September meals tax up 2.6%

September 2010 meals tax collections exceeded September 2009 by 2.6%. Additionally, we remain ahead of budget projections for the current fiscal year. This is great news as it indicates that overall business for restaurants has increased - people are spending more money at restaurants in the city than expected.

Year to date, Roanoke City Public Schools have received $35,000+ more than they had expected or budgeted for. If the trend remains and meals tax revenues continue to meet or exceed expectations, our schools will receive the funds budgeted for and our city restaurants will have improved business overall.

I'll continue to update the numbers monthly.

City Approves Much-needed Updates to Financial Policies

Over the course of the last couple of years, we've discussed at length the need to put in place stricter and more financially sounds practices, saving money for economic conditions like the one we are in presently. Though it's taken a bit longer than I would have hoped for, Council adopted new policies to create "savings" accounts that will help to stabilize our bond rating, provide adequate reserves for risk management and self-insured claims, and provide a fund that has resources to dip into if necessary during a "rainy day."

I don't think this accomplishment of the city received enough attention last week. This was a policy passed based on economic conditions and the belief that we should be much better prepared for potential future downturns. It is an aggressive and responsible step towards ensuring the long-term financial stability of the city. I'm proud we took this step.

Below is a summary of the new policies:

1) Maintain the undesignated reserves at 10% and structure the risk management reserve. The city should fully fund those two reserves first by dedicating incremental revenue of $250,000 to $500,000 (.1% to .2% of today's budget) to funding of reserves, subject to funding availability and our overall progress in funding of reserves. We will fund those two reserves by FY 2016.

2) Once revenues recover to their peak level (FY09) as adjusted for CPI
and any permanent tax rate increases, establish an Economic Downturn/Budget Stabilization reserve of up to 5% of the budget. This reserve will be funded by allocating incremental funding of 10% of the growth in local revenues annually until the reserve is at the 5% level.

3) If we reach revenue recovery as mentioned in #2 but have not yet
completely funded the reserves cited in #1, it is understood that the
funding must first be used to complete the reserves listed in #1 before
contributing to the reserve in #2.

4) The city will use real estate, personal property and public service
corporation assessed values in our formal AV ratio policy, however we will maintain compliance from an internal perspective by applying only real estate assessments to the 4% limit.

New Police Chief Chosen

Congratulations to new Chief of Police Chris Perkins, who was introduced this morning in the Police Headquarters Community Room. Over the past two years or so, I've gotten to know Chief Perkins and have been incredibly impressed by his knowledge, creativeness, and involvement in the community. He has proven to be an excellent leader who uses innovative methods of policing to make the community safer and the police force more responsive to the needs of our neighborhoods. Chief Perkins was instrumental in the introduction of community policing to Roanoke, which has reduced crime and caused our police to become more connected with our neighborhoods to prevent crime as opposed to only reacting to it.

To me, the selection of Chief Perkins also shows wonderful judgement on behalf of City Manager Chris Morrill. This is the most significant appointment since he began his role, and is a great reflection on him.

Congratulations to Chief Perkins.

Work Ahead

Now that summer is officially over, the pace will pick up on Council. We will begin in earnest, having already had our first budget work session, to put together a budget that is devised in a very different way than has been done before. It's a process known as Budgeting for Outcomes, which essentially requires public leaders to set a price for the city government and to figure out what citizen's most value and how to spend taypayer dollars. I'd encourage you to read about it at http://www.psg.us/resources/osborneletterbfoupdate.html.

We will also have to begin to grapple with a Capital Plan in the city that offers little wiggle room in terms of debt capacity and the stability of our bond rating. So it would seem to me that we'll stick again with more infrastructural and existing capital projects in the current five-year plan.

We'll also be dealing with putting together a Master Plan for the former Countryside Golf Club property. Any plan should have significant recreational components that include well-designed green spaces. Other ideas that I heard at the multiple public meetings for neighbors of the property and other stakeholders could include some nice and compatible housing, a village center, a conference center, playing fields and other ideas. All stakeholders will have the opportunity to provide more public input beyond the meetings already held, and I hope folks will take advantage of that opportunity.

