City Council - workshop

Good afternoon and welcome. At this time, we will call our city council work session to order. Our first order of business is a discussion related to the recycling operation. Mr. Manager.

Mayor, Vice Mayor, members of council, as you're aware, the 2026-2027 operating budget emphasized maintaining a high quality of service to our citizens while identifying opportunities to maintain or lower rates and fees. Additionally, at the same time, as a 50-year member of the Southeastern Public Service Authority, or CIPSA, you've taken recent action, along with the other member jurisdiction, to advance the life of the regional landfill by challenging CIPSA to introduce recycling to their regional refuse operations. All these efforts have aligned recently, offering the City of Suffolk the ability to continue to provide a recycling service, not through our current vendor, TFC, but through SPSA SORT. You received an update at your May 20th work session from Dennis Bagley, Executive Director of SPSA. This shift from TFC to SPSA SORT maintains our current refuse rate of $30 a month for our refuse customers and citizens. This shift officially takes place July 1st. We've been working on both an operational and communication strategy, which you will hear more about with this presentation. And so without further ado, I'll introduce Greg Benton, our Director of Public Works, who's been working on the operational strategy. He will be followed by Jennifer Moore, our Director of Communications, who will touch on how we are getting the word out. I'll also mention that Dennis Bagley, Executive Director of CIPSA, and Kyle Strickland, the Deputy Executive Director, are with us. here today as well, if you have any questions.

Thank you, Greg. Mr. Manager, before we continue, I failed to mention that Vice Mayor has contacted me and he is going to be tardy to the meeting today, and Council Member Butler-Barla will be absent from the meeting and has been excused. Thank you.

Good afternoon, Mayor, Vice Mayor, members of Council, City Manager. Jen Moore and I will be presenting our overview of our refuse operations and communications plan as we prepare for the July 1st start of green and blue can collection. This presentation will summarize our operational readiness, staffing, equipment, efficiencies, and communication efforts to ensure a smooth rollout. First, I want to give all of our refuse staff a shout out as it is refuse appreciation week. I like to tell them that they have one of the most complex and critical jobs. They are masters in logistics and overcoming challenges that impact them every day because a citizen's refuse has to be picked up. Rain or shine, hot or cold, snowy or windy, and no matter how long it takes to get across Highway 58, Only a few more days of that. So the plan. Achieve a 50% reduction in waste being landfilled by separating organics, recyclings, and trash from mixed waste. That 50% breakdown is 20% of all waste will be recycled. 30% of the waste will be converted into biochar. So that achieves a minimum of 50% diversion rate, extending the use of our landfill by up to 30 years. Also note the citizens refuse bill will not be increasing as a city manager mentioned. I wanted to share another great opportunity beginning July 1st. Residents who are and are not serviced by the city's collection system, such as condos and apartments, For example, have the option to bring recyclable materials to CIPSA's landfills designated drop-off station if they wish to self-sort. Those who self-sort can also take advantage of the opportunity to dispose of household hazardous waste, electronics, and tires in the same visit, reducing the risk of improper disposal or roadside dumping. When residents do come to the landfill, they will be able to use the flyover on Highway 58 that will be opening soon. The flyover makes it safer and quicker to get to the landfill. Once here, residents will come to the scale house noted by the green rectangle and inform the scale house attendant that they have recyclables to drop off. The scale house attendant will give them a ticket and they will proceed to the household hazardous waste area noted in the blue rectangle. and staff will then direct them to the drop-off station shown at the red rectangle. The resident needs to inform the scale house attendant if they also use hazardous waste, tires, or other items that need to be dropped off so additional tickets can be created. There's no charge for the use of the recycling drop-off station. Getting into the operations. We are ready for July 1st. As we approach July 1st, I'm pleased to report that our team is fully prepared for the transition. We currently have 41 refuse employees supporting daily operations. Our fleet includes 21 automated trucks, 10 compactor trucks, eight boom trucks, and two crash trucks. This combination of staffing and equipment ensures we have the coverage and capacity needed beginning July 1st to collect our citizens bagged refuse. Citizens are just to put all their refuse in a bag and place in either the blue or green cans. Both of these cans, green and blue, will stay at the residence. The green can is a lifetime lease with the city for the green can, and the blue can is property of the city purchased by us. The items that used to have to be sort can also go in the same bag and also in a green or blue can. We also ask that if there are any items that were part of a special collection that can go in a bag to go in a bag and placed in the green or blue can. This will eliminate or help to draw down the number of special collections that we have had. Last month we had a record breaking 10,000 special collections. for last month. However, appliances, furniture, those are to remain at the curb and be part of the special collection pickup. To further support this transition, we've added five new collection vehicles. These include four automated side loader trucks and one automated auger truck. The auger truck reduces trips to the landfill by 50% due to its increased holding capacity. We also have filled our part-time dispatcher to continue our responsiveness and coordination. Finally, we have replacement parts and cans on hand to maintain operations without disruption. We've also implemented several operational efficiencies to improve service performance. First, our staff is cross-trained, which increases flexibility and capacity across the system. Second, we have optimized our collection routes, increasing the number of routes from nine to 13. Most important to our citizens, there are no changes to your pickup day for refuse. We have mobile fleet support, enabling on the spot mechanic assistance to keep trucks running, vice being towed to our fleet facility. Not only will we be able to change tires on the spot, but we'll be able to replace hoses on site by having prefabricated hoses ready to go via our mobile repair truck. The SIPSA flyover will be open, saving time by eliminating the need to cross Highway 58. And finally, we have access to an alternate automated truck clean-out station, helping us turn vehicles around more quickly after we visit the transfer station tip floor. A few more items not listed on the slides. We've added a second location for our refuse equipment consumables that keep our trucks going. Our truck availability uptime has increased through various actions, so we have the ability to have the right truck for the right route at the right time. We've built in additional flexibility and adaptability for the need at any time. We have a versatile fleet, a cross-trained staff, and a motivated workforce. We perform test runs to ensure our success and the efficiencies have been proven. I want to thank the Public Works team as a whole It's refuse, it's road maintenance, it's fleet, it's finance, it's city leadership that supported us as we tackled this challenge set before us. We picked apart every aspect of the process and found efficiencies along the way. We listened to our operators. We asked for feedback. We asked for people to step up, and guess what? They did. We're gonna pick up that green can and that blue can and be more efficient than we were before. I'm happy to answer any questions after Jennifer Moore briefs the communication plan. I'd like to welcome her now.

