Contact Sitemap Search
|Board Members Present:||
Fitzgerald A. Barnes, Dan W. Byers, Willie L. Gentry, Jr., Willie L. Harper, Richard A. Havasy, P.T. Spencer, Jr.* and Jack T. Wright
* Mr. Spencer arrived at 5:42 p.m.
|Others Present:||Dale Mullen, County Administrator; Ernie McLeod, Deputy County Administrator; Greg Hoffman, County Attorney; Andy Wade, Economic Development Director; Bar Delk, Manager, Louisa County Water Authority; Amanda Reidelbach, Office Manager, Administration; and Kimberly Smith, Records Clerk, Administration|
CALL TO ORDER
Chairman Harper called the November 30, 2009 budget meeting of the Louisa County Board of Supervisors to order at 5:30 p.m. Mr. Harper led the invocation, followed by the Pledge of Allegiance.
Discussion - Guidance for the FY 2011 Budget Cycle
Mr. Harper said one thing he wanted to identify at this meeting was “core services.” Mr. Harper said the Board talked about “core services,” but he was not sure all the Board members had the same thing in mind and he felt that term needed to be refined. Mr. Harper said “core services” should be geared toward what the County needed or had to have as opposed to the things the County wanted to have.
Mr. Harper said he hoped the guidance from the Board at this meeting would help Mr. Mullen put together a budget that would need very little adjustment once it was presented to the Board.
Mr. Barnes said Mr. Roy Hopkins would soon have thirty (30) years of service on the Transportation Safety Commission and he would like a resolution to be presented to Mr. Hopkins at one of the January 2010 Board meetings. Mr. Barnes said he would also like a resolution to be done for Mr. Jack Wright for his years of service on the Board of Supervisors.
Mr. Byers said he wanted to talk about any known areas of the budget that could be increased or affected by State of Federal budgets or funding requirements. Mr. Harper said he knew already that VRS was taking a jump and that Moss-Nuckols Elementary School would be opened up. Mr. Harper said there would be other areas that would affect the County budget and he thought it would be a good idea to know how to handle those items up front.
Mr. Harper said when budget cuts are handed down, each agency had to be ready to absorb the cut. Mr. Harper said the County could not always make up the difference and that was going to be an important point to get across. Mr. Harper said there was also one more year of stimulus money which would not be available the next year. Mr. Harper said the Board made it clear last budget year that stimulus money stood on its own along with any program supported by the stimulus funds. Mr. Harper said there was no guarantee that the programs or positions funded by stimulus money would be picked up in the regular budget.
Mr. Harper said he wanted the Board to use this meeting as an opportunity to say what they wanted out of this budget to help Mr. Mullen prepare a budget that would not require many amendments once it was presented to the Board. Mr. Harper said it was very important for the Board to become disciplined in what they did. Mr. Harper said he read today that other city and town managers were not looking for a very rapid recovery in the revenue streams. Mr. Harper said the County would probably not see very much revenue flow from the State this year. Mr. Harper said there would probably be a lot of financial responsibility shifted from the State level to the County level.
Mr. Wright said he read that experts said the recession was almost over. Mr. Wright said there would not be much improvement in employment before 2012. Mr. Wright said he didnt understand how the recession was almost over when one out of 10 people was unemployed.
Mr. Havasy requested that fire and rescue budgets be kept at least flat. Mr. Havasy said he was not asking for an increase, but asked that their budgets at least remain the same. Mr. Havasy said the Board owed that to the public. Mr. Harper said that may be one of the areas that could be defined as “core services.” Mr. Harper said he did not have to go outside in the dark to play baseball, but if his house was on fire or if he was hurt in an accident, he would need medical attention. Mr. Harper said those were areas the analysis needed to be applied to.
Mr. Wright said when Moss-Nuckols Elementary School opened, there would be no new State money granted to the County. Mr. Wright said new teachers could not be justified because existing students were being transferred to the new school. Mr. Wright said there would not be a 100% offset, but there would have to be an offset somewhere so there would not have to be so many new teachers. Mr. Wright said he had no idea that that number was, but he hoped the school system knew. Mr. Wright said the County would only receive new State money if there was an increase in the total number of enrollment in the schools.
Mr. Havasy asked if the only stimulus money left available for this budget year was going to the schools. Mr. Havasy asked if there was any stimulus money left over. Mr. Harper said it was his understanding that some of the programs were two year programs. Mr. Mullen said yes, he thought there would be. Mr. Mullen said amounts were unknown. Mr. Havasy asked if it was only for the schools. Mr. Mullen said yes, so far. Mr. Mullen said he did knew there was other ARRA stimulus money that was available that would probably not be spent in some areas. Mr. Mullen said there may be a second round of funding for some projects.
Mr. Wright said Broadband would have another round of stimulus money coming. Mr. Wright said it could be in January 2010.
Mr. Barnes said the Board kept talking about “core services,” but he felt those services should be defined. Mr. Barnes said if the County was going to continue to attract business, it had to start with strong schools. Mr. Barnes said having strong schools would attract business. Mr. Barnes said he hoped the Board would not forget that. Mr. Barnes said he felt strongly about the Countys need to invest in vocational programs to the point where a new vocational center needed to be placed in the CIP to help the adult population who had lost their jobs become re-trained. Mr. Barnes said when industry moved to the County, it could be accommodated. Mr. Barnes said he wanted the Board to be mindful of the fact that in any economic downturn, there would be areas that would be growing.
Mr. Barnes said the Board should seriously reconsider a meals tax that could be used to help offset the cost of capital projects. Mr. Barnes said any citizen who ate a meal in the Town of Louisa or the Town of Mineral paid a meals tax. Mr. Barnes said Charlottesville and Richmond had a meals tax in place. Mr. Barnes said it burned him up to see hundreds of tractor trailers at Zion Crossroads and the taxpayers of Louisa not benefitting from any meals tax there.
* Mr. Spencer arrived at 5:42 p.m.
Mr. Barnes said he would like the County to look seriously towards Lake Anna and putting water and sewer out there. Mr. Barnes said there were some economic challenges in that area, but added that the Board members had made tough decisions regarding economic development before. Mr. Barnes said this was something he wanted the Board to seriously consider because there was exponential potential in the Lake Anna area. Mr. Barnes said he did not want the Board to lose sight of the economic development they had been involved with in the past and wanted to see that continue to develop.
Mr. Wright reminded the Board that citizens had come out and opposed any commercial zoning in the Lake Anna area.
Mr. Gentry stated that Rockingham County got their meals tax passed this year. Mr. Gentry said Rockingham was in a similar situation as Louisa where they did not think the tax would pass. Mr. Gentry said it did pass and Rockingham County must have done something right. Mr. Gentry asked that Mr. Mullen look into the meals tax at Rockingham County to see what they may have done right to get the meals tax passed.
Mr. Gentry said he was feeling more and more pressure from people in the Lake Anna area. Mr. Gentry said the Cutalong Food Lion would be coming soon and that would be generating more interest in the area. Mr. Gentry said he thought there would be a change in attitude from the people around the Lake. Mr. Gentry said he heard that there were many people who were excited about the Food Lion coming and were excited about the commercial growth.
Mr. Gentry when economic times were tough, it was a good idea to take a close look at the CIP budget to see what could be delayed for a year or two. Mr. Gentry said he knew there were a few commitments that were already made that could not be backed off. Mr. Gentry said he hoped the Planning Commission would look at the CIP budget in a little more detail this year.
Mr. Harper said he thought that was an excellent point. Mr. Harper said he felt Mr. Mullen filtered through most of that in the CIP last year. Mr. Harper extension of equipment uses and non-critical projects could wait. Mr. Harper said he could understand the Sheriffs Office not wanting cars with 150,000 miles on them running 100 mph in an emergency. Mr. Harper said a fleet vehicle with 150,000 miles on it was different. Mr. Harper said if that car broke down, someone could just tow it. Mr. Gentry said the fleet vehicles could not be put off too long because maintenance costs would become too expensive. Mr. Gentry said there had to be a delicate balance there, but putting off the replacement for about one year may not hurt anything.
Mr. Spencer said he was not sure how the County would ever be able to manage water and sewer at Lake Anna because developments are spread out all over the Lake. Mr. Spencer said there had been an idea of trying to draw water from the Lake and he wouldnt mind seeing the Board pursue that avenue. Mr. Spencer said it had taken Cutalong years and years to get to where they are and it would be hard for the County to jump on the idea of water and sewer and have it done quickly.
Mr. Spencer said he agreed with Mr. Gentry and Mr. Barnes regarding the meals tax. Mr. Spencer said he would also like Mr. Mullen to research with Rockingham County to see about how their meals tax was passed.
Mr. Spencer said he supported the idea that police cars were in ideal shape. Mr. Spencer said there was no reason why some of the other fleet vehicles could not run until they reached 200,000 or 250,000 miles.
Mr. Spencer said the school system was going to want the money that had already been taken away by the State. Mr. Spencer said the Clerks Office, the Sheriffs Office and the Treasurers Office already knew of cuts that were being made in their budgets. Mr. Spencer said the State and Federal budget cuts needed to be considered before the County thought about buying or building anything else.
Mr. Gentry said he knew this Board had been very diligent in looking after the poor and the disabled. Mr. Gentry said a lot of the agencies that provided services to the County were going to be hurting because of lack of money from the State. Mr. Gentry said the Countys share to these agencies may have to be slightly increased in order to keep providing the services.
