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HomeMy WebLinkAbout1998-03-23 adjMarch 23, 1998 (Afternoon) (Page 1) 00Oil9 An adjourned meeting of the Board of Supervisors of Albemarle County, Virginia, was held on March 23, 1998, at 1:00 p.m., Room 241, County Office Building, McIntire Road, Charlottesville, Virginia. This meeting was adjourned from March 18, 1998. PRESENT: Mr. David P. Bowerman, Ms. Charlotte Y. Humphris, Mr. Forrest R. Marshall, Jr., Mr. Charles S. Martin, Mr. Walter F. Perkins and Ms. Sally H. Thomas. ABSENT: None. OFFICERS PRESENT: County Executive, Robert W. Tucker, Jr., Deputy County Executive, Richard E. Huff, II, Assistant County Executive, Roxanne W. White, and County Attorney, Larry W. Davis. Agenda Item No. 1. The meeting was called to order'at 1:00 p.m. by the Chairman, Mr. Marshall. Agenda Item No. 2. BUDGET WORK SESSION: FY 1998-99 COUNTY OPERATING BUDGET: Review and Discussion by Board regarding Issues/Funding Priorities. Mr. Marshall asked Mr. Tucker how the Board should proceed with this work session. Mr. Tucker suggested the Board go through the entire packet of materials handed out for this meeting. The first item mentioned was the following chart: COUNTY GENERAL FUND: Beginning Reserves $388,971 County Executive Adjustments: Less Juvenile Detention Home Reduction $(5,099) Plus Jail - Per Diem Increase 3,883 Less JAUNT Night & Weekend Service Reduction (638) Less VRS Life Rate Reduction (0.72% to 0%) - Life Insurance "Holiday" (98,946) Less Miscellaneous Salary Adjustment (21,402) $t 22,202 Plus Resource Changes: Additional Scottsville Reimbursement - Salary Adjustment $490 Additional E-911 Revenues - Planning (to offset Operations) 2,272 Additional Compensation Board Reimbursement- Salary Adjustment 8,826 $11,588 Net Ending Reserves $522,761 Board of Supervisors' Funding Initiatives for Discussion Cost Amount Judicial: Parity/Pay Plan Implementation - Commonwealth's Attorney $38,960 Parity/Pay Plan Implementation - Sheriff 35,642 Public Safety: Fire/Rescue Education/Training Specialist ($15,269 Jan Hire) $30,538 $30,538 Parks, Recreation & Culture: Virginia Festival of the Book (funded through Tourism Fund) $10,000 $0 Community Development: 1.0 FTE Engineering Inspector -Soil Erosion ($24,443 Jan Hire) $44,355 Albemarle Housing Initiatives Trust Funds - Additional Funds $25,000 25,000 Piedmont Housing Alliance -Additional Funds 10,000 10,000 ClP/Debt Service Transfer: Additional Funding for School Debt Service $300,000 Additional School Instructional Technology Projects 150,000 County Computer Upgrade 25,000 COB Maintenance & Repair Projects 18,023 Courthouse M&R (Deferred to FY 2000) 10,000 Sidewalk Construction Fund 21,077 County Athletic Field Improvements (Deferred to FY 2000) 25,000 Revenue Sharing Road Project Funding 120,000 Chris Greene Lake Property Purchase (Deferred to FY 2000) 113,400 Walnut Creek Park Improvement Funds (Deferred to FY 2000) 24,500 Additional Funds to Other Projects 70,000 Subtotal CIP/Debt Service $877,000 $0 Total Board of Supervisors' Initiatives -General Government $952,538 $184,395 Re~a!6i"gB°~rd ~SU~rVis~'rs;~es~~'' : :. ':= I : I $338!266 000:1.20 March 23, 1998 (Afternoon) (Page 2) Mr. Tucker said there are some items which have not been listed in this chart. There may be Comprehensive Services Act (CSA) payments due late next year that are unknown at this time. He suggested that the Board keep a large sum in the Reserve Fund, but said the Board, at its discretion, can change any of the figures shown in the chart. Ms. Thomas asked if staff is certain the County will receive the extra funds which recently came to light. Mr. Tucker said in talking to people at VRS, they feel the VRS payment is certain ($98,946). This has been done previously and they have agreed to fund this VRS payment for tWo additional years. Whether or not the State will continue to do it after that time period is unknown. The only item the General Assembly changed that could make a difference is the additional funds for the schools. The Governor could potentially veto that bill, although staff is not anticipating that will happen. No one knows what will happen until after the General Assembly Session ends. Mr. Tucker then referred to the following chart: Beginning Reserves ($195,422 is One-Time) $270,422 Less Superintendent Adjustments: VRS Life Rate Reduction (0.72% to 0% - Life Insurance "Holiday" $(321,326) 321,326 Plus Resource Changes: Additional State Funds (Estimated to be from $130,000 to $180,000) 180,000 180,000 Net Ending Reserves $771,748 School Board Unfunded Priorities (One-Time in Bold Italics) i *Total School One-Time is $251,407 Cost Academic Learning Project Schools (ALPS) + Differentiated Funding $48,000 Addt'l 4.13 FTE Growth Teachers to Fully Fund Growth (19.1 of 19.1) 164,899 Additional Funds for CA TEC ($23,000 is One-Time) 53,993 Additional Funds for High School Athletics 37,072 Elementary Health Clinician Phase-in (4 hrs/day at 6 elem schools) 67,282 Elementary Task Force Subcommittee Recommended Phase-in of 2.5 FTE 99,740 Teachers for Art, Music and PE Standards Extended School Year (Pilot Yancey Elementary) 68,874 Gifted Services Five-year Phase-in (2.6 FTE Teachers) 105,830 Partial Instructional Funding Restoration 92,800 Partial Textbook Fund Restoration 159,533 Total Board of Supervisors' Initiatives - School Division $888,023 Mr. Bowerman asked if the $270,422.00 beginning reserve balance includes the expected savings on energy costs. Mr. Tucker said it does not. He indicated previously that some significant savings are anticipated, but he does not have a figure at this time. Mr. Bowerman asked if that figure includes the School's hold-back of funds. Mr. Tucker said it includes $195,422.00 of one-time money and $75,000.00 of recurring funds. He assumes the hold-back is included in that figure as well. Mr. Bowerman asked the hold-back amount. Mr. Frank Morgan, Assistant Superintendent for Support Services, said in this budget there is $680,000.00 of non-recurring money that the Schools are using to fund the budget. That amount was carried over from the previous year and includes the hold-back of funds never released to the individual schools. In terms of non-recurring money, if it is used for recurring expenditures, the Schools start that much behind the next year. In terms of carry-over funds from the current year's budget, the savings in energy costs mentioned by Mr. Tucker should be available in the Spring, and can be used for funding the 1998-99 budget. Mr. Bowerman asked if the Schools have hold-back funds which have not been identified on this chart. Mr. Morgan said there is about $350,000.00 of the hold-back in the current year still in effect. Mr. Bowerman asked if it is proposed to use these funds for one-time costs. Mr. Morgan said it is hoped that some of those funds will be given back to the schools because this hold-back has occurred the last two years. It is hoped that any carry-over from the current year can be used next year as the 1999-2000 budget is started to counterbalance some of the non-recurring funds being used this year. March 23, 1998 (Afternoon) (Page 3) Mr. Bowerman asked if $250,000.00 is a low estimate of the energy savings, and the $350,000 is actually $600,000.00 which currently is not identified anywhere. Mr. Tucker said that is correct. Ms. Thomas asked if it would be appropriate to use those funds for things like the Textbook Fund which is a one-time cost. Mr. Tucker said "yes." He said the Schools total reserve is now at $771,748.00. Then, on their Unfunded Priority List, one-time expenses amount to $251,407.00 which is within their one-time reserve, their hold-back of funds, or their savings on energy. Staff believes the Schools can fully fund their one-time expenses with savings in the current year. They have a shortfall at this time of $116,275.00. Ms. Thomas asked if that is after spending the $771,748.00. Mr. Tucker said that is correct. If the savings in energy costs is added, that figure would turn into a positive figure. Ms. Thomas said the Schools have fewer one-time expenditures than they will have in one-time revenues. Mr. Tucker said that is correct. Ms. Thomas said when one gets to the revised shortfall of $116,275.00, that shouldn't be covered with one-time funds. Mr. Tucker said that is correct. Ms. Thomas said the $600,000.00 is in one-time funds so that is not a good way to cover $116,275.00, but it is Mr. Tucker's suggestion that they do that. Mr. Tucker said they can cover those one-time expenses with savings that have not been identified as part of these services. Ms. Thomas said at the top of the chart it shows $195,422.00 as one-time revenues. The figure at the bottom shows the School's one-time expenses as $251,407.00. That only leaves $55,000.00 which is not covered, and then there is the $600,000.00 which more than covers that amount. Even if that is all covered, there still is a shortfall in recurring costs. Mr. Tucker said if this Board wanted to fully fund the School budget with recurring money on recurring costs, the Board would have to dip into its Reserve Fund. What staff attempted to do was use the Schools total reserves and the additional funds from the State to show what their total reserve is, and the bottom line of their priority list if those reserves are used. Staff could take the list and try to show true one-time costs and true recurring costs and break out the revenues that are recurring and non-recurring and give the Board a different bottom line figure. Mr. Marshall said if one went through the budget, other one-time expenditures could be found which are not being shown to the Board today. Some of this money could be put toward some of those one-time expenses. Mr. Tucker said that is another way to try and apply some of the one-time moneys. Ms. Thomas said it would be ideal to find out how many items in the Schools budget are appropriately supported by one-time money. Mr. Tucker said a lot of items in their budget are funded as one-time expenses already. Mr. Jackson Zimmerman said approximately $875,000.00 in one-time money is being utilized in the School budget as presented to the Supervisors. The Schools do not have $875,000.00 in one-time expenses. Mr. Martin said it would be ideal if there were time for the School Board to get together and determine what to do with the additional State funding. Mr. Tucker said he thinks they would want to fund the ~Unfunded Priorities" shown in the chart. Dr. Kevin Castner, Division Superintendent, said he agrees that the money might be saved because of the mild winter and that money could be carried over. He does not feel comfortable including the hold-back funds in that mix. He said seven percent of the schools money is held back each year in anticipation of emergencies. Last year, all of the seven percent was not returned. Over the last four or five years, the school-based budgets have been level-funded. He does not want that hold-back to become a part of the carry-over again. This year when revenue projections were received, they were told that $1.08 million had to be made up out of last year's budget. They had to make some changes in technology, in capital improvements, and things to do with energy. Hopefully, that will generate some money for the carry-over. The hold-back area is one he is sensitive to just to maintain or continue whatever their present effort is. He thinks all are pleased to have the March 23, 1998 (Afternoon) (Page 4) 000:1.22 positive information they received last Friday, particularly with the VRS Life Insurance payment. Mr. Tucker said the next item concerns VRS. There were questions raised as to whether the County could fund VRS payments by having the employees contribute. Ms. White has put together a chart which identifies the issues and how difficult it would be to go back to the format the County had prior to 1980. Mr. Bob Brandenburger did the research and Ms. White will make the presentation. Ms. White said participation of state agencies and public school boards in the Virginia Retirement System (VRS) is mandatory; the election by a political subdivision to participate in VRS is irrevocable; an employer may elect to pay the member's five percent contribution for all of its current members; if the employer makes such an election, it is irrevocable; by State Code an employee is not allowed to contribute to the employer's share of VRS; the only way to change the current VRS policy would be for the General Assembly to make amendments to the State Code. As regards teachers, the State pays the employer's share for teachers; the State reimbursement is calculated only on the Standards of Quality (SOQ) teachers, not on all teachers; for FY 1998-99, the State will reimburse the School Division approximately $184,000.00 of the mandated $474,000.00 increase; the ratio of the State/County share of the increase is approximately 39 percent/61 percent. Mr. Perkins asked how long it takes for an employee to be vested under VRS. Whose money is it once it goes into the system? Ms. White said the employee's share is refunded if the employee leaves County employ before they vest, which is five years. They do not get the employer's share unless they retire. This has not been an issue which has been addressed before. The State is picking up a share of some of the increases, but not for all of the teachers. Mr. Tucker noted that the next chart contains the Performance Pool costs. The Board had asked staff to show the savings on one-tenth of a percent reduction in the merit pool. That has been done. Staff also gave the full costs for the compression issue as proposed. Mr. Tucker recommended that the Board fund at least 33 percent of compression in this budget, phasing the remaining 67 percent in over three years. If the Board were to choose to use some of its Reserve Fund and fund up to 40 percent, the full costs are shown. Mr. Tucker said Mr. Huff will present the requests from the Commonwealth's Attorney and the Sheriff. Mr. Huff said staff found real issues which will need to be answered should the Board consider granting either of these requests. First, there are differences in the requests. The Commonwealth's Attorney requested that he be included and placed on the County's pay plan, whereas the Sheriff did not make that same request. In a performance-based system, it