it allows people, if you've actually been doing it for a long time, to be making much more than that starting salary of $2,150.

We do not have as many bus drivers as we need, so there's still work to be done.

I don't have the data in front of me.

And we can share that with the board.

We actually do weekly updates with the board on vacancies for the bus drivers.

So rather than at the beginning of the law, I'll just send that to you.

Thank you.

Just send that to the whole jury.

Well, we had, as Chair Carlson did mention, the well was dry.

up until the compensation increase.

And now we started to see a little trickle of applicants.

And then for every number of applicants you have, some aren't qualified.

Some don't, they get into the training and decide it's not for them.

Some get all the way to the end of the training and don't pass the test.

So, but we have seen an uptick in applications and we are seeing more drivers coming out.

I do anticipate next year though we are going to need to strategically

strategically instead of in terms of just reacting, we are going to need to strategically start to modify our services to fit the fleet that we have.

So you may see some adjustments to that.

The last question I have regarding step increases, which I know really work well.

Are your step increases based on longevity and

Are you talking about teachers?

It's both.

It's both.

Yours teaching and education will move you into a different category as well.

Master's plus 30.

Thank you.

And then really the other compensation that comes with attending classes is professional development reimbursement.

The difference with the bus drivers is that prior to until now they were all sitting in one pay grade.

So a bus driver, you got hired into a pay grade and your pay would change very little.

It was all entirely based on where you are relative to the midpoint for your pay grade.

And if you're below the midpoint, you would accelerate based on the percentage increase.

So if there's a 5% increase, you might get six, seven, until you get to the midpoint, then you start slowing down.

So it's a disincentive to stay as a bus driver in Albemarle County.

By moving to a more competitive position in our market, we decided to use a step scale

Just a few things here and there.

I'm just trying to make sure I understand.

And I sort of highlight the themes here.

Obviously, retention is a big driver for a lot of this.

And I know you're talking about surveys and looking at teacher retention rates, which are great, and bus driver situation.

Yes.

And what we can do, too, is we can share our annual HR report.

We'll send that to the board of supervisors.

It's accessible online, but we'll send it right to you.

And about 65% of our employees live in the county.

Live in the county.

Live in Albemarle County.

But that doesn't include the city.

Right.

So with the city, I think it's more in the neighborhood of

So we'll share that with you.

You can get a good snapshot.

So what we did was, beginning in the fall of last year, we did a compensation review with an outside consultant.

The firm was single.

What they did was they did an internal study.

They also studied what our board identified as our market for Albemarle County Public Schools, our competitive market.

Our board adopted a new market.

They adopted a new goal in the market.

And then based on the new market and the goal in the market, they made a series of recommendations for how to change compensation to become more competitive in that market.

So that would be the logical sequence.

And so what we did was we started to tackle that in phases because we had areas of critical shortage that existed right now, like in the fall.

Bus drivers being, it's always interesting when you feel something, you see the smoke, and then you see the data, which is the fire, and it told you that it was really serious.

We're not competitive in our market for bus drivers as far as our pay.

I think we were about halfway high in 50% of the market.

So that was like an on fire one and we had one time money that the board had set aside in the previous fiscal year to anticipate these critical shortages.

So that was really some strong wisdom on the board.

to set that money aside.

So we were able to use that immediately to put it back into operational dollars to start that.

The other area was registered nurses.

Our registered nurses in the schools were well below market.

And then there was a series of other positions that were really hard to fill, like you can imagine, like an electrician.

They would be highly competitive to work someplace else other than in a school system.

Through a combination of critical shortage areas, they applied the Band-Aid to that, and we're moving forward with those.

And now we're moving into a series of second round that we wanted to fund in the recurring budget for fiscal year 24.

So it's now hitting those areas where we have shortages, but you wouldn't call them critical yet, and also strategies for

Bringing on board employees and tapping into areas that we hadn't been tapping into before to bring people into the teaching workforce out of a need.

And also recognizing that it's a way to increase diversity.

So for example, out in our schools, because we hire so many teaching assistants and we also now hire permanent substitutes, we have people that are interested in being in schools and working with kids and helping them learn.

but they're not credentialed to be teachers.

But there are grant programs now being offered through the VDOE, there's local partnerships with UVA that we can identify people that are really interested and help subsidize their credentialing so that they can become regular classroom teachers with us.

Just to add to that a little bit, I know that both Supervisors Gallaway and McKeel know we hadn't looked at our market basket for over 20 years and that was the initial thrust of doing this employment study.

Is having Nelson County, for example, versus Fairfax or Buckingham, are those appropriate, you know,

Markets for us to compare ourselves with.

So they recommended a different market basket.

And then within that market basket, some of which was aspirational school divisions, where do we want to, as you know, Ned, we used to have the market basket and we peg our salaries to 75% of that.

So we rethought that whole thing.

But that study then subsequently identified areas where we were 20 or more percent low.

even the midway point.

Thank you.

I'm going to give people a chance.

I do know that there are certain uncertainties at the state budget level.

It is unnerving.

from the Head Start with the presentation.

I just had a couple of things.

On your slide five, we talked about who we employed.

Is there an example of a round number per school that would be involved in the orange category there?

I mean, I assume it's a principal and a vice principal, but some schools don't have them.

So is it like between 5 and 10 people per school?

In the building, what we did last year, we have principals and we added assistant principals.

We used to not do assistant principals if the school was too small, but now we have assistant principals at all the schools.

So that would be an administrator in the school.

So what we can do, Supervisor Malek, is we'll pull from the back of the budget notebook there.

We have a staffing standard for every, that was one of the things when I became superintendent, I wanted to identify every employee we have and create a staffing standard for them so that those kinds of questions aren't, it's never random, but we wanted to make sure that it's numbers driven, it's needs driven around,

differentiation for students that are free or reduced lunch, things like that, not based on squeaky wheels.

So we'll make sure we pull that section and get it to you.

All right.

Well, if I missed it in the book,

I think one of the things we've done, and I know Dr. Haas will jump in, is some of our schools, for example, one of them in my district, Diantha's in my district, Greer, they would use some of their differentiated instructional staffing to hire social workers, because they had so many social work needs.

So that would be another category that's been pulled out of instruction, because it's not instruction.

I mean, it's supportive of instruction.

But in the security, assistance is a new position, but it's one that our secondary schools would hire someone who could also do some security.

And we really, I think it's good that we are cleaning up what differentiated staffing goes to.

It goes to instruction, and we have to identify those other functions in our budget and accommodate for that.

They would be working with the students

helping secure buildings, interacting with kids and teachers.

And the reason you haven't heard of it before is I hadn't heard it before either this year.

So this is new.

He sprung it on you.

So one thing I think that would be helpful too for the board of supervisors, that topic around differentiated staffing, it's kind of

been swirling around for quite some time and intervention.

So what we have a table now it's G2021 and those pages in the budget notebook and the purpose of that table is to summarize

and it's aggregating and disaggregating all of the intervention support in one place so that you don't have to go from one table to another table to see reading specialists or intervention specialists and try to put it all together and that's an effort toward transparency.

With the security assistance, so all around Virginia, you know, I started teaching in Virginia Beach.

I left there in 2001 and we had security assistance in our high school

usually have for our student our high school where I was the assistant principal I had 2,000 students and we had four security assistants and generally speaking they were teaching assistants that had some that had differentiated job responsibilities but they were there to be a presence in the school so that students you know could be directed to go to class or if there was a

you know, violent situation or something like that, they would be there to support.

But they're often, they're on the same pay grade as a teaching assistant, and they had a job description.

When I came to Albemarle a few years later, there was no such thing here, and I was principal at Albemarle High School, which at that time was 1,800 kids, and so we,

We just started using some of our staffing because the division wouldn't staff it.

We just started using some of it to have, we called them security assistants.

They were just a random pop-up and then it became popular, you know, so that, you know, Monticello had some, Western had some.

So what we did was, this year we decided to create a staffing standard for it.

We, and just so you'll see it in there with the staffing standards,

there's a specific job description for it and we also are more centralized in our supervision of the security systems because we just want to ensure that if someone is going to be out in the hallways at the school checking in with kids and getting them to go where they belong or going in and out of restrooms or breaking up fights or things like that that they are properly trained and that we're going to vet them centrally and provide central training for that so it's not a random

out and about in the schools.

Now the issue around staffing was that principals were taking that out of instructional staffing to do that, so naturally that would impact class size at the school.

So now we're funding it centrally, we're supervising it centrally, we're doing the same thing with substitute teachers.

That was another thing that was just kind of everybody making their own budgets for it, the quality, the quantity, everything was outcast around the schools.

So we have centralized the budget.

We have a substitute coordinator.

Our numbers of substitutes that are available in filling jobs has grown dramatically.

Our fill rates have grown dramatically.

So we don't want to become everything centrally controlled or driven.

Well, thank you.

And that was another question.

Oh, well, there you go.

OK.

I was thinking about the ones where the kid and the teachers

The SOQ.

funded ones is like 30% or something.

Right.

Supervisor Galloway.

Thank you, guys.