Mr. Barnes said if the Board was considering looking at a meals tax, there was a very small window of opportunity to get the meals tax placed on the ballot for the 2010 election. Mr. Barnes said he would like to see some projections of the amount of tax revenue the County could generate by having a meals tax in place. Mr. Barnes said he would like to see the revenue from a potential meals tax to be used toward capital projects. Mr. Havasy said he would like that projection to include an estimate of how much meals tax would be generated from out-of-County people. Mr. Harper said there was no business license in Louisa County, so it was difficult to find out who was doing what. Mr. Harper said a questionnaire could be sent out to ask. Mr. Harper said businesses shouldnt mind reporting to the County something that they have to report to the IRS.
Mr. Gentry said the County did have a meals tax on the referendum and he was at the polls all day that year. Mr. Gentry said he asked people how they voted on it and most people said they did not vote in favor of another tax. Mr. Gentry said he explained to people that there was a benefit to the County because most of the taxes were coming from people who were just passing through. Mr. Gentry said people told him they would have voted differently for the tax if they had known that. Mr. Gentry said the County failed to get the message out last time. Mr. Gentry said there was not much that could be done as a Board.
Mr. Wright said he did not think the Board could promote the tax being on the referendum. Mr. Harper asked Mr. Hoffman to do some research and see how much effort the Board could put into the tax referendum as far as going out to get support. Mr. Barnes said the County could get the Chamber of Commerce to support it. Mr. Harper said a guideline could also be set as to what the meals tax revenue would be used for.
Mr. Harper said the Board would come back to the meals tax issue and allow time for the ideas to digest.
Discussion and Resolution - Zion Crossroads WWTP Filter Procurement
Mr. Bar Delk said in 2000, when the WWTP was built, it was highly recommended at that time that the Plant have a finer filter on it. Mr. Delk said the Plant was a $2 million, 100,000 gallon per day plant at the time and it wouldnt be there long before a larger plant would replace it. Mr. Delk said the manufacturer of the equipment said it would meet the discharge requirements up to the 100,000 gallons per day without the filter. Mr. Delk said it would have cost about $600,000 or $700,000 for the filter. Mr. Delk said the decision was made not to put the filter on at the time, but to put it on at a later date.
Mr. Delk said he had experienced some violations this past year that were actually due to mechanical problems. Mr. Delk said he had outside expertise come in and examine the process. Mr. Delk said they recommended that a filter be installed since the Plant was getting closer to capacity.
Mr. Delk said there were two options. Mr. Delk said the County could buy one that would be installed later this year when the expansion of the Plant was done. Mr. Delk said it wounded simple to go ahead and buy one out of the two filters that the expanded Plant would have. Mr. Delk said the problem had to do with the construction of the building. Mr. Delk said the piping would be different from the new plant to the current plant.
Mr. Delk said the second option was to rent a filter. Mr. Delk said this option was recommended by the Water Authoritys consultant. Mr. Delk said the filter would be rented for six months because the invitation for bid for the expansion of the Plant would take place in March 2010. Mr. Delk said he thought six months would be long enough until the new filters were installed. Mr. Delk said renting a filter would be a safeguard and would ensure that there were no more violations at the Plant.
Mr. Harper asked if the cost was $60,000. Mr. Delk said the cost would be $2,000 per week for 26 weeks would be $52,000. Mr. Delk said if freight costs, set-up costs and the cost of doubling the filter was added in, it would cost $66,854 for six months. Mr. Harper asked if the new filters would be installed and functioning at the end of that period. Mr. Delk said it was supposed to be.
Mr. Byers said what the current capacity of the system was. Mr. Delk said it was running about 75,000 to 80,000 gallons per day on average. Mr. Byers asked Mr. Delk if he anticipated this option carrying through the six-month period. Mr. Delk said yes.
Mr. Barnes asked if there was any other choice. Mr. Delk said a filter could be purchased and installed, but then the expansion of the plant would have to be bid and a new filter would then have to be installed. Mr. Delk said it would be all under different contracts. Mr. Delk said there was no simple way to do this.
Mr. Harper asked if this was planned with the new expansion. Mr. Delk said yes. Mr. Delk said the expansion would have to final filters in it.
Mr. Spencer said the County could not receive any grant money if they rented the filter, but they could receive some if they purchased it. Mr. Delk said the County would be receiving grant money to purchase the next one. Mr. Spencer asked about this one. Mr. Delk said he did not think so. Mr. Spencer said the County could end up paying money out in fines for violations in the next six months if something was not done about it now.
Mr. Gentry asked Mr. Delk what the Water Authoritys recommendation was. Mr. Delk said this was all pretty new since the last Water Authority meeting. Mr. Delk said Dewberry was the normal designer and outside engineer. Mr. Delk said everyone recommended moving ahead to have the filter installed.
