City Council

409 S. Main Street City of Harrisonburg Harrisonburg, VA 22801 Meeting Minutes - Final City Council Tuesday, April 21, 2020 5:00 PM Council Chambers Budget Work Session 1. Roll Call Present: 5- Mayor Deanna R. Reed, Vice-Mayor Sal Romero, Council Member Richard Baugh, Council Member Christopher B. Jones and Council Member George Hirschmann Also Present: 3- City Manager Eric Campbell, City Clerk Pam Ulmer and City Attorney Chris Brown 2. Regular Items Mayor Reed asked if Agenda Item 2b could be heard first. 2.b. Discussion of any items in reference to the Covid-19 response Council Member Jones asked if Council had to wait until the April 28th’s meeting to hear from the Virginia Department of Health and if there is anything that can be provided now. Mr. Campbell stated VDH will be distributing additional granular data which will come out before the April 28th meeting, which is supposed to be released on a daily basis. Mayor Reed stated our hearts go out to family, friends and loved ones who have lost a loved one residing at the Accordius Health facility and asks all to keep them in our hearts and prayers. She stated she looks forward to having Dr. Kornegay from VDH speak at the April 28, 2020 City Council meeting. She stated she reached out to Delegate Tony Wilt and his office will be reaching out to Dr. Kornegay’s office to get the information we are requesting. Vice Mayor Romero stated he spoke to Dr. Kornegay about his concerns regarding the demographic data that would help us address the situation more specifically and that we have not been made aware of other hot spots that we should be addressing . He stated he has been drafting a letter to send to the Poultry Federation talking about what is going on in the local poultry plants and hopes to get it to Council and staff to edit and approve the letter. He stated he is concerned about the poultry workers, he has received a multitude of emails and phone calls, some steps have been taken forward to protect some employees, but not enough. He doesn’t think we are getting ahead of the event and hopes Council will provide support. Council Member Baugh stated he appreciates Vice Mayor Romero’s efforts, he City of Harrisonburg Page 1 Printed on 5/14/2020 City Council Meeting Minutes - Final April 21, 2020 hopes that those in that industry are starting to understand that businesses who don ’t take care of their workers won’t get anything done, and they need to address the issues. He stated he hopes the message is getting out there and things are moving in a positive direction and would support Vice Mayor Romero’s efforts. He stated in regard to our communication with VDH, the city is being proactive and would hope the VDH would see that and provide information that is needed. Council Member Hirschmann stated it is a good reminder to these people to not be lax about keeping track of what is happening in the factories. Mayor Reed stated as our numbers continue to rise, we must be responsible for each other, she has been getting numerous emails and calls about masks and gloves, we are not able to enforce but we can recommend, therefore, we recommend everyone wears masks and gloves and protecting each other. Council Member Jones stated he wants to remind people they can still buy a house, a car, food, groceries and fully engage on a local level with local restaurants and other businesses from home to keep our economy going. Most businesses downtown are owned by people who live in the city so let’s support those families. Vice Mayor Romero stated in addition to the concern he has regarding large employers in the community he wants to know what we can do as a locality to ensure that local businesses are adhering to the recommendations of wearing masks and gloves with their employees. City Attorney Brown stated there isn’t a whole lot we can do, under the Governors Executive Order # 53 that closed certain businesses and deemed certain businesses essential to remain open and encourages to all extent possible to engage in social distancing and cleaning but did not include enforcement of wearing of masks or gloves. He stated we can encourage those to follow our recommendations but cannot mandate it. Mayor Reed stated she hopes people understand that we are following the recommendations of the Governor and we just need to practice being safe for each other. Council Member Hirschmann stated he agrees with the city attorney, we can pressure those essential businesses to make sure their employees are wearing masks, but we can’t control the public. 