I'll stay with the security assistance.

I think part of it is just we didn't, or I don't understand how it's set up.

So it may be answered.

I think when you were referring to the back of the book, you were talking about your school board budget book.

It's not in our budget book.

Maybe send a link to where the full budget book is online.

That might at least give folks, if you want to go back and look at the tables and stuff.

And there's probably more detail about that program in that budget book.

I mean, if somebody asked me to explain security assistance or safety coaches, I couldn't do it.

So part of my questioning today was going to be, all right, let me get my head wrapped around what this is and what it means.

So is the safety coach, is that an admin position or is that

Well, it sounded like these security assistants report to a safety coach.

I heard that, right?

So one thing we can do, so just to back up a little bit, Ned, what we can do is send you job descriptions for these positions, because I think that helps to clear it up a lot.

And if you think about the structure at a high school in particular, and you think about it in tiers,

of safety and supervision.

So you know our model around response to intervention.

You start at the bottom in tier one.

So in tier one, you have 95%, maybe almost a lion's share of students there in tier one.

They come into school, they're doing their thing, they're coming and going from classes, they use the restroom.

Even among the students, it's just like any place else you might go where you might need

a little bit of security there.

Someone that is just there to supervise, make sure everybody is going in the right direction, make sure that if the bell rings and students are late to class, someone's kind of going through the halls and making sure they get where they need to be.

That requires training, but it requires a really low level of training.

It requires people skills, and oftentimes it's someone who's retired from another job.

and so those would be the security assistance and you'll have a handful of those around the secondary schools.

Then you get to go up a tier to a smaller number of students that exhibit inappropriate behaviors for schools or they are frequent flyers in terms of needing to go down to the office.

That is where you start to see more safety coaches.

and they are required, they have post high school education, college degrees, in fields, areas related to education or psychology.

Some of them are teachers that have come from other school systems that have joined us to do that work.

They're required to have a much higher level of training through the Virginia Department of Education and then the Virginia Department of Juvenile Justice.

They're not police officers, but they have a lot of the same training and background around crisis intervention, culturally responsive teaching, and they're there to work with students that have been identified either through maybe a threat assessment

or who are always needing to work with a school counselor or one of the administrators.

So you've got a handful of them at the school, depending on the size of it, that is constantly interacting with that student.

You know, seeing them in between classes, checking in with them, making sure their behaviors are safe that day, that they're doing all right, and getting to know those students and supporting them.

So that's your base tier, and then the middle tier is the coaches.

And then you get to the top.

Then you're talking response to intervention practices for special education students.

It might be a behavior assessment.

It could be a Title IX complaint.

You're talking right away at the top of the triangle there.

I think it's, I mean, under state code,

You can have SROs, you can have school safety officers, and we call them school safety coaches, both of which have specific training requirements.

And what we're talking about, since we don't have school SROs now, is adding a layer beyond the school safety officers slash coaches to, you know, especially, well, in our schools,

Well, just adding a layer.

We just need more eyes in the hallways and that's what we're talking about.

To some extent it's not adding a layer because some of that is already happening.

Right, because it sounds like in the way I read it, at least, that safety coaches currently exist.

No, no.

The school safety coaches or officers already exist.

We're adding school safety assistants that have been part-time teaching assistants or

that have been doing that function without it being called safety assistance.

That's my understanding.

Creating the new position so then you're paying for it separately or you're not using up instructional time or instruction.

Right, right, right.

So safety coaches existed, security assistance is the add-on.

So what was my struggle was the mission behind it, like operation.

So that explanation helped understand that.

So I guess I'm clear on, is a safety coach a full-time, non-instructional position that reports to admin in the school?

The safety coaches.

And then your security assistants might be part-time, or are they going to be full security assistants?

They're full-time, and they are at around the pay grade of a TA.

But they'll be full-time security assistants.

Full-time, yeah.

They won't be full-time, like 0.7 security assistant and 0.3 something else.

And everybody knows, well, does everybody clear on what our differentiated staffing even means?

Okay, I know you are.

And then the security assistants, you do have this part of the notebook, it's A, section A, and their logic model for them is A5051.

I did mention the job description in there, so that is something I'd love to share.

I appreciate the safety coach description as well.

School resource officer is where my brain goes when I'm hearing security assistance.

I'm starting to understand that these are two, within Albemarle anyway, two separate probably goals or outcomes you're shooting for by bringing a school resource officer back, yet this program is a little different.

So the more info I can have on that is helpful in just explaining when I get questions about

So just so I'm clear on the funding, the slide with the governor and the House and the Senate.

So it's all balanced at the current governor's piece.

If the state ends up being higher in what they offer, I missed what that was.

You'd have to go back into your budget to find whatever the cost difference is.

It's a 2% additional salary increase.

I think it's two to two and a half million dollars.

So in your, and you do it, in the portion that we got in the budget it talks about how if any increases are

Any increases occur, it must be detailed.

And if any decreases occur, it must be detailed.

And I see the way the one-time funding is down, state revenue goes down.

But one spot in that building services operating impacts was like $57,000.

So even there, catching that small a number.

I remember Matt a long time ago having conversations about trying to do program evaluations now.

But we were talking about how can you figure out the return on investment for instructional programs.

Are beyond the program evaluations specific to that, do you guys track, you know, from year, I don't know, 16 to 18, we tried this program and figured out, nah, this just wasn't giving us the return that we were going and we eliminated that.

I think of that when I think of decrease too because it may not eliminate the cost because you're going to put the money somewhere else.

Do you guys track that type of stuff?

We haven't tracked it.

I mean, there's like one that when you're on the board, something we started was called the SEED program, S-E-A-D, and we don't do that anymore.

We made an assessment of it and decided that it had been supplanted by other resources and it wasn't the staffing that was behind it.

It wasn't panning out.

But we don't have a return on investment strategy.

Well, with some of those programs, you have to, I guess, at some point, just make the call as the superintendent whether the program based on your own internal data is working.

We talked last Thursday in a work session about, or Wednesday, you know, it's important with a budget of this size, when real estate assessments are going up and folks see more money coming out and they start to say, what is this going for?

and there are a lot of people that are supportive for it to go to things, but they also want to know the story behind what are you, even though revenue is increasing and costs are increasing, what are you doing to find efficiencies and decrease costs so that you're offsetting cost increases and not just adding to the bucket.

The budget that I'm seeing with what's been provided, it may be in your full budget book, but anything like that that could be highlighted, I'm not saying it has to be talked about right now, but anything along those lines that could be provided so that we could put it on the website as folks are looking at it, I think is very helpful in telling the budget story.

But yeah, even though the budget's grown in total,

The mental health coordinator position you're adding on, I presume that's one and then

It's Miles Nelson and we used that anonymous donation to hire him which allowed us to hire him for three years but he coordinates all the school counselors and as we were coming out of the pandemic we used ARPA funds to add

a social emotional counselor to every school.

So we added 25 counselors that he works with in addition to that.

So those now are, we're still funding one time for one more year.

And some of that will have to do with how things do pan out with the state budget.

Because if somehow we have a net, if we net some funding, we can apply that more to offsetting that and getting it into the,

We're actively trying to build resilience, trying to educate the teachers about social emotional development and our counselors say they've never been busier.

I was thrilled when the social emotional learning became part of what the school division was going to go after.

So seeing the SEL coaches being put in there,

I was starting to look at, all right, how are you going to judge that, evaluate that?

So one of the things we did was, that's what the logic model is.

So there's a logic model for that position because we didn't do one before because we were getting grant funding for it.

But the process that we use now,

This is something else since you were on the board.

Every proposal that's made, including just increasing staffing or anything, has to have a logic model with it.

And what that does is identify the inputs, the activities, and the outputs and outcomes.

What happens is throughout the year, if someone submits a logic model and it gets funded, throughout the year that person has to come back to the cabinet.

to demonstrate what's going on with it.

Are they up to date on the inputs, up to date on the activities?

And then as they get through the process, we've identified key timelines that have to show us the results that they were anticipating.

And somewhere in the A section, there's also a scorecard for every single logic model that the board

has incorporated it into their budget since I started out as superintendent.

So it's A5859.

So everything that's been funded, that is a new proposal.

And as you all know, the school system's budget is the actual part that we can do something about or change is like a sliver out of, you know,

There's so many regulations just like with the county.

I mean, there's so many regulations around everything we do.

There's rules, there's ordinances.

We get to play with a tiny fraction and thank you because that's because of the Board of Supervisors and your decision to allocate consistent funding to the school board.

So we know pretty early on what we're going to have to work with that we can enhance our program.

So that's an opportunity to say thank you to you.

But just because it's a small fraction doesn't mean we go, oh, well, we can blow it into the wind and see what happens.

Everything has to have a logic model.

And you can see there's quite a list there now.

Most of it is green, but it didn't all start out in the green.

The first time the person comes in to make their report, it's in the red until we start to see it as a healthy project.

And that's where we do our cutting, too, at the cabinet level.

If something's just not happening, then we just wash it out and go back to the board

and say well we're just we're not going to keep investing in that just never got anywhere.