raises the question of who would perform their personnel performance reviews annually. The Commonwealth's Attorney requested that his attorneys and the legal services assistant be included on the County's pay plan. The Sheriff requested that his entire department staff be included. The Commonwealth's Attorney requested that the salaries of the attorneys and legal services assistant be identical to specific individuals in the County Attorney's Office based on factors not utilized in the County's pay plan, such as the year admitted to the Virginia Bar or the year the person began employment with the County. The Sheriff asked that salaries for his personnel be matched with those of personnel in the Police Department, grade for grade. Mr. Hendricks, consultant for the pay plan, had recommended one pay range lower for a field deputy, with a difference in salary for~the sergeant, lieutenant and captain level. Mr. Huff said it is difficult to match the Sheriff's employees to any kind of a pay plan until there is an understanding of what ranks would be approved. Under the current structure in the Sheriff's Department, there are six supervisory positions for ten deputies, plus his auxiliary force. In the Police Department, two positions at the captain level would not be funded for just ten deputies and the auxiliary force. There are issues such as who would address grievances, future promotions and hirings. Those issues could be addressed through a memorandum of understanding. Staff has seen such a document which is in effect in Spotsytvania. It would only be binding on the current constitutional officer. Mr. Huff said neither the Clerk of the Circuit Court nor the Registrar are included in this request. The Registrar's staff is already on the March 23, 1998 (Afternoon) (Page 5) 000128 County's pay plan because the State does not pay those salaries. The Registrar is currently receiving a fixed stipend from the County. There are two sheriff deputies in Scottsville, one of which carries the rank of sergeant, but who is being paid as a regular deputy sheriff. To put this position on the pay plan would require a substantial increase because he is at the bottom of the range. Mr. Huff said staff calculated different options and scenarios, as many as 30 different options depending on how the options are answered. Option 1. Retain the current system of base Compensation Board pay plus local stipends. There would be no additional costs for this option. Option 2. If the Board chose to place the salaries of the Commonwealth Attorney's staff on the County's pay range, Mr. Hendricks could be asked to identify the appropriate pay grade for these employees, as was done for the Sheriff's Office last year. Option 3. The salaries of these persons could be put into an appropriate range but these positions not be placed on the pay plan, i.e., they would have no access to the performance pool. The estimated cost of this option is about $2360.00 net of $3872.00 in additional Scottsville reimbursement. Mr. Huff said prior actions of this Board have brought the salaries of these persons up to the minimum. The bulk of that $2360.00 is actually for one employee hired last year below the minimum after this Board took action. This option would cost Scottsville $3872.00 because of the two employees there. Option Place these positions on at least the minimum appropriate range and allow access to the County's pay plan. The estimated cost is $31,515.00, net of $6281.00 in additional Scottsville reilmbursement. Mr. Huff said this option does not take into account that there might be a deputy with many years of service whose salary is at the minimum range. This would bring into play the compression issue. Option 5. Could decompress an appropriate range and either allow access to the pay plan or not. The estimated cost of decompression with no access to the performance pool is estimated at $67,766.00, net of $12,943.00 in additional funds from Scottsville. The estimated cost of decompression with pay plan inclusion is estimated at a cost of $96,921.00 net of $15,532.00 in additional funds from Scottsville. Mr. Huff said the same decompression formula being used for other employees could be used to see where these positions would go on the range. It yields the greatest need for funds from the town of Scottsville for those two deputies. He is not saying the Scottsville issue should drive this decision, but it could affect how they choose to do business because they have an officer being paid as a deputy, who they consider a sergeant. Option 6. Develop another alternative. Option 7. Meet budget requests. Estim&ted cost of $74,602.00 net of $12,446.00 in additional Scottsville reimbursement. Ms. Thomas asked if Option 3 would work for both the Commonwealth Attorney's Office and the Sheriff. Mr. Huff said that is correct. There are only three employees involved whose salaries are not at the minimum. This assumes that the Sheriff would go on the Hendricks recommended ranges and not what he has requested. The Sheriff has one employee who was hired after last July 1, and one employee who received a promotion and the salary is off by $125.00. Mr. Bowerman asked Mr. Huff to discuss Option 7. He asked if this relates to the amounts shown in the first chart under "Funding Initiatives." Mr. Huff said it reflects two different things in each office. In the Commonwealth Attorney's office that amount reflects matching just the March 23, 1998 (Afternoon) 000124 (Page 6) attorneys and the legal services assistan~ directly to specific positions in the County Attorney's Office based on the year they were admitted to the Bar. The funding for the Sheriff's Office matches positions to actual ranges in the Police Department because that is what the Sheriff requested. It just makes sure the people in those positions are at the minimum of the range. It does not address where they are in the range. Mr. Bowerman said those salaries would not be decompressed if the Board approves that option. Mr. Huff said that is correct. Mr. Bowerman said if they were part of this amount it would add a little to the amounts the Board discussed before. Mr. Huff said it would be a fairly large amount. The Sheriff has deputies with quite a few years of service who would be close to the bottom of the range if placed on either range. Mr. Bowerman asked if it would cost about $20,000.00 additional to decompress salaries in the Sheriff's Department. Mr. Huff said decompression in both offices is the $67,766.00 shown under Option 5. Mr. Tucker said those employees would have no access to the performance pool. Mr. Bowerman said if the Board agreed to the Sheriff's suggestion, that would cost $35,642.00. If the salaries were then decompressed, what would it cost? Mr. Huff said he did not have that figure today. Staff did not assume that these positions would be placed on the Police Department scale, which the Sheriff did assume. Staff did not make that assumption because of Mr. Hendricks' recommendation which this Board adopted when the stipends were approved earlier. Mr. Bowerman asked if the figure would then be higher than the $96,921.00 noted in Option 5. Mr. Huff said the difference between the $67,766.00 and the $96,921.00 is the three-percent merit pool in the current budget. He said there are numerous possibilities and options. Staff decided it needed direction from the Board before making any further calculations. Mr. Bowerman said the decompression costs could be twice as expensive as simply bringing these positions onto the pay scale as the Sheriff requested. Mr. Huff said that is correct. Mr. Marshall asked to look at the Scottsville costs. He said the Town would have to raise an additional $15,352.00 under Option 5. He asked why there has to be a sergeant in the town. There used to be a town sergeant, but that was different from having a deputy doing law enforcement. He asked if the town promoted the deputy to a sergeant. Mr. Huff said the Sheriff promoted this person at the request of the Scottsville Council. This person carries supervisory responsibilities over the other deputy. He said the County had nothing to do with that decision. Both people are classified as deputy sheriffs by the State and are receiving a County stipend. Mr. Marshall asked if Scottsville Council is aware they might have to pay these additional funds. Mr. Huff said he has not discussed it with them. Mr. Tucker said this would be a change in policy which the Board of Supervisors would have to approve. Staff did not want to get the Town Council concerned when it did not know what the Board would do. Mr. Huff said the Board had asked for comparative data from other jurisdictions. Sheriff Hawkins sent something to the Board members over the weekend showing data for other sheriff's offices. Mr. Camblos identified 30 other jurisdictions, cities and counties, who are in one way or another supplementing their commonwealth attorney's offices. There is a large, varying mix of supplements, just about any scenario that can be derived. Mr. Tucker said this concluded the staff's presentation today. The Board may want to go back to the first chart and make decisions item by item. Mr. Marshall suggested that the Board start with the ending Reserve Fund of $522,761.00, and go through the list item by item. Ms. Humphris said she did not feel ready to do that yet. She needs from Mr. Tucker a better idea about the School Division's budget. Although their revised shortfall is shown, she said the Board has not dealt with other large sums of money which she understands they would like to keep. She thinks those sums need to show somewhere in print so the Board will know exactly what they have to spend in which category. If the Board does not have that information, she does not have a good idea of how much money she would be in favor of adding to the Schools budget. Leaving out the energy savings, which is just a guess at this time, is a significant number. Leaving out the hold-back, which has not been March 23, 1998 (Afternoon) (Page 7) 000 .25 identified yet, is a significant number. She thinks the Board has the right to know a little more surely how those amounts will affect unfunded priorities. Ms. Thomas said she would like to understand a little more about the current year's hold-back. She thought that when the Board and School Board put together a budget last year, it had "x" amount of money, and each school got a budgeted amount to spend, and each division also if it was not a school. Then, at the beginning of the year they are told that they got that budgeted amount minus seven percent, and that is what created the hold-back. When the budget was laid out, this Board, the School Board and the schools expected they would get the full "x" not "x - 7%". History shows that for the last few years what they have gotten is the "x - 7%". Now, most of the way through the school year, that budget will never be met. The Board could say they can't use that seven percent this year, but has to use it next year because that is the $350,000.00. If this Board says that has to be used to meet next year's needs, it is just making permanent the seven percent holdback. She asked if this was brought into this discussion with some reluctance because it was a budgeted figure which was held back in case there was an emergency and the emergency was that the County got $1.8 million less than expected. The Schools didn't use that seven percent to meet that need, and it is still held back. Mr. Zimmerman said only five and one-half percent is currently being held back. Ms. Thomas asked if that is the $350,000.00 figure. Mr. Zimmerman said the seven percent hold-back was instituted in the past after a significant State revenue shortfall. The School Division had to cut, in March of that year, many hundreds of thousands of dollars and it was an extremely difficult process which resulted in risks and substantial reductions. At that time, the School Board adopted a policy of holding back seven and one-half percent of operational funds for departments and schools. The idea was to hold that amount in reserve until there was certainty about State revenues. It also allowed the opportunity to get some savings should there be a substantial cut from the local side. Last year was the first time any of that reserve was held back for the entire year. Last year two and one-half percent was held back because they were not sure they could meet their "lapse factor" which is something that is not budgeted. They project the turnover in staff and how much will be saved from that turnover. Last year they were concerned they might not have the level of turnover projected. Typically, at this time of the year, with each new revenue and expenditure report submitted to the School Board, staff has a recommendation as to how much of the seven and one- half percent holdback to release. The individual schools themselves make up about 50 percent of that hold-back. Ms. Thomas asked if the Schools permanently held back two and one-half percent last year that was carried over. Mr. Zimmerman said that is correct. In budgeting strategy this year, they planned on using a significant portion of one-time money. They needed a significant amount of carry-over funds for the 1998-99 budget, so they planned for that. Ms. Thomas asked if part of that money was used to help with the shortfall this year. Mr. Zimmerman said they are currently using $680,000.00 of the carry-over in the existing budget. Ms. Thomas asked what happened to the two and one-half percent held back from the year before. Mr. Zimmerman said it is part of the $680,000.00 carried over. Ms. Thomas said the schools are down to five and one-half percent in the hold-back. If they do the same thing they did last year, they would continue holding back about one-half of that amount. If this Board suggested that some portion of that $350,000.00 be used in next year's budget, it would be doing the same thing as the School Division did this year to itself. Mr. Zimmerman said with the exception that they would be utilizing an extremely large amount of one-time money to fund an extremely large number of recurring expenses. They would start out the 1999-2000 fiscal year with close to $1.0 million of one-time moneys and not have anywhere near $1.0 million in one-time expenses. Ms. Thomas said that is a separate issue in her mind