2.a. Discussion on the proposed 2020-2021 Budget Mayor Reed read the following disclosure: Pursuant to Sections 2.2-3112(B)(1) and 2.2-3115(H) of the Conflict of Interest Act of Virginia, I am declaring for the minutes of this meeting that as a result of my employment with the On the Road Collaborative, which has a contract with the City of Harrisonburg Page 2 Printed on 5/14/2020 City Council Meeting Minutes - Final April 21, 2020 Harrisonburg City Public Schools, I have a personal interest in the transaction of the City’s budget as a member of a business, profession, occupation, or group of three or more person the members of which are affected by the transaction. I further affirm that I am able to participate in this Council’s consideration of the City’s budget fairly, objectively, and in the public interest. Vice Mayor Romero read the following disclosure: Pursuant to Sections 2.2-3112(B)(1) and 2.2-3115(H) of the Conflict of Interest Act of Virginia, I am declaring for the minutes of this meeting that as a result of my employment with the Harrisonburg City Public Schools I have a personal interest in the transaction of the City’s budget as a member of a business, profession, occupation, or group of three or more person the members of which are affected by the transaction. I further affirm that I am able to participate in this Council ’s consideration of the City’s budget fairly, objectively, and in the public interest. Eric Campbell, city manager, stated he presented the proposed budget to Council on April 14, 2020, and emphasized that one of the things made clear at that meeting was the proposed budget was created with pre-Coronavirus revenue projections and at some point the proposed budget would have to be revisited to amend it so revenues could align with the expenditures. He stated staff is also in the process of doing the same thing with the present FY20-21 budget and trying to end in a balanced state as well. He stated many of the questions received from Council is only on the expenditure side, but revenues are the key part of the equation, if the revenue isn ’t available then the expenditures won’t happen. Council Member Jones asked if Mr. Campbell plans on letting Council know what revenues looks like and what expenses will be removed. Mr. Campbell stated once staff gets a handle on what projected revenues are it will be shared immediately with Council with a plan on recommendations to amend the budget based on available revenues will be. Council Member Jones asked if the city is required to fulfill any of the following 2021 Capital Improvement Projects (CIP) due to bond or contractual obligations: the renovation to the old Municipal building, the skate park, Purcell Park Kids Castle, Heritage Oaks Golf Course bridge replacement, school bus replacements and the transportation additions. Mr. Campbell stated some of the projects have some current year funding already assigned and have started in some respects. Larry Propst, director of Finance, stated the CIP is just a planning document, he is not aware of any obligations to the above listed projects, nor does he think any funding has been included for some of those projects. He stated we would only be able to move forward on those projects if we have funding. Council Member Jones asked which of those projects have funding in the proposed budget. Mr. Propst stated the projects with budgeted funds are the Purcell Park Kids Castle (to finish an already started and City of Harrisonburg Page 3 Printed on 5/14/2020 City Council Meeting Minutes - Final April 21, 2020 half funded project), and the school bus replacement. Mr. Propst stated that as Mr. Campbell mentioned, once we look at incoming revenues these may change as well . Mr. Jones stated Council can make a decision to remove any funding for those capital projects and use funds to take care of people, small businesses, and local organizations first. Mayor Reed stated transportation did get funding from stimulus package and cannot be used for any other projects. Mr. Campbell confirmed. Council Member Hirschmann stated he is sure there will be multiple adjustments to see in which direction and by how much we are heading and to maybe allow us to disburse some of the money towards the populous to keep them afloat before we get involved in some of the capital projects. He stated he suspects over the coming months that the budget will need to be continually adjusted. Mr. Propst stated we will have to take an educated guess as to what the revenue is going to be when we amend the budget. Vice Mayor Romero stated it takes less money to operate our school system today than it did several months ago, what is the potential savings that we could get from that to be utilize towards some of the needs across the city. He stated we have traditionally supported our school systems and have always approved the requested budget from the School Board, but not really knowing what the future holds for us as a city school district, Council should look at ways of reducing the school ’s budget. Council Member Baugh stated we do not have line item veto power over the projected school budget, however we can make recommendations. Vice Mayor stated he understood that, but we need to look at what cuts we need to make. Council Member Jones stated we used money out of our fund balance to move forward on a project that we are not able to move forward on at this time. He feels it would be a mistake to fund the school budget as presented