Go ahead.

If one was interested in diving deeper into one of these elements is it available or easy to access electronically or is that something to just ask for?

Well we don't so we don't it would be in the minutes of the cabinet of our of the leadership team so we could pull it from the minutes just what was reported.

I'm just trying to keep my head out of the school board's work.

Are these the right outputs?

Are these the right outcomes?

Are these the right measures?

That's not my job.

But I am curious since I'm a parent, so I get interested in those type of things.

So I think your strategy when you were talking about the moving of localities for your compensation planning, like you were talking about like we remove fucking and I don't disagree with that overarching strategy.

I think you're on point for that.

The thing I would caution against in listening to and having the opportunity to present to other localities via the regional housing partnership, and that each jurisdiction is doing a compensation study of their own, is to not forget that we have folks that are working here that are living in those jurisdictions.

So if we eliminate Buckingham County, which my own place of work, I have folks that travel from Buckingham to work for me.

If Buckingham County sneaks up on you, now you would think in your strategy they never will because they're down towards the bottom, but if they laser focus in on like a substitute or a certain type of position and all of a sudden they pay more than what we're paying for the person that travels from there to here to work, then you could lose those positions to those outlying counties.

So all of those counties I know are going to start beefing up or looking at their areas.

They're not going to be able to afford to do it for everybody.

So I would say that outside of your larger compensation strategy, stay on point with that.

But just because they're out of the loop, don't lose sight of what they are doing in and of their own divisions, because they are places where people currently live that are employed here, and you don't want to lose them and have them pulled off.

Can I ask one fast follow-up question, please?

For the benchmark discussion,

Is commuting distance and time relevant in that?

Because someone mentioned about Fairfax, but I don't know how logical it is for people to live here and work there and run back and forth over the road every day.

So I just didn't know if you were talking about that.

I have to admit, I don't know.

I don't recall all of the jurisdictions that were in the new market basket.

And we can certainly send you a copy to that.

I mean, one thing we did is included some aspirational school divisions, but then we're no longer pegged at the 75th.

We're more in the midpoint of the range of jurisdictions.

Yeah, and I think there was also some discussion

because teachers do have mobility, not so much that they're commuting, but that they might be willing to move closer to Fairfax if Fairfax is paying double what is getting paid over here.

Cost of living difference might take care of it.

Yeah, cost of living difference.

My mom needs from Fredericksburg to Alexandria because there's a cost difference.

I see.

Thank you.

Thank you.

Supervisor McKeel?

Just to grab on to that point pretty quickly, I remember a few years ago that we have divisions in the state that are getting cost of living bonuses for their teachers from the state.

And we tried, because of our cost of living for several years, to get that same stipend or bonus from the state.

Do you remember, Ned?

And that area had moved as close as Colfax.

And if you think about it, it's not very far for folks to drive to Culpe or move to Culpe, just to add to that.

So I was just wrapping my head around.

My fellow supervisors ask great questions, and I don't want to repeat the same questions on the topics.

So just trying to move on to a couple of different things.

First, overarchingly, I just want to say that I remember very clearly, we used to say,

that we could be a system of schools or we could be a school system.

And I really appreciate you moving towards being a school system.

And that gets to the centralization that you're doing.

And that is really critical that we don't have 24 schools out there doing their own thing like decades ago we had.

This is really good, I appreciate it.

I also really appreciate that

is not risk adverse in trying pilots, in trying to do things differently.

And then circling back to look at the metrics and to see if they're actually working, those pilots are working.

And if they're not, say, we're done.

We're not going to continue to do that.

We're going to move on to something else.

It's really important to get at some of these gaps, learning gaps, that we're trying different things to see what works and doesn't work.

That's really high up level.

And I do really appreciate that.

The logic model, I'm very impressed with.

That's a new term I hadn't used or heard before.

And that's really cool.

So that work is great.

Let me just go back to my other notes.

I know that we've been talking about differentiation for decades.

And it sounds like to me you're looking at it differently, which is really great when you talk about

The schools on page 18, no I'm sorry I'm conflicting a couple of things.

When you're talking about the differentiated funding, for schools for example, there's an enormous difference between Meriwether Lewis and Greer.

Let's face it, we know that.

So do you all have that data if you could share

And I was thrilled to see that Greer was going to be getting an early childhood special ed program this year, which is really outstanding based on the needs at Greer.

But Diantha, the differentiated funding, I think Maryweather Lewis maybe has a half of FTE versus six or... Yeah, and that's what I'm getting at.

They're just different walls.

That's great.

I just would be interested in that data.

I'm trying to hurry so I don't take up too much time.

What I was looking at on page 18 is I circled the data center because for our two, for both sides of the aisle, we all have to use data.

And I just don't want to lose the sight or the idea that maybe combining forces and looking at a shared data system could be a win for both sides of the aisle, so to speak, here.

So I saw the 1.7 million in my brain and I was thinking,

I hope we're still talking about those areas where we could share resources or something like that and save some money for both parties.

I'm having, getting, but receiving a lot of questions from your community based on some of the work around criminal justice.

I'm just curious, is the school division still using restorative justice with your disciplinary hearings?

I used to sit in a lot of these disciplinary hearings.

And I'm just curious if you all are still

Great.

That answers my question for the community.

That's really good.

We talked a little bit about the unknowns about collective bargaining and KTEC, and I get KTEC is a year away.

I've been hearing from the state.

We know that the state underfunded school divisions by about $34 million.

$225 million, yeah.

Sorry, wrong number in my brain.

So very underfunded.

So that's the one piece that's sort of known as of today that they haven't approved.

The remainder of the budget is not approved yet.

OK.

And what I'm also concerned about is I'm now hearing, and I'm not sure I really understand it, but discussions chatter.

Governor Youngkin is talking about how he's going to give millions to families.

to millions of dollars to families for them to spend on closing issues that children had during the pandemic.

And I'm just trying to figure out that one pot of money is not replacing another, that we're not playing a shell game, because sometimes that happens.

I read that.

That's concerning to me.

We would take one pot of money and replace it with another.

Just out there in my head.

And I really want to thank you for the mental health services, that addition of the guidance counselors and the mental health folks.

That's really, really wonderful.

I do think a couple of years ago, I want to say how we noticed that.

You had lowered your ratio of students per guidance counselor, which was great.

And I'm assuming that some of those lower numbers still are.

That's great.

I think that's great.

Right, right, right, yeah.

That's great, really good.

And I guess I'll stop.

I'm looking through my notes really fast.

I think I like that we're looking at the market basket.

We've talked about that for years.

Yeah.

And I think, oh, and if I can digress a little bit off of this just while you all are here,

But it did, in fact, impact the CIP at one point.

Oh, right, right.

Some communities have certainly, and some schools, have had lots of millions of dollars in donations, and some of them

Marrow.

That was on my tickler list.

I mean, I think we're looking bigger than that.

I'm one of the members of the board members of the foundation, which is American Foundation, Albemarle Foundation.

We're just at the point of going to be hiring an ED.

But I think we are aligning like our

funding request for aligning its general areas of concern.

So we could address things like differences in gifts from DTOs.

But I think we're looking much bigger than that.

And we're looking for a lot of ideas.

Our grants are not going to be classroom grants, like DonorsChoose type grants.

We're going to be looking at either school-based or across schools or division level grants.

That's always the case, right?

But I think it's going to be really good.

And it will address a lot of inequities.

I mean, reading, or STEM, or science, or science sports were almost, you say, disappointing as a science geek.

But I found them disappointing.

Or providing color cartridges for the printers.

Exactly.

Yeah, and one thing I think it's worth clarifying just because we heard from constituents concerned that it was somehow superseding PTOs, and it is not.

This is a separate foundation, so I think that's worth repeating.

And one additional thing I would just say that I'm excited about it is I think it helps people re-envision how you can give

I think it's a way to capitalize on how people do want to give back to our community.

We saw it with our half a million dollar donation and this is a way to hopefully have additional revenue to help our families and our students out.

Right people to understand where the money would go and what is needed.

So I think that's really great.

Thank you.

And I'm going to stop.

First, let me acknowledge and recognize school board member, Donna Ocaro, who joined us a while ago shortly after we started.

So thank you to the entire school board.

Your presence here today really is a great reflection of our ability to work together.

So thank you.

I have more comments than questions.

I do have a couple of questions.

Most entities are able to self-select who their membership is.

Schools aren't that way.

If you're a business and you're a contractor, you choose your plumbers and electricians and heavy equipment operators.

Schools get what comes in the door from 100 countries, 70 languages, and when you listed some of those demographic groups that have historically had challenges in the educational system and

immigrant status or whatever it may be, I marvel at how you will be able to actually use these metrics to measure success because educational is a building block process and what the first year may not reflect how much the students are actually learning.

And so I really applaud the work that you all are doing to bring education to everyone who comes through your doors.

With regard to the security assistance, about how many security assistance are you estimating based on that 566,000?

We know that one school resource officer has been mentioned, and so I was just curious as to how many that may actually be.

I may have just missed that, so thank you for clarifying that for me.