from whether the hold-back is fair game. Mr. Zimmerman said there would be some significant difficulties. This would be a real reduction in both schools and department budgets not even counting inflation. The individual schools and.departments have only received a two percent increase over the past five years. They were March 23, 1998 (AfternoOn) 0001Z6 (Page 8) held back two and one-half percent last year, and if they were held back some portion this year, that would be a significant reduction. Ms. Thomas said there is that issue. Then there is a separate issue of having so much one-time money that there could be $1.0 million in one-time dollars for much less in one-time expenditures that would hit this Board when the budget is presented for the next year. It would look like new expenditures but be, in fact, just on-going costs that were paid for with one- time dollars which won't be available again next year. Mr. Zimmerman said it would hit the School Division extremely hard. If it utilized savings from the current year to fund next year's budget, it would mean that there would be almost no carry-over to use for the 1999-2000 budget. Mr. Martin asked what Mr. Zimmerman is suggesting doing with the $350,000.00 during the current year, or at least a large portion of it. He does not want to commit it to next year at this point. Mr. Zimmerman said it would probably be staff's recommendation to the School Board to release portions of that money as additional information comes in during the current year regarding revenue streams and expenditures. Mr. Martin said he remembers a time when the Board of Supervisors took back all of the carry-over and then decided whether to allow the Schools to keep it or keep it themselves. One thing this Board did was to change that policy to get away from "let's spend it before we lose it" thinking. He does not think most Board members expected to run into a situation where the School System constantly carries over funds and counts on it in the next year's budget. That was not the anticipation. The anticipation was that sometimes there would be carry-over and sometimes there would be left-over funds which could be carried over. He does not think it was envisioned that you would always plan for it to carry over. Dr. Castner said $680,000.00 is a lot larger than the normal carry-over they have. They tried to use some fiscal accountability. They did not return back the two and one-half percent. When you look at a $70.0 million budget, and you look at a carry-over of $0.25 million, you are dealing with a small percentage. Some schools do hold funds back to buy some small items. They do some good planning on their own. He agrees the number is larger than in the past. It is not the way the Schools want to do business. If they get into using a lot of the one-time money, it forces them into this cycle. He does not disagree with what Mr. Martin said, but he wanted to say this was a deliberate attempt to do what the Supervisors wanted done to solve some of their problems internally. Mr. Martin said he understands it is a large amount because they tried to be fiscally responsible. He does not disagree, but he does not think it would be wise to continue in this way. Dr. Castner agreed. Ms. Humphris asked Mr. Tucker if he is recommending that the Board proceed with the revised shortfall for the School Division and leave it up to the School System to deal with those other funds. Mr. Tucker said based on what the Board members have said, staff did some quick math and tried to separate the one-time moneys from the recurring revenues, and the outcome is: Take the beginning reserves of $270,422.00 and of that amount $75,000.00 are recurring funds. Add the $321,326.00 as recurring revenue, and the $180,000.00 as recurring revenue, so the total of those recurring revenues is $576,326.00. Under the Unfunded Priorities, he started with the figures of $888,023.00, subtracted $251,407.00 in one-time costs, leaving an amount of recurring programs of $636,616.00. Subtract the recurring revenues of $576,326.00, leaving a shortfall of $60,290.00. They assumed the $251,407.00 in one-time costs can be covered by the fuel savings for the remainder of this year. That savings has been estimated at between $250,000.00 and $400,000.00. Ms. Thomas said that does not take into account that there are already $875,000.00 in one-time funds being used in the budget which is not being shown to the Board today. Mr. Tucker said the School Board recommended the budget to the Board in that way. Mr. Marshall said the shortfall is then $60,290.00 instead of the $116,275.00. Mr. Tucker said that is correct. Ms. Thomas said the Board is creating a budget with over $1.0 million in one-time funds being used mostly for operating expenditures. That is sort of like the CIP the Board has put off for one year. It will just hit the County March 23, 1998 (Afternoon) (Page 9) harder next year and the Board will either get angry at the School System, or remember that this was built in this year. Mr. Bowerman said that assumes the Board accepts all the budget recommendations up to this point in terms of on- going costs. Mr. Marshall asked if the Board members would like to start making final decisions by discussing the Funding Initiatives, the first item being the pay plan implementation for the Commonwealth's Attorney and the Sheriff. Mr. Bowerman said he did not believe the Board could compartmentalize this discussion. He said the Board has received a sheet of information on the performance pool costs. Assuming the Board funds the three percent, it is exactly as Ms. Thomas has laid it out. If the Board funds less than three percent, the figures for both General Government and the Schools change. While that is going on, he agrees the Board has to pick some finite point to work against, but, there are a couple of things affecting one another. Ms. Thomas talked about the almost $1.0 million of nonrecurring operating costs being funded. He thinks there is a mechanism to lower some of the operating costs if the Board chooses to do that. Ms. Thomas asked if Mr. Bowerman would like to deal with that question first. Mr. Marshall asked if Mr. Bowerman wanted to deal with the performance pool costs. Mr. Bowerman said these costs drive a lot of it. For every one- tenth of a percent the performance pool is decreased, it frees up money. The Schools put together their budget based on the three percent dictated by this Board. If the Board begins to work with that number, they have more operating funds they can redirect. He asked if there are any additional costs on top of these savings like not paying VRS costs. It is a small percentage, but it is 13 percent of the payroll. Mr. Tucker said staff had not make that calculation, but it could be some small amount. Mr. Bowerman said if the Board saved $300,000.00, it could be another $30,000.00 in lower VRS costs. Mr. Marshall said he needs to know where to start. Mr. Bowerman said he thinks the big issue is the performance pool. Until the Board looks at that and tries to come to some consensus, the Board is "spinning its wheels." Mr. Marshall agreed. He asked if the Board members would like to deal with the performance pool first. All agreed. Mr. Marshall asked for a suggestion as to the amount of the increase. Mr. Bowerman said as a policy discussion the Board needs to go back to what it is trying to accomplish with the merit pool and the benefits program. It is to recognize on the one hand that the Board has a responsibility to meet some of the costs in the increase in the cost-of-living. The Board does pay a substantial share (95 percent) of health care costs. That was a big increase this year from $2000.00 to $2400.00 on the average. That is a significant increase. What the Board is trying to do with the merit pool is to reward better than average performance. Some people will get more than three percent and some will get less than three percent. It is fortunate that there is a fairly low CPI this year. It has been fairly low for a number of years, but this year it is lower than in the past, just over two percent. In all likelihood, it will be an even smaller number next year. In the face of that, he would find it difficult giving the three percent on top of the benefits increase when there is a CPI that has not gone up that much. Philosophically, he has a difficult time with that. As a matter of fact, the number he thought the Board entered the process with was two and one-half percent which was closer to the CPI than three percent. He thinks the original number was flawed. He is looking at two and one-half percent as the amount for the merit pool along with the benefits increase, which is somewhere between a three and one-half and four percent increase in salary and benefit costs for this year. If the Board had started with two and one-half percent, this discussion would not be necessary. Mr. Perkins asked if that is Mr. Bowerman's recommendation. Mr. Martin asked if Mr. Bowerman is suggesting that the Board start with two and one-half percent which on the School side would free up $240,000.00 which could be used for operating expenses. Mr. Bowerman said "yes" for this year, next year and forever. Ms. Thomas said she did not do any extra research on this, but since staff did bring to the Board the three percent figure, and that is very comparable to what is happening in surrounding counties, she thinks it is fair to ask staff to discuss the three percent. Why was that amount recommended? Mr. Tucker said he and Dr. Castner discussed this with their respective staffs March 23, 1998 (Afternoon) (Page 10) O00:I. Z8 who started with two and one-half percent but then learned that some localities were looking at four percent and higher. There was a general consensus that perhaps the three percent would be a better match. It is still lower than what they found localities in the Valley and surrounding Albemarle were proposing. Most are proposing two-plus-two which means they are doing a two percent COLA and a two percent merit. That was the basis of the presentation made to this Board last month. Mr. Marshall asked if that recommendation was based on the benefits package that Albemarle provides. He said it certainly makes a difference. Mr. Tucker said it really does not make a big difference. Most other localities now have similar benefits packages. Staff was strictly looking at salaries, and did not compare benefit packages. The Board had asked Mr. Hendricks to compare Albemarle's benefit package to other localities, as well as some of the major industries in the area. Albemarle does compare favorably with regard to its benefit package with some of the major industries in the community. Dr. Castner said he and Mr. Tucker started with a two and one-half percent number. He surveyed localities in the surrounding area and heard significant numbers above that two and one-half percent. He pointed out that this affects teachers more than it does the general merit pool. In the last three years, transitions have occurred where a good number of employees did not get a cost-of-living raise. That came about because the School System had a different type of pay scale. It had a "bubble" in the middle where some teachers were getting paid above market, and also some teachers at the other end were $5000.00 below market when they were nearing retirement. In a 30- year scale, there are about seven years of teachers that are not getting cost- of-living raises because they tried to phase them out of the ~bubble" and get them back into the linear scale. This past year, the academic leadership stipend model was different than the career ladder. The career ladder had ranges which were higher. There was a group of teachers who did not get COLA raises. In addition, for a family, some of the pass on for health care was significant. While the single coverage was $10.00 more a month, the coverage for a family was $165.00. Even though the School Board tried to buffer the cost, there is only so much money in the reserve. A lot of these people did not see the raise because of health care increases. He said they did some things which have created a better pay structure package, so there is now equity across every school in the system, but it did not come without a price. Dr. Castner said they tried to be fair and hold the employees harmless, but then there is the health care. These are the issues their people have had to undergo in the transition. These are not issues which directly affect County Government. He feels comfortable that when they were talking about the three percent that he did not think it was the time for the school system, for a group of people who are getting improvement every year, to all of a sudden not be supported in the way of the three percent. He does agree that the cost-of-living increase is different this year than in the past, but he is looking at it over a three-year period. There are a significant number of teachers who have not had the benefit of the cost-of-living adjustment because of some system changes. To him, taking any step backward and having a significant difference between their counterparts was not something he felt comfortable with. The strength of the system is its employees. It does have to deal with morale. They are going into next year, as other systems are, going from 11 to 37 tests. They are going to ask every teacher in their system to step up in a different way. This did not seem to be the time to take what he felt was a step backward in relation to all of the surrounding counties. Mr. Bowerman said he believes the County has done a good job with the Hendricks pay study. He does not believe the County is underpaying. He thinks the County has fair wages and salaries in the community. This has been a tough year. There were some significant unanticipated shocks on the revenue front. The public did approve the meals tax. That has gotten the County out of the jam it would have been in because of the extra $2.3 million. He is uncomfortable that the Board has ~to eat all of this" in one year. He does not see why there cannot be some spread to see what next year brings. There is the possibility of doing things differently next year. Mr. Tucker said he was trying to respond to Ms. Thomas' question and how he and Dr. Castner, in discussions, in looking at what the other