knowing that we have already invested funds into the new project, it would be wise to do a unilateral cut on the school ’s budget for now, which could be discussed during the next city/school liaison meeting. Mayor Reed asked when that would be. Council Member Jones stated we were waiting to hear back once the School Board checked with the builder as to delaying the contract. Mr. Campbell asked if Council is requesting that the School Boards formal requested $1.3M additional allocation be reduced. Council stated yes. Council Member Jones had questions regarding the loan program, in FY 18-19 $91K was budgeted, in FY19-20 $104K and this year it is proposed at $10K, does this mean we only want to give out 2 business loans in FY20-21. Mr. Propst stated this year we did $100K in disaster impact loans out of the business loan program, causing us to not lend out as much next year as the funds aren ’t there and there is uncertainty of payments coming back into the program. Further discussion took place on how the budget for this program works. Mr. Campbell stated staff is also looking City of Harrisonburg Page 4 Printed on 5/14/2020 City Council Meeting Minutes - Final April 21, 2020 at possible funds from the Community Development Block Grant (CDBG) for help to local businesses. Council Member Jones asked other council members if they are interested in increasing the loan program funding in the budget and keep this program going. Vice Mayor Romero agreed, but noted he feels there are quite a few business owners that aren’t aware of this program and it would be critical to get the information out to all the businesses in the community. He asked if there seemed to be more downtown businesses than anything else applying for these loans. Mr. Campbell stated that information can be found out and relayed. Mayor Reed stated we need to support our small businesses, make sure they get back on their feet, and would support anything that will help the small businesses. Council Member Hirschmann stated it would not be in our best favor to earmark funding now for later not knowing what revenue we have, we can always re-visit once we know what our revenue will be like. Council Member Baugh stated it will take a miracle for us not to be having discussions about what we can fund out of the budget given the revenue is substantially less than what is projected, as well as through the rest of the current budget year. He stated at this stage adding expenses to any line items in the budget, no matter how worthy they are, doesn’t really stand to do anything other than show your support for certain funding promises. He stated there really is no need to have these types of discussions considering the state we are in. He would like to help people over other projects but increasing funding doesn ’t create any money. Council Member Jones stated he wanted to increase some funding and decrease other funding, but it would be prudent for Council to instruct the city manager on how Council wishes it to move forward. Mayor Reed stated if we really think it is going to be as bad as we think then we shouldn’t be doing any capital projects. Further discussion took place regarding what should and shouldn’t be on the budget based on current proposed to actual revenue. Mr. Campbell stated the budget was in the works pre-pandemic, rather than redraft based on so many unknowns, he presented the proposed budget knowing it would have to be amended once actual revenues can be determined. Council Member Jones asked Mr. Campbell how will staff proceed after July 1 when it comes to spending with all of the unknowns of the revenue. Mr. Campbell stated staff will move forward with the budget approved. Council Member Jones stated his concern is that if we move with the budget without making those priority adjustments, and he is uncomfortable with how staff would be moving forward during the waiting process for amendments, the requests of changes from Council should be reflected in the proposed budget. Vice Mayor stated he feels if we don ’t set our priorities now, he would feel very uncomfortable approving the budget. He asked if Council could wait to discuss this when a better view of the revenues is available. Mr. Campbell stated the challenge is there is no certainty in any of the scenarios, Council can wait but there is not a known outcome at this stage. He stated Council can dictate what their priorities are, and the appropriate actions would be taken. He stated one month from now we still wouldn’t know the impact on the current budget, which would still not give us certainty on revenue for the proposed budget . Mr. Propst stated in the month of June we will start really looking at revenues and he City of Harrisonburg Page 5 Printed on 5/14/2020 City Council Meeting Minutes - Final April 21, 2020 suspects the budget will be discussed in June again. Vice Mayor Romero stated he wants to be involved in discussion of what should be in the budget, and feels we need the second work session to discuss further once more information is available . Council Member Hirschmann agreed, knowing the budget will most likely be amended multiple times after adoption, but still allow Council to look at what priorities they have and how it would affect the proposed budget. Mayor Reed asked if the capital projects are removed from the proposed budget, and the revenue came back better than expected, can those capital projects be added back in. Mr. Campbell stated any surplus available would be presented to Council along with recommendations of what to use them for. Council Member Baugh stated whatever is removed from the proposed budget will need direction from Council to re -incorporate into the budget. He stated he understands the impulse to provide certainty to people, but he hates to articulate that certainty to people in a world where things are uncertain, there are too many unknown scenarios that could change the budget. Mayor Reed is aware people are struggling and she doesn’t want to make any promises that cannot be met, in particular, raises to city staff and school staff, which she is supporting . Council Member Jones stated if at all possible, the raises should be included in the budget, we cannot provide raises from one group and not the other. He stated if we don’t tell people which organizations we want to help now, we have to live with the recommendations by the city manager, he will not be comfortable with that. Vice Mayor Romero agreed with the Mayor but feels raises should not be promised if we cannot guarantee they will happen. Council Member Baugh stated these are unprecedented times, we do the best we can to make the decisions and get the input from the public, if there ever has been an environment where everyone knows things are subject to change it is this one. Council Member Jones stated he wants to know that any capital projects that are not necessary would be removed, support all that we can to make sure raises happen to both school and city staff, either all or none. He stated he would also like to see what the thoughts of Council are on community contributions as that section of the community will need their funding from us or a clear idea of what to expect from the city so they can move forward. Mr. Campbell stated when the budget process was started pre-Coronavirus, he had budget conversations with the superintendent of schools, Dr. Richards, where it was agreed on what the proposed raises would be. He stated reality changed and now both are sitting in uncertain points of what each of our revenues are going to be, in fairness to Dr . Richards, there were conversations to make sure everyone was on the same page . Mayor Reed stated she feels capital projects is something that should be removed from budget and raises need to be given however he can make that work. During the April 14, 2020 City Council Meeting, Mayor Reed requested a date be set for a work session to discuss certain items on the budget. Recess At 6:55 p.m., Mayor Reed called the meeting into recess. At 7:02 p.m., Mayor Reed called the meeting back into session. City of Harrisonburg Page 6 Printed on 5/14/2020 City Council Meeting Minutes - Final April 21, 2020 2.a. Continued conversation on the proposed 2020-2021 Budget Mayor Reed stated the Virginia State and Local Conflict of Interest Act requires that she make the following disclosure to be recorded in the city records on any matter from which she is prohibited by law from participating: The transaction involved is agenda item 2(a), the matter involved in the granting of community contributions by City Council as part of the budget. On the Road Collaborative has applied for a community contribution from the City of Harrisonburg; her personal interest affected by this transaction is that she is an employee of On the Road Collaborative; She affirms she will not vote or participate in any manner in this matter. Vice Mayor Romero stated in regard to Community Contributions, there is an amount recommended by the evaluation committee as well as an amount recommended by the city manager. Council Member Jones asked if the city was obligated to contribute to the Friendly City Fourth. Ande Banks, deputy city manager, stated the amount in the budget is used for the fireworks. Council Member Jones asked why the city manager increased the funds recommended to the Arts Council. Amy Snider, assistant to the city manager, described the process of the evaluation committee. Mr. Campbell stated when he got the recommendations, he rearranged some funding which freed up funds for the Arts Council. He stated he did that because they were a highly scored agency and the key to his adjustments came from the Open Doors funding. Council Member Jones stated he wants to balance out the funds for the after-school care organizations. Council Member Jones recommended the following: Reduce the Boys and Girls Club by $25,000 Reduce funding to the Historical Society Reduce funds to Way to Go by $10,000 Provide funding for the Roberta Webb Childcare Center $10,000 Provide funding for the Harrisonburg-Rockingham Child Day Care Center to $10,000 Provide funding to NENA in the amount of $5,000 Provide funding to 4-H in the amount of $25,000 Council Member Hirschmann stated he agrees that the child care centers should get funding. Discussion took place about the funds going to the Historical Society and how it has nothing to do with the Harrison House Project as the Historical Society is not a financial partner in that project. Mr. Campbell stated after making the aforementioned adjustments we are over the City of Harrisonburg Page 7 Printed on 5/14/2020 City Council Meeting Minutes - Final April 21, 2020 $430,000 threshold by $10,000. Vice Mayor Romero stated some of the capital projects that will removed, can those funds be reallocated to additional community contributions such as the Free Clinic, Our Community Place, Second Home, Strength in Peers and United Way. He understands we are constrained in funds but perhaps funds can be gotten from other projects. Mr. Propst stated two of the projects, the Kids Castle and the MLK Bridge repair was scheduled to come out of fund balance, but if Council doesn ’t want them to have them, they can come out. Council Member Jones feels we will need the organizations during the recovery period to help with families, and agrees those organizations mentioned by Vice Mayor Romero should also be funded, however he was trying to stay within the $430,000 threshold. Vice Mayor Romero stated he is asking numbers if 100% of request of under $10,000 be fully funded, and 75% to the additional requests. He stated he thinks it will be around $300,000 additional considering the capital project funds would be reallocated. He feels our community will need all of these organizations more than before and he is afraid if these organizations are not fully funded, we will have hard time with community needs. Mr. Campbell reminded all of these funds will still be based on revenue, there may be a scenario where he would have to tell Council we cannot fund Community Contributions based on the revenue that materializes. He stated if we do what Vice Mayor Romero is asking it will through off the budget by between $ 200,000 and $300,000 which means we would have to go into fund balance to find the money. Council Member Jones stated it costs roughly $300,000 in order to fund the employees at the golf course. He stated keep the staff working somewhere else within the city and reduce the expenditures at the golf course so the funds could be used to cover the additional community contributions we are seeking. Council Member Baugh stated we are not reallocating money we are reallocating aspirations . He stated all the organizations deserve the funding, but core services come first. We have had the ability to increase this portion of the budget in better financial times than we have right now and during the recession we modestly reduced that part of the budget. He stated we are talking about reallocating funds that are most likely not going to be there. Council Member Hirschmann stated we have to face the realization that these funds may not be available unless things change later down the line, he is not sure how it is possible to make everyone happy. Council Member Jones stated he proposes the funds come out of the golf course but keep the employees and asked if the city manager would be willing to do that if revenues come up short. Mr. Campbell stated it is not a core service but a few months ago a discussion was held regarding this at a Council meeting and Council decided not to take any action. He stated he would look at the budget overall and priorities, it may not be the first place he would look but everything would be on the table given the level of revenue available. Council Member Jones stated Council decided not to do a study on the golf course, what he is asking for is the funding for the golf course be reduced by what is needed to fund the Community Contributions as City of Harrisonburg Page 8 Printed on 5/14/2020 City Council Meeting Minutes - Final April 21, 2020 earlier stated. Mr. Campbell stated he will take what direction Council tells him to take. Vice Mayor Romero asked, if it is the wish of council, if the city manager could prepare a budget that would show how it would look with funds shifted from the golf course to community contributions and have it prepared for the next work session . Mr. Campbell stated he would need three council members to direct him to amend the proposed budget, but if he just wants to see a budget scenario to share with everyone that is purely informational that can be worked out. Council Member Jones stated with what has been said, the problem now is that we cannot move forward with the Community Contributions because we could possibly shift funding from the golf course towards Community Contributions. Vice Mayor Romero stated without being fully knowledgeable about the budget are we expecting revenue from the golf course in the proposed golf course. Mr. Propst stated