I'm also amazed at the way that you're able to achieve the success that you do with regard to

but I think are very reasonable school class sizes as well as your graduation rate, advanced diploma, lower dropout rate.

Obviously, we always and everything wants to do even better, but it's always good to be on the top half of the bridge.

Back to the metrics, you know, your slide 10, which you don't need to go to, enrollment growth.

I really love the $10,000 towards the students to allow them to have their voice heard.

One of the most frustrating things that I've always observed is where students are not allowed to have their voices being heard.

And for y'all to encourage that really is a great thing to do.

And I wish we had more money for capital improvement.

I think we all do.

I wish that we had that pleased with what we are able to afford to fund.

Chair Price, in addition to the increase in numbers of special ed, there's an increase of special eds to increase in the severity, which is...

I believe it's just a good time for a break.

If the board would like, we'll just rearrange some seats.

All right, good afternoon everybody.

We're back in session.

Trevor Henry, Assistant County Executive.

Go ahead.

And those listening from home, I'll just acknowledge you virtually.

No action is requested by the board today.

On the 15th we will have work session number three and at the end of that work session the board will be asked to propose a budget and a tax rates for advertisement.

Just like we did previously last Wednesday, we're going to provide a level of detail in between the County Executive's presentation of the budget document.

We'll have breaks along the way to allow for board question and discussion, posting those answers to the website, if not addressed on the spot.

And again, also listening very closely for any adjustments, whether that be more of something, less than something, or something else that we would hear in the budget process.

I'll skip the agenda, because I've already spoken to that earlier, and bring us right to the CIP.

I'll make sure, because terminology is important in the CIP, the CIP is a five-year period of time beginning with next fiscal year and four following years.

The very first year is called the capital budget.

It is the only year that we request to be appropriated by the Board of Supervisors.

So that is the only action in terms of authorizing spending in the CIP the Board will approve in May.

The other four years are very important though because they shape what happens in the future where just like last year the board adopted a CIP at fiscal year 23 to 27.

23 was appropriated and then fiscal year 24 to 7 became the basis of this year's CIP with a new year five rolling in.

So some of the numbers we look at are going to be one year, some of them will be five year, and I'll clarify which one they are, but just want to differentiate the board's action of appropriating the first year versus adopting the total five year plan.

So with that said, this is the first donut chart we'll look at in five years of the total CIP revenues.

Just two observations I'll make.

As you can see, the majority of the CIP is planned to be funded through planned borrowed proceeds.

These would be bond issuances the county would do every two years to reimburse itself for expenditures.

And then the debt service on those would be paid over the next 20 years or whatever the terms of the bond may be.

The next piece of the donut I'll draw the board's attention to is up in the upper left in green.

That is the cash equity in the CIP both ongoing and one time.

The other revenues I won't spend much time on.

They're much smaller and they are really specifically tied to projects.

For example, in the school system they receive funding from the state or federal government for either some of their programming in the areas of schools and technology.

The same would be true for some county government programs.

The plan borrowed proceeds and the cash equity are where there is more flexibility not tied to particular projects.

Next, just on the expenditure side, we can see the majority of that in this five-year period is recommended to be made up of public school projects.

That piece of the doughnut is about 61%.

Then we see the other functional areas that we talked about on the operating side last week.

I'll highlight the largest functional area is community development, which is not just the community development department.

Here, this is speaking to primarily what we call the transportation leveraging program.

where the board sets aside funding for transportation projects that then draws down additional state funding to make improvements.

I'll speak just in a few slides a little more about what that program does.

Before we get into project details, I want to take some time to kind of step back to where we were on December 7th with the joint meeting with the school board, also in our five-year planning process with the board, and just give a few references of where we were at that time and financial updates that have taken place since then.

So this is a slide I showed a version of on December 7, and it takes the annual capital budget, that first year of over about the last 20 years, and now in this kind of looks like a dark orange, just more of a goldish, yellowish color on my screen, where the next five years look like in the recommended CIP.

Just to explain this chart at the 30,000 foot level because the number of dollars did not necessarily speak to the number of projects or the complexity or how long those projects may take.

But we see starting in the blue section, prior to the Great Recession, we see a trend where the capital program was generally increasing over time.

That changed with the decisions that were made during the Great Recession in that second category and the brighter orange.

where we see there was a much more lower investment in capital overall and that tended to be relatively flat compared to the other areas.

We then see in green from the kind of post great recession of those initial recovery years through the pandemic a steadily increasing trend line.

We do see fiscal year 21 is lower due to the onset of the pandemic but we've returned to a much increased level of capital spending since that time.

That trend continues in the final section in fiscal year 24 through 28.

Still on that upward trend, those big jumps in fiscal year 25 and 28 are when the construction of the next two elementary schools would be planned.

That kind of explains where those jumps are.

So just sharing that as a reference, another slide I'll share as a reference from December 7th was the very last one we spoke to.

What were the next steps forward from that day?

We talked about at that point the CIP was just a draft, it was not balanced.

Since that time it is balanced and I'll speak to the work staff has done from December to the recommended budget.

That leads us to where we are right now, today's meeting, continuing the discussion of the annual budget and the CIP.

On December 7th, we discussed there were possible strategies that the board could consider to increase CIP revenues and some of those are already included in this recommended CIP.

What we now know today that we didn't know on December 7th is the impact of calendar year 23 reassessments.

That is now included in this CIP.

The tax rate is not changed at this time.

The same recommended rate of 85.4 is included.

And there's also investment of one-time funding both from fiscal year end 22 and some other reprioritization of one-time funds that have been identified and I'll speak to in just a moment.

The other long-term strategy that was identified at this time was potential General Assembly legislation around local enabling authority for sales tax for school construction.

That has failed in the current General Assembly session, so there is no update I can provide that provides any additional revenue at this time.

So with that framework, I'm going to touch back on this slide that was shared with the board and as well as the school board back in October and November.

Staff's approach to preparing the fiscal year 24-28 CID.

There was a five-step plan.

I'm going to spend most of my comments talking about number two and number four today.

Number one is because we knew it needed to anticipate the third school construction.

That is included.

Number three, the next steps from the joint school board meeting will be the rest of my comments.

Number five, to the extent possible of the strategic plan, that isn't possible because so much of our funding has gone to the cost updates in the CIP.

Number two, so much of this challenge of the CIP has been working to maintain the current plan, giving updated project costs and borrowing costs.

Staff worked hard not to de-scope or delay or altogether remove projects, but in order to do that, that required some other strategies.

So in the next slide, to give some magnitude of the challenge, the very first challenge we had was increased project costs.

Right around the time of the budget adoption last spring, I want to say really for the last several years, we've been in a very dynamic situation in terms of raw material cost.

raw material availability, labor cost, and we've seen across the board as projects have come out to bed monitoring what's going on in the communities, getting input from staff both within our facilities department and school building services, trying to get the best information we can on a rapidly changing environment.

Let's kind of give the best apples to apples comparison.

If we were to take fiscal year 24 to 27 of last year's plan,

take those exact same projects and now have them in fiscal year 24 to 27 of this plan, there'd be about a 38 million or a 26% increase that we are facing to solve in the CIP.

And we have, the CIP is balanced with this included.

What this has meant is a lot of the additional tax revenue has not gone to add into new projects, it's been to maintain the current plan.

The second challenge we had where it did happen last year as the budget was being adopted is the interest rate environment has changed dramatically as the Fed has continued to raise interest rates several times since then as it continued to indicate they will continue to do so in the future.

So from a perspective of what that means, a million dollars of debt service would buy $13.1 million of projects based on last year's adopted plan.

Unfortunately, those dollars don't go as far this time as $1 million in debt service if we continue to lease revenue bonds, which is what is included in the recommended CIP.

That would buy $11.8 million in projects.

If the board wanted to pursue an alternative of general obligation bonds, there's about a quarter of a percent, a better rate that we would obtain, and that would stretch that a little farther to be $12.1 million in projects.

So this is really a double whammy situation because not only does our debt service not go as far,

The amount of funding we can buy in projects is not as great either because the projects have gone up so much with raw materials and labor cost.

So with this reality, we knew we needed to work to find some ways beyond just the traditional funding formula to fund the CID.

So we heard in the county executive's recommended budget presentation there were $16.7 million of one-time revenues that was added in addition to our regular formula funding.

So there are four sources of where this funding came from.

Some that I discussed with the board last week, some I'm going to discuss today, but just to put it all together so we can all see the total picture.

I've arranged this also by fiscal years because also to echo what Thieme said over these work sessions that decisions in one year can impact another in the budget, whether it be fiscal year or calendar year.

So the first item is really from the prior fiscal year sources.

We've identified above our general funds fund balance, above all policy and obligated levels, there's 1.2 million that is recommended to go into the capital budget.

The next, fiscal year 23, this is the first item we did not talk about last week, but while we do have increased borrowing costs,

the new interest revenue environment.

There's a little bit of a silver lining that the county's return on interest and investments is also increasing based on that environment as well.