localities were proposing, arrived at the three percent figure, knowing the County is in the two and one-half percent range for the CPI. March 23, 1998 (Afternoon) (Page 11) 000129 Mr. Bowerman said he did not want the County to "chase its own tail" by chasing other people who are chasing Albemarle. He thinks it is important to look at the community, which is what Mr. Hendricks did, look at the private sector and try to come up with fair salaries and pay levels which the Board can address. The Board is also looking at the compression issue. He thinks the Board has been fair in the way it has looked at salary increases in the past and the way they are looking at them this year. He does not think it is a significant hardship to look at a two and one-half percent merit, and the benefit increases, instead of the three percent amount. There might be more revenue next year to meet some of the other needs, but this is the year the Board is dealing with. Ms. Thomas asked why Mr. Bowerman referred to this as a tough year when it looks like the Board can meet the needs that have been presented. Mr. Bowerman said Ms. Thomas just laid it out. Mr. Perkins asked how much struggling the Board had to do to meet that? Mr. Bowerman said Ms. Thomas had said the Schools are using close to $1.0 million of non-recurring moneys on operating costs. Therefore, Ms. Thomas is indicating the resources are not available to do what should be done. He is trying to free up some funds for operating costs. If the Board gives one-half of a percent this year, that increase is forever. He does not think it is unreasonable to look at a four or four and one-half percent package rather than a five or five and one-half percent package this year. Mr. Marshall said he agrees with Mr. Bowerman. In fact, Mr. Bowerman knew he was going to agree with this proposal before this meeting began. Mr. Perkins said when compensation amounts to over 80 percent of the budget, that has to be looked at closely. He can only look at what has happened to himself the last three or four years. He works for a very conservative company. His increases over four years have been just a little over ten percent. His fringe benefit package is less than that given by the County. It is about 19 percent, and the County's is over 20 percent. Compare that to increases over the last four years for School Division employees of 16.5 percent and almost 16 percent for General Government employees. Compensation is where most of the money is spent, so that is what has to be checked the closest. There have been good increases in the past. That is one reason the Board is talking to the Commonwealth's Attorney and the Sheriff. When he first became a Board member, policemen were being lost to the Sheriff's Department because the Sheriff paid more. The State didn't have increases, and the County did. He will support the two and one-half percent. Mr. Martin said he has mixed feelings. There is a lot to be said for covering another $241,000.00 in operating expenses. In certain situations he would prefer more staff over more pay. He is not comfortable with not having more input from the School Board about all issues. It is difficult for him to look at all of this in light of the additional funding that came to light on Friday and look at how that will be plugged into the School System, and what is left to be funded. If at that point, there are still things on the unfunded list that the Board needs to look at again, Mr. Bowerman's way of doing it would free up another $240,000.00. He is not sure how to vote at this point. Ms. Thomas said it is true that Local Government is a people-intensive operation. Their compensation is the largest piece of the budget. It does behoove the Board to look at the expense carefully. Looking carefully is not meant to be a code word for cutting down. The Board has looked carefully but she does not think it leads to the conclusion that compensation should be cut. Compensation is the largest item in the budget because the employees are being paid to do the work asked of them. If it has been a tough year on the County financially, next year it will be tougher on the employees because of what they will be asked to do. She does not see any justification for cutting the scale and merit pay for employees. Just because it is available does not make it the right thing to do. She is not convinced it is the right thing to do in terms of the comparison with neighboring jurisdictions, whether the County has kept up with inflation in the past. The Board knows the County Executive is very slow in adding people to the staff, so by necessity more is being required of each employee. She does not think this is either the necessary or the right time to reduce what has been talked about in terms of a three- percent increase. Mr. Bowerman said it is a reduction in an increase rather than a cut. He said two and one-half or three percent is an arbitrary figure. There is a March 23, 1998 (Afternoon) (Page 12) 000'130 two- percent inflation rate, and the Board had before it a two and one-half percent recommendation. Ms. Thomas said as an employer, just meeting inflation is not adequate. If the County's above average employees can only think that the inflation rate will be covered, that's not what the Board as employer should be doing to its employees. Mr. Bowerman said it is over four percent, which is double the rate of inflation. Ms. Thomas said that is because of what is happening with the benefits package. That is essentially out of the hands of the employees. The VRS payment the County is facing is not because the employees are getting a richer retirement package. It is because the State did not pre-fund the COLA until they were told they had to. They didn't do what the court decided in the Harper case (that had to do with the Federal retirees). It is actions by VRS and the State that have gotten the County into a situation where there is an increase in what has to come for the VRS payment. It does not rebound to the benefit of the employees in the way of a greater benefit. It is like a lot of other things the Board faces, When the State has a cold, it is the Board who gets the sore throat. It doesn't materially add to what the employee is getting. If the Board were increasing the health insurance package, she would regard that as an increase to the employees. But, the VRS thing is something she regards that the State and the VRS system have done. Somebody has to pick it up. Because the County is picking it up this way, the Board does not need to ~beat the employees over the head" with it. Mr. Bowerman said health care benefits increases are already being counted in the CPI. Some of the numbers are being counted twice. He is just saying that this year the Board needs to look at doing something other than what was recommended. The Board looks to setting aside some additional money for operating expenses. The Board recognizes that the County has a good payroll package and salary plan. It will be increased. Benefits have been increased, but he does not see the need to do the three-percent versus the two and one-half percent merit when there are obvious things to gain. He does not see that much negative surrounding it because it is not zero, it is not a minus. The County still has salaries growing faster than the rate of inflation. Some people will get a seven and one-half percent merit increase plus their benefits increase. The whole payroll package should not be out of line, just like there should not be compression. This change would give more flexibility to do some of the other things the Board thinks are important. Mr. Martin said knowing where the Board members stand at this moment, he would suggest discontinuing the conversation now. Then, as the Board discusses some of the other items, it can think in terms of what it would do with those items if there were additional moneys available in operating expenses. Mr. Marshall agreed. He knows where five supervisors stand, but he doesn't know where the sixth one stands. Ms. Humphris said Mr. Marshall wants to know where she stands on the issue. She and Mr. Bowerman have talked about this, and a couple of weeks ago she did not know where she stood. The picture has changed considerably in that time. At first, she did not understand how the Board ended up with a three percent merit pool instead of two and one-half percent. During discussions she has recognized that there are good reasons for that because of what has happened in the School Division and because of the additional responsibility that will be put on them. She is one who realizes that employees respond to additional dollars in their pockets. They feel rewarded and appreciated based not on what they can see in retirement, or even in their health benefits, but by what they can use to put food on the table, and to buy a house, etc. What she is looking at in the Board's Reserve Fund with the three percent merit is a balance of $338,266.00. The School Division's revised shortfall is $60,290.00. Of the items on the list the Board will soon be discussing, she believes that some of those items will not be funded. She thinks the Board is in a good position to be able to pay its employees what she believes they are worth and not fall farther behind in the market and not have disappointed and irritated employees. She would rather that the employees spend their time teaching and being productive for the County, like the employees in the County Office Building and the Schools do, than go around being angry because they feel they are not being appreciated by having the income they believe they deserve, and which she believes they deserve. That is where she stands at this moment. She is wondering why, given the situation at this moment, the Board would feel the need to cut the merit pool. 000:1.3 March 23, 1998 (Afternoon) (Page 13) Mr. Marshall said Mr. Bowerman has expressed most of his feelings. He has not heard anybody say anything about the private sector. He looks at this as a two and one-half percent raise, not a one-half percent cut. His employees would like to have that increase. A lot of other employees would like to have the increase, particularly the benefit package that goes along with it that a small business cannot afford. It is not that he does not want the employees to have a three percent raise. He thinks it would be wonderful if everybody could have it, but they can't. He will stick with what Mr. Bowerman said with the CPI where it is and the benefit package being given. He does not feel he can justify that expense of taxpayer's money. With that discussion over, he believes the Board needs to discuss the rest of the budget because it appears that the vote is split three to three. Mr. Martin said he thinks the Board can conduct the rest of the work session with the idea in mind that there is the possibility of either a two and one-half percent or three percent increase. He doesn't see why the Board needs to make a decision at this moment. Ms. Humphris said she thinks the Board needs to go through the rest of the list now. Mr. Martin suggested a recess. (Note: At 2:47 p.m, the Board recessed, and reconvened at 3:05 p.m.) Mr. Marshall said the request from the Commonwealth's Attorney for Parity/Pay Plan Implementation is the first item on the list of funding initiatives. Mr. Bowerman suggested the Board discuss the options. He asked Mr. Camblos, who was present at this time, if his position was to be included in the County's Pay Plan. Mr. Camblos replied uno." Mr. Bowerman said in reference to the comparison of lawyers to lawyers in two different offices, the point was made by staff that there are things other than when one graduated from law school and passed the bar to consider. He asked if it would be acceptable if the positions in the two offices were in the same grade and then evaluated equally. Mr. Camblos said he sent the Board members information he had received showing when people graduated and what people were being paid, and those were given to show a comparison. Whatever the rules are for the pay scale, they should apply across-the-board whether it is a civil attorney or a criminal attorney. He does not care what the rules are, but they should be applied equally to every employee. Mr. Bowerman asked how this would be decided' Mr. Tucker said Staff would first ask Mr. Hendricks to make a recommendation as was done for the Sheriff's employees. After that, a decision would have to be made as to how to place each employee on the Pay Plan. Ms. Humphris said when Mr. Huff went over the various scenarios earlier, she understood that staff had information from across the state as to how commonwealth's attorneys are compensated as compared to county attorneys. Mr. Huff said staff only has information from jurisdictions which give supplements. The State pay scale for commonwealth's attorneys is below that which is paid to most city and county attorney's offices. Staff can do some market research. He thinks staff will find that in many jurisdictions city and county attorneys are paid differently than commonwealth attorney's staffs. Ms. Humphris said she needs the kind of information Mr. Hendricks would give the Board in a study. The Board needs to address the whole issue of being on the County Pay Plan, and how that would work. First, should the office be on the County Pay Plan, and second, if it is, how does that work? Then, the amounts of money are the easiest thing to deal with. Mr. Huff said the internal equity question is the biggest question. Ms. Thomas asked why the Board should not take Option 2 (Hendricks to do a study) and Option 3 (place employee on appropriate range, but not on the Pay Plan itself, no access to performance pool). Mr. Camblos said he understands that Option 3 would only bring one of his employees up to the minimum salary. Everybody else's salary is already over the minimum. Ms. Thomas asked if Mr. Hendricks would not insure the range is correct. Mr. Huff said staff assumes he would not pick a range higher than one in the County Attorney's Office. Staff assumed there would be only one deputy commonwealth's attorney's; it would not justify there being two deputies. March 23, 1998 (Afternoon) (Page 14) Mr. Perkins asked the amount of the current local stipend. Mr. Huff said it is six percent. Mr. Camblos said he looked at the