We're already working and have just gone through a third draft of the city's annual legislative plan, and members of Council will likely go to Richmond to lobby the General Assembly on certain requested legislative changes. I'm sure there will also be a lot of talk about our need for the Commonwealth to stop the massive funding cuts to public education.

We've got a busy fall ahead and I'm sure more will arise as we head into winter. There's a lot to be done.

New Council seated

Roanoke City Council met for the first time yesterday with two new members - Ray Ferris and Bill Bestpitch. I'm looking forward to working with both and am confident we'll have a cordial and collegial Council.

It's also important to thank Rupert Cutler and Gwen Mason for their service. They both worked hard to make the best decisions for Roanoke during these very challenging times. Dr. Cutler deserves the opportunity to have more free time and to pursue challenges important to him. And Ms. Mason has a challenging new role with the U.S. Attorney - one I know she'll be excellent filling.

As we begin a new fiscal year, we should work hard to find opportunities in this financially troubled time. There are opportunities out there and we need to find them and take advantage of our ability to more efficiently and effectively run city government.

Full Council dinner tonight to support meals tax/Roanoke City schools

Tonight City Council will gather to go on a progressive dinner in support of the temporary increase in the city's meals tax for the sole benefit of Roanoke City Public Schools. The schools faced an enormous deficit this year, mainly caused by funding cuts to localities out of Richmond. Council made the tough decision that a lack of responsibility in Richmond didn't merit similar irresponsibility in our own policy making decisions. Given the significant progress made in our schools over the course of the past two years, Council supported the temporary increase in the tax to stave off major programmatic cuts in the schools.

The dinner will begin with appetizers at Table 50 downtown, then proceed to Thelma's Chicken & Waffles on Orange Avenue for dinner. To conclude the evening, Council will travel to Pop's in Grandin Village for dessert. This dinner shows a strong commitment on the part of Council to support our local businesses while also supporting necessary funding for our schools.

I'm hopeful that the media will cover this positive, community-oriented and important event that shows a united Council working together to better our city. It's an opportunity to highlight an improved working relationship amongst Council Members, and one that is definitely newsworthy.

Regardless, it's the right thing for Council to make efforts to support our local restaurants during a time when few options left us with little choice but to increase the tax over the next two years. I'm really looking forward to it.

Vice Mayor Sherman Lea and today's story

I received a call this morning from Roanoke Vice Mayor Sherman Lea letting me know that news would be appearing sometime today regarding an inquiry his employer, the Department of Corrections, undertook based on a hotline phone call received earlier this year. My understanding is that Vice Mayor Lea and his employer have resolved the issue, and any differences were reconciled.

As someone who also has to balance my professional life with my work on City Council, it seems pretty easy to me that administrative mistakes could occur in recording time and distinguishing between professional work and council work. For instance, I'll be driving back from a meeting in the New River Valley for my own business when I get a call asking me to swing by the City Building, so I've confused the two. Or I'll get a phone call or email that takes up a half hour on an issue relating to the City and that gets thrown into the mix. For someone like the Vice Mayor, who serves in a senior capacity with the DoC, I can imagine that confusion occurs when trying to administratively account for time.

I've known Vice Mayor Lea in a working capacity for 2.5 years, and have worked especially closely with him for the past two years. He is an honest, decent, hardworking and good man. There's no doubt in my mind that any mistakes that were made in accounting for time between his work on City Council and for the Department of Corrections were entirely unintentional. Mr. Lea has provided leadership during times when we desperately need it, and I have immense respect for his genuine love and concern for Roanoke and his willingness to work tirelessly on behalf of its residents.

A tough year is ending

I've not posted in a while on this blog, largely because it's a relatively slow time in terms of city council business. We adopted the FY 2010-2011 budget in May, and after lots and lots of meetings and work leading up to adoption, June is a slower time.

It was a difficult year, with major reductions or eliminations of services, reduced school funding and a generally difficult financial period. City staff worked dilligently, with an eye towards efficient delivery of services at reduced funding levels. Staff carried out this task with optimism, seeing opportunities during this time to create a more streamlined government focused on the core services that government should provide residents. There's more work to be done, but difficult times force us to think outside the box.

It's also important to recognize that, by and large, taxpayers have recognized that expectations for services and programs like they were only a few years ago is unrealistic. Having the community understand the difficult task of simply balancing the city's budget has made the process immeasurably smoother. Protecting the city's school system from debilitating cuts in funding, and largely supporting the temporary 2% increase in the city's prepared foods tax to help offset these reductions to our schools, was a real testament to the priorities Roanokers have set for our community.

The next fiscal year's budget will be as tough, if not tougher, than the one we just adopted. The practical effects of the national recession have caught up to Virginia and caused localities to endure the brunt of the revenue reductions that are passed on by the Commonwealth. We should continue to work as a community to maintain realistic expectations and to make sure that the priorities of residents are also the priorities of the city government. Let's find more opportunities to better serve residents with a disciplined, responsible government.

Exercise your right - vote

THis Tuesday is the Roanoke City Council elections that will determine the make up of Council for at least the next two years. It's an important election and one that will significantly impact the way the city does business and how we'll weather the current financial challenges we face.

I won't encourage you to vote for any candidates in particular - though I have my preferences. Instead, I'll simply encourage you to vote. Participation in the electoral process is the most effective way to shape your government and the way it operates.

Exercise your right and please vote Tuesday.

Emergency Measure to Aid Schools Passes

Yesterday, Roanoke City Council passed an emergency measure to help offset the massive funding cuts being leveled by the state to aid the Roanoke City Public Schools for the next two years. This occurred in the form of a temporary 2% increase in the city's prepared food tax, and will raise more than $4 million per year over the next two years to protect such critical urban educational programs as summer school, Spanish for elementary students, and most importantly the maintenance of reasonable class sizes, among others.

Nobody likes to raise taxes. And without question reduced spending and targeted cuts should be undertaken. But it's important that we remember that we have made massive cuts, reducing spending last year by nearly $10 million (the schools cut nearly $5 million last year). Additionally, the city will cut another $10 million this year and the schools will cut an additional $5 million. To say that the city has not cut and reduced spending and seeks only to "tax and spend" is simply not true.

The future of our city, I'm convinced, is directly linked to the success of our schools. Adding $1 to a $50 meal, with the resulting revenue this will generate, is a small price to pay when looking towards the economic and social prosperity of Roanoke.

Council deserves kudos for the courage and foresight to make a very tough decision (the state limits our ability to make these sorts of local decisions) to temporarily raise the meals tax to stave off the devastation of our schools. It's a tough decision in the short-term but I believe, if approached correctly and with our planned marketing campaign, that our restaurants will benefit from increased support from residents who recognize that without a solid school system the future holds less promise. And as a temporary measure, the city and schools will have the opportunity/necessity to restructure how we conduct our affairs and find more efficient ways to deliver better outcomes for cheaper.

I know that there are many who hear the word "tax" and automatically oppose it. I understand this philosophy, but I don't believe that it leads to good government. And when it comes to education, sometimes we have to make the tough decisions that make our long-term future that much more promising.

Public Hearing Scheduled on Meals Tax Proposal

Last evening City Council took the important and urgent step of scheduling a public hearing for April 5 to consider a temporary 2% increase in the prepared foods tax (meals tax) for the benefit of the Roanoke City Public Schools. The unanimous vote to move forward and hold a public hearing enables us to get over the legal hurdle necessary to bring this matter to a final vote, which should be held following the April 5 public hearing.

None of us wants to raise taxes; in fact, I'll be the first to say that I wish I paid less taxes than I already do. But the reality is that lawmakers in Richmond are not fulfilling their Constitutional responsibility to adequately and appropriately fund our public schools and to provide a sound, quality education to children across Virginia. They have let us down, and have created massive budget deficits for localities that make the upcoming budget decisions exceptionally difficult.

I believe to my core that the long-term future of Roanoke is directly linked to the success of our schools and the quality of the students that benefit from those schools. A temporary, 2% increase in the meals tax would provide more than $4 million to our schools, helping to keep class sizes reasonable with the potential to help save 4 year-old pre-kindergarten and other programs that most benefit urban youth.

I'd love to believe that we have no need to raise revenue, or that something less than 2% on the meals tax would suffice. But the whole $4 million+ that a temporary 2% increase would create is needed. This is the reality that City Council faces. And last night was a bold move by each member of Council.

Meeting with Educators

The Roanoke Education Association held a membership meeting yesterday to discuss the current state of education funding and to discuss any efforts to try to affect final decisions being made in Richmond.

They also invited City Council to attend the meeting and offer a few words. I'm happy to report that the sense I got was that the educators who were able to attend the meeting are fully aware and understand the consequences of the decisions being made in Richmond to cut massive amounts of funding to our public schools. For the last couple of years, and certainly for the next several years, teachers and educational staff have been and will be asked to do more work with less resources, teaching larger classes with less materials offered. We have some of the very best educators in the state, and I think we should all be confident that they will do their very best to help work through the current situation.

I also addressed the meals tax proposal that I made several weeks ago. I believe that the matter is urgent and that City Council should deal with the need for more revenue sooner rather than later. All my colleagues on Council are working exceptionally hard to navigate the current financial crunch, and I believe that in the end we'll make the right decisions.

Vote today

Today is primary election day in the City of Roanoke. You have three votes and I'd encourage you to cast all three.

I certainly have my preferences, but it's up to each person to understand what the candidates stand for and the type of leadership and committment they'll bring to City Council and to make the most informed decision you can.

No matter who you support, please vote.

The Closing of Countryside

As is widely known now, a majority of City Council decided last week that continuing the operation of Countryside as a golf course is not in the best interests of the taxpayers of the city. This was a tough decision but a necessary one.

Countryside was purchased in 2005 with the idea that higher end housing could be built, offering more diversity in housing and increasing property tax revenues to the city. There were few responses to Requests for Proposals seeking developer/builders that could create this new housing, and so the course has remained in operation for the last several years.

Recently, the existing operator of the course and the city were in negotiations to try to come to an arrangement to continue operation of the propoerty as a golf course. I did not agree with the idea of putting $1.5 million of capital improvements into the course and continuing to operate it at a significant annual loss to the city. This yearly loss, of course, did not include the more than $400,000 a year in debt service payments for the purchase of the course.

While I fully realize the short-term negative feelings that closure of the course brings to a group of residents that play the course, I truly believe that in the long-term the repurposing of portions of the property into actual park space will be of greater benefit to the community. As is, residents living near the course cannot use the property recreationally unless it is for playing golf. By repurposing portions of the course into a park, more residents will be able to take children or grandchildren to enjoy the green space.

To those who this long-simmering decision impacts, I am hopeful that the long-term use of portions of the property as a park will bring more enjoyment and use, and will be of significantly less cost to the taxpayers throughout the entire community. At the very least, a decision has finally been made and the community can continue on with the knowledge that Council made the responsible decision, particularly in light of the enormous budgetary pressures the city is facing.

Budget Meeting tomorrow

Tomorrow, beginning at 9am, we will be meeting to begin the tough discussions necessary to prepare next fiscal year's budget. It should be an all day meeting, and anyone who is interested and can sneak away from work for a bit I would certainly recommend attend. If nothing else, it will provide insight into the way the budget is put together each year.

Please feel free to share any comments on specific programs or services that you feel should or should not be looked into for cost-savings.

Emergency Relief for Schools

Rosen Proposes Two Year, Emergency Meals Tax Increase

Says School budget needs short-term, immediate fix

ROANOKE, VA- Roanoke Councilman Court Rosen today proposed an emergency, two-year increase in the city’s prepared meal tax of 2% as short term fiscal first aid to provide the Roanoke City Public Schools needed breathing room amid massive state cuts to public education. The measure would help fill an enormous funding deficit within our schools and also alleviate significant pressure on the city’s budget, preserving public safety and other essential city programs and services.

“As a small business owner, the last thing I like to see is increased taxes, particularly during difficult economic times,” said Rosen. “But within the next eight weeks our schools must adopt a budget for next fiscal year, and we must look at what's best for the education of kids by trying to keep class sizes lower and preserving programs that benefit our urban youth.”If enacted, a 2% increase in the “meals tax” would have the following impact on the cost of meals in the City of Roanoke:

· On a $10 meal, it would add 20 cents to the cost of the meal
· On a $25 meal, it would add 50 cents to the cost of the meal
· On a $100 meal, it would add $2 to the cost of the meal

“This is only one proposal that deserves a public, transparent and vigorous debate,” Rosen said. “It’s important that city residents also recognize that this measure, while directed to fill a funding gap within our schools, will relieve significant pressure from the city’s budget, preserving needed programs and services delivered by hardworking, qualified employees of the City of Roanoke.”

The next two fiscal years are projected to be exceptionally difficult in fulfilling needed educational, economic development and social programs. If enacted, City Council should revisit this tax increase at the end of the next fiscal year, and should the economy rebound sooner than expected, the Council should revert the meals tax back to its current level. If, as expected, the next two fiscal years are as tough as expected, the sunset clause written into the proposed ordinance would guarantee the tax would end following the next two fiscal years.

“Additionally, this proposal stresses that any tax increase should sunset and end on June 30, 2012 and should be enacted only as a temporary measure and not as a ‘new’ source of revenue that either our schools or the city become reliant on,” said Rosen. “It would be a short-term, emergency tax to fill an emergency need that has been forced upon us at the state level.”

Rosen stressed that this proposal should be debated in the upcoming budget sessions that City Council will soon begin, and that he looks forward to other discussions, proposals and solutions by others to what soon could be devastating funding cuts leveled by the Commonwealth at our public schools.

Snow

I just travelled some of the city streets, as I did last night, and crews have been out working all night plowing the roads. The main roads look cleared by and large and I've noticed that most neighborhood streets appear to have been plowed at least once.

Given the intensity of the storm and the hard work of so many city employees, I think the city has done an exceptional job during this heavy snowfall.

I hope you agree.

Flood waters recede

As many folks know already, there was significant worry that the Roanoke River would overflow and cause some flooding in the city with the heavy rains experienced over the last few days. The city's emergency management coordinator was prepared and on top of the situation and very adept at managing crises or potential crises of this nature. We're fortunate to have such a person who has the experience and skill to manage emergency situations of all kinds - natural or man-made.

The good news is that the river waters crested and receded without major damage or destruction. But this possibility reinforces more why the Roanoke River Flood Reduction project is so important to the city and its residents. We're committed to seeing it through and hope the last few days have evidenced why we need to fulfill this significantly completed work.

Stormwater Tax Tabled

Last evening at Roanoke City Council the decision was made to table, as far as I am aware indefinitely, the adoption and implementation of a new stormwater utility fee that would affect residents and commercial property owners.

I believe this was the right policy decision to make. We have to maintain a competitive advantage with our neighbors and not put ourselves in a position where locations outside the city are more attractive for employers to locate than locations within the city. A new tax on properties would serve to do just this.

I was pleased that Council made this decision and hope that it will spur us to work closer with our neighbors to address this and other issues that require regional solutions.

Not the right time for Stormwater Utility

As Roanoke City Council debates whether or not to impose a new stormwater utility tax on residents and commercial property owners in the City, Vice Mayor Sherman Lea and I co-authored an opinion editorial that appeared in today's newspaper arguing against this new utility at this time. To read the piece, please click on the link below or scroll down to read the text:

http://www.roanoke.com/editorials/commentary/wb/233397

TEXT:

Stormwater solution deserves reprioritization, not automatic new fees
by Sherman Lea and Court Rosen

The City of Roanoke has one of the highest real estate tax rates in the Commonwealth of Virginia ($1.19 per $100 of assessed value). This is fact – one can visit the Virginia Department of Taxation’s website to confirm it.

Roanoke also has a $60+ million and growing stormwater management problem - which is and should be addressed regionally, the magnitude of which can be seen following steady rains that flood roads, basements and yards. Compounding this water quantity problem, the U.S. Environmental Protection Agency has passed down strict new water quality standards that our locality must abide by to protect future water quality and to curtail chemical contamination of our waterways.

In response to the new EPA regulations, Roanoke must improve its stormwater infrastructure to ensure compliance. These improvements will cost money. The current proposal, which City Council will soon approve or defeat, charges every residential property a fee of $3 per month, or $36 per year, and businesses $3 per Equivalent Residential Unit (ERU). One ERU is equal to 1,920 square feet of surface. In reality this would be a new tax, but not called a “tax” because certain groups, such as churches, are exempted from taxes whereas everyone must pay a “fee.” This might not seem like a big burden, but coupled with our already high real estate tax rate, businesses/entities like the Airport, Valley View Mall, car dealerships and others will pay fees in the tens of thousands to hundreds of thousands of dollars because of the amount of commercial surface they own in the City.

Proponents of this new fee argue that a new source of revenue to address stormwater management is needed. The point of this piece is not to declare that some sort of fee won’t be, in the end, appropriate or needed. Rather, we wish to share two arguments for defeating the current proposal and using existing capital money to fund the improvements, while at the same time working with our neighboring jurisdictions to address this regional problem in a cooperative and mutually beneficial way.

First, the City of Roanoke, in Fiscal Year 2010, plans to spend more than $66 million on capital improvements projects. Keep in mind that a majority of this money is borrowed, and like any other loan accruing interest, the total repayment obligation will far exceed this principal amount.
Of the $66+ million slated for capital improvements in FY 2010, and this is not a typo, a mere $179,759 is budgeted for existing storm drain/stormwater problems in our City. That’s 0.27% -- just over one-quarter of one percent. The easy way to address our significant stormwater management problems is to add a new fee to residents and businesses, increasing the tax burden on the very same businesses we rely on to provide good paying, quality jobs. The right way to address those needs is to look in the mirror, recognize that there are some capital projects currently planned that are “nice to haves” and not “need to haves,” and to reprioritize our governmental responsibilities.

The second main point as to why the proposed stormwater utility fee is wrong for Roanoke at present is that we’re in the midst of the worst national recession since the Great Depression, and many would argue in the history of our country. The unemployment rate nationally is over 10%, the highest it’s been in more than two decades. And while the Roanoke region’s unemployment rate has fortunately fared better than the national average, further burdening residents, a large portion of whom are on fixed-incomes, and businesses, who employ those residents, is just plain poor timing. Now is the time to support those businesses, encourage them to create more and better jobs, and not add to the burden on property owners of an already high real estate tax rate.

There’s no question that the City of Roanoke has got to address our major stormwater management needs, both by choice and mandate. But the elected body, City Council, must reprioritize where we’re spending your money. Dedicating the necessary resources to make progress in fixing our storm drains throughout the City is about making tough choices, understanding the fundamental responsibilities of government to maintain its infrastructure for its citizens, and making tax/fee increases the very last resort, not the first and default option.

Bad Blogger

As the new year begins, I am going to recommit to posting on this blog more often (hopefully a couple of times a week) about issues affecting the City of Roanoke. I have been a bad blogger, there's no question about it, and I am going to work very hard to do better about being more informative to those who read this blog.

Often it's difficult to convey to folks what's happening in the City since news outlets have limited space to cover City issues. I feel as though I have a respnsibility to make sure that I'm sharing as much as possible about current events so that residents are more aware of the decisions that are being made in the City with your money.

I will put up a new post soon and hope you'll visit my blog regularly to stay up to date on current happenings in Roanoke and to provide feedback on those issues.

Court