Good afternoon, Mayor, Vice Mayor, members of Council, Mr. City Manager. I AM JENNIFER MOORE WITH COMMUNICATIONS AND TODAY I'LL PROVIDE AN OVERVIEW OF OUR COMMUNICATIONS PLAN FOR THE UPCOMING TRANSITION AND THE CHANGES TO SUFFOLK'S CURBSIDE RECYCLING PROGRAM THAT WILL TAKE EFFECT JULY 1, 2026. OUR GOAL IS TO ENSURE RESIDENTS CLEARLY UNDERSTAND WHAT IS CHANGING, WHAT IS STAYING THE SAME AND HOW THEY CAN EASILY ADAPT TO THE NEW SYSTEM. The communications campaign is built around five primary goals. First, we want to ensure all 32,000 Suffolk households receiving refuse service are informed about the upcoming change. Second, we want residents to understand that they will no longer need to separate recyclables from household trash. Third, we want to educate residents about Sips Assort and the environmental benefits associated with the innovative regional program. Fourth, we want to minimize confusion and reduce customer service inquiries regarding this implementation. And finally, we want every resident to remember one simple message, two cans, no sorting. To support the public education efforts, we have already launched a dedicated SPSA sort page on the city's website. This page serves as a central information hub for residents that include FAQs, educational material, and videos explaining how the system works. This can also be accessed on the website home page with a tile that you see on the screen titled Sips of Sort. We also have coordinated with public works and dispatch so that residents who call with questions can receive consistent information and be directed to available resources. The goal is to make information easy and easy to find and easy to understand. This campaign uses a multi-channel approach to ensure we reach residents through multiple touch points. Direct outreach includes a postcard mail to approximately 32,000 households, website resources, FAQs, and newsletter updates. Digital communications include social media campaigns, municipal channel advertisements, digital signage in city facilities, and home page alerts on the quick tile access. Community engagement efforts include refuse truck magnets, council member and staff talking points, And short educational videos and FAQs distributed through conversations at the curbside platform, which is the texting educational resources that Greg may have mentioned earlier in a slide. And that is when residents call the refuse number and have a question, there is a dedicated cell phone where we text them a direct link to the FAQs and to the educational videos. So by delivering the same message repeatedly through multiple channels, we will increase awareness and reduce confusion. Throughout every communication, we are reinforcing several key messages. Most important, that this is not an elimination of curbside recycling. Rather, it is a change in how recyclables are collected and processed. Beginning July 1, residents may use either their blue recycling can or their green trash can or both. Collection schedules remain the same, and both cans can be placed curbside every week, and there will be no change to the refuse fees. RESIDENTS SHOULD KEEP BOTH THEIR BLUE RECYCLING CANS AND THEIR GREEN CAN, BUT THE BLUE ONE WILL BE USED FOR CURBSIDE COLLECTION. FOR THOSE WHO PREFER TO SELF SORT THEIR OWN RECYCLABLES, THE RECYCLING DROP OFF SERVICES WILL STILL BE AVAILABLE AT THE REGIONAL LANDFILL CONVENIENCE CENTER LOCATED AT 1 BOB FOLDER DRIVE. We are also emphasizing the environmental benefits of Sipsa Sort, including recovering recyclable materials after collection and helping to reduce landfill disposal while extending the life of the regional landfill for future generations. The visuals that you will see associated with the communications campaign are the blue and green cans, the Sipsa Sort logo, and a new, albeit temporary, mascot. Meet Charlie Toucan. To help make the campaign more engaging and memorable, we've introduced Charlie Toucan. Charlie serves as a campaign mascot and spokesperson. He helps simplify what could otherwise be a complex operational change and provides a recognizable visual element across postcards, social media, videos, signage, and educational material. Charlie reinforces our primary message in a friendly and approachable way, especially the reminder, Toucans, no sorting. Get it, Toucan? So the timeline. The campaign will begin in June with the launch of the webpage, social media outreach, homepage features, and direct mail. Postcards will be mailed in the coming days to all residential refuse customers, and the municipal channel advertising will be underway. When Sips of Sort goes live on July 1, we will continue outreach through media engagement with a media facility tour. and ongoing communications throughout the summer. Additional messaging opportunities will occur during community events such as National Night Out and the TGIF concert series. Our objective is to maintain visibility before, during, and after implementation. We'll evaluate the effectiveness of the campaign through several measurables. These include a reduction in customer inquiries, website traffic, social media engagement, media coverage, participation in facility tours, and overall resident understanding of the program. Ultimately, the success will be reflected in resident behavior and whether the public clearly understands how to use the new system. If residents only remember two things, we want those two things to be two cans, no sorting, and don't sort it, just toss it. In closing, this communications campaign is designed to provide residents with clear, consistent, and repeated messaging across multiple platforms before the July 1 implementation date. Our focus is simplified, educational, and transparent while highlighting the environmental benefits of sepsis sort and ensuring residents will understand that this transition makes waste disposal easier than ever. Thank you, and Greg and I are available to answer any questions you may have.