Mr. Byers said he understood that the location of this filter would be the last point before the water re-entered the normal environment. Mr. Delk said currently the water came out of the reactors and went into an equalization tank. Mr. Delk said the water slowly left the equalization tank through the UVs and into the Creek. Mr. Delk said the filter would catch the water after it left the tank but before it went through the UVs.
Mr. Havasy said that a big assumption was being made that the plant expansion would be built and would be on schedule. Mr. Havasy asked if a filter was rented for six months and construction fell behind a couple months, would it be wiser to purchase the filter, install it and have a flat fee rather than make the assumption that only six months would be necessary. Mr. Delk said if the filter was purchased, it had to be built. Mr. Delk said the filter that was available was a smaller filter. Mr. Delk said he thought it would take several months to purchase a filter. Mr. Delk said it was imperative that the filter be inside a building. Mr. Delk said it would require excavation, piping and changes in elevation. Mr. Del said if the filter was rented, it would be off line and would just be parked on site.
Mr. Havasy asked Mr. Delk if he was looking for money from the County or if he was just looking for a blessing from the Board of Supervisors to move forward with renting the filter. Mr. Delk said a decision needed to be made to move forward with the filter. Mr. Delk said the Water Authority did not have $67,000 extra dollars. Mr. Delk said there was some money on hand from connection fees at Zion Crossroads and that there would be some more significant connection fees coming soon. Mr. Delk said what the County needed to do was authorize the Water Authority to spend money from the connection fees that would be turned over to the County anyway to move forward.
Mr. Havasy said he felt the most important thing was operating a violation-free Plant. Mr. Havasy said he was more than willing to support this.
Mr. Spencer asked how long it would take to get the filter hooked up. Mr. Delk said it would probably take a few weeks.
Mr. Harper said this only applied to Zion Crossroads.
Mr. Byers asked if procurement requirements could be met if the Board moved for approval. Mr. Hoffman said he had looked at the request and he had sufficient written justification that this was an emergency procurement situation.
Mr. Harper asked Mr. McLeod if he anticipated connection fees as part of the revenue stream of the County. Mr. McLeod said he had a budget for it. Mr. Harper said the fact that this was going to spend that money would take away from revenue flow that Mr. McLeod had already budgeted. Mr. Delk said the connections fees were just estimates. Mr. Delk said he had about $171,000 in connection fees coming soon.
Mr. Mullen informed the Board that it would probably be easier to take this money out of Contingency.
Mr. Barnes motioned for approval of the rental of the filter at an estimated cost of $66,000 to come out of the Contingency Fund. Mr. Spencer seconded the motion.
Mr. Byers asked for a clause in the contract that would allow the County to have the filter for longer than six months if necessary.
Mr. Havasy asked Mr. Delk if the County would receive any guarantee on what went through the filter. Mr. Havasy asked if he could go to bed at night knowing that the filter was doing its job. Mr. Delk said there would be no solids passing through the filter.
On the motion of Mr. Barnes, seconded by Mr. Spencer, which carried by a vote of 7-0, the Board approved for the Water Authority to rent a filter for the Zion Crossroads Wastewater Treatment Plant at an approximate six month cost of $66,000 to be used until the new, permanent filters were built and in place.
Discussion - Guidance for the FY 2011 Budget Cycle (Continued)
Mr. Harper asked Mr. Mullen if it would be of any benefit to him if the Board talked about what they identified as core services. Mr. Harper said it was important for everyone to understand core services because his perception of it could be different than other Board members. Mr. Mullen said he felt that would be beneficial because “core services” was such an imprecise term. Mr. Harper said the “core services” were the ones that absolutely had to be funded and that were essential. Mr. Harper said there were some services that could disappear and no one would be hurt, but there were others that could not do that.
Mr. Harper said he also thought it would be beneficial to discuss what to do regarding any comeback from the State. Mr. Harper said last year, the Board said that each department would have to absorb any cuts from the State.
Mr. Havasy asked when the information from the State would be received. Mr. Havasy said Mr. Gentry brought up a good point about keeping equipment longer when it wouldnt affect the services at all. Mr. Havasy said there was a lot of equipment and areas that could withstand cuts for a year without affecting the outcome of the job.
Mr. Harper said he agreed. Mr. Harper said one of the Boards ideas last year was to try and maintain employees. Mr. Harper said he did not want to contribute to the problems by laying off employees. Mr. Harper said he felt the County should maintain employees. Mr. Harper said that meant that a service someone liked could suffer a loss. Mr. Harper said that may mean that salaries would not be increased. Mr. Harper said Louisas revenue experienced some growth last year because of Lowes and would experience some growth this year because of Wal-Mart.
Mr. Wright said he felt it would be helpful for Mr. Mullen to go to each department and see what they view as core services once the Board was done determining their core services. Mr. Wright said the Board knew Social Services were essential, but he questioned if everything within Social Services was essential. Mr. Wright said the Board needed to dig deeper and go below the surface.
Mr. Harper said he felt that was a good point. Mr. Harper said that would give the departments a chance to plan better in case there were budget cuts. Mr. Harper said he felt this needed to be planning as opposed to reacting.
Mr. Spencer said what the Board needed to do was get down between the difference of wants and needs. Mr. Spencer said there was a house on his road listed for $377,000 that sold for $240,000. Mr. Spencer said that was going on all over the County and that was just a preview of what the revenues were going to be for the County and the difference in taxes. Mr. Spencer said there were people who had lost their jobs and were losing their houses and it didnt make sense to raise taxes to make the other people happy.
Mr. Harper said he was not preaching planning and being ready for situations that could arise. Mr. Harper said he hoped the revenue growth over the last few years would continue. Mr. Harper said it would be wise for the Board to have a plan in place.
Mr. Mullen said on December 18, 2009, Governor Tim Kaine would present his budget to the General Assemblys Joint Money Committee. Mr. Mullen said this presentation would include his proposals for the remainder of FY 2010, which would end June 30, 2010. Mr. Mullen said it would also include spending proposals for FY 2011 and 2012. Mr. Mullen said revised revenue forecasts last week indicated an additional $300 million shortfall in the overall $77 billion budget for FY 2010. Mr. Mullen said that indicated that there would be some adjustments to virtually everything in State government.
Mr. Mullen said one of the things Governor-Elect McDonnell was doing differently was looking at opportunities to fund programs that may not be considered essential, but would result in job creation and State-level economic development. Mr. Mullen said the creation of jobs was what would get the economy moving again and generating income among citizens. Mr. Mullen said when considering “core services,” he felt it would be important for the Board to focus on some areas that would be able to create opportunities for jobs and would take advantage of the aggressive construction market. Mr. Mullen said the County had realized 30% savings in the bidding of necessary projects.
Mr. Mullen said there would be tough budget cuts coming out of Richmond and if the Board wanted those budget cuts to be mirrored in services here, he would be happy to do that.
Mr. Harper said he was always told that the County could not receive any numbers until April, but he hoped the County would move ahead and not take that as an answer. Mr. Harper said he hoped the Countys numbers would be right on target and would not be over-optimistic like the State.
Mr. Spencer said he had been associated with the Virginia State Police for over 40 years. Mr. Spencer said he received a message from the State Police Association saying that State Troopers would be laid off. Mr. Spencer said that was the first time in 40 years that this had happened. Mr. Spencer said it was not a matter of “if,” but a matter of “when.”
Mr. Wright said he heard the end of a report the other day about some bonds that had been uncovered and the implication was that Virginia may receive up to $300 million. Mr. Wright said he was not sure what kind of bonds these were because he only heard the very end of the report. Mr. Wright said it was ironic that the figure in the report matched the figure of the State shortfall and he asked if anyone else had heard about it. Mr. Byers said they were unclaimed bonds issued during World War II. Mr. Wright said the story could be checked out to see if it was valid or not.
Mr. Gentry said things were very hard to plan when there was a “moving target” involved. Mr. Gentry said every month, there were new numbers and reports about how bad the State really was. Mr. Gentry said he didnt know what the Board wanted to do, but it seemed like to deck was “stacked against them.” Mr. Harper said one plan that was discussed was having an absolutely flat budget. Mr. Gentry said the Board also talked about a 5% cut, but he did not know if that was reasonable or not.
Mr. Barnes said no one on the Board had advocated for a tax increase. Mr. Barnes said this Board had been really consistent with the tax rate. Mr. Barnes said people may fuss about their tax assessment, but the Board had been extremely consistent with the tax rate. Mr. Barnes said even in tough economic times, the citizens expected certain things. Mr. Barnes said they expected education, fire, rescue, and police. Mr. Barnes said if he had to build a budget today, he would start with flat. Mr. Barnes said he would put the salaries and benefits in another pool by themselves and have a separate discussion about them. Mr. Barnes said if he had a committee for that, he would have conservative members and not-so-conservative members. Mr. Barnes said he would suggest setting the salaries and benefits to the side to discuss separately.
Mr. Barnes said the Capital Improvement Plan projects could be moved back five or ten years, whatever was necessary. Mr. Barnes said the Operational budget was key. Mr. Barnes said some items could be put off for a few years. Mr. Barnes suggested advising everyone to start off with a flat budget. Mr. Barnes said the Board did a great job with the budget cuts last year. Mr. Barnes said the Board could then look at other ways to raise revenue.
Mr. Barnes said when it came to employee benefits, that was when the School Board and Board of Supervisors needed to meet together. Mr. Barnes said he wanted people to keep their jobs, but he didnt believe it was fair to ask employees to cover huge health insurance increases when they were not getting a pay increase or raise. Mr. Barnes said he knew someone people were just glad to have a job, but he thought the benefits should be separated.