So what staff is recommending to do is for that additional revenue in fiscal year 23 to send that one time into the CIP in this fiscal year to fund the fiscal year 24 to 28 plan.

The next two items are ones that I talked about last week.

where in fiscal year 23, if the board sets a calendar year 23 rate at the same rate as recommended at 85.4 cents per $100 assessed value, that will generate some additional revenue in fiscal year 23.

That is recommended to be sent, or 7.5 of that update is recommended to go into the capital plan.

With that revenue update, we are also honored during the intent to share that tax revenue with the school division.

where 6.3 of that revenue update is going to the school's CIP.

That revenue update allows for the third school, elementary school number two, to be included in year five.

It helps address the increased cost for school projects, and it also stretches the school renovations a little bit farther than we looked at on December 7th.

On December 7th, there was $8 million for school renovations across five years.

That number has now increased to $14.3 million.

6.3 is contributing with all of these sources to help all of those three.

And then in fiscal year 24, we talked last week where the transfer to public schools and county government operations is being adjusted to send a little bit more to capital one time in fiscal year 24.

This is really just a one-time adjustment to look at the relative needs of the public schools operations, the county government operations, and the total cost.

So what that means in fiscal year 24, 4.9 would be split, 60% to public school CIP, 40% to county government, just like that revenue would be split into operations to support the overall plan.

With fiscal year 25 comes around, we would then revert to the regular planning standard unless the board of supervisors directed otherwise.

So all of these strategies are different ways that we have done work to apply that revenue and get that cash into the CIP to support those project increases.

Now I should clarify that there are $38 million of increases we need to solve for.

So just as this cash is providing some of that, there is also we are looking at the timing of projects to make sure that the timing of borrowing and execution is aligned.

There is additional revenue from the formula transfer because we had such a strong reassessment that is going there as well.

And just any other smaller assumptions that we do in terms of

around the edges in terms of our scrubbing.

And I should say the capital program is very different, where the dollar and the general fund are really one dollar in, one dollar out.

It's all in the same fiscal year.

With capital, you're looking at multi-year projects with multiple funding sources, some of which are borrowed.

And so what the principles are there, where anytime you need to make an adjustment, you need to make a counter-adjustment.

Given the timing of that and the issuances, it's a little bit more complex of an exercise that we have to work with on the staff side.

That was it.

In order to not de-scope projects and to maintain last year's plan,

That's exactly right.

OK, so you're taking a little bit here, a little bit there, and we're delaying or whatever.

Yes, I guess the path staff chose was to keep the CIP intact in terms of schedules and all that as well.

Another approach would be to change the scope or timing of projects in lieu of other things, which is an option available to the board if they desire to.

Thank you.

All right.

Yes, that would be correct.

That would be subject to the Board of Supervisors.

Thank you.

Yes, mine was the GO Bond question as well.

We ran those numbers, Supervisor Mallek, a few months ago.

So if our savings is $300,000 minus whatever expenses there are.

Yeah.

That was on the slide 11.

Thank you.

Thank you, Supervisor Galloway.

I don't have any questions.

I don't have any questions.

This is very helpful.

at 38 million is over a five-year CIP and the 16.7 million would come out of your adjustment for the first year.

OK, thank you.

The number two school is proposed.

Oh, I guess that could be built in 25 or started in 25.

That would be constructed in fiscal year 28.

So high school center two was appropriated in fiscal year 23.

That is one of the projects contributing to the jump there.

Okay, so the money's there to do it and then we just have to... Yes.

Correct.

At this time the funding is all in place for High School Center 2.

Thank you.

Supervisor Andrews?

Working with the school staff, we kind of looked at our pressures in the school fund and the general fund.

And this is not to imply all school needs are met in the operations fund or all general fund needs are met there.

And then just based on the split, working with our partners at the schools,

That's the reason.

So next year that would be, it's ongoing revenue, right, but just this one time moving it together.

Thank you.

Yeah, I'll share for anyone who would be interested in the math, if that doesn't anyone, on page 228 we do...

Okay, thank you for that break.

Once again, I started the work session with a really dense topic in terms of revenues and dollars.

Now we're going to talk about the actual projects.

So what I will plan to do is to give a snapshot of those projects in the CIP.

Once I wrap through that, I'll end with a comment on the community agency process, which includes a project, and we'll open up the board questions.

So we have organized these projects just like we did through our budget process around the board six strategic goals.

I will begin with the school CIP and my comments will be brief given Dr. Acuff's comments on this matter just in the last hour or so.

The major projects included here are the system of renovation.

This is the 14.3 over five years.

We have elementary school one and two that are planned in the CIP.

I've included, to kind of clarify Supervisor LaPisto-Kirtley's comment, high school center two is currently appropriated, but what we've done in our strategic plan is there are the dollars that we are changing to add, but also recognizing there are the work plans ahead which impact the capacity of the organization to move things forward.

So High School Center 2 isn't here just to recognize that is a significant effort of school financial and building services staff as they implement that rather than new funding.

But to touch that on the funding for the next three slides, Elementary School 1 will be Elementary School 2.

The opening dates here are the total dollar amounts.

Each one of these is about a 500 student elementary school, about 72,000 square feet.

The southern feeder pattern would be prioritized first, primarily to relieve overcrowding in Mountain View.

And the northern feeder pattern would be second, that's elementary school number two, to relieve overcrowding in Baker-Butler and also to accommodate the growth that is taking place in the 29 corridor.

To briefly touch on system-wide renovations, again, because the school spoke to that, they are prioritizing the high school renovations first.

Examples of these are on those slides and were also mentioned earlier by Dr. Acuff in her comments.

So to look at the schools in total as a snapshot to have all the dollars together, it's $194.5 million.

And we can see the timing of design and construction in fiscal year 24 and 25 for the southern feeder pattern.

The northern feeder pattern being in 27 and 28.

And then throughout the entire plan, we do have the renovations, maintenance and placement programs, and school bus replacement.

replacement taking place through all five years.

I do have a footnote on the bottom just to recognize the new money is up top, but there are notable projects ongoing, such as the current Mountain View expansion underway for the current school, as well as the high school center tube landings.

Those are just efforts underway.

The dollars are already appropriated in the current fiscal year.

So with that, I'll spend a little more time on the county government projects.

We did not go through them earlier today.

This is to go back where were we on December 7th, we had a county government CIP that looked like this.

I want to take a moment to explain this big block on the right, the strategic plan placeholder.

Last year in the budget process, the Board of Supervisors intentionally held back some financial and administrative capacity knowing that you all were about to update your strategic plan.

The idea was not to plan every dollar of capacity until that plan was updated.

In the out years of the plan, there was about $27 million in a combination of borrowed funding and cash.

where after the strategic plan was adopted in the fall, we would then take this process to begin to plan out where are those projects most aligned to help fill in the gaps where we are in the strategic plan.

That is a large box because it's about to be filled with a number of projects that does not correspond to the number of dollars in it.

But we'll see on the left, we already had some projects here.

When we go to the right, where we are in the recommended CIB, these are the projects that are created from the

the line with again the color code of the goals.

The number on the goal on the left corresponds to the box on the slide.

I'll walk through these now to show a little bit about what are these projects at a high level and once we get to the end we'll open it up for board questions if we'd like to go into more detail on any of these.

So to begin with the court's construction which is associated with goal one of safety and well-being.

There is some additional funding based on the anticipated project cost we are seeing in that project.

No change in the actual project itself as most of the major phases have been appropriated and will be getting underway in a very visible way soon where we have the scope of work for the new general district courthouse, the renovation of the historic Levy Opera House, and then the renovation of the current courthouse which currently serves both courts.

So this is really just continuing the existing project and adjusting for project costs that are anticipated.

I will move next to the transportation leveraging category.

We have funding across all five years.

On this screen is an example along Rio Road of the transportation revenue sharing project, where what the board does with this is funding goes into the transportation leveraging program.

It then draws down funding from the state as these projects are approved, allowing those things to be completed.

Examples of the projects we have in consideration are shown on the screen here through the US 250 corridor, Brookmar Extension to Airport Road, Old Lynchburg, Eastern Avenue, and the Brookmar Path shared use extension.

And I guess the final comment I'll make in this too is with all of these projects based on when the funding is needed, we coordinate with our community development staff to make sure that we have that lined up, which is why we don't typically see just a flat amount every year.

It's based on the coordination and those projects we're working through with VDOT in the state.

The next two projects tying into infrastructure and placemaking are two in the areas of solid waste.

First, we have on the left a replacement baler facility.

This is a facility that is jointly funded with the city of Charlottesville and operated by the Rivanna Solid Waste Authority, which is what RSWA stands for in the slide.

The city has also included their share of this project in its CIP, which is now going through deliberations at the city.

There's an opportunity where we've included the full local cost for the county and the CIP.

The county is currently pursuing grant funding that may draw down that cost, but the outcome of that grant is not yet known.

On the right we have the Northern Convenience Center where design would be planned in fiscal year 25 and fiscal year 26.

The actual location of that has not been confirmed yet.

What we see here is a computer image of a concept for the Southern Convenience Center which will be soon opening this calendar year.

I'll note that we did make a slight adjustment to the Northern Convenience Center.

It was previously all in fiscal year 25, but we have done that really to reflect the sequencing with the Baylor facility where working with RSWA we'll have the Southern Convenience Center soon completed, then moving to the Baylor facility, and then moving to the Northern Convenience Center kind of one after the other.

Really next to economic development, there is funding in the CIP that is really about, again, leveraging funding in public-private partnerships.

This is included in the last four years of the plan.

There is currently a balance in economic development funding of around $2 million.

This now begins to add to it as part of the goals objective around economic development and quality of life.

Again, this is really about public-private partnerships.

public-private partnerships, or P3s, giving site control.

That could look a number of ways, but this is in there to provide flexibility so the county is well positioned as opportunities rise, such as on the right, we see a picture of the Will and Mills, which was an agreement, the performance agreement the board executed in the last few years.

Staying in goal four, moving next to Parks and Recreation.

Last year CIP contemplated additional phases of Biscuit Run Park.

The total master plan was developed when the county received the land and the CIP moved forward for funding in fiscal year 23 and 24 and also some additional fiscal year 27.

So the scope of Biscuit Run is for the park entrance and the trailhead, the internal system and also connections to other trails.

What is included as part of that strategic plan placeholder is there are athletic fields at Biscuit Run that would be designed in 24 and constructed in fiscal year 25.

I apologize for that spacing in that very last line of fiscal year 25.

And that is for two grass athletic fields at Biscuit Run.

The final project that does not appear in the CIP yet at this time really to go forward but is going to be very much part of staff's work plan in the coming year is the concept of an urban pocket park.

Right now that work is going to be done internally for design of where that may be located, what that may look like in the urban development area, confusing staff resources.

We would then expect once we have a much more concrete concept that will come back to the board in a future CIP process more specifically what that may be.

So at this time, we don't have a dollar amount or a location to put out there, but certainly the intent will be looking forward in the coming year to bring that back in the future CIP process.

So next, moving on to, we'll skip Goal 5 because we talked about that with the schools.

Moving to Goal 6, two concepts out there.

One is on Workforce and Facility Renovations, I'm sorry, Workplace and Facility Renovations.

This speaks to space as one of the boards

Strategic Objectives, and Goal 6.

For some perspective, prior to the pandemic, the county was leasing office spaces downtown for its economic development office, also for part of its financial functions.

We were also having discussions at that time about potentially moving the registrar's office out to have a rental space in the county.

None of those that will.

The registrar in place never happened.

Those leases for the county's other space have discontinued and have moved back into the county's county office building.

So what this is now building upon about those space needs, learning on the lessons of the pandemic, how would we use the space that's existing at the county office building at McIntyre Road and Fifth Street differently to reprogram those spaces so they fit more of the modern way that we're working and continuing to provide the customer functions for why people come into those buildings and when they do.

On the right, we have Core Systems Modernization funding across fiscal year 24 to 27.

I won't speak to those in detail because we had a lengthy conversation last week's session.

Just again, speaking about the technology for contemporary digital governance solutions.

So the final group of projects I want to talk about, a really broad project, was to take a moment to discuss this community non-profit process.

Because this was something we did for the first time in fiscal year 24 in a very formalized way.

So this was a process we discussed in concept with the Board of Supervisors that rather than periodically receive capital requests from the community throughout the year, to really have one designated time where outside agencies were available to request those in context of the budget process.

And then all of those project requests may be considered alongside all other school and county government needs.

Consider those in the context of the strategic plan to make sure we were making one decision rather than a budget process with other decisions that could happen outside of that.

So we required alignment with the strategic plan for any projects out there.

We received 15 total requests.

The only one is recommended for funding.

There may be other paths forward in the future for others.

Our intent would be to make this a regular part of our process, just like we have agency funding for others.

So before I talk about some of those paths forward, I will highlight the one project that is included.

So there certainly is a connection with Goal 2 about the Equitable Engaged Community in terms of access to services.

So this is $65,000 that would be provided to Bennett's Village.

What they would do would be creating adaptive recreation amenities at Penn Park, really what they're calling kind of the accessible treehouse.

There's a diagram of that from the nonprofit on the screen.

So this is a project that was not unfamiliar to the county.

They have previously met with the park staff to figure out if they were to do this, what is a county park or where this could be located.

What they've ultimately settled on is actually land in a city park at Penn Park.

And I want to clarify that though that's in the city, it is adjacent to the county in the urban area in close proximity to a very large number of county residents.

The city also and with the county partners already and all of the operational adaptive recreation programs to meet the needs of anyone who may need that.

So this is again in that spirit of collaboration we have with the city and county as well.

Funding is not recommended until fiscal year 25.

This is a project that has a total budget of over half a million dollars.

There's currently funding in the state budget that could provide a very large chunk of that.

Now that depends on the final state negotiations.

They have fundraised a large portion of that, but the county's portion of that would be leveraged by roughly half a million other sources.

Should this ultimately be approved, just like we would any nonprofit, the county would seek to enter into an agreement with them to set stipulations on when funding would be released, any other terms that would be subject to make sure that we are both providing service and protecting the stewardship of the taxpayer.

So that is the project that's included now in fiscal year 25.

There are all the other projects that are not included.

I just want to take a moment to explain why and what some of those paths forward may be.

There are some projects that really require further discussion with the City of Charlottesville.

I mentioned the Baylor facility is included.

in the city of Charlottesville, CIP.

There are some other large investments for projects like the regional libraries in region 10 that are located in the city, jointly owned with the county and some of those facilities.

And before we could really get ahead of the city, there's additional dialogue that would need to be had for those to move forward.

Also because they may be investment that were made only to the county where clearly both a very large portion of city residents would also benefit, not only county residents.

Second, we received some projects considered, you know, can still be considered through the county's housing fund.

We felt it would be appropriate to share those with Dr. Pethia and the Department of Human Services and Social Services team to evaluate what the concept is for those.

Third, we had a category of some requests that were made that did not leverage funding.

There were very largely requesting for county funding only.

or some nonprofit receives were really about the just the maintenance of the existing facilities to repair water damage or replace flooring or some of those other routine things.

Those felt like a larger policy decision we need to have for the board.

That was the level, that was not typically what we envisioned.

We were asking for those requests.

Then fourth is just acknowledging that it's in the case for any budget process, whether it be the schools operating budget, the county government operating budget, or a capital program.

There are good ideas out there, but we're always faced with limited revenues and needing to make choices about what we prioritize.

So these are things reasonable people could disagree on, but the projects we take to be funded out of the strategic plan placeholder did not allow for all things to be funded, whether that be school projects, county government projects, or these community agencies.

So that's just a reflection that in picking choices among priorities, that is just some of the simplest explanation why some projects were not included.

So with that said, my final slide before I open to board questions.

in the fiscal year 24 where the board will be asked to appropriate.

These are the projects that are listed.

All the other projects would be then, if approved as recommended, would become part of the CIP and then they would continue to march forward as we pick up this process next year.

So I will pause on this slide.

All right.

Thank you, Mr. Bowman.

Supervisor LaPisto-Kirtley?

I actually have a question regarding ones that were not prioritized for FY24.

If we prioritize them, you said they wouldn't go into the CIP until FY25.

What I'm thinking of is, is there a chance even next year to say, OK, we want this in 25, but then 25 comes, and then we say, well, no, that one's not as important.

So could we remove it?

In other words, is there flexibility?

Thank you and that's a good comment that did not, reminds me of a comment I meant to make is that this was a challenging year for anyone to newly come into the process because we were working from the CIP where the first four years were balanced.

We had to find a way to make up 38 million dollars to keep that plan balanced.

In year five, which would typically be thought of as maybe not a clean slate but other than some of our maintenance obligations a clean slate, we already knew we needed to bring in this construction of that second elementary school.

So these factors have increased project costs, the third school being constructed.

And again, the first balanced plan made it a challenging environment for these agencies to get into.

That said, though we start with the basis of the CIP for next year, we always want to take a fresh look about what are those projects that are going to move forward with the board's strategic plan.

That may change in a year in terms of where we are.

There may be items where we have shifts in terms of needs of partners.

Things could change in terms of their leveraging.

Thank you.

and you already answered the question I had about competitiveness and some of these other requests and how they're going to be considered.

I should clarify, just for community expectations, anyone listening, a lot of the transportation projects in the first few years of the plan are the ones that have been in the works based on prior board decision and applications.

Thank you.

So I'll finish that question.

I think Supervisor Andrews just started on slide 21.

It says, projects included for consideration.

That is the plan.

I will put down my red flag on that.

Thank you.

That's great.

We never want to lose where we've gotten to over the last 10 years.

The question I would like to leave for another day, because I know it's not right now, is a process question.

And should there be tiers of consideration?

So it seems to me there's a big difference between a very lovely

Totally adaptive playground.

I mean, the Kim Jontree up in Arlington is absolutely spectacular.

And for the last 10 years, I've been hoping we can do something like that down here.

should there be a different level of those applications, especially for ones which have been being booted around through the CIP process for more than 10 years about planning and planning and planning.

So these are all concerns that I have shared with all of you on the other side of the table.

And I would like to have a time set aside during our further work sessions to be able to

That's already in your thing.

Thank you very much.

If I could just make one comment on the community capital process.

Supervisor Malek will absolutely come back for the discussion.

But I do want to clarify a couple of things.

One of the biggest, I think, positives for us doing at your all's request, a process for capital, is because of the difficulty in trying to fund these large projects.

because as you're learning today, the CAPITAL program has so many levels and layers that we have to work through in order to be able to time it appropriately.

And so what was happening, we had Boys and Girls Club and North Garden that came through a non-process.

And we needed to have an ability to say what is out there that's going to be coming down the pike and also making sure that the entity coming to us has skin in the game.

they're actually putting forward.

This came from Boys and Girls Club.

I remember the board was pretty emphatic about the fact that they had gotten so far and that we wanted, you all wanted to recommend funding them.

We applied a lot of what we've heard from you into this process and that's what you saw as an outcome to what we're recommending funding.

And so we can definitely go through all of the decision makings that we made as staff.

But we really use your words and your process into our process to try to figure out what in the world and how do we do this differently.

But the pathway to funding, Supervisor Mallek, is really important.

It's important for people who apply.

It's important for people who are going to apply, people, organizations.

Among those that did not apply is ECC.

ECC has building needs.

We need to know about them.

When is the timing?

What is it going to look like?

What's our obligation?

That's one example that we need to work with them to say, you've got to get in the hopper so that we can help you plan for when it's appropriate.

So I wanted to put that into the public safety realm as well.

So we will come back.

Supervisor Galloway?

Can you see the Bennett's Village?

That was not on my radar.

Can you send like some

So we've created a capital project.

But if you look at our budget, it doesn't have any funding.

And that's because we're going to do all of the work in-house through our people to figure out where's the location, scope this out, that sort of thing.

But we did not want the board not to see that we are going to be dedicating staff time to try to figure out who, what, where, when, why, how much, all of that.

And so it's now a project in our capital program.

So next year, we'll take it in-house and we'll design it in-house.

We don't even have a location yet.

It came out of your fall retreat up at North Fork, where you folks talked about.

the need to create an urban pocket park somewhere in the urban rain area.

That's the work of fiscal year 24.

Find a location.

Find a location and then once we determine a suitable location and the strategy for, you know,

But the athletic fields, fiscal year 24, it's the $97,000.

What's the, or is that the total cost for two fields?

What's the total cost for two fields?

The $3.85?

It'll be the $3.85 million.

This probably needs to be discussed.

I'm still not thrilled about going and we're going to spend money on two more fields and that's about, what, two-thirds of the cost of doing what we were projecting to do in Darden Tower with athletic turf and pulling that out.

We now have a maintenance plan in place that while it's going to hopefully address quality, it's reduced capacity.

So, you know,

I have a five to six million dollar option that I think is good to produce four fields and helps capacity throughout the whole system.

I start comparing that to 3.85 to bring two fields online.

That's not dollars that I'm really interested in going in that route.

So wherever that conversation needs to take place, we're going to get into that conversation.

That's all, thank you.

Thank you.

I'm really excited about the Venice Village at Kim Park.

small dollars but it's both substantive and I think symbolic working with the city on that and so I commend you for that.

The only real question I have though is on slide 22

at IBM UC, the Southern Convenient Center will be a recycling center, as well as residential trash pickup.

And then the northern will be similar.

I love the southern picture that you've got there.

But having seen the baling facility as it currently exists, or that that may be, I really would not envision that as being appropriate in either the northern or southern

That's not Rolton Road to Freebridge, is it?

Yes.

Mr. Kevin McDermott, our Chief of Planning, is not in his head.

Correct.

With that I just have a couple more slides to talk about debt management and debt policies.

This is a slide that the board saw back on December 7th and it's been updated with all the financial information for where we are.

In this chart it shows our debt service as a percentage of our general fund and our school fund revenues.

We have a few key debt policies that we track.

I'm showing only this one on the slide because this is where the county has the tightest area in terms of headroom from its policy level which is the red line 10% to where we are in this CIP which is the blue line that we have recommended here.

I put, just as an example, an 8% target.

8% is not in the financial policies, 8% is not in the state requirement rule or anything, but it's just for illustrative purposes to say, you know, what would our headroom be if we went to 8%?

And that number is about $72 million of policy.

The reason that we're not going all the way to 10 is that we could have unforeseeable situations where there was actually a change in the economy where revenues declined.

If we were close to 10, we could be in a situation where we went over through no fault of our own other than the economy declining.

Also, based on past conversations we've had with the board, it's been expressed that planning to go to 10 would not be a prudent practice.

Also did not plan to go to 10 because there may be a situation, and this was alluded to in some of the board members' comments, where every year we'll look at the CIB and there may be fresh ideas, there may be changing circumstances.

So there could be opportunities that may be not known at this time, but in a year or two's time, or wherever it may be down the line, could be essentially too good to pass up.

And that capacity is there, it allows the board to be nimble and take advantage of them.

The third thing, as we know about year five in particular, we're not sure exactly what those out years look like.

We need to remember that if that blue line increases and we issue future debt, that line will go up not only for that year, like it may be a one year in an operating budget, but it will extend out through the next 20 years as that debt is issued.

Now, debt will continue to be refinanced as we're able to, pay down and all of that.

Just recognizing we're making generational investments in the CIP.

There are generational impacts into our debt service as well.

Because, well, debt service is a critical obligation that we have.

And once it's there, the more debt we have, the less operating flexibility that we have.

That's one of the benefits of our AAA and being able to adhere to these strategies.

It always gives that more flexibility built in.

So why did we not add in that $72 million?

It really speaks to the related cash that you need for that.

So just some of the considerations if we were to add in additional projects.

First question is, do we have debt capacity?

And the answer is, yeah, that we do.

For the related cash funding that would be needed,

There would really be two components.

We would look first, say we want 5% of the total projects, what we call pay-as-you-go funding for that cash match.

That would be $3.6 million, which is 5% of $72 million.

In addition to that initial project cost, we would need to have the annual debt service payment for each year of the life of the bond.

That would be about $6 million, lease revenue in general obligation I have on the slide, so you can see the slight difference in that annual debt service payment on $72 million.

Now the funding source of that is to be determined.

That would have to be a consideration of the fiscal year 24 budget process or later because the board doesn't have to make a decision on using that capacity.

And for a perspective of what that six million dollars would be if it was translated to equivalent pennies on the real estate tax rate, if dedicated entirely for debt service that would be about 2.3 cents dedicated there.

Now these are just speaking to the debt capacity and the cash side.

There are certainly no shortage of other things the Board of Supervisors would consider.

If we're building capital projects, what do their operating costs look like?

That would be something we would need to pick up in the General Fund.

Again, what does that impact to future flexibility?

Because once that flexibility is gone at debt service, it takes a while to get it back.

and then finally just looking at the ability to actually execute and deliver on those knowing that a volume of 72 million dollars worked over five years we would need to consider operationally what do we need to do to position ourselves to execute on those depending on what those projects are.

So this is kind of the what if exercise just really update where we were from on

December 7th, we are within our policies.

There is capacity that is out there to be used, but it is not being used for all of these reasons.

At this point, this concludes my comments on debt.

I'm happy to turn it over to board questions again.

The only thing I would emphasize, particularly for the public committee listening, is when Andy speaks about the county having the related funding or the related cash,

That means you have to find the revenue source.

Typically, it's the general fund, right?

Because debt service or cash comes from the general fund unless you can find other people's money to offset that.

But typically, it's the general fund.

General fund is now balanced.

So if the board chose to do anything different in the capital program, we would have to do something different in the general fund in order to be able to pay for that.

So I just wanted to round that out with respect to knowing where we are with the general fund.

Thank you.

So we have that capacity, but then

Right, we don't.

So the capital program over the next five years is balanced.

You have to have revenue sources and uses.

They have to match.

And so in the event that the board next year decided, I want to take some of that $72 million, that number will change because the circumstances will change.

The budget's either going to grow.

The denominator, if you can go back to the last slide, Andy,

You get the $72 million from this calculation.

So if your denominator changes, which is your budget, that's going to make some movement.

But absolutely, that would be the analysis that we would go through next year is, what is the capacity that we have to do more?

Can we do more?

Let's say we take $10 million from that $72 million.

We also have to identify the revenue in order to cover that $10 million.

And I just want to explore just for a second the decisions with respect to the existing projects as to how much is paid now and how much is paid over time.

Yeah, I think kind of the kind of thought process first we get projects and it kind of doesn't meet the criteria for borrowing.

So we have a officer's treasury management who works with our financial advisors.

We'll go through and kind of assess these are the types of projects that are good candidates for borrowing and those that are not.

From those that are a good plan for borrowing, we'll work with a planning assumption of 5%

and then 95% of that would be from borrowed proceeds.