Council, any questions or comments?

Council Member Williams. Yes, thank you. Thank you, Greg. Thank you, Ms. Moore, for a great presentation. I do have a question as it relates to the tipping fees for the commercial clients. Will there be an increase in the tipping fees or...

Just to provide clarity, so, you know, as a municipality, our operating budget, it's laser-focused to the residents, and so this is a separate component that does not involve our customer base or our residents.

Councilman, to answer your question directly, we contract with commercial customers, and we have a contract directly with them. The cost this year does go up $3 per ton, but we've added some tiered approaches to possibly be able to bring their tip fee down, but that $3 increase in the commercial tip fee is what SIPSA charges directly to those commercial customers, and that $3 increase is based on our increase in transportation costs this year.

So you just said there might be some type of mechanism there to reduce it?

Yes, sir. What we've had in the past is a $30,000 ton limit and anything over 30,000 tons, the customer got a lower rate. We've had a tiered approach in now, so somebody that may be a smaller company who might only bring 5,000 or 6,000 tons, they get a much better price as well. So those customers would see a decrease in their cost. The only ones that would see an increase are those big companies that were bringing us 30,000 tons and more. Thank you.

Thank you. Councilmember Bennett.

Yeah, a couple of questions. On the self-drop-off for the recyclables and tires and hazardous waste, are they going to be in a charge for that type of drop-off? I know the recyclables probably will not, but what about tires and hazardous waste?

So regarding the other two that you mentioned, the same procedures and costs would stay in place?

Okay, I'm talking about residents of Suffolk. If I have some tires or I have some hazardous waste that I want to carry to the landfill, so what approach do you take when you go there? I know you have to go across the scales. So what other things, charges or whatever, will be added?

Right, so they'd stay the same. So it would be the four tires per day. I know residents are allowed to drop off four tires per day. And then the hazmat, if there's any other specific details on the hazmat.

fees there again um i'm going to ask dennis to come up and speak because he's the director for the landfill yes sir there is a charge for each customer who brings um has has material household has material to us there's a per pound cost and then there's a uh gallon cost and that's billed right back to the city that that number has not changed in the last five years i don't want

Don't hold me to this, but it's on our website, but I think it's $15 per customer per visit Okay, because that's some of my concerns I know with tires We find people just dumping tires everywhere. So if they can bring them to the landfill maybe Rather than to dump them then I think that will help Probably some of the scattered tires all over the city That's really why I was asking the question about a number or how many or whatever it takes to initiate

Uh, so we do have, uh, we actually just had a recycle drive this past weekend. And so those recycle drives that we do usually around once a quarter is an opportunity for residents to bring their, um, hazardous material, their tires and have amnesty to those charges. So that is something that we, the city public works, uh, do put on for the residents. Uh, if the fee is a concern or a roadblock to them. Okay.