all the revenues in the proposed budget are pre-Coronavirus. Council Member Jones stated however if the golf course is closed and no revenues are coming in then there are no expenses either. Vice Mayor Romero stated he is hearing more and more from the community and this is something that we need to really consider. Council Member Hirschmann stated if funds are taken out of the golf course then it will suffer neglect and will cost the city more money to reopen. Council Member Baugh stated he is agnostic about the golf course, we are talking about possibly shutting the golf course down, no public notice, no general opportunity for public input, no staff report that reflects what impact it would have, and at this point we aren’t even talking about real money, just aspirations. Council Member Jones stated we just shut down the major activity at Purcell Park (Kids Castle Capital Project) but for some strange reason we can’t with the golf course. He stated the golf course is not a greater priority than the non-profit organizations and what they can offer to the residents and businesses of the city. Further discussion took place regarding who the golf course serves, how funds are needed elsewhere, the reasoning behind shutting it down, previous golf course conversations, previous community contribution increases or the lack thereof. Council Member Baugh stated he finds it odd that at the time when we have the least resources we have ever had this would be the time to increase more money to the Community Contributions all in aspiration. He stated people tend to look at us for help and funds, however, he feels we are the ones that are going to need the money. Vice Mayor Romero stated he feels adamant about what he said in the beginning as well as what Council Member Jones stated, he understands the golf course is an issue that we would not want to make lightly without public comment, but all he wants is to see a report on what the budget would like without the golf course . Council Member Baugh stated he has never been against taking a good look at the golf course. Council Member Jones stated Council was against doing a study of the golf course several months ago. Further discussion took place regarding that previous discussion. Vice Mayor Romero asked if it is the wish of Council to have the city manager and staff to look at the process of reviewing the golf course and its viability. Council Member Jones stated we shouldn’t be having this conversation without the Mayor. Mr. City of Harrisonburg Page 9 Printed on 5/14/2020 City Council Meeting Minutes - Final April 21, 2020 Brown, city attorney stated if the conversation about community contributions is over, the Mayor definitely should be a part of this discussion and possible decision. Council Member Jones reiterated he is in favor of increasing the Community Contributions by $300,000, and staff figures out where that money comes from in order to support more local organizations and making it a priority if the revenue can support it. He stated he hopes to see this at the next budget work session, and perhaps even capping everyone at $35,000. Council Member Baugh stated it doesn’t make any sense to increase any part of the budget at this point, all of our real time discussions are going to be about the things we approved in the budget that we are not going to be able to do. Council Member Hirschmann agrees with Council Member Baugh and stated that is where the conversation started out this evening . Vice Mayor stated he would support Council Member Jones’ suggestions, but we are not in agreement, how do we move forward, its been a fairly lengthy night. Council was reminded there is another Budget Work Session available for May 5, 2020 if Council chooses. Council Member Jones asked if we have any clarity if funds will be shifted to Community Contributions as a priority. He asked if the Council Members are in favor of increasing the Community Contributions. Council Member Baugh stated no he was not in favor. A discussion took place as to when do funds go out to the organizations after the budget is approved. Vice Mayor Romero stated it doesn’t look like there is an agreement, therefore Council should hold the additional work session. Everyone agreed to the Work Session on May 5, 2020 at 5:00 pm. Council Member Jones asked Ms. Snider if she could provide the revised breakdown reflecting his requested changes on the Community Contributions. Vice Mayor Baugh stated we can fine tune at the next work session. Vice Mayor Romero asked if the city manager is going to present a scenario of the budget reflecting the golf course removed. Amy Snider Council can expect the revised Community Contributions sheet by late afternoon on April 22, 2020. Mayor Reed asked if there were any other discussions. 3. Adjournment At 8:21 p.m., there being no further business and on motion adopted, the meeting was adjourned. ________________________ ________________________ CITY CLERK MAYOR City of Harrisonburg Page 10 Printed on 5/14/2020