City Council

403 The City Attorney continued to explain that the City Code referred to the Charter, but did not state when elections would be held. He reiterated during the October 10 Council meeting, the City Attorney was to research the matter for further discussion by the Council. In addition, if elections were held in even numbered years, the Statute states that the terms of office for 2020 and 2022 must be extended by six months; and if elections were changed to odd numbered years, the terms of office for 2022 would be shortened by six months. Following extensive ongoing dialogue amongst the Council Members, Council Member White-Boyd offered a motion to move the Municipal Election Date from the first Monday in May 2020 to the Tuesday following the first Monday in November 2020; and that the City Attorney be instructed to prepare the proper measure for adoption at the November 4, 2019 Council Meeting. The motion seconded by Vice-Mayor Cobb and adopted by the following vote: AYES: Council Members Osborne, Price, White-Boyd, Cobb and Mayor Lea-5. NAYS: Council Members Bestpitch and Davis-2. At 9:27 p.m., the Council meeting was declared in recess until Monday, October 28, 2019 at 8:30 a.m., in the Community Room, Melrose Branch Library, 2502 Melrose Avenue, N. W., SuiteD, for the Annual Planning Budget Retreat. The Recessed Meeting of Roanoke City Council was called to order on Monday, October 28, 2019 at 8:30a.m., in the Community Room, Melrose Branch Library, 2502 Melrose Avenue, N. W., SuiteD, with Mayor Lea presiding. PRESENT: Council Members Michelle L. Davis, Anita J. Price, Djuna L. Osborne, Patricia White-Boyd, William D. Bestpitch, Joseph L. Cobb and Mayor Sherman P. Lea, Sr.-7. ABSENT: None-0. The Mayor declared the existence of a quorum. OFFICERS PRESENT: RobertS. Cowell, Jr., City Manager; Daniel J. Callaghan, City Attorney; and Stephanie M. Moon Reynolds, City Clerk. OTHERS PRESENT: Troy A. Harmon, Municipal Auditor; R. Brian Townsend, Assistant City Manager for Community Development; Sherman Stovall, Assistant City Manager for Operations; Susan Lower, Director, Real Estate Valuation; Cecelia T. Webb, Assistant Deputy City Clerk; and R.B. Lawhorn, Budget Manager. 404 Mayor Lea welcomed everyone to the City Council Strategic Workshop and stated the purpose for the session was to hold the Annual Council Strategic Planning Work Session. UNFINISHED BUSINESS: CITY CLERK TENDERING RESIGNATION AS CITY CLERK OF THE CITY OF ROANOKE, VIRGINIA: Council at its meeting on Monday, August 19, 2019, having postponed action on resignation tendered by the City Clerk of the City of Roanoke, effective January 1, 2020, the matter was again before the body. (See communication on file in the City Clerk's Office.) Council Member Davis moved that the resignation be accepted with deepest regret and the communication received and filed. The motion seconded by Vice-Mayor Cobb and adopted by the following vote: AYES: Council Members Davis, Osborne, Price, White-Boyd, Bestpitch, Cobb and Mayor Lea-7. NAYS: None-0. CITY MANAGER: The City Manager stated the purpose of the Work Session was to briefly cover three budgets by discussing last year's budget, taking a quick glimpse of the Fiscal Year 2020 budget and beginning construction of the Fiscal Year 2021 Budget and performance measures. He gave an overview of the following: Strategic Plan Agenda • Workshop Objectives • Budget Overview • Link to Strategic Plan • Fiscal Resiliency • BudgetPriorities • Stormwater Fund • Property Tax Abatement Program (See presentations on file in the City Clerk's Office.) R.B. Lawhorn, Budget Manager reviewed the City's Fiscal Year 2019 Budget • .,. noting that final revenue and expense adjustments were in process and the anticipated audited results would be presented to the Council in December.  405 He highlighted the Fiscal Year 2020 Budget stating that it included funding for strategic investments in all priority areas, 2. 