letters he had written to the Board over the last three years, and he does not believe anybody could argue with the fact that if the Board had pay scales that were based on gender or race or religion, the Board would be in trouble. What is being discussed is a pay scale based on whether the employee is a civil attorney or a criminal attorney, and he does not think that is right. His is a department within this County. They do different kinds of work, but they are still attorneys. Mr. Martin said it is a different job description, and it is an issue of supply and demand. How many criminal attorneys could represent the Social Services Department, the School Board, the Board of Supervisors? He does not believe there are more than five people in the area who would fit the job description of a county attorney without a whole lot of training. Mr. Camblos said he was talking about a very basic difference between civil and criminal. He does appreciate everything the Board has done for his office since he has been Commonwealth's Attorney. He does not care what the criteria is or how the scale will be applied. That can be worked out. Mr. Marshall asked if this can be a year-to-year thing, or is the Board locked into it once it is done? Mr. Bowerman said it can only apply to the officer during his term in office. Mr. Camblos said a number of jurisdictions in the state do it, but it only applies while the person is in office. Mr. Martin said he can only say good things about the Commonwealth Attorney's Office and his staff. That is a reason he supported a stipend, but he thinks the whole idea of putting the office on the same pay scale as the County Attorney's Office is a "huge can of worms." It has nothing to do with the quality of the work in the office. Mr. Bowerman asked if the Board could expand what it does now and have some sort of acceptable review, keep the offices separate, but recognize equal pay for equal work and equal experience? Mr. Tucker asked if Mr. Bowerman was suggesting a performance review, but not have the employees on the Pay Plan. Mr. Bowerman said he meant that the stipend would be based on the review. A study might still be needed by Mr. Hendricks. Mr. Marshall said that is more like what he had in mind. Mr. Martin said now the stipend increases depending on the increase for County employees. Mr. Huff said that is not true. The stipend is based on the State salary. The stipend is an "x" amount on top of the state salary. The stipend is six percent in the Sheriff's Office, and two percent in the Commonwealth Attorney's office except for some individuals who have been given flat dollar stipend amounts. Ms. Thomas asked if the Compensation Board is giving the same increase that the State is giving its employees. Mr. Tucker said "yes." Ms. Thomas said that means they will be getting a 3.67 percent increase. She said this year Mr. Camblos would be better to take the State increase. Mr. Camblos said he does not think so. Ms. Thomas asked if the Board was discussing how much the County would give in addition to what the Compensation Board grants. Mr. Tucker said ~no." Ms. Thomas asked if the County would be returning money given by the Compensation Board. Mr. Tucker said the revenue from the State comes to the locality. It goes into the General Fund, and these employees get a paycheck from the County. The Commonwealth Attorney's employees would receive whatever the Pay Plan showed. It would not be on top of, or in lieu of, or anything of that sort. Mr. Bowerman said the real test would be if the State raised salaries 15 percent and that revenue went into the General Fund, and then some of that money was redirected because that was more than the County's compensation package. Mr. Camblos said if he had an employee whose salary was lower on the County Plan than what the State was paying, the difference in revenue would not come from the State. The County could not use that difference in revenue for another employee. March 23, 1998 (Afternoon) (Page 15) 000 .33 Mr. Bowerman asked what benefit this would be to the County. Mr. Camblos said he would stop coming every year and making this request. He said someone had mentioned that salary and morale go together, and another comment was made about being rewarded and appreciated. Just because they are ~up on the hill" does not make his employees any different. They are just talking about equal pay for equal work. He said if it would make the decision any easier, the Board could leave his position out of the discussion. Mr. Marshall asked if any Board member had a recommendation. Ms. Humphris said Mr. Camblos makes a good case every year, but she is still reluctant to change things. It is sort of mixing apples and oranges, and no matter what he says about the jobs being the same, she does not think they are exactly the same. She would like to find some option to insure that Mr. Camblos feels his employees on the criminal side are fairly paid for what they do so they have high morale. She is not sure they need to be on the County's Pay Plan to do that. She would like to find a way, based on what Mr. Hendricks might recommend, to see what should be done. Mr. Martin said he can go along with that suggestion. One of the things the Board has done historically for stipends is to base the stipend on the person and not the position. Ms. Humphris said the Board felt comfortable doing it that way, so doing it for the job and not the person would be a distinct change. Mr. Marshall asked if they were only talking about Option 1. Mr. Martin said it might be better to formalize it, but that would basically say this Board had no say over it. In the past, the Board was looking at individual job performance, which is a little unfair because the Board did not know anything about some of these employee's performance. Mr. Camblos asked if the Board decided whether each individual employee is hired or is that decision made by staff. It sounds like the Board is micro-managing his office, but not others. Ms. Humphris said the Board can hire and fire all of these people, but it has no control over Mr. Camblos. Mr. Camblos said if he is put on a pay plan, the Board has financial control over him. Mr. Bowerman suggested including funds in the budget, and not designate at this time how any study would be implemented. After the study is received, first get Mr. Camblos to agree to the study. It is possible the study might show that defense lawyers are a pay scale lower than civil lawyers, or vice versa. Until Mr. Camblos agrees to whatever the Board wants to do, it would be pointless to continue. At that point, the Board could decide whether to do something informally, or through a salary review without being on the Pay Plan, or something else. The Board has already done it for the Sheriff's's Office. Mr. Tucker asked if the Board wants to keep the amount for the Commonwealth's Attorney and the Sheriff in its Reserve Fund until that decision is made. Mr. Marshall said he thinks the Board is talking about Option 7 at $74,602.00 for both the Commonwealth's Attorney and the Sheriff. Mr. Tucker said until staff finds from Mr. Hendricks what range these positions should be on, the figure is not important. It is more important to just include some amount. Ms. Humphris said the Board has not discussed the Sheriff's request yet. Mr. Bowerman said the two requests can be separated. Ms. Humphris agreed. She said there are different problems with each request. Mr. Perkins said Scottsville is part of this decision also. Mr. Marshall suggested adding $38,960.00 for the Commonwealth's Attorney back to the Reserve Fund Balance, and then discuss the $35,642.00 for the Sheriff, as suggested under Option 7. Mr. Bowerman asked staff for a report. Mr. Huff said Sheriff Hawkins' request was to bring the salaries of his employees up to the minimum of the exact range of the Police Department. Then, a captain in the Sheriff's Department would be on the same range as a captain in the Police Department, etc. That would be the range only, but they were not placed anywhere in that range. If they were at the minimum of the range, the employee received no compensation. If the employee's salary was below the minimum, that salary was brought up to the minimum. Ms. Thomas asked if that is Option 3. Mr. Huff said it is the same process as Option 3. When Option 3 was costed, Mr. Hendrick's recommendation was used, which is one grade lower for a field deputy and several grades lower for captains, sergeants, etc. 000134 March 23, 1998 (Afternoon) (Page 16) Ms. Thomas asked if the discussion should be about the definition of "appropriate range." Mr. Huff said "yes." Mr. Marshall said that will leave Scottsville with a decision as to whether to demote their sergeant or pay the additional amount of $3872.00. Ms. Thomas said it would not cost the County as much as the figure shown. Mr. Huff said that is if the Board assumes the Hendricks range for sheriff's deputies. Ms. Thomas said Mr. Hendricks is the expert in this matter. She thought his conclusion about the range was appropriate at the time, and she has seen no reason to change her mind. Mr. Bowerman said there are over 80 people in the Police Department, and there are only two captains. There are 16 deputies in the Sheriff's Office and there are two captains. He does not think job responsibilities are equivalent to the extent that Hendricks was able to characterize them. He thinks that is what the Board should deal with initially. He does not think the Board has to make both offices the same. These are policy questions, but both offices are already being supplemented. That big hurdle has already been dealt with. Mr. Huff asked what Mr. Bowerman is thinking about. Mr. Bowerman asked if what everybody is trying to do is bring all the positions to the mid- range on Hendricks recommendation. All Board members disagreed. Ms. Thomas said Option 3 says "minimum". For compression, mid-range is the goal. Mr. Marshall asked if the $35,642.00 represents minimum. Mr. Huff said that is of the Police range, not the Hendricks range. If the Board wants the minimum of the Hendricks range, it is $2360.00. Mr. Marshall said that would be is $2,360.00 instead of $35,642.00. Ms. Thomas said $3872.00 would have to come from Scottsville assuming Scottsville kept one deputy as a sergeant and one as a deputy. Mr. Huff said it also assumes a conversation he had with Sheriff Hawkins where one of his captains would have to be reclassified as a lieutenant. It assumes a captain, a lieutenant, and three sergeants, ten deputies, plus the auxiliary at the Hendricks recommended range for each of those classifications. Ms. Thomas said the Board would actually have to add to the budget the $2360.00 and the $3872.00, but revenues would be increased by $3872.00 from Scottsville. Mr. Huff said $360.00 is net of Scottsville. Ms. Thomas said $2360.00 would be coming out of the Board's Reserve funds. Mr. Huff said it does not put the positions up into the range. It only puts them at the minimum. Mr. Marshall asked if $2360.00 will be subtracted from the $522,761.00, at this moment. The Board has done nothing with the $38,960.00 for the Commonwealth's Attorney except to leave it in that Reserve Fund awaiting on the outcome of the study. Mr. Tucker said the Board can do it that way, or identify it as an item in the Board's budget as a reserve for the Commonwealth's Attorney parity. Mr. Marshall said it is still a reserve. The only thing the Board has spent is the $2,360.00 at this point. Mr. Huff said plus the $38,960.00. Mr. Bowerman and Ms. Thomas said ~yes." Mr. Tucker suggested that the funds be kept in a separate reserve so the bottom line figure is not affected. He said the Board needs to understand that with the Commonwealth's Attorney the Board is assuming receipt of the Hendricks's study first and then with the $38,960.00 there would be a way to figure out where best to place the employees in the Commonwealth Attorney's Office in the Pay Plan. All the Board has done for the Sheriff, so far, is to make sure that his staff, based on the Hendricks Study, is brought up to the minimum. These are two different issues. There is revenue in this budget to move the employees in the Commonwealth Attorney's Office to the appropriate range based on whatever criteria the Board derives. The Board has not provided revenue to do the same thing for the Sheriff's Office. If that is what the Board intended to do, fine, but he wanted to be sure the Board understood what it is doing. Ms. Humphris said she also wants to understand what the Board is doing. Mr. Tucker said the Board put money aside for the Commonwealth Attorney's Office. The Board has not done that for the Sheriff. Mr. Bowerman said there will not be a discussion between the Sheriff and Mr. Huff about where each deputy position should fall in the pay range. Mr. Tucker said if that is what the Board chooses to do, that is fine. Mr. Bowerman said that is not what the Board just did. It just did to the minimum. Mr. Tucker said that is correct, the Board just did to the minimum. 000:i.35 March 23, 1998 (Afternoon) (Page 17) Ms. Thomas said for the Commonwealth's Attorney, the Board did not do anything. But, Mr. Hendricks is to do a study. Mr. Tucker said that study will only give some recommended ranges. Mr. Marshall said there is a possibility that the Board has spent $41,320.00 of the Reserve. Mr. Tucker said that is right. Ms. Thomas said she thinks the Board has said it wants to spend the $2,360.00 for the Sheriff's Department. Mr. Marshall said there is a total possibility of $41,320.00. He is keeping a running total of changes today. Ms. Thomas asked Mr. Tucker why he suggested that the Board keep both of these amounts in a separate reserve fund. Mr. Tucker said it is not necessary, but it helps staff identify that the revenue is being kept for a specific purpose. Ms. Thomas said she thinks the Board's decisions on the two departments are different. For the Commonwealth's Attorney, it seems appropriate to hold funds aside and wait to hear from Mr. Hendricks. For the Sheriff, she thought the Board had said it wanted to bring the Sheriff's deputies to the minimum of each of the Hendricks identified ranges, and the only question in her mind is about Scottsville. Mr. Tucker said he was trying to get to the bigger picture. What the Board is about to do for the Sheriff, it is not talking about doing for the Commonwealth's Attorney. He is saying, the Board "will get itself into a box." What it is about to do is put the Sheriff's deputies at the minimum of a range. That will lead the Board to do the same thing for the Commonwealth's Attorney after it gets the Hendricks' study unless the Board decides to do something differently with the revenue. He knows the Sheriff will come back when the Board starts moving the Commonwealth Attorney's positions up in the range, and he will want the same thing done for the deputies. The Board does not have the revenue to do that. It will not matter if the Board keeps a decent amount in the Reserve Fund because there would be revenue to work out some kind of a solution for both. Mr. Marshall asked about doing the $35,642.00 and then setting aside $74,602.00. Would that solve the problem? Mr. Tucker said "no." Ms. Thomas said it would create more problems for her. Ms. Humphris agreed. Mr. Tucker said it may be best to get the Hendricks study, then the Board use the study to review both departments. At that time, the Board can discuss how to implement the study. Mr. Martin said that makes sense. Mr. Marshall said in that case, the Board is not setting any revenue aside. That leaves $522,761.00 in the Reserve. He suggested discussing the item under Public Safety, "Fire/Rescue Education (Training) Specialist" for $30,538.00. Mr. Martin said in the long run it makes a lot of sense to approve this request. No one objected to this expenditure. Mr. Marshall said the Parks, Recreation & Culture item of $10,000.00 for the Virginia Festival of the Book is moot at this point. Mr. Marshall went to the Community Development Category. The first item is a full-time engineering inspector for soil erosion at a cost of $44,355.00. Ms. Thomas said she was at a house yesterday where she learned that the owners had to turn to the EPA (Environmental Protection Agency) to help with erosion coming from a new house being built uphill from them. She cringed. Mr. Perkins asked how many employees are in that department now. Mr. Tucker said there are three in soil erosion and environmental types of issues. Staff is going to do a further analysis of the Comprehensive Water Resource Ordinance the Board adopted last month and look at the fees. He hopes that most of this expense can be offset by fees. That fee schedule will be returned to this Board to be adopted in the next few months. Ms. Thomas said the Engineering Department's staff is being enlarged by .05 FTE, the cost of which should be offset by fees. She would not want anyone to think this full-time person's salary would also be offset by fees because fees are a policy decision that has to be made by the Board. Mr. Bowerman asked which amount the Board is considering. Mr. Marshall said it is the $44,355.00 for a FTE beginning July 1. Mr. Perkins asked if a January hire would be half of that amount. Mr. Huff said "no", there are capital expenses involved with a new employee. No one objected to keeping this expense on the list. March 23, 1998 (Afternoon) (Page 18) 000136 Next, Mr. Marshall asked for comments on the $25,000.00 for the Albemarle Housing Initiative. Ms. Humphris was in favor. Mr. Perkins asked if this is in addition to the $25,000.00 that is already in the budget. Mr. Tucker said ~yes." No one expressed an objection to this expenditure. Mr. Marshall asked if anyone objected to the $10,000.00 for the Piedmont Housing Alliance. There were no objections. Mr. Marshall said the Reserve now stands at $412,868.00. He suggested the Board discuss the School Division shortfall of $60,290.00. He said that amount will not be necessary if everybody agrees to a two and one-half percent merit pool. Since he did not know where all of the Board members stand on this matter, he asked for discussion. Mr. Martin asked Mr. Tucker for a suggestion concerning the CIP/Debt Service Transfer. Mr. Tucker said of the projects listed, the projects which have been deferred to the year 2002 are sinking funds for maintenance and repairs. If the Board wants to put additional funds in that category, staff recommends that funds be added to School Debt Service. Ms. Thomas asked if there is any urgency to the Chris Greene Lake Property purchase. Mr. Tucker said he does not believe so. The amount shown is what the County assessors have said the property is worth. The County has offered that amount to the owner, and this individual has turned down the offer. The purchase is listed in the CIP, but it is not an item he feels needs to be funded at this time. The offer was made, and the owner has not been receptive because the County's assessment was used for the offer. Ms. Humphris asked about the project listed as "Revenue Sharing Road Project Funding" in the amount of $120,000.00. Ms. White said when the County got its highway revenue sharing allocation for next year it only received $380,000.00. The $120,000.00 was included should the County get the $500,000.00 allocation. Mr. Marshall said he had a suggestion to make. He feels the Board is at an impasse. He suggested funding the $60,290.00 to balance the School budget, then proceed to a discussion of the compensation package and decide what the Board is going to do with it. Mr. Martin said he is thinking about it differently. He would suggest putting $112,868.00 toward additional funding for the School Debt Service which would leave an even $300,000.00 in the Board's Reserve Fund. He would then suggest splitting that amount and giving $150,000.00 to the Schools and keeping the other $150,000.00 in the Board's Reserve. He suggests leaving the compensation package alone. Ms. Thomas said $60,000.00+ may have to come from that balance for the pay plans the Board has been discussing. Mr. Marshall said it could be as much as $74,600.00. He thinks it all goes back to the pay plan and he thinks the Board needs to make a decision. Ms. Thomas asked if she could tackle this question from another angle. She asked Mr. Tucker what amount he would be comfortable with in the Board's Reserve Fund. Mr. Tucker said there are several expenditure costs which are not accounted for in this budget, such as potential reversion costs but he thinks the Fund Balance could be used for this expenditure because it is a one-time expense. There is funding of the Comprehensive Services Act (CSA). A third item is the purchase of an elementary school site. The Fund Balance could be used for that expenditure also. Looking for a site for a new northern elementary school is an item which will have to be done soon. The $150,000.00 range for the Reserve Fund would be an appropriate amount to retain. Out of that figure, the Board would have to consider funding for the constitutional officer's requests. Mr. Marshall said he personally would like to see the Board keep a large reserve fund. Mr. Tucker said when there is a large reserve fund, people feel they can come to the Board and ask for money out of the budget cycle. The Board had no reserve fund during the current fiscal year and there were no items requested for funding. The CSA is the only thing that worries staff. It is an expensive item. Mr. Perkins said the Board knows there are things waiting for funding. The new elementary school site is one. He thinks money should be set aside, March 23, 1998 (Afternoon) (Page 19) not only for the site, but also for the building. Why borrow every penny that it takes to build the school when it is known that the expenditure is coming up? The Board should start putting a little money aside so that when it comes time to do it there is some money built up. Why spend every penny that comes to the County? Ms. Thomas said that usually the Board puts money into a capital reserve. Mr. Tucker said he would suggest that one-time revenue be put aside for a school building because the structure itself is not a recurring cost. The Fund Balance could be used to buy down the amount that has to be borrowed, but he does not think the Board could put aside $6.0 million between now and the year 2000. Mr. Martin asked if anyone wanted to change the proposal he put on the table. Mr. Marshall asked why Mr. Martin is recommending that the Board give the Schools an additional $150,000.00 when all they need is an additional $60,290.00 to cover their shortfall. Mr. Martin said it depends on the interpretation of "all they need." Mr. Perkins said in looking through all the costs of the Schools he found some items which he felt could be priced more appropriately. He believes they could find enough items to cover the $60,290.00 shortfall. Ms. Humphris said there is another way to look at that. Buying for herself at home she would not have to buy a chair that would be used eight to ten hours a day, five days a week. Buying things for institutional use, those things must be of a better quality. Ms. Thomas said she can support what Mr. Martin has proposed. Ms. Humphris said she too can support it. The Board needs to look at the list of other unfunded priorities of the School Division. It is a long list of significant things, so she does not think that putting $150,000.00 into it instead of the $60,290.00 is a huge problem. Ms. Thomas said it was the discussion about the one-time funds paying for operating costs that partially led the Board into the discussion about compensation. That suggests this would help the Schools meet their needs in a way that is more fiscally responsible. Mr. Bowerman asked Ms. Thomas to go through what she had just said. Ms. Thomas said if meeting operating needs with one-time money is not ideal, then meeting those needs with operating money is more fiscally responsible. She said Mr. Martin's proposal would lead to a more fiscally responsible budget even if it does not increase much from what it has right now. It will allow the Schools to expend what they had budgeted to expend at the beginning of this school year which otherwise will carry over into the next year. She thinks that is a sticking point with many of the schools, the fact that their budgets have been level-funded and decrease with hold-backs each year. The five and one-half percent holdback is greater than they have had in the last couple of years. Mr. Martin said when he first decided to run as a candidate for the Board of Supervisors, he did so because he had served on the School Board and felt that this Board did not understand the needs of the Schools. He wanted to help make sure the Schools were adequately funded. Now that he has been on the Board of Supervisors for a while he realizes the Board was not the "bad guys" he thought. Several things he has noticed. Listening to what the Schools said today, they started to use carry-over funds, anticipate those funds, and put them into next year's budget. That's how much they are hurting. He also looks at the bus replacement cycle. At one time it was eight years, then it was increased to ten years, and now it is up to 13 years. He is sure the Schools do a good job with maintenance, and maybe buses are better than they used to be, but he sees that as another example of where they are stretching. Mr. Martin said he heard today that the Schools are anticipating personnel that will not be there, and are putting that into the budget. He remembers the first time the School Board did that, they were scared of the consequences, and now it has become commonplace. Until Friday when the Board heard about the additional $500,000.00 in State revenues, he believes the Board would have done some different things for the School System. Ail of a sudden the State became a little more benevolent and helped close the gap with the money. He does not think this Board should just walk away and say everything is solved now. He believes the School System has done an excellent job of pinching pennies, maintaining quality education even though every year they have to cut back on something. This year, at Hollymead and Stone March 23, 1998 (Afternoon) (Page 20) 000:1..38 Robinson in particular, teaching assistants are leaving. He knows that is micro-management, and he knows that is bad. If you go into the elementary schools, which he does often having three children in the elementary schools, those teaching assistants are needed because it is not just 23 kids, but it is 23 kids, three of whom are special ed, two of whom are acting out, and then all the other kids. If this Board had made this decision on Friday, it would have done certain things. The Board was lucky on Friday to hear about the $500,000.00. Mr. Marshall said he remembers when he was on the School Board. The members got long list of expenditures, and he would read through them and he found a lot of things that did not jive with what he was doing out in everyday life. He recalls one incident where they wanted to buy a John Deere tractor to use for pushing snow, and were putting a cab over it, but it was several thousand dollars more than he had just paid for the same tractor on his farm. He bought his tractor from the highest priced dealer in the area because he wanted to leave that money locally. He could have bought it cheaper in Orange. He said the list went on and on like that. Mr. Marshall said after a while he began to question those expenditures. Now, all he sees is one sum coming from the School Board. He was frustrated because the School Board would send the budget to the Board of Supervisors and it was sent back saying there was not enough money, slash it. At that time, he felt the problem was that there was not a good rapport between the County Executive and the Superintendent of Schools. That problem has been solved. The Superintendent had good working relationships with the County Executive because he knew what the revenue projections would be, and the Schools would know how much money it had to spend. It worked out well. They would give the Board a budget balanced, based on revenue, and the Superintendent and County Executive would go over the needs based on the amount of money they had, just as the ordinary citizen does when doing personal shopping. Now, things have changed. There is a School Board that now feels it has a mandate to spend money on things he is not sure the County needs to spend money on. Mr. Martin suggested that Mr. Marshall look at what the School Board did with the bus schedule. It took guts for them to face all of those families that yelled about the bus schedule. It took guts for them to stand up and save that money. Things have changed since he and Mr. Marshall were members of the School Board. He remembers that Mr. Marshall always used to underline "staff development." Back then it was $250,000.00+ for that line item. Now, it is something like $20,000.00, a very small amount. He remembers the days when it could have been said there were some things in the system which were elaborate. But, the Schools have taken tremendous "hits" during the last four or five years, and to him this is an opportunity to do some catching up without having to increase taxes. Mr. Marshall said he and Mr. Martin agree on that. He doesn't know how to say it. He feels that when a kid brings a note home from school, or he (Mr. Marshall) gets telephone calls from some child putting pressure on him, he wonders if it isn't being used inappropriately. He does not like the type of pressure that is being put on him by the Schools. He does not like the pressure that is being putting on him by some people in the system to get what they want. What they want is more pay and less work. Ms. Humphris said the Board members were elected to take the pressure. The Board members are the people the citizens are supposed to speak to and say what they want or do not want. That is what they have been doing. She believes all of the Board members have received pressure from every direction, and it's that old thing, "if you don't like the heat, get out of the kitchen." Mr. Marshall said he is getting pressure now from a group of people who are saying the County is spending too much. Ms. Humphris said the Board members were elected to make the decisions. When she first became a Board member eight years ago, she was of a mind that there was probably "fat and fluff" in the County budget overall. She looked for it. At the time, there were some things. Nobody has been able to show her and prove that the things which are called ~priorities" in the School Board's additions to the Superintendent's budget are in any way fat or fluff. These are necessities which are caused by growth. This Board has no control ove~ growth, and will continue and will increase. The County has been falling behind and it can't afford to fall further behind. It is in everybody's best interest for the County to have a superior school system. The only way to do it is to make March 23, 1998 (Afternoon) (Page 21) 000:1.;39 sure that things are appropriately funded. With almost 300 extra students in the system every year, the Board can't just say "level fund, business as usual." Something positive must be done. She thinks the County is extremely fortunate that things have come about as they have. Things have been happening since the middle of this fiscal year about moneys and whether there will be continued shortfalls, whether there will be any extra from the State. Right now, the Board is in a situation it could not have dreamed of even a month ago. Instead of squeezing in and trying to do less, the situation should be celebrated, and say that without a tax increase, the Board is able to do these things, and be grateful that it is possible. Mr. Martin said he would like to try another suggestion. When the Board approved the last subdivision out in the Hollymead area, people said the Board was trying to increase growth. His reply was uno", the County is trying to direct growth. The subdivision does not cause people to come here. Second, he heard people say that the infrastructure and the schools are not there. He explained that the County is anticipating growth and planning for it as best it can. The County does not support growth, does not want growth, but it is coming, and it is not because of that subdivision. Given that, the Board of Supervisors is trying to make sure the Schools are as prepared for growth as possible. This is an opportunity now for the Board to be able to take a step forward. Last year, the Schools stayed in place. The year before, the Schools stayed in place. This is an opportunity to take a step forward in terms of preparing the County for the growth it does not support, but which keeps on coming. Mr. Perkins said he believes the Board should be preparing for growth by setting aside some money because it is known that new schools will have to be built. Maintenance will need to be done on the schools. The Board of Supervisors has increased the Schools budget every year. It might be said that some of that was for inflation, and some was for growth, etc. In the last ten years the Schools budget has increased over $30.0 million. He believes the Board has "stepped to the plate" by providing millions of dollars. The State comes forward with a little more money. Maybe they should step forward again too. Their percentage has been decreasing over this same period. If every penny is spent every year, there will be a time when there is a real shortfall, and there will have to be some cuts made that are substantial. He heard a lady talking several months ago about teaching during the Depression. She taught in a school up in Sugar Hollow. There was not enough money, and the school was closed at Thanksgiving. Hopefully, there will never be that kind of a situation again. But, he thinks that a trouble of the Federal Government today is that they spend every penny they have, plus more, and that is why there is a trillion dollar debt. If the Board spends every penny, then next year there is a percentage added to that, and so on. These things are paid for forever in the percentage growth that occurs year after year. Mr. Bowerman said on Friday (until Mr. Tucker called him on Saturday) he was approaching this meeting today with the thought of decreasing the merit increase to two percent because he felt the Board needed to fund all of what the Schools had requested. He was not going to vote to raise taxes. He was not going to vote to change the rate because he felt that selling the meals tax was a difficult job. It happened and he is appreciative of that fact. He does not favor doing two things in the same year if he has a choice. It was not an option for him to raise taxes. Then, on Monday, the State recognized some of its responsibilities and gave the County $500,000.00 of its money. The same thing the State accuses the Feds of doing, they do to the localities. The picture changed so the Board was able to do more for the School System than he thought possible. Mr. Bowerman said he feels differently about the responsibility of the Board of Supervisors and the responsibility of the School Board. The School Board is never going to be accountable and responsible for the actions it takes unless it is held to what it does and made responsible for it. If the School Board says they need dollars to fund things, he will go out of his way to see that they get what they say they need. He can only give them a dollar amount. The Board is sitting here micro-managing, and the School Board does not have to pay any attention to this Board at all. The School Board has to be accountable for how they spend the money. The Board of Supervisors has to be accountable for the dollar amount it gives the School Board. He thinks that is how it should be because that is the way the Legislature ~dealt the cards." One of the things the Board controls, since there is parity between General Government and the Schools, is that the Board dictates a salary 000:1.40 March 23, 1998 (Afternoon) (Page 22) increase the School Board has to abide by, or the Board would be the first to get upset if they didn't. Mr. Bowerman said he is a little upset because he is being seen as not being appreciative of County employees, on all levels, in all areas, because he believes there can be a two and one-half percent merit increase this year rather than three percent. It was a difficult year financially. Without the Meals Tax, it would be entirely different. He believes that next year there will be more resources available, and if there are not, then the Board will have to look at a tax increase. The needs of the community have to be funded. He said that by changing the merit pool to two and one-half percent and using Mr. Martin's suggested allocation of resources it leaves the Board with $150,000.00 in its Reserve Fund. If the School Board determines that the $500,000.00 this Board says they don't have to spend on salaries can be used for a sinking fund for the new northern elementary school, they can do that. If they don't want to return the hold-back to the Schools in terms of operating funds, they can do that, but without this Board taking some action, they don't have that flexibility. Mr. Bowerman said in today's world, a two and one-half percent merit increase is a very fair increase. He thinks it gives General Government and the Schools more flexibility to deal with some other needs rather than having a policy of the Board of Supervisors dictate to them. He thinks the School Board should be held accountable for how they spend their money. If they want to spend money to pay their teachers more, that is their decision. Basically, he is saying that almost all of the reserves the Board has are being directed to the schools. He thinks it is appropriate to do that. Out of the one-half percent reduction, General Government gets $80,000.00 to use as the Board feels appropriate. He is not a non-education supporter. He is not a County employee non-supporter. He is a very big supporter of both. He thinks the salary and fringe package is a fair one in terms of the resources the Board has to work with. He is grateful for the fact that the situation is different today than it was just two days ago. He is not saying to reduce the merit increase and give it back for a tax decrease. He does not think that is responsible. Mr. Marshall said there are a lot of people in the community who worked for the banking industry who are now out of work. Some had been working 34 years and their compensation package with the new bank has been cut tremendously. Others, his age, have been laid off, and can't find another job. The thing he worries about, because he has reached that age, is the people who live on a fixed income. He has to worry about what an increase in taxes would mean to them. Even though the Board is not increasing the rates, the assessment will go up next year. He knows it will affect people who are on a lower income. He is tired of being made to look like the bad guy in this school situation. He wants the schools to be the best they can possibly be. He does not think that throwing every penny you have at them will make them the best. People make them the best. He believes School personnel are being paid an adequate wage. He will support Mr. Bowerman on the two and one-half percent. As far as what is done with the final School budget, he does not want to micro-manage where they spend their money. If the Supervisors reduce the overall merit pool to two and one-half percent, the Schools are going to have the money they need. Let the people who were elected to run the schools decide where they are going to spendit. It is his job to make sure people can afford to live in Albemarle County. Mr. Perkins said he does not believe any Board member has mentioned a tax cut. It is certainly not on his mind. He does think there is an opportunity to save some money. The Board knows there are "some big hits" coming up because of growth. There is also an opportunity to address what the Superintendent talked about, the school teacher situation. Last year there were teachers that got no increase, but School administrators, for the most part, got merit increases, and some were substantial. This would give the Schools the opportunity to address the teacher situation by limiting what they give to the administrators. He thinks the Board needs to look at ~what is comin' at us down the road" and prepare for it. Mr. Marshall said he does not think the Board can vote on the School budget until some decision is made about the compensation package. Ms. Thomas said she would like to say a few words. She agrees with a lot of what Mr. Marshall said about the situation in the community. She has often said this Board has a lousy tax to work with. The real estate tax does March 23, 1998 (Afternoon) (Page 23) 000±41 not take into account that one has just been laid off from work. She thinks there are major tragedies in the community and the country. The working person is ~getting shafted" by the economy now. One of the few things the Board can impact in the whole big economy picture, is the kind of education given to kids. When she is angry about the kind of tax there is, when she sees people who have worked hard for the Meals Tax thinking the money was going to the schools, when she sees the cost per pupil, when she sees that the County has not kept up with inflation in most years in the past, when she knows the County is opening a new high school which she feels strongly should be given every opportunity to be a really good high school, she comes down on the side of thinking that although it is arbitrary and anybody could have come up with different figures, the way Mr. Martin has suggested dividing up the budget makes a great deal of sense to her. Mr. Bowerman agreed. Mr. Marshall said he can go along with what Mr. Martin has proposed if Mr. Martin will go along with the change in the compensation package. Ms. Thomas said she was not including that change in her comments. Mr. Bowerman said he understood that. The distribution Mr. Martin talked about was what he was talking about as the final product. There would be $250,000.00 more for the Schools and $80,000.00 more for the General Government from the compensation package change. Ms. Thomas said she thinks that is failing to compensate employees while continuing to ask more of them. She does not think the Board has the basis for not going with the three percent increase. Mr. Martin said it seems the Board is split three to three on this issue, but he will put a motion on the floor. He moved that the Board use the $412,868.00 that is currently before it by putting $112,868.00 toward Additional Funding for School Debt Service, take the remaining $300,000.00 and put $150,000.00 into the Board of Supervisors' Reserve Fund with the remaining $150,000.00 going toward the School System budget. Ms. Humphris gave second to the motion. Roll was called, and the motion failed by the following recorded vote: AYES: Mr. Martin, Ms. Thomas and Ms. Humphris. NAYS: Mr. Marshall, Mr. Perkins and Mr. Bowerman. Mr. Marshall said he believes the Board will have to agree on a compensation package before this matter can be settled. Mr. Martin asked if in the spirit of compromise, the merit increase could be set at two and three-quarters percent instead of two and one-half percent. Mr. Marshall said that would give the School System $130,000.00 more and the General Government $50,488.00 more. Mr. Bowerman said that will just upset everybody and retain less discretion. Mr. Marshall said he has to agree with Mr. Bowerman. Mr. Bowerman asked Ms. Thomas if she will agree to this change. He said he will support it in the interest of getting someplace. Ms. Thomas said she will not support the suggested change. Mr. Marshall asked if another Board member wanted to try a different motion, or would the Board members like to adjourn until Wednesday to think about it. Ms. Humphris asked for a recess. Mr. Marshall suggested taking a recess until 4:45.p.m., then return and decide whether to continue or adjourn until Wednesday. The Board recessed at 4:35 p.m.) At 5:00 p.m., the Board reconvened. Mr. Marshall asked for suggestions from the Board members. 00014;2 March 23, 1998 (Afternoon) (Page 24) Mr. Bowerman said he is always accused of being the swing vote, and always accused of being the great compromiser, so he will try a motion. He moved that the Board have the allocation of the Board's Reserve Fund as indicated by Mr. Martin which would leave the Board, "after all the dust settles", with $150,000.00, the balance going to the Schools as previously outlined by Mr. Martin. He proposed, as Mr. Martin suggested but did not motion, that the Board have a merit pool of two and three-quarters percent, and that the funds generated by that change, about $42,000.00 for General Government would be added to the Board's Reserve, and the Schools would have an additional $120,000.00 that they could direct as they saw fit. Mr. Marshall said instead of making that a motion at this time, can the Board hear Mr. Martin first? Mr. Bowerman agreed. Mr. Martin said one of the things he would like to suggest which would have everyone involved is to use a portion of the funds to pay toward family health insurance coverage which would ~take it from the one hand and give a little bit with the other hand." Of course, it would not be across-the-board, but for those with family coverage it would give a little bit of relief. Some of that would go toward a small positive impact. Mr. Bowerman said everybody would get that who had more than one person on the health plan. People who would not have shared anything in the merit pool would benefit also if they had a family plan. He thinks there could be a more equitable way. Mr. Marshall asked if the two ideas could be brought together. Mr. Martin said it might be more beneficial for the employees who do pay for their health insurance to get some relief in that manner. Mr. Perkins said he would need to get some figures on that to see how many employees are affected. He realizes it is a big impact for the single person working in this system who has a family. It is a big "hit" to them, but for the majority of people, there are usually two working people and some are covered by plans other than the County's. He would like to see how many people would be affected. This is adding more to the benefits package, and next year it will be the same thing again. That is what he has heard so much resentment about, that the benefits package, along with salary increases, are too high. Mr. Martin said this is not one of those things which you put on top and then next year added to. Next year, the Board might decide not to fund the additional amount. Mr. Perkins said it is hard to take away a benefit. Mr. Martin said he was not suggesting taking it away, but it does not mean you have to add to it next year. Mr. Marshall asked if Mr. Bowerman's motion is to have a two and three- quarters percent merit pool, and then give the School Board the rest of the money. Mr. Bowerman said whatever was previously allocated. Mr. Tucker said it was $112,868.00 and $150,000.00. On top of that would be $120,000.00, more or less, from the change in the merit pool. Mr. Bowerman said that would be in the dollar amount allocated to the Schools, and which they would have the discretion to use as they see fit. Ms. Thomas asked if the Schools could put that money back into salaries. Mr. Tucker said they could. Mr. Marshall said that would be at their discretion. Mr. Tucker said that is the parity issue Mr. Bowerman mentioned earlier, or they could fund teacher's salaries and leave the classified employees at two and three-quarters percent. Ms. Thomas said she was not on the Board when "parity" was determined so she does not know if that is ~cast in stone." Mr. Tucker said it is a policy that both boards adopted. Being a policy, it can be changed at any time. Mr. Martin said he was on the School Board when it was adopted, and the Board of Supervisors drug the School Board, kicking and screaming, into it. Mr. Bowerman said the merits of it are pretty good. Other systems are trying to move to it because they have real problems. Mr. Tucker said there were major issues between General Government and the Schools before there was parity, and those issues were solved. Mr. Marshall asked Ms. Thomas if she would support the suggestion. Ms. Thomas said she had to think about it. Mr. Marshall said he and Mr. Bowerman would like for the Board to be unanimous on this, if possible. Mr. Bowerman March 23, 1998 (Afternoon) (Page 25) 000 .43 said the budget process has been painful this year. It has been difficult regardless of where the Board ended up today because each Board member had to think through different scenarios. Ms. Thomas said the people who lived through the Depression have a different view about money than the generation that did not. She thinks all the Board members went through that painful period and came into this meeting with the mind set that compensation had to be cut. She thinks that is a left over mind set. She does not think it is the reality of where the Board is now. She does not think that three percent was unfair or too generous or inappropriate or any of the other charges. Mr. Bowerman asked if two and one-half percent or three and one-half percent is any different. Ms. Thomas asked about a comparison of the wages elsewhere in this area. Mr. Bowerman said the Board does not have the information to know how the County has kept up, except for the Hendricks study. Ms. Thomas said last year the staff came up with a similar kind of figure and Albemarle was below what the surrounding counties were doing. She thinks the County has at least a two-year memory. Mr. Tucker said the Hendricks Study recommended a ten percent increase to implement the new Pay Plan two years ago, and the Board only did four and one-half percent because that is all the revenue that was available at the time. Mr. Martin asked what it would cost if the County agreed to pay an additional $10.00/month toward family health insurance. Mr. Huff said there are about 2200 subscribers on the plan. Mr. Martin said that $2.00 or $5.00 a month would not be noticeable. Mr. Tucker said if the Board is interested in that idea, staff can come up with the figure later in the year. Mr. Martin said he thought it might be important in the Board coming to some kind of a conclusion today. It looks like the Board is at an impasse at this point. Mr. Marshall said he talked with Mr. Tucker earlier today about this impasse. Mr. Tucker said all of the information is fresh in everybody's mind, and if the Board puts this decision off until Wednesday, it will have to go through this whole discussion again. Mr. Marshall said he is not sure the Board would not wind up in the same place. He thinks the Board needs to make the decision today. Mr. Martin said he did not see how there would be a decision made today. Mr. Marshall said he does not believe it would be any better Wednesday, but if that is the will of the Board, that is what it will do. Ms. Humphris said she would like to keep at it for a little while longer. She wanted to follow up on what Ms. Thomas said. Nobody here has convinced her that the originally proposed three percent merit pool is too large, or that the Board is overpaying, or over rewarding the people that work so hard for the County. She does not believe they have persuaded Ms. Thomas or Mr. Martin, but "the simple sticking point here is", is the three-percent merit pool too much? Mr. Marshall said nobody had convinced him that the Board needs to give three percent when the CPI is at two percent. Looking around the community, people are being laid off from work and people who are still employed are having benefit packages cut. Then private enterprise has to compete with what is being done in the County Office Building. He, personally, is one of those people. He asked why the Board does not give two percent instead of three percent when the CPI dictates that the Board should be considering two percent. What is being done in other counties can be brought into the issue, but would the employees rather live in those counties, or live in Albemarle County? Would they rather work in that county, or would they rather work in Albemarle County? Ms. Thomas said it is more expensive to live in Albemarle County, so, if anything, when looking at the other counties it should not be assumed that the norm is for Albemarle to give a great deal less. Mr. Marshall said there are a lot of people working for Albemarle County who live in Greene and Fluvanna counties. Ms. Thomas said that is correct; it is expensive to live in Albemarle County. Mr. Marshall said that is his whole point. He asked if Ms. Thomas wanted Albemarle County to pay for everyone to afford to live in Albemarle County. What happens if that individual has lived in Albemarle County his whole life and all of a sudden is living on a fixed income, and he can't afford to live in it anymore? Ms. Thomas said that would be a good argument if the Board was facing a tax increase. Mr. Marshall said the March 23, 1998 (Afternoon) (Page 26) 000:1.44 assessments go up every year. barely increased. Ms. Thomas said this last time the assessment Mr. Perkins said the tax increase was in the form of a Meals Tax. Mr. Marshall said that was part of it. Ms. Thomas said people voted it in, many of them thinking that meant the Board would be as helpful as it could be to the County's School System. Mr. Marshall said those people voted for that meals tax in lieu of having a real estate tax increase and nothing will convince him o~herwise. Ms. Thomas Said she agrees with Mr. Bowerman about not having a tax increase this year. She certainly never promised that it was one or the other, but she thinks there were enough people who voted on that basis Several people told her they convinced their neighbors to vote on that basis, so she would not be arguing for a tax increase. She is arguing that the Board should look at what is in front of it today. Mr. Bowerman said basically all of the resources the Board had to put to work, are in the schools. Mr. Martin told Mr. Bowerman that he was not going to let him be the swing vote this time. He is going to be the swing vote. In the interest of making sure that the School System gets that $112,868.00 toward Debt Service, and the $150,000.00 that the Board can give them, he will also support Mr. Bowerman's motion for the two and three-quarters percent merit pool which would give the Schools an additional $120,000.00. He agrees with Ms. Thomas and Ms. Humphris that there is nothing wrong with the three percent, but he would hate for the Board to get in a situation where it ended up not doing the other stuff it needs to do because of what really will amount to a very small amount to each individual person. He said he would second Mr. Bowerman's motion. Mr. Marshall asked if there were further discussion. Mr. Perkins said he did not know how he would vote. Ms. Humphris said when Mr. Martin said it will mean a very small amount to the individual person, she thinks it would help to know what that very small amount would mean. Mr. Perkins said if the School Board chooses they can increase teacher salaries if that is where they feel there is a shortfall. Mr. Tucker said on a teacher's salary, the difference is $90.00 per year between the three percent or two and three-quarters percent. Mr. Martin said that after tax that is $75.00 divided by 12 or $6.25 per month. Mr. Bowerman asked if this is what the Board would go to public hearing with. Mr. Tucker said "yes" if that is what the Board votes on. Mr. Bowerman said that can still be changed after the public hearing. Mr. Marshall said it can be changed up until April 15. Mr. Bowerman said if he does not show up for the meeting, you will know why and there will only be five people to vote. Mr. Marshall said a motion had been made and seconded. He asked the Clerk to call the roll. Ms. Thomas said she could not remember where she votes in the order today. Mr. Marshall asked for a repeat of the motion. Mr. Bowerman said it deals with the distribution that Mr. Martin outlined in terms of the balance of the Board's Reserve, reducing the merit pool from three percent to two and three-quarters percent which would free up about $42,000.00 for General Government and it would free up about $120,000.00 for the Schools which they could then use as they see fit. Ms. Thomas asked Ms. Humphris to comment since she was not sure of Ms. Humphris' position at this moment. Ms. Humphris said that is why she wanted to know what was being talked about in terms of the impact on the individual person. If the Board does not agree, and stays at a three/three vote on the percentage increase, she does not see anything else to do except agree to the two and three-quarters percent merit pool, realizing that it means an average of a little over $6.00 per month per person. She can't see being so stubborn on this given where the Board is at the moment. Ms. Thomas said she can go along with it too because she does not want to do any grandstanding here that makes it look like there is one person who cares a lