City Council - Regular Meeting

Good evening and welcome. We are glad to have you join us for this special meeting where we're going to be talking about the city budget. Before we get rolling, one of the things I need to do is ask that council choose to amend the agenda. I'd like to make a motion that we move our closed session to right before new business. So it would be after our public hearing but before new business. Do we have a second? Second. A motion and a second to amend the agenda. Any discussion? All in favor, please respond by saying I. I. Any opposed? Okay, I would like us to begin with our pledge of allegiance and moment of silence. So if you all would please join us. I pledge allegiance to the flag of the United States of America and to the republic for which it stands, one nation under God, indivisible, with liberty and justice for all. Please be seated. Now I'll ask that you join us in a moment of silence. And I know this is a little out of order, but I will say we lost someone real special to the Radford family the last few weeks. Johnny Butler passed away. His funeral was yesterday and his internment was yesterday. Our city police did an absolutely beautiful job remembering him. Please keep Johnny and his entire family and the Radford City PD family in your minds. All right. Thank you all very much. Uh council, we do have a little bit of unfinished business that we need to address first thing. We have an appropriation ordinance 1802.30 in the amount of 1 million, 2,593.55 cents from fiscal year 2023-24. We had tabled this in November at our meeting and the purchase orders in this total that amount that I just mentioned. They relate to capital projects, electric transit, streets, and various small general fund departmental planned

expenses and transfers. This was not done earlier and so we need to take care of that as an accounting procedure. Are there any questions? Do we have a motion to move forward with AO 1802.30? So moved. We have a motion. Do we have a second? Second. A motion and a second. Any discussion? Uh would you call the roll, Melissa? Mr. Sutphin? Yes. Mr. Foster? Yes. Mr. Glasscock? Yes. Mr. Wilder? Yes. Mayor Horton? Yes. Having heard four affirmative votes, we can dispense with a second reading if so desired. Is there a motion that we do so? So moved. We have a motion. Do we have a second? Second.

A motion and a second. Any discussion? All in favor, please respond by saying I. I. Any opposed? Okay, at this time I'm going to turn the floor over to our city manager who's going to give you a very brief review of the budget, where we stand, what we're looking at before we get into our public hearing on the tax rates, fees and rates, and the fiscal 2027 budget. Todd, the floor is yours. All right, Mayor. All right, Mayor, council. Thank you. I thought I would start the evening off by explaining a little bit about the budget, just summarizing where things are. And starting the discussion on Let's see. Let's Yes. There we go. Okay. So There we go. So just to begin the discussion with the fiscal year 2027 budget, just wanted to recap what was advertised. And right now what you have that was advertised for this evening is a budget of 81.7 million dollars for fiscal year 2027. The biggest change from the original presented budget is in the water wastewater account. It's It has increased to 9.9 million. But that includes that not to exceed rate that we advertised. So This is your advertised budget. What's all this? Oh, thank you. So our advertised not to exceed rates, the revenue changes that were proposed and advertised over the last couple of weeks. We've proposed to increase the real estate tax from 82 cents to 87 cent per 100 dollars of assessed value. For each one cent that the real estate is either increased or decreased, that equates to 118,000 dollars. The increase that we also proposed

increase the water rate by 5.87 cents per 1,000 gallons. So that's per 1,000 gallons. The minimum bill is 4,000 gallons. So that would increase the minimum bill from 24.32 cents to 47.79 cents. That was the not to exceed advertised rate. Each one dollar on the water gets about 447,000 dollars in revenue for the city. And we also proposed to increase the electric rate by 5%. As part of that, we proposed that the customer charge will increase from 7.02 cents to 20 dollars. The residential energy charge will decrease from 1 cent from 0.1 Excuse me, 10 cents down to 9 cents, 9.9 cents. Per kilowatt hour. And the reason we proposed that is when you look at electric and billing for electricity, we tend to think in 1,000 kilowatt hours. And if we go to the 20 dollars on the customer charge, the per kilowatt hour would decrease at the 1,000 kilowatt hours and save on that bill. I would actually be cheaper for someone at that level of usage as opposed to keeping it at 7.02 cents or just having a smaller increase with the customer charge. So I wanted to focus on the slide that we have in front of us right now. This is a summary of the options that we have discussed over the last couple of weeks. There are 12 scenarios on the chart that you have in front of you. And they're a combination of proposals on the real estate and the water. Electricity is not part of this graphic that you have in front of you. So what we were working with is a 2 cent increase in real estate, 3 cent increase