Mr. Barnes said he was friends with all of the Constitutional Officers, but that was a separate situation by itself.
Mr. Havasy said there had been a question floating around the County for the past few years and that question was, “why cant Louisa be the best?” Mr. Havasy said there was a time when that was asked in Louisa and all there were was excuses. Mr. Havasy said anytime someone was asked to improve and they gave you an excuse, you knew that was part of the problem and not part of the solution.
Mr. Havasy said when he looked back at the school system, he was impressed. Mr. Havasy said Louisa County schools were getting to be the best in the State of Virginia and he wasnt just talking about the football team. Mr. Havasy said he was really pleased because it was called the education system. Mr. Havasy said the School Superintendent and some of the other authority figures in the school system had really made him proud. Mr. Havasy said when he looked back at what the Board had accomplished over the last few years with new staff and the quality that was brought to the table, he was proud.
Mr. Havasy said the answer to the question was there was no reason why Louisa could not be the best. Mr. Havasy said he was going to place a lot of the demand on the capable staff to come up with solutions for money savings and creative ways to do what the County needed to do.
Mr. Havasy said he agreed with Mr. Wrights point that just because a department was essential did not mean that everything within that department was essential. Mr. Havasy said if the department heads evaluated their departments thoroughly, they may be able to come up with money savings. Mr. Havasy said there was either opportunity for the County right now or the County could sit back and look at what everyone had lost. Mr. Havasy said he wanted to look at the opportunity side of things.
Mr. Wright said he was reminded of the phrase, “When the going gets tough, the tough get going.” Mr. Wright said he thought the County was capable of going there.
Mr. Spencer said he thought the route to take was to leave the budgets flat. Mr. Spencer said when Mr. Mullen was hired, he was left with a pile of things to try and figure out. Mr. Spencer said he thought Mr. Mullen and his staff would really amaze the Board. Mr. Spencer said he had confidence and faith in that.
Mr. Spencer said asked if the County was going to end up taking over the VRS and, if so, how much was it going to cost the County. Mr. Mullen said it was a possibility and he was not sure how much it was going to cost yet. Mr. Mullen said he did ask all department heads and divisions to separate their personnel budget away from the regular operational budget. Mr. Mullen said there were certain predictable assumptions, such as Social Security at a 7.65% and VRS estimating a 30% increase over the FY 2010 budget. Mr. Mullen said he did not know anything for sure yet. Mr. Mullen said the separation of the two would also get away from the idea that the County was purchasing a vehicle rather than keeping a persons job. Mr. Mullen said he did not want that to be the analysis.
Mr. Mullen said he had already asked department heads to separate the personnel budgets from the operating budgets and to present a flat budget as well as a budget with a 5% decrease in operational expenses.
Mr. Mullen said the good news was that all departments, with one or two exceptions less than $2,000 or $3,000, came in right at or under budget for FY 2009. Mr. Mullen said there was one department that was $2,300 over budget and there was one department $3 over budget. Mr. Mullen said the County was able to make some cost savings during FY 2009. Mr. Mullen said about $1.5 million was put back into the General Fund balance to give the County some more cushion. Mr. Mullen said if that was considered the “rainy day” fund, it sure wasnt raining for Louisa County yet.
Mr. Mullen said he asked for the personnel and operating expenses to be separated so things could be examined thoroughly. Mr. Mullen said it was a different way of doing things, but he hoped it would make it easier this year to see things that were changing and realize how they were changing.
Mr. Spencer asked if that could be done with a flat line budget. Mr. Mullen said personnel was going to take a few hits. Mr. Mullen said he was not sure what they were going to be or where exactly they were coming from yet. Mr. Mullen said he believed the operating budgets could survive with no increase and on the flat side.
Mr. Barnes said he always wondered why the County did not look at merit-based increases as far as compensation. Mr. Barnes said the Board would determine from year to year, based on the budget, how much money could be put into the merit pool. Mr. Barnes said merit increases would be based on an employees evaluation. Mr. Barnes said even in difficult times, there would be a pool of money available to give employee raises. Mr. Barnes said an employee who did nothing would receive nothing. Mr. Barnes said many localities used merit-based increase systems. Mr. Barnes said if there was money in the merit pool, at least the employees who performed would eligible to receive a merit increase. Mr. Barnes said employees may not know how much money was going to be available to be placed in the merit pool each year, but at least they knew if they excelled in their work, there would be an opportunity for a pay increase. Mr. Barnes said he understood that money was not always a factor, but he wanted employees to come to work knowing that if they did a great job over the year, they would be compensated for that.