75 percent compensation increase and inflationary cost increases. He pointed out that the budget included additional funding to further address support of EMS services, sheriff/Jail operations, Children's Services Act needs, fleet specialized vehicle repair, an additional election, library services, greenways and trail maintenance, tree replacement, weed and trash abatement, mental health services, tourism and transit operation. Mayor Lea inquired about jail services and what the City of Roanoke funded; whereupon, the City Manager responded the City funded the salaries of the jail staff, but most of the jail services were state funded. Council Member Osborne asked who addressed maintenance issues at the jail; whereupon, the Assistant City Manager for Operations advised that the City work crews addressed maintenance issues identified by the Sheriff. Mr. Lawhorn reviewed the five-year operating model noting that assumptions for growth in real estate tax, personal property, prepared food and beverage, revenue, operating expenditure and salary increases were built into the model. The City Manager focused on financial resiliency and the importance of using essential characteristics to build a resilient system, noting that real estate was predominate and a stable source of revenue for the City. He explained how it was imperative to build the FY 21 budget as if experienced the same revenue decline as FY 2009 to FY 2010, a decline of 2.03 percent or $5.3 million, the worst year over year decline in the last 10 years. In summary, the City Manager offered eight essential characteristics-diversity, redundancy, decentralization, transparency, collaboration, fail gracefully, flexibility and foresight to create financial resiliency through long term planning. STORMWATER UTILITY FEE: The Assistant City Manager for Operations gave a briefing on the Stormwater Utility Fee, as follows: Stormwater Utility Fee • Council advised of Stormwater Utility Fee considerations at: o April 1, 2019 Budget Briefing o July 29, 2019 Strategic Planning Session • After 2021, current revenue will not be sufficient to support: o Inflationary costs o Debt service for capital projects 406 o Increase in debt service if there is a reduction in capital project grant funding o Planned staff additions based on business model Required Utility Fee Adjustment • Maintenance of service level and support of business model requires an adjustment in the utility fee o Adjustment from $.90 per 500 sf to $1.14- $1.31 over five years Current Average Average Average Monthly Monthly Monthly Residential Residential Residential Fee Fee @$.90 Fee@ $1.14 @ $1.31 $5.40 $6.85 $7.89 Virginia Stormwater Utility Fee Comparison Average Monthly Fee- $7.38 Highest Monthly Fee- $21.00 (Falls Church) Lowest Monthly Fee- $2.08 (Chesterfield County) Median Monthly Fee- $6.00 Required Utility Fee Adjustment Recommend adjustment from $.90 to $1.25 over five years Current FY 2022 FY 2023 FY 2024 FY 2025 FY 2026 Monthly $.90 $.93 $1.03 $1.10 $1.18 $1.25 Fee Per500 SF Avg. $5.40 $5.57 $6.20 $6.60 $7.06 $7.50 Monthly Fee Avg. $64.80 $66.80 $74.44 $79.14 $84.71 $90.03 Annual Fee Virginia Stormwater Utility Fee Comparison Average Monthly Fee- $7.38 Highest Monthly Fee- $21.00 (Falls Church) Lowest Monthly Fee- $2.08 (Chesterfield County) Median Monthly Fee- $6.00 Stormwater Utility Fee • Rate adjustment: o Planned staff additions o Assumes half grant funding  407 • Without an adjustment in the Utility Fee: o Existing level of service will be reduced • Drainage improvement projects • Water quality improvement projects • Maintenance of infrastructure Mr. Stovall explained that after FY 2020 the Stormwater Utility Fee would not be sufficient to support inflationary costs, debt service for capital projects, and an increase in debt service if there was a reduction in capital project grant funding; and recommended adoption of a pathway to achieve the increase. Following discussion by the Council of the proposed rate schedule, Mr. Stovall explained that adoption of an increase should occur in 2021 to allow time for citizens to adjust to the increase for 2022. REAL ESTATE