As we get to an actual issuance where we have a lot more financial data, maybe we deviate from that, but that's more in terms of how we manage the actuals rather than the plan for budgeting.

Yeah, so I guess it really speaks to the life cycle, the nature of the expense, whether the county or the owner of that facility.

So for example, a school is a great candidate for borrowing.

If it's a $45 million school or whatever the number may be, that's something that's got a very long asset life.

The people who benefit from that school are doing much greater than the people who are using that in one particular year.

and for the county to raise that amount of cash, to have $40 million in one year would create an unusually burden on who's paying versus who benefits from that over a generation.

So the existing debts, public schools debt and county government debt, those are not just amounts and dates.

Yes and that goes to I guess an additional layer of analysis that our senior budget analyst behind me does quite a bit with others to say okay here's where we are budgeting this.

When does this get under contract?

When do we pay this?

When are we actually occurring expenses?

When do we reimburse it?

Because you may find examples where as we start a school it will get reimbursed over two different issuances based on what we call the spend plan of that.

So this goes to a lot of some of the kind of the behind the scenes work we have to do on to make

Thank you.

Thank you.

Supervisor Galloway?

Can you go to the slide where you had the 5%?

I don't know if I'm understanding.

I'm not understanding the increment.

So are you saying that

Yeah, so I guess in this hypothetical scenario, if the board were to pursue a project that are projects that was that amount, the board would need to raise for the debt service 2.3 cents on the tax rate.

That by itself, depending on when this is enacted, would more than enough cover the 3.6 million that was needed for that initial one time pay-as-you-go.

Not to say that has to be the source of it, but that would be a way to do it.

If you were to essentially say that we're

Again, the timing consideration makes that.

But if you were essentially to say that we'll raise the tax rate 2.3 cents, that more than provides the one-time cash that we need.

And then the remainder, once that project becomes borrowed for, we'll then pay the debt service with that 2.3 cents.

Sorry.

So if I wanted to do that, I'd have to go find $6 million in the next year's budget if I wanted to offset and borrow $72 million.

$6 million only.

Yes.

Thank you.

That's all.

Thank you.

I'm going to ask you to go to an old slide and then come back to a newer slide because I've got something running around in my head and I have to see it.

So slide number eight, which was the comparison of the different eras.

Right.

When I look at that slide and its lack of consistency, its irregularity over these periods of time, and then if you go to slide number 32,

This is a somewhat arbitrary line that we have established as kind of a cautionary point.

The 10%, the red line, that's a line we don't want to reach because that affects our AAA and all of the other associated consequences of that.

So as I look at the blue line that's moving from FY24 at about 5% up to FY28 up at about 7%, I recognize that there's still

Yeah, I think what you're going to see, without even doing the analysis, so if you recall, I was hired in 2020 and before that we had not issued debt to repay ourselves in like four years.

That's going to skew everything because the debt service isn't there.

What we've committed to is we're going to issue debt every other year because we've got to have the consistency, right?

We've got to be able to plan this more effectively and manage our money differently.

I think that over time you should start to see the consistency play out if we do what we said we're going to do.

Thank you and I really appreciate that.

I don't want to ask you to do something that's not necessarily going to be beneficial.

With that, I think your explanation, Ms.

Burch, has really helped me to feel more comfortable about this because, again, I recognize the green 8% line is an arbitrary line that we established, but it's kind of that warning you're bumping up towards that 10% that we don't want to get to that 10%, we don't want to get close to the 10%.

And that's why we increased our emergency rainy day fund from the 10% plus one plus one to 12%.

All right, thanks.

If it may help just kind of explain why that is increasing, it really is the impact of some of these very significant projects that are being invested because while the course project is not being appropriated largely it's already been done as that project is executed the debt will start to kick in when we issue debt in 25 and 27.

The same for high school center 2 and the elementary schools as well.

All those other projects are there and we'll be retiring debt as well as we see that number drops from 26 to 27 but

And I appreciate it.

And frankly, if the green line was at 7%, I'd have to say we could put it anywhere.

And as we approach it, I'm going to start saying, OK, are we protecting ourselves?

Thank you.

Any other questions?

Supervisor Galloway, I heard you first.

I was just going to say this orange block here from the 2009-10.

The reason that we couldn't do anything but maintenance and things which were already under contract was because we didn't have the cash to pay the mortgage on any new borrow.

So that's what always jumps into my mind when I see that fairly flat, which is combining that with the

I do consider it a very stressful time for everyone, citizens as well as staff and us, because of the postponement that has created the pileup of things that are really pretty essential right now.

Are you scared?

It was an 18 or 19, I think, pre-pandemic.

I don't remember if it was 8% or 70%, whatever.

But we were knocking on the door of the threshold that we hadn't really finished.

We were doing a big jump in projects because the board was ready to go to that point.

But I don't remember if it was 7% or 8%.

So that was fine.

You asked the historical trend question, and then your response actually confused me.

We did it about, was it two years ago?

Because we were between 7% and 8%, I believe, at one point in time.

And so the budget has grown faster than our assumptions.

It's one where refinancings have taken place during that time.

The timing of projects has changed.

I don't mean better or worse.

It changes because every year we update this.

And we've really worked our model with the support of this team back here and our treasury management group.

to try to squeeze out all of the capacity and flexibility we possibly can from our debt program.

And one of the things that I think this county did years ago is we would forward fund capital projects.

And then the projects wouldn't get done.

And then we'd have to figure out how to scramble to move some things around.

We don't do that anymore.

We refund ourselves.

We spend the money, and then we go to the market, and then we replenish our reserves.

because we're using our cash more effectively.

We're probably going to move to more of a hybrid.

We did that in our issuance two years ago when interest rates were so incredibly low.

We actually forward funded about, it was like about $20 million because we knew the projects were going to come in and we wanted to take advantage of that low interest rate.

Going forward, we'll have to work that with our investment strategy to see how best to do a little bit of both.

But I think that that might be some of the reasons, some of that capacity

was held at a time when you needed it because we actually couldn't execute projects.

We've already bonded for it, and then we're held with the obligation to repay it.

And so I don't know the history, and I've not dug into it.

And the court projects were hanging over our hands for 20 years, and everybody's very cautious not to touch that bucket either.

And also, many of the CIP committee years getting that through was based upon some future tax increases.

And fortunately, with the growth of the economy and the way things responded here, that didn't have to happen.

And I think some of that, Supervisor Mallek, and why I give kudos to this team back here is when you work the model and you get more connected to the project delivery and you are really refining your assumptions about when you need to issue debt for that project,

It will result in savings to the plan.

And that's what we did.

We've been doing for the last three years is really trying to work the spent plans and work the execution and get a better understanding for that.

So we don't over inflate what we think we can do and then it never materializes.

And so the next year we come to you and say, well, we didn't do those things we said we were going to do.

We've tried to get out of that business.

All right, thank you.

Mr. Bowman, read the sentence.

I know we are, and at the risk of the board being in a really good spot right now, I do want to say a couple more things about this slide, but I want to compare it back, if I could, for a second to Mr. Andrews' question earlier.

If you look at the gap here at 7%, moving further,

It's not just about the things we build and the things we bring online.

If you look at the bottom at FY24 sources, I want to talk about that for another second.

And this is where we generated, we artificially generated, with next year's revenue, about $2 million for the county and about $3 million for schools.

That's the 60-40 split.

And it would have typically been funneled

and the FY24 operations and we created artificial capacity and the main reason that I did that is looking into 25 and looking at what our obligations are in 25.

A good example of that would be the FEMA SAFER grants where we're looking into 25 and we know that there is some of that FEMA SAFER grant money that allowed us to feather

The cost for additional firefighters in over three budget years as opposed to us having to take the cost on year one.

An example on school side would be building an elementary school and what are the operational costs for bringing that school online.

which is going to be in and out here.

But that's going to be over and above just what your growth is for additional operating cost needs.

And same goes with us because we've got operating cost increases that are tied to the Southern Convenience Center.

We've got operational costs tied to the additional courts.

And so we have that just like schools.

But when you look at it, when you look one year away from 24, it concerned me

and it was quite the effort to balance and to save five million and that just gets us five million if we're able to hold that intact and balance this year.

It gets us five million ahead, three for schools, two for us as we move into 25 because of the growth and expenses that we know we're gonna see on the operating side.

To recap, we will begin the work session on Wednesday with those items that we did not finish last Wednesday, those chapters of the book.

Arts and Cultural View Festivals will be part of that.

Any other items that we can bring back in the Q&A, we'll make sure we have that.

All right, board, anything for any supervisors not on the agenda?

I just want to thank the financial team.

You guys have done an awesome job.

Thank you very much.

We really do appreciate it.

Thank you.

Thank you.

Supervisor Andrews?

Thank you.

Thanks.

Thank you very much.

Thank you.

We'll work behind the scenes.

Thank you.

Supervisor Galloway.

And the only thing I would say is, Mr. Richardson, please do not detail any of your staff to Washington, DC.

All right, board, anything further from you, Mr. Richardson?

No, ma'am, not this time.

Then we will adjourn.

Page, and on the Albemarle County Calendar.