Charlottesville City Manager Tarron Richardson is proposing to increase funding for the school division by $1.6 million from the last fiscal year, about $2.2 million less than requested.
Exacerbating the gap in the request and proposal, the two sides apparently crafted their spending plans from different starting points.
On Friday, Richardson unveiled his proposed $196.6 million budget for fiscal year 2021, which starts July 1, plus a $35.3 million Capital Improvement Program and $111 million in other dedicated funds.
The spending plan is a $7.7 million increase, or 4.11%, over the fiscal 2020 budget.
Earlier this month, the School Board accepted Superintendent Rosa Atkins’ recommended funding request of $61.7 million.
The request is a $3.8 million increase over the amended fiscal 2020 allocation. The city originally allocated $57.36 million, but later provided $468,000 to hire six teachers for the gifted education program.
The school division has been crafting its spending plan around the amended budget, assuming ongoing funding for the new teaching positions. But Richardson’s proposal instead focuses on the original adopted budget.
“They have to account for those funds in this fiscal year that they were provided in one-time funding,” Richardson said.
Richardson’s schools proposal for the upcoming year is $59.4 million, which is $2.1 million more than the adopted fiscal 2020 budget. It is only $1.6 million over the amended budget.
“We had a conversation about that last week,” said Krisy Hammil, a senior budget and management analyst, referring to school officials.
School division officials were unavailable to provide comment before press time.
When funding the school division, the city uses a non-binding City Council guideline to automatically contribute 40% of new real estate and personal property tax revenues. The earliest mention of the arrangement in available documents is in a Nov. 11, 1990, City Council meeting.
The city has consistently paid more than the formula requires since at least fiscal year 2012, with the only exception being fiscal 2018, when the real estate reassessment led to a larger-than-expected increase in revenues.
Hammil said the city fulfilled the obligation by giving an additional $2.1 million in new revenue, so “technically it’s covered, they just have less new money if they continue that program.”
Richardson said he stuck with the 40% formula and highlighted expenditures in the capital budget for the division such as a heating, ventilation and air-conditioning replacement.
Looking at revenues, the spending plan does not raise any tax rates.
The city advertised a 2 cent increase in the real estate tax — the first since 1981 — to give more flexibility for crafting the spending plan. Although a 2 cent increase would provide about $1.6 million in additional revenue, Richardson’s proposal calls for the rate to remain steady at 95 cents per $100 of assessed value.
Tax bills, however, will rise under the annual reassessment, which contributed to a 7.2% average increase in assessed value.
In Richardson’s letter opening the budget, he writes that the city has seen an “incessant rise in property values.”
“I didn’t want to increase the tax rate while the assessments have gone up, but the additional 2 cents gives the council the flexibility to add new programs if they want to, but they don’t have to,” he said.
Richardson said officials will present options for using the additional revenue at upcoming City Council meetings.
Employees are slated to receive a 2% cost-of-living increase, which will cost about $1.04 million.
Departments were asked to submit only essential requests and therefore most of the revenue changes are minor over the prior year.
One publicized request that was not included in Richardson’s proposal was $1.3 million for 12 new firefighters to staff ambulances for a department that is stretched thin.
Firefighters donned yellow shirts and attended City Council meetings in the past few weeks, urging the council to support the funding request.
Richardson called the staffing problem “an issue I inherited” and said the city needs to look at a long-term fix by reallocating staff.
“I told the fire chief that he needs to look at the reallocation of his resources to fix that issue,” he said of Fire Chief Andrew Baxter.
The budget cuts the currently-vacant council community outreach coordinator position, which was housed in the Clerk of Council office.
The budget allocates $197,000 for an Office of Equity and Inclusion and includes $150,000 in start-up costs for the Police Civilian Review Board.
The budget maintains two full-time employees in the Office of Human Rights, allaying concerns from the Human Rights Commission that Charlene Green, who stepped down in February as the office’s manager, may not be replaced.
The budget also reflects a reorganization of the departments of Public Works and Neighborhood Development Services.
Thirteen positions will be moved from NDS to a new engineering division in Public Works. Richardson has also reorganized the department to have a deputy director of planning and a deputy director of zoning, with plans to demote Director Alex Ikefuna to the latter when a replacement is hired.
The Sheriff’s Office is slated to receive a 14th deputy sheriff after renovations to the Charlottesville Circuit Court building, which will produce an additional court room.
The Police Department will have three sworn positions and a deputy chief position unfunded as turnover has kept the department from filling all its positions.
The proposed $127.9 million Capital Improvement Program, which covers five years, includes $35.3 million for fiscal 2021. The council approves a five-year capital spending plan plan each year, but only dedicates funding for one year at a time. Further years are included as projections.
The proposal is identical in every line item to a draft presented in November except a signalization project on East High Street. It was projected at $500,000 for fiscal 2021, but now allocates no money in the upcoming year. Instead, $1 million is earmarked for fiscal 2022.
Most of the big-ticket items in the capital budget were projected or previously planned projects.
The plan includes $4.9 million for the first part of the city’s commitment to construct a parking garage under an agreement with Albemarle County to keep county courts downtown.
The 300-space garage will be constructed on a lot on Seventh and Market streets at a total cost of $10 million.
Another expenditure is $5 million for a local match to construct a new Belmont Bridge. The city plans to seek construction proposals next fall.
The plan allocates $800,000 to the Charlottesville Affordable Housing Fund.
The proposal also calls for $3.2 million toward expanding Charlottesville General District Court.
The plan includes $125,000 for a Downtown Mall threat and risk assessment study. The recommendations from the study would be implemented in fiscal 2023.
The city will contribute $1.5 million to the Charlottesville Redevelopment and Housing Authority for its redevelopment of public housing stock in fiscal 2021.
The city and school division budgets will be presented to City Council on Monday. Public hearings are planned for March 16 and April 6, with final approval planned for April 14.