in real estate taxes, and a 4 cent increase in real estate taxes. And for each one of those real estate tax levels, we we analyzed the numbers or analyzed the data if we were to increase the water bill by 2 dollars, 2 dollars and 50 cents, 3 dollars, and 3 dollars and 50 cents. So one of the most important things to look at is the real estate revenue decrease from 5 cents. That's how much we have to get make up if we come off the 5% that was proposed. If we reduce it by 3% and we go to a 2% increase in the real estate tax for FY27 we need to make up $354,000 from that proposed budget that was in front of us a couple weeks ago. So in the in the second column that's showing how much money from the proposed budget how much is being reduced from real estate taxes by backing off the 5% increase by going down to 3% by going down to 2% 3% and 4%. The third column is the transfer to general as we pull back on the real estate tax we have to make up that that revenue with a transfer from the water and in column three it's showing exactly how much we do need to transfer if we as we reduce the real estate. So at if we if we go up 2% which is a 3% reduction from 2 weeks ago if we go up 2% on the real estate we have to make up $354,000 the transfer to the general will need to increase to make that up and you'll notice that there's there's some changes with the transfer to the general from the water and the pilot pilot is payment in lieu of taxes and just to review that payment in lieu of taxes we treat our enterprise accounts as if they were businesses they would pay taxes into the general if they were privately owned. So so

what what we're calculating is what they would pay in personal property real estate so forth. Um those numbers will change as we as we change the amount being transferred from the water it does affect that calculation but they all total to 354 which is what we need to make up by pulling back 3% on the real estate. The final column is the transfer to water reserves how much that would increase at each level. I do think that column might be the most important one on this on this slide because the more we pull back or the more the city pulls back on the real estate the more has to be transferred out of the water. So it's going from the water to the general the more we can go the closer we can get to that 5% on the real estate the less we have to transfer out of the water. Now of course at each level at each tier A B and C at each tier if we the more we go up on the water the more we're we're going to transfer into the water reserve. And that original amount was 256 in the budget that was proposed at the first meeting. So for instance at step A if we go up 2% on the real estate we increase the water by $2 and the minimum bill bill goes to 32 32. If we do that the transfer to the general and pilot will increase by 354 to make up the lost revenue from the reduction in real estate the final column shows that we only have $124,000 going into the water reserve. $124,000 in addition to the 256 so we're looking at 370 380,000 dollars that would go into the reserve. Now bear in mind there's really no reserve there as we speak so we're trying to build that back. Um and we're building it back because we need to invest in some capital projects.

We need to look at water storage tanks we need to get those on preventative maintenance schedule which will cost most likely a couple hundred thousand dollars a year. We're also looking at replacement of water lines and water equipment other other water infrastructure projects. So you know I won't go through each each tier and every single scenario but I do want everyone to take a second to review it and to ask any questions that me or staff may be able to answer.

[cough and clears throat] All right. Excellent. So the next steps we need to finalize our tax and utility rates we need to have a discussion about that. And the second reading and budget approval was scheduled for next week 7 days from today on April 28th. So we really need to think about all of those scenarios and congeal around one of those options. And with that being said I'll take any questions from council. Thank you Todd. Any questions?

No questions to my only comment is thank you to you and the finance. I know you guys have ran a hundred different scenarios a hundred different ways and it's been very valuable for us to have the information presented to us the way that you have. So thank you. That no question just just a thank you. Thank you. All right. Thank you. Okay so as you can see we are going to open the floor for the public hearings on both the tax rate and the budget we'll begin talking about tax rate and the rates and fees and you see what has been proposed just to to go back to this originally 87 cents per 100 dollars of assessed value not to exceed 87 cents per 100 dollars of excess value assessed value for real estate property and then the rate fee would be an additional 5% a 5% increase with the following scenario that the basic customer charge move to $20 and the energy charge would actually decrease from a little over 10 cents down to just a little under 10 cents 9.9 cents for the energy charge for a thousand kilowatt hours that would result in some level of savings. We also have some proposed fees for the EMS standby for $171 animal control the adoption fee $20 microchip fee $15 vaccination fee $15 so that total adoption fee would be 50 daily care fees would be $15 a day impound fees $25 for the first offense 35 for the second offense and 45 for the third offense and then the library community room rental would be free to nonprofits then finally just on the water you saw all the scenarios that are there that we're considering so the rate increase would go from $24.32 per 4,000 gallons to some level between