REHABILITATION TAX ABATEMENT PROGRAM: The Assistant City Manager for Community Development and Susan Lower, Director, Real Estate Valuation briefed the Council on the Real Estate Rehabilitation Tax Abatement Program, as follows: What is the rehab program? • A city-wide program that was developed to encourage rehabilitation, and /or repair buildings in the City of Roanoke by providing an incentive through an abatement on real property taxes. • The amount of the tax abatement is based on the increase in assessed value of each building that has been repaired or renovated. • Examp1e:I Building Assessed Value Tax @ $1.22 p/$1 00 of Assessed Value Before Rehab $100,000 $1,220 After Rehab $250,000 $3,050 Difference $150,000 $1,830 (Credit/year) $3,050- $1,830 (credit)= $1,220 Tax owed per year Background/Overview • Established Rehab Program in 1981 • Revised Rehab Program in 2000, 2005, 2010, 2015 • Established a Marketing Program • Established a Timeline for Rehab Completion (2 yrs) • Program "sunsets" in 5 year intervals (Expires June 2020) • Municipal Audit overview report on program issued in April 2018 408 Qualifications RESIDENTIAL COMMERCIAL Age of Structure 40 25 Minimum Assessment 40% 60% Increase to Qualify Square Foot None(Rehab plus additions) Less than 100% Restrictions Rehab Application Fee $50 $50 • To apply for rehab, owner must be current on all real estate taxes. • To remain in the rehab program, taxes must be kept current. • To remain in the rehab program, the buildings must comply with the City's building, zoning, and nuisance codes Terms for rehab abatement • Three years: If before value of the Single Family Residential Building is greater than or equal to $300,000 • Five years: City wide for both Commercial and Residential Buildings • 10 years: Commercial and Residential Buildings in H 1, H2 Historic Districts, Conservation Districts, Rehab Districts • Additional Four years: 50% reduction in the number of residential units What's Changed in the Last Five Years? • What are our Peers Doing? • Administrative Process- (three departments and several staff) • Market changes: o What properties are eligible? (Commercial buildings 1995 or older) o Length of Abatement o Market Forces vs lncentivization . d'ICf IOnS c ompanson Ch a rt J UriS Jurisdiction Age to Qualify Term (years) Application Fee Roanoke 1995 3/5/1 0/14 */15* $50 Charlottesville 1995 7 $50 Lynchburg 1995 10 $250 Hampton 1995 6* $100 Norfolk 1980 15* $250 Fredericksburg 1980 7* $150 Danville 1970 5* $100 Petersburg 1970 5 $250 J *various step down or graduated abatement provisions  409 Administrative Process • Application • Check delinquency (Treasurer) • If ok, REV accepts Rehab application • Quarterly check delinquency (Treasurer) • Dec and June- check code violations (Code Enforcement) • REV team inspects properties until complete Next Steps • City Council Comment/Feedback • Further Analysis/Information Gathering • Initial Recommendations for Program Changes (January) • Council Action on Program Re-authorization (May) • Program Changes Effective (July 1, 2020) The City Manager advised that the program was approaching its sunset and discussion was necessary. The Assistant City Manager for Community Development explained that perhaps the City's abatement program was over generous and complicated and added that the application fee of $50.00 may need to be increased to be better aligned with surrounding jurisdictions. Ms. Lower explained the process, noting that verification of delinquencies and code violations were handled by the City Treasurer's Office and Code Enforcement. In conclusion, the City Manager reviewed the next steps and asked if Council had a specific focus for the program. There being no comments by the Council, he advised that initial changes to the program would be presented in January 2020. There being no further business to come before the Council, the Mayor declared the recessed meeting adjourned at 12:05 p.m. APPROVED ATTEST: ~~~·. \n.~r-.l--~~ ~-Moon R~~~~~~"Mc Sherman P. Lea, Sr. City Clerk Mayor