The other thing I was going to ask, uh, I have. I can't speak for other council members, so I won't say we. I'll say I have been getting a lot of communications about the new system. I work, will not work, and this and that. So they're going to be advertised on television about one can, two cans, and all this and that. Is there a set time limit where they're supposed to be in operation for 50 percent, 100 percent? What's the timeline on that? Do you know? So with that I was asked for me and I couldn't answer gotcha.

Yes, sir.

I'll refer to the city manager on We might do a triangle here I'm hanging up then it's quick going to the third row you need to stay up front but there is a ramp up that's Dennis can provide a little more detail and as the Essentially the former wheel abrader facility gets brought online, but I'll he knows way more than I do We're currently process of 54,000 tons per year

The contract ramp date has 108,000 tons per year, July 1. And then there's a ramp date for, through the 28, there's four different ramp dates that bring on 54,000 tons per shift, or 108,000 tons. That brings it, at January of 2029, it will be at 540,000 tons. But the first ramp date has already passed. They're doing the 54,000 tons. There's a second ramp date, July 1, at 108,000 tons, and they've already proven they can do that. The 2028 date, through the year 2028, there'll be four more ramps of 108,000 tons per unit. We've had the first four months since it's been operating They've exceeded the contract requirements of 50% diversion, more than 20% recyclables, and more than 30% organic material. So it is working? Yes, sir. Okay. And we will have a dashboard that will be put up on after we have a board meeting next Wednesday. After our board sees the dashboard, we will put the dashboard out. You can go on our website. and you can see exactly how much we're recycling and how much biochar-eligible material we're producing every month. Okay.

And I would also just like to say thanks to Jennifer and the manager, whoever got this together about the communication campaign. That will be going out to the citizens because I think that's very important that they understand what the changes will be like so that no surprises. And because there are some that, still don't get it, you know. So I appreciate the mailers. I think that goes to each home just about. I should pretty much tell everyone exactly what is taking place and what to expect. So you can't, personally myself, I think that you can't ask for more than that as far as communication, getting it out to the people. So, again, I just want to say thank you.

Just to be clear, July 1, for the residents, You roll out whatever can, however you do it, we're going to pick them up. So nothing happens. You don't have to change your operations or what you do at home. And so we're just educating what happens once the city of Suffolk truck picks it up versus a TFC truck.

Council Member Johnson.

And Dennis, my question is for you, if it's okay. I'm excited about this new program. I think it's something that we've needed for a long time. And I think if it works, wow. It's going to be real advantageous to the citizens. But I'm just like Leroy over here. I've had phone call after phone call. The people don't understand it. And I'm convincing them. I'm telling them the same thing. It's going to work. You've just got to pay attention and ask questions. So I think it's most important that as we go along and we're going to recycle 20% of the waste and we're going to converts 30% to biochar, that we respond and make sure the citizens know what we've done and how this moves forward. Because with any new program, those numbers may not be met, but like you said, now they are. So as we said before, I think it's most important that we stay on top of this for the next every three months.

We agree that we need to build confidence. That's why our communication strategies, we've been working directly with your communication team, and they can tell you that we're very, serious about making sure the citizen knows what's going on and trying to rebuild confidence in a recycling program that's probably not had the most confidence in the world over the years.

But I do think that what we're trying to do here is a real asset to the city. And I think that it's going to work. I have faith that it's going to work. We just have to make sure the citizens understand what we've done and why we're doing it and how we're doing it. If we have a glitch or we screw up, we fix it. But my point being... I think that's the ultimate charge here is that we keep the people informed. And I thank Jennifer as well and the city manager because it's great. The communication part of this program is excellent, and we just need to keep on. So thank you. We'll continue to work on that.

Council Member Richter. Thank you, Mr. Mayor. And Greg, Jennifer, thank you very much for the presentation. Greg, just a real quick simple question for you. What is a crash truck?

A crash truck is the large truck that you see in a work zone that has two boxes that come off the back so that if you see it on 58. So right whenever they it's the truck that if you were to not see the lane closure and you would run into the truck and it has those two boxes hanging off the back that would take the impact. That is what a crash truck is. And the reason why we have those crash trucks is because on some of our secondary roads, such as Carolina Road, Whaleyville Boulevard, we put those in place behind our refuse collection trucks because of the chance of an accident. And we actually had an accident a few weeks ago where we had a vehicle not see the trash being collected, and they did... hit the crash truck and saved some people's lives, and the person in the crash truck was okay. So that is why we actually have crash trucks out on our higher speed roads to make sure that we protect our staff.

Well, it just goes to show you what kind of memory I have. I should have remembered that from attending the Public Works Academy, not once but twice. But anyway, thank you for that. uh... got going back to the recycling you know almost as long as i've been in suffolk we've had this curbside recycling and i can remember the little bins that we have that you would put on the side of the street and then we graduated from those to the bigger containers that match the trash containers and when folks talk about recycling uh... you know it it it invokes a little bit of an emotional issue because everybody wants to do right by the planet these days and recycling is a big component of that but the bottom line is is that the system as it is in place now is not really functioning at the efficiency that we would really like to see. And, you know, so for me, the two big takeaways, you know, in addition, I know that change can be upsetting to a lot of people, but the two big takeaways are, number one, the amount that is going to actually get recycled is going to go up considerably. And then the other big takeaway for me is just simply the extension of the life of the landfill. there's no place else around here that we can put a landfill. So anything that we can do that has the multiple benefits of A, increasing the amount that is getting recycled, and B, extends the life of the landfill, I think for the citizens in the long run is going to be nothing but a win-win. So I would encourage folks, I know there's a lot of anxiety about this. I've received just like Councilman Bennett and Councilman Johnson have received all kinds of phone calls, all kinds of emails, and all kinds of text messages expressing doubts about whether this program is going to actually work. I would encourage folks, give it a chance. Don't condemn it before it's even gotten off the ground. And let's see and make sure that these benchmarks get met. And according to Dennis there, some of the benchmarks that have been put in place are already being met or exceeded, so I find that is a very encouraging sign. And keep the communication up. Jennifer, that's always the important part of it, because no matter how much you advertise it, there are always people who say they didn't know. But y'all are doing a great job, as always, and thank you very much.

Council, anyone else with any questions or comments? Hearing none, thank everyone for their and we'll move on to our next item for our work session today. Thank you. And that next item is a report related to the fiscal impact of removing the moratorium on tax exemptions for nonprofit organizations. Mr. Manager.

Mayor, Vice Mayor, members of council, Billy Butt, Suffolk Assessor, and Stephanie Wells, Director of Finance, are going to team up and provide the council with an overview on the requested subject topic.

Good evening, Mayor, Vice Mayor, members of council. As the manager just said, we'll kind of have a little tag team presentation here on the nonprofit exemptions and the fiscal impact of lifting the moratorium. The first part that I'm going to do is provide a little history of the program and to provide an overview of the application process. And then Stephanie will come up and discuss the fiscal considerations. Okay, Virginia State Code Section 58.1-3651 allows localities to determine whether qualifying charitable organizations may receive local tax exemptions. Back on September 7th of 2011, City Council here in Suffolk passed an ordinance establishing Section 82-487 of the city code to provide for such exemptions. Not long after, the city began examining the financial impact of the program as officials became concerned about the loss of revenue, the growth in the exemption applications, and the long-term fiscal impacts. And two short years later on September 4th, 2013 City Council voted on an ordinance imposing a moratorium on the acceptance of applications for tax exemptions for these organizations. This moratorium remains in place today and that's why we're here tonight. So there have been some recent changes in state code. 58.13603 Section A says, when a part but not all of any such building or land, however, is a source of revenue or profit, and the remainder of such building or land is used by any organization exempted from taxation pursuant to this chapter for its purposes, only such portion as is a source of profit or revenue shall be liable for taxation. The new change says, and that's section D, any rental income or other sources of income received from any portion of real property that is used for charitable or benevolent purposes in accordance with subdivision A2 of 58.13651 shall not be considered a source of revenue or profit for purposes of this section. Basically what that means is there are some properties out there where uh... non-profit has been approved under this program and they lease space in their building out and we can tax that space that's least real estate taxes what this will do uh... is take the ability to attack that tax that space so we'll have to exempt the entire property from real estate taxes based on this. There are four or five properties, I believe, out there in the city that fall under this. So the process for applying for this exemption is the entity requesting the exemption shall file an application with the city assessor The application shall be in a form that's prescribed by the city manager and they must to be considered for each July 1st. The application must be received by my office by April 1st. Within 45 business days of receipt, city assessor's office will review the application for completeness and request any additional information that may be needed. Once deemed complete, The application is sent to the city manager for action of the city council within 60 days after receipt from the city assessor. The city manager will place an advertisement for a public hearing in the local newspaper. The ad will state the date, time, and location of that public hearing. And basically, city council will make the final determination on every one of these that apply. And to retain your status in this program, the entities shall file an application with the city assessor every three years as a requirement for retention in the program. So we actually are getting those letters ready now to send out to the folks that need to reapply. that are currently in the program. With that, I'll turn it over to Stephanie for fiscal considerations.

So this is the fiscal, I'm going to do the part on the fiscal impact and this chart reflects the different properties, class of properties that we have exemptions under. On the left hand side we have showing the mandated versus discretionary. AND THEN EACH OF THE DIFFERENT CLASSES OF PROPERTIES. WE'VE ALSO INCLUDED THE NUMBER OF PARCELS FOR EACH OF THESE CLASSIFICATIONS, AND IF YOU LOOK DOWN THE FIRST ROW OF REVENUE LOSS UNDER THE 2012-2013, YOU CAN SEE IN FY2013, THERE WAS $12.3 MILLION OF LOSS REVENUE. FOR 25-26, WE HAVE $30.5 MILLION OF LOSS REVENUE FROM THESE EXEMPTIONS. which is 17 cents on the real estate tax rate. Looking at the veterans, which is our largest one, it is mandated. And that veterans exemption is $3 million more than the government's and quasi-government's property in the city of Suffolk. So that's really exponentially grown. And so the question is, why is this important to point out the veterans exemptions we've had A THOUSAND APPLICATIONS IN THE LAST 12 MONTHS FOR THIS VETERANS EXEMPTION. IT'S ESTIMATED THAT THERE'S APPROXIMATELY 4,000 VETERANS WITH DISABILITIES IN SUFFOLK AND THIS EXEMPTION HAS GROWN EVERY YEAR AS YOU CAN SEE EXPONENTIALLY IN THE LAST FEW YEARS. THE VETERANS EXEMPTION IS PART OF THE DISCUSSION OF HOW MANY EXEMPTIONS ARE WE GIVING NOW, HOW MANY ARE OUT OF YOUR CONTROL. How much of a burden will they continue to be and can we afford to provide other discretionary exemptions as well? For pulling out just the exemptions that are discretionary, We have the charitable, other elderly and disabled. The charitable there is our nonprofits, and you can see for the number of properties, we have 53 properties now. The total revenue loss in 12-13 was $1,674,000. For the revenue loss in 25-26, it was 2.2 million. The total revenue loss for the discretionary exemptions was 3.1 cents on the tax rate. The previous slides reflected what is shown here. The discretionary tax exemptions are $5.5 million in lost revenue for FY26, or 3.1 cents on the tax value. Mandated tax exemptions do continue to grow. For the nonprofit tax exemptions, you saw that there were 53 nonprofits totaling $2.2 million in revenue loss, or 1.3 cents on the $1.06 tax rate. An estimated 280 nonprofit organizations in Suffolk could request these exemptions. Does that mean that the value will be two times the $2.2 million? Will it be five times? Will it be ten times? We just really don't know. We would have to do more research to determine the true fiscal impact of removing a moratorium. For the nonprofit support, I did include that here so that we can show that not only have we given some other nonprofit tax exemptions, we do also locally support nonprofits. Our local contributions increased by $164,000 going into FY27. We have 30 local nonprofits that we contribute to, $1.8 million or one cents on the current tax value of each penny assessed. I DID ALSO INCLUDE THIS LAST SLIDE HERE, WHICH IS THE 30 NONPROFITS DISCUSSED. FY26 WAS THE $1.6 MILLION. FY27 IS THE $1.8 MILLION TOTAL. AND THEN ON THE RIGHT-HAND SIDE, I'VE ALSO INCLUDED THE $164,000 WHO BENEFITED FROM THAT INCREASE GOING INTO FY27. SOME OF THE AGENCIES HAD LARGER AMOUNTS, LIKE THE $20,000 FOR STOP INC., WHICH IS NEW. FOOD BANK GOT $20,000. Western Tidewater saw a $25,000 increase. I'm sorry, Western Tidewater Free Clinic. There's lots of Western Tidewaters. Then we had some of the other mid-level, like Geneve Shelter got $15,000, Center for Cultural Arts got an additional $16,000, and then some other smaller ones. So I won't go into more detail on that because all of the information is here for you to review, but we are providing nonprofit support in addition to those exemptions that are already in place. And that is under the purview of council as well. If you would like more financial information on the tax moratorium and what that impact would be, should it be removed, we could bring that back to you at another presentation.

Okay, thank you. Council, questions or comments?

Council Member Richter? Thank you, Stephanie, for this. And, Billy, thank you for your contribution to this as well. I guess I'm the one that asked for this information, so I want to thank you very much for providing it. There's a lot to digest here. I mean, obviously the impact, you know, would potentially be significant. So if nothing else, I'd like to take this information and further study it. Absolutely. But thank you for assembling it for me.

Sure. No problem.

Councilman Bennett.

Definitely. All this I see that's mandated here, nothing actually can be done to eliminate or cut it back or do anything with that, right? Because that's mandated.

In the first fiscal impact section that says mandated, that is correct. We are mandated to give those exemptions.

Okay. And they cannot be reduced or increased. I'm sure you could increase them, but not decrease them.

Correct. It is set by the state code.

Okay.

Councilmember, do you have another question? Okay, thank you. Councilmembers, do you have any other questions moving forward? I appreciate Councilmember Rector bringing this up. I've had several people ask me about it as well. And we go back to this vote from 2013. The vote was seven to one. I was the one that didn't vote for it. And I had reason for it at the time. I mean, it's quite obvious when you look at the numbers that were here that there was a lot of lost revenue due to circumstances that are beyond our control, which are those that are mandated as a classification. If they fit in that classification, then they are indeed tax exempt. Another one of those exemptions that we didn't take into consideration are the land use issues and the abatement in taxes there. I think that's several million dollars. I might ask Mr. Budd if that sounds correct. He's shaking his head yes. I remember looking at a list last year and it was around 2.1, 2.3 million, maybe somewhere in that neighborhood. I'm not really sure how much revenue would be lost if we lifted this moratorium. I do know of several organizations that could certainly use it that would qualify. I don't know if it would be appropriate or would I say prudent for us to delve into it a little bit more. We only have 53 Charitable organizations, we talk about the number of charitable organizations, but they would have to be the landowner for one thing, and then they would have to adhere to the guidelines that are in Section 82-487. So there would be maybe another step to this process, and that would be to delve into exactly how many of these nonprofits own real estate to begin with And then secondly, once we determine that to have a review of section 82 dash four 87, because that I'm looking at city attorney, just nod your head if it's wrong or whatever, he'll give you the no single, uh, that that's discretionary. What's done by designation means we get the pick in the way this was originally written. There are a lot of considerations. that come into play before we grant that exemption. The other exemptions, the government exemptions, all these that are mandated, we have no choice. It is what it is. We don't set the guidelines. We have the latitude to set the guidelines. That's one piece of the puzzle. To ensure that the only entities that are receiving this tax abatement truly do deserve it and need it, So we have the ability to do that, but it's up to the members of this body to have the wherewithal to not approve a charitable organization, which is really no more than a tax designation. You choose a 5013C, which means unlike a regular business, you don't have income per se. You know, you don't have stockholders, you don't have income. but charitable organizations can have excess revenue, and charitable organizations can still set up salaries for whatever they want them to be and how that money is being used. So looking at what's in our ordinance now, I mean, I just highlighted a couple of the things. They have to have been providing that service for over three years. They're supposed to be providing it to at least 50% of those services have to go to the citizens of Suffolk, whether any director, officer, employee, organization, paid compensation in excess of a reasonable allowance for salaries and other compensation. That's what I'm talking about, the designation. If a lot of the charitable organizations either don't have a paid staff or if they do have a paid staff, it's not an overpaid staff. So we may want to look at the regulations themselves before we move forward with it. Like I said, I was the one that voted against it last time. We were in a little different circumstance 13 years ago. The city of Suffolk was not in the financial position it is now, for one thing. And secondly, I can remember that the catalyst behind it, one of the part of the process was the last application that was considered, and I believe it was in December, was a large one. I mean, a very large 5013C that would have resulted in about, if my memory serves me correctly, $300,000 or $400,000 worth of revenue. I mean, this was not a ruriting club sitting on a corner, you know, that's basically, and it wasn't some of the I mean, I don't want to put any specifics, but it was a large organization with a 5013C designation. And if that had been exempted, it would have been, I know it was over $300,000. So at the time, I think the thought process, Council Member Bennett might remember, the thought process was, you know, things are a little tight right now. We don't need to be, we need to get out of considering these applications right now. I think there are organizations out there that need it, that deserve it, because they serve the citizens of Suffolk. There's a lot of volunteer time. I don't think the fiscal impact would be exorbitant at all, but I would maybe suggest that a motion be made to delve into this further to see what the actual fiscal impact could be. nonprofits we have, how many of those own real estate. For one thing, that would be the first number. And then from there, once we establish that, if we want to move forward, maybe take a look at the ordinance and tighten it up a little bit more and make any changes that council would like to see happen. That's if it's the will of council. And if we just want to leave the moratorium on, then so be it. Yes, sir.

So we believe in some of the research that's done thus far for this presentation that there are about 200, approximately 280 nonprofits that own property in the city of Suffolk. So we feel pretty good about the number. We could dig in a little bit further. Trying to delve in really deep, if I'm hearing appropriately. maybe a challenge, you know, the other component was the application process. And so we would need to get more information provided by the nonprofit going through the process to understand would they qualify as written in the ordinance. So, I mean, we can go a little bit further, but I do believe there'll be a gap and kind of a guesstimate to try to get to a real big number at the end of the day at this level of research.

So would it be difficult my assist from the assessor if we had those however number of nonprofits that we have that own property can you attach a dollar value to those and possibly the nonprofit and you know to each one of them if it's not that hard the entity who it is that owns the property and the value of that particular property.

Theoretically yes it's um It's a little difficult because sometimes they register with the IRS under a different entity than the entity that owns the property. It's still under the umbrella of the 501 , but I'm trying to sort through that now with our land book to figure out who these are, but I think there's definitely 280 of them out there. We've been able to cross-reference that with the IRS. There's also a new little potential game changer in this with this new legislation. If a charitable organization owned a large piece of property, they could now come in there and develop affordable housing, apartments, something like that, and qualify under this for an exemption for those apartment properties. I don't know how many of those there are. I guess in this research, that'll probably surface, but I know there's at least two or three out there that have large parcels of land.

All right, thank you. I guess another thing we can consider, if we just leave the moratorium on for now, see what the changes are, how the new legislation is going to change the outlook, the income numbers, and then revisit it later on in the year, or revisit it next year. I mean, I think it needs to be revisited, but there are some unforeseen consequences to some of the recent legislation, so if we want to measure that impact, have a real feel for what that impact would be, and then possibly consider it next year before we do it.

I will say this about one of the numbers on that chart, the veterans program. That number, 2,600 recipients, I believe, was last July one land book number, and it's at least 1,000 more than that, I believe, we've processed since the last land book. Okay. All right.

Thank you. Council Member Richter. Thank you. And Mr. Mayor, just to kind of piggyback on some of your comments, I also read the underlying ordinance that this thing was drafted on, and since 2011, obviously, been a lot of water over the dam and some of these mandated uh... classifications have come into effect since that ordinance was written uh... so the environment that that ordinance was written in in twenty eleven i don't think exist today because of all these other exemptions so i would agree with you if we want to continue this in some form or format that That underlying ordinance needs to be looked at very, very closely and brought up to date with what the other impacts that these mandated classifications have brought to the city in terms of their financial impact so that we can get a real, real clear picture of anything that we do moving forward, what its impact would be. I don't have any objections to trying to support worthy charitable organizations. I think I agree with you. There are some out there. that would benefit. However, one of the downsides is I don't want, without a lot of background information for this council, to sort of end up being in the position of picking the winners and the losers with that. So with that, I'm happy to have this thing continue to be explored, but like I say, one of the first steps, I think, would be to take the ordinance and compare it to what's going on today and make sure that anything that we do obviously is very prudent moving forward. So thank you.

Okay, Council, any other questions, comments, or questions? Okay, well, we will basically just put this on the back burner at this particular time, and if any member wants to bring it up, bring the same issue up, Later on in the year or before budget time next year, we can delve into it more deeply to see what the ramifications would be. So that concludes our work session at this point. We do have a need for a closed session, and I would ask the clerk to read the motion for consideration.

Item number one, pursuant to Virginia Code section 2.2-3711A1, Discussion consideration or interviews respective candidates for appointment and the assignment appointment and performance of specific public officers or appointees of the city Specifically the appointments has shown the attached list for vacancies or term Explorations for the community policy and management team the Hampton Roads Planning District Commission the Human Services Advisory Board the local board of building code appeals Paul D camp Community College Board Planning Commission Senior Services of Southeastern Virginia Board of Directors, the Southeastern Virginia Alcohol Safety Action Program, the Planning Council, Tidewater Youth Services Commission, and the Western Tidewater Water Authority. Item number two, pursuant to Virginia Code Section 2.

Next item, number two is not on the agenda for tonight.

Oh, okay. Thank you.

Okay. All right, a motion is presented for consideration. Council? Council Member Rector? Move to approve. A motion for approval. Council Member Rector, do we have a second? Council Member Bennett? Second. Second from Council Member Bennett. Is there any discussion of the motion? Hearing none, Council Member, prepare to vote. Please cast your vote. Madam Clerk, please record the vote.

Councilmember Bennett? Yes. Councilmember Johnson? Yes. Councilmember Rector? Yes. Councilmember Williams? Yes. Councilmember Wright? Yes. Vice Mayor Ward? Yes. Mayor Duman?

Yes.

The motion is approved by a vote of 7-0.

This meeting stands adjourned and we will reconvene at 6 p.m.