that and not to exceed $47.79 cents per 4,000 gallons. There's still a lot of fluidity in this but we wanted to open the floor for the public hearing for the 2026 tax rate and 2026 27 fees and rates so at this time we'll open the floor we are going to set a clock even though there's no time limit on your ability to speak about this portion of the public hearing we would like you to know how long you've been speaking so you can monitor up here how long that's going and and just so you're aware because time can really change when you're at the podium. If you have something you'd like to say for the public hearing please come down to the podium speak into the microphone state your name for the record and we'll move forward from there. So the public hearing is now open. Okay hi um my name is Beth Barber and I wrote down um what I want to say so I can just read it. Um but the topic is electricity it's the the rates the fees and all that fun stuff. Um so my name is Beth I'm a Radford resident. I stand before you today um for my voice to strong in strong opposition to the additional fee on our electric bills which continue to go up. We are currently facing a strong cost of living crisis. Believe it or not families in the city already making impossible choices are making possible choices impossible choices between groceries medicine and keeping the lights on. Um to see an arbitrary fee tacked on to our bills essentially asking residents to subsidize city debts or operational shortfalls is not it's not just a poor policy it's a breach of public trust. Um and why should the residents be responsible for the city's financial

obligation because that one I honestly still don't understand why we're stuck kind of paying for what somebody else's messed up. Um when a household faces a budget deficit we cut costs we do not simply demand more money from our neighbors by shifting the burden of city expenses onto our utility bills we are creating a regressive tax that hits our most vulnerable citizens hardest. A flat fee on electricity does not account for income it punishes the elderly on fixed incomes and working families alike. Um I have more on here but I have a a petition that I probably should have started out with a couple weeks ago cuz this is only four pages. Um but I'll read and I'll I've made a copy that I can give to Melissa. I'll read to you what it says at the top of each page it says Radford residents are asking you to please stop with the additional fees on our monthly electric bills that seem arbitrary. Each of us understand that the cost of actual usage must be paid. We also understand that the taxes must be paid. We need families we need fairness for all our households. We the people paying these bills are asking you as a city council to eliminate these fees. The affordability needs to be restored on our essential to our essential utilities. And this is affecting all of the Radford residents regardless of income bracket. However, I'm calling myself speaking for the underdog. Those of us in HUD housing, it affects somewhat more. I believe it's affecting our rent because our rent amount has to do with the utility amount. The utility allowance that each Virginia HUD housing resident is allowed does not include the fees. So, like if I understand correctly, my rent has gone up because of the amounts that get turned into the state which go to HUD.

Um So, yeah. So, that affects not only our higher electric bill, but then also our rent. Um And I brought my own electric bill, but I only got frustrated with that because when I went down to the city to get an explanation for a disconnect notice I got, the lady she didn't even understand the amounts. Like quite literally. And I don't understand what she didn't understand, but then that got me even more flustered. Um but anyways, these the fees have really need to get lowered. So, that's all. And that's the copy. Okay. Um can I ask a quick question?

Sure. Cuz I know all this stuff is going to keep going. If that list was to be longer, like if I were to keep getting more and more names, would that affect anything that you all do or not? Well, certainly bring us whatever you have, whatever you want to share with us. That's fine. And if you between now and next week, if you have more, I think you can bring them either Monday night or next Tuesday. And we would take a look at those before we finalize things.

Okay. Okay. All right. Thank you. Thank you. Is there anyone else who would like to speak as part of the public hearing regarding the tax rate or for 2026 or the fiscal year 2027 fees and rates? Hi. My name's Doug Knipp. I live 7th Street. Been here for 20 years, 20 plus years now. Um So, I wrote some notes down, some things I was thinking about uh related to the the budget and some of the things. And ultimately, where I come to is I don't think we should raise rates very very much at all. And the main primary reason is they never go back down. They they only go up and they stay up. And that affects everybody. Every rate increase affects everybody, right? So, um when we make cuts in budget, they affect fewer people, right? So, you cut the library hours, you cut whatever it happens to be, whether it's rec center, park hours, whatever it happens to be, they affect far far fewer people because the fewer people use all those resources. I don't use the library very often. I don't use the rec center very often. I don't use some of those other things. So, to me, it's more much more important to cut items out of the budget than it is to raise rates. Uh a prime example is is I heard last week or 2 weeks ago at the first uh budget meeting was um our we've we're about as lean as we can be is the comment that I heard. And then the following week, we come back and there was $400,000 worth of cuts we were able to find. I in my head, there's probably another 400,000 there that that we can go get. And I think it I think we got to keep digging and not just say this is as lean as we can be. I think that's the totally