Mr. Byers said the State had used a merit program over the years and they had also used another program that was successful. Mr. Byers said the other program was that if an employee came up with an idea for cost savings, they would be able to get a portion of the money that was saved as an incentive. Mr. Byers said that would reward employees who had creative ideas for cost savings and would still allow the agency to save money.
Mr. Byers said if personnel was separated from operating, he thought there was a real need with VRS to look and see if employees within the County were paying a comparable or similar amount. Mr. Byers said he wanted to treat people fairly and if there was some opportunity for savings, that the money be used to help keep positions and keep people employed.
Mr. Wright said merit increase systems worked great if there was a certified and consistent performance evaluation system. Mr. Wright said the County had not had a very credible evaluation system over the last few years. Mr. Wright said the performance evaluation system had to be in place and working before the merit system would work. Mr. Wright said there needed to be statistics and verification that the performance evaluation system was working across all departments. Mr. Harper said the performance evaluations would have to be very objective and tight.
Mr. Gentry said with the State, the merit system just got to the point where it was an automatic payout. Mr. Gentry said it would take an extremely consistent, objective management system to do it. Mr. Gentry said it was much easier to give an employee a 5 rating instead of a 2 rating because a lower rating would require more detail. Mr. Gentry said with his experience, a merit system was very hard to do correctly. Mr. Gentry said he would have to look at the performance evaluation system on the County level because the one used on the State level did not work.
Mr. Byers said if the Board moved away from the idea of determining “core services” and asked Mr. Mullen to do it, would the Board be able to receive that information in enough time to adequately review it. Mr. Byers said if that was the case, then some type of deadline needed to be set.
Mr. Gentry said he was not sure how the Board was going to determine “core” or “essential” services because any item that was chosen was going to be debated against. Mr. Gentry said some localities would do away with training and conferences when times were hard. Mr. Gentry said any “core” item was going to have a debate against it.
Mr. Byers said one of the groups of essential items to get out of the way would be the ones that were legally required. Mr. Byers said one of the things to look at would be to make sure the legally required programs were being done in the most efficient way. Mr. Gentry said the programs that were legally required should not even be brought up in discussion because they had to be paid for anyway.
Mr. Barnes said he didnt think there would ever be a consensus among the Board about what was “core” and what was not. Mr. Barnes said he would go with a flat budget and go from there. Mr. Barnes said the school system had already started to build their budget. Mr. Barnes said the Board already knew they would have to deal with Moss-Nuckols Elementary School opening this year.
Mr. Harper said Louisa County was fortunate to be able to have this conversation because there were other localities that had to cut their budgets. Mr. Harper said he hoped it did not come to that for Louisa. Mr. Harper said the Board received a copy of the County audit each year and he offered the Board members to take a look at the departments that had grown over the last ten years. Mr. Harper said the school system had not grown by a large percentage. Mr. Harper said there were other agencies and departments that had grown by double digits several times. Mr. Harper asked how they could be a more “core” service in the County besides education. Mr. Harper said the 30% increase on VRS was just to catch up the shortfall.
Mr. Harper said tax rates had stayed the same, but assessments had gone through the roof, which increased the tax revenue. Mr. Harper said the effective tax rate had, in essence, been going up. Mr. Harper said he was not knocking that, but it was important to look at both sides of the picture.
Mr. Barnes asked if the Board could at least give Mr. Mullen some consensus to start with a flat budget. Mr. Harper said he didnt think there was any doubt that the budgets had to start flat.
Mr. Spencer asked what was going to be done about Moss-Nuckols Elementary School and the VRS. Mr. Mullen said the rate for VRS for the schools had to be set by the General Assembly. Mr. Mullen said the rate for the County was probably going to be about 6.11%. Mr. Mullen said the remainder of the budget for Moss-Nuckols was planned for the future fiscal years so the County was not currently going to take a hit and the General Fund balance was not going to be depleted.
Mr. Mullen said he was asking for flat budgets on the operational side and was asking for personnel and operating expenses to be separated. Mr. Mullen said he wanted to continue to institute parody across the County. Mr. Mullen said that meant that no one got anything last year as far as increases and he had already put the word out this year that no one would be getting any increases. Mr. Mullen said there would be no piece meal fixes for increases and that either everyone would stay the same or everyone would have increases. Mr. Mullen said he was going to check and see if a cost of living increase had been granted for people in the area. Mr. Mullen said it felt more expensive for him to live now than it did one year ago. Mr. Mullen said the Board could decide once they looked at the personnel budgets if there was a need for an increase.
Mr. Harper said an increase in energy alone was going to drive an increase. Mr. Harper said if an increase was going to be considered, then energy needed to be divided out. Mr. Harper said the unemployed were paying the same amount for a gallon of gas as the employed were.
Mr. Gentry said there were three Board members who had to pay 5% when they started out in VRS. Mr. Gentry asked if that was on the table. Mr. Spencer said it should be. Mr. Harper said 12 to 15 years ago, the County started paying the employee and school system VRS for the employees. Mr. Harper said there was an employee match, a County match and then the State provided some money. Mr. Harper said the County started paying all of it. Mr. Wright said the County starting paying the school systems VRS about ten years ago. Mr. Barnes said he heard at a NACo Conference that VRS was going to change tenfold. Mr. Barnes said the retirement age would be moved up in the future.
Mr. Gentry asked if this was being thought about on a County level. Mr. Mullen said he did not include that in the assumptions that the preparers of the budget were supposed to include. Mr. Mullen said it seemed especially difficult to ask all employees to adjust to an overall decrease in take home pay in a time where there were going to be no employee pay increases. Mr. Mullen said this had not been something that he had thought about.
Mr. Byers asked if the flat budget idea was for constitutional officers as well. Mr. Harper said yes. Mr. Byers said if the Board collectively agreed that a flat budget was the way to go, then that was the way it needed to go. Mr. Byers said he didnt want someone to get nervous and back off of it. Mr. Harper said there was no guarantee what would happen the day the Board voted for the budget. Mr. Byers said the Board needed to be willing to step up and examine the budget and spend quality time to make logical decisions. Mr. Byers said if politics were going to be involved, then there was no need for the Board to put their time and energy into it. Mr. Harper said if this budget was based on past experiences, there would be last minute requests brought to the table that would be approved. Mr. Byers said he was fine with that as long as they were logical requests.
Mr. Barnes reminded the Board that they needed to move as soon as they could to get the information out about meals tax. Mr. Barnes said could free up some money to be used towards the operational expenses for the County. Mr. Barnes said he would not be surprised if the County received about a million dollars from the meals tax alone.
Mr. Mullen provided some projected meals tax revenue to the Board using figures from 2007. Mr. Mullen said if the County had a tax rate of 2%, the County could have received approximately $235,000 in meals tax revenue based on conservative numbers from 2007. Mr. Mullen said a 5% meals tax would have yielded about $600,000 in 2007. Mr. Mullen said those numbers were strictly for Zion Crossroads only and only included the businesses that were there in 2007. Mr. Mullen said Virginia Law did not currently appear to allow the County to institute a meals tax strictly at Zion Crossroads. Mr. Mullen said those figures were two years old and were not an insubstantial amount of money.
Mr. Byers asked if a Louisa County meals tax would be in addition to the meals tax in the Towns of Louisa and Mineral. Mr. Barnes said the Louisa County meals tax could not supersede the Town taxes. Mr. Mullen said there would be no double tax.
Mr. Gentry said the County needed to have a plan to start somewhere and the flat and 5% decrease that Mr. Mullen had requested seemed like a good place to start. Mr. Gentry said if half of what the County was hearing was doom and gloom, then the flat budgets or 5% decreases were probably not going to be it.
Mr. Byers asked if the budget proposals were going to include the legal fees for the County for the upcoming year. Mr. Mullen said he hoped so. Mr. Byers asked if legal fees were budgeted by department or for the whole County. Mr. Mullen said it was budgeted in the County Attorneys budget. Mr. Hoffman said what was done in the past was that fees were budgeted to be used on outside counsel, but litigation was somewhat unpredictable and it was hard to know what to budget. Mr. Hoffman said the County never knew when they would be sued, what it would be for or how much it would cost. Mr. Hoffman said separate budgets would be created for the litigation once it happened.
Mr. Byers asked if the Board was going to receive a timeline. Mr. Harper said the County normally had a budget calendar and if that was going to be done this year, he suggested that some things be moved up on the list. Mr. Harper said it was hard to put the budget off until April once the State numbers were received. Mr. Harper said he would rather make a decision using someones best estimate than wait until the last minute.
Mr. Gentry said he knew Mr. Mullen sent out a letter to the agencies requesting a flat budget and 5% decrease budget proposal. Mr. Gentry asked if the school system received the same letter. Mr. Mullen said yes.
Mr. Gentry asked if any numbers had been tied down as to what it was going to cost to open Moss-Nuckols Elementary School. Mr. Gentry said he kept hearing numbers, but he was not confident that any of them were very accurate. Mr. Havasy said $1.5 million was what he heard.
Mr. Mullen said he had lunch with Dr. Pettit and he did believe there was a fair assessment of what Moss-Nuckols Elementary was going to cost. Mr. Mullen said the figure was closer to $1.5 million than $3 million.
On the motion of Mr. Spencer, seconded by Mr. Barnes, which carried by a vote of 7-0, the Board voted to adjourn the November 30, 2009 meeting at 6:54 p.m.
BY ORDER OF
WILLIE L. HARPER, CHAIRMAN
LOUISA COUNTY BOARD OF SUPERVISORS
LOUISA COUNTY, LOUISA, VIRGINIA