wrong mindset um to have. So, um another thing is comparing rates to other cities and other areas. Uh not a big fan of that. And the reason is I I get that that's the easy comparison, but when you compare rates to another city, you're saying everything else is the same with that city, the the services they offer and everything. And that's never the case. So, um it to me, it's um I can't I I actually wrote down a John Wooden quote that I like cuz I'm a I'm a sports fan. And um it's don't measure by what you accomplish, but what you should have accomplished with your ability. So, let's if we make the budget to a point where we are as lean very lean, we can have rates much lower than other cities. We don't have to just raise it up to the wherever everybody else is. So, um I really think that's super important. Um And that's that's uh I guess the gist of what I wanted to say was I think raising rates should be a last resort and making cuts should be the first priority in every way in the budget. Thank you. Would anyone else like to speak? My name is Regina Meredith and I live on Rock Road. Um and I did last week, I wasn't able to be here, but I did send each of you uh my comments about what I would have said had I been here. Um I know that in doing some research, there's about 30% of residents in Radford who live at the poverty rate. None of us want to see anything increase. We all feel like we are paying out more than ever at this time, you know, with gas and groceries and just things that we need to get by. I do feel like that we're putting a lot

of pressure on the backs of those of us who are able to pay real estate taxes. To the best of my ability, that might be about 45 to 48% of the residents of Radford. And especially when we look at the history over the last 3 years. Um we've already talked about if we raise 2% this year, then probably next year it'll be 2%. It just seems like there's no end in sight to the to the races with that. I also want to echo what the gentleman said before me. I had thought the same thing. When you put us in a list with our neighbors, it is assuming that all things are equal. You really have to look at individual places, what they get for what they pay. For instance, Salem pays some of the highest real estate taxes around. They get an enormous return on their taxes. Um

[clears throat]

I still would like to echo that I really believe that what Radford really needs is a robust and aggressive economic development plan to bring in more businesses that are really going to revitalize our city. If a couple more of the larger employers in this area were to shut down, it would be bad. I mean, it would be the end probably. And we've got to continue to bring in and fill empty buildings with bigger companies that can really add to the city's finances. Thank you. Does anybody else have something they'd like to share? We did receive an email this afternoon from Alyssa Archer and she asked that we share this during this time cuz she couldn't be here. Dear city council members, thank you all for Thank you all for your time and thought you're giving to the budget. I'm writing in favor of increasing property taxes to 87 cents or even higher if possible, especially in comparison to raising the electricity rates with property tax relief provided to residents living in poverty. Property taxes are the best way of shifting the burden to residents who can afford it. I hope that the city council does a better job of getting the word out to residents who feel that any additional property tax would be too high. It really isn't compared with other localities where residents must pay both town and county taxes, residents of our city would still be paying less overall. We all want to live in a healthy, vibrant, and safe community on the other side of taking care of the current debt. Raising the property taxes to 87 cents would help us work toward that goal. Thank you for your time. Alyssa Archer, Randolph Street, Radford. Is there anyone else who would like to speak this evening on the rates and fees? Hi. My name's Pat Fluke. I live on 101 3rd Street. I just have a quick

question. Is tonight only going to be a discussion on the raising of the taxes? Is it Are we also going to discuss the possibility of cuts? Well, we're going to talk about the budget next. So, we're having two public hearings, one on the rates and fees and one on the budget. So, we'll open the floor for the the budget portion in just a second. Fantastic. Thank you. Hello. I'm Amanda Winter and I'm speaking as a community member. Um a lot of people feel like when taxes are raised, it only affects those who have real estate and that is not true. It is reflected in the rent prices. And I would like to kind of build a little bit on what Beth had to say. When it comes to HUD, um I'm not sure if you guys are aware, the allotment for HUD has went down for the city of Radford. And that is not reflected in the the rental rates at all. So, it concerns me and it concerns me for the people who need it most. So, um just thought I would mention that. Thank you. Is there anyone else to speak regarding the tax rate or the fiscal year 2027 fees and rates as presented? Seeing no one, we'll close that public hearing. And we will open the public hearing for the fiscal year 2027 budget. If you have something directly related to the budget, you can come down to the podium and state your name for the record and share your thoughts.

Hi again. My name is Pat Luke. Live on 101 Third Street. Uh I have a couple of questions about cuts. Transit is the first. I don't know how many of you have seen the buses. They don't seem to be have cut much as far as transit. Uh question is have you cut as far with transit at all? Uh another question is um is producing revenue. Um you have a lot of opportunities in the city to produce revenue. Um I've looked into this quite in quite depth. And um I figured that they we have a million dollars of unused and I call them toys. Uh take a trip over to public works. Look into the parking lot. And you will see I don't know do we still have a street cleaner? We have a street cleaner.

a street cleaner. How many times have you seen the street cleaner? Oh, I'm sorry. How many times have you seen the street cleaner? Maybe twice. Usually it's for the parades. Uh the police department has a Hummer. How many times have you seen the Hummer? Our street department has a full size um where they um completely can redo a parking lot. Uh the whole works. How many times have you seen all of the equipment in the city? The street department. Um we have a lot we can sell. We have a hazmat program on the fire department. I would love to know how many times we've used the hazmat program. Um we have a lot of waste uh that can be sold. Uh Montgomery County does a surplus auction every single year. Generate quite a bit of money. Um another thing is we have an issue with uh workman's compensation. Uh we've had a lot of workman compensations claims. And uh I kind of know this for a personally is that um our public works will employ ex-cons directly from the jail. And um a lot of them have drug issues. And what happens is it's a big circle. We hire them. Um what happens is they have a tend once in a while they go back into having a drug problem. They're still employed by the city. They have accidents. I think if possibly

the public would have a lot of this information public that they could see where places can be cut. And what happens is because they are having a drug issue and they come to work. I know this actually personally. Because I actually my son worked and I also worked for the city. And uh what happens is when they come and they have an issue with drugs they hurt themselves. And um we foot the bill. Um I could tell you a lot of stories. Uh I could tell you a lot of ways of us generating revenue. We're talking about millions. We have spent ourself into this problem. We went over the budget for McCarg. How much did we go over the budget for McCarg? Uh we've gone over the budget for a lot of things. We have a beautiful stadium and I know the answer to this already. Grants, grants, grants. We matched them. We matched them. And when you match them it comes out of revenue. It comes out of revenue. We're paying for all the toys. And now we're talking about a new garbage truck. We have 10 garbage trucks. And I could give you a list of the toys we have in this city. That's where your money's gone. Thank you for your time. Thank you. Would anyone else like to speak regarding the fiscal year 2027 budget? All right. Seeing no one else coming forward, I will close that portion of the budget. Uh Todd, I will ask for one quick thing since it was brought up and we are going to go into closed session

here in just a minute. Uh the electric has been brought up multiple times and uh Ms. Barbara brought it up again this evening. Uh we are talking about the 5% increase on that. If we were to drop that say by 1%, what would happen uh with the money that should be generated by that? So if you drop the uh the the electric revenue by 1% it equates to roughly $300,000. Where that will hit the budget, you have to reduce the transfer um uh or to the general. Um if we reduce the transfer to the general, you now have to balance the general. And to balance the general by that $300,000, it's approximately 3 cent on the real estate. Okay. And that would be true if we drop down 4%, 3%, 2%. You're adding $250 to $300,000 each time you do because the 5% generates about 1.3 million and the main reason we're doing it is we're anticipating losing about $1.3 million in revenue from the co-gen. Correct? That's correct. And approximately every 1% you drop it, it'll go down a little bit from $300,000 but it'll be 300 2 280 285 and then it'll drop again to like 270 as you go down to 3 and 2% until it's But that 1.5 1.3 million would would be around 10 to 12 cents on the real estate tax rate if we had to find that in another way for example. Approximately. Yes.

Okay. I just wanted to clarify cuz a lot of folks don't know how that math actually works out and with the 1.3 million dollars in potential losses we're anticipating from the co-gen facility we have to consider that in the budget. Okay folks, we do need to go into a closed session. So I'd like to make a motion that we go into closed session for consultation with legal counsel employed or retained by a public body regarding a specific legal matter requiring the provision of legal advice by such counsel. Nothing in this subdivision shall be construed to permit the closure of a meeting merely because an attorney representing the public body is in attendance or is consulted on a matter. Specifically to discuss the Pulaski County PSA. This is Virginia Code Section 2.2-3711A8. Uh we have a motion. Do we have a second to move into closed session? Second. We have a motion and a second. Any discussion? All in favor please respond by saying I. I. Any opposed? Now you all are welcome to stay. We're actually going to move to the conference room for the closed session. Uh we will be back as soon as we're through and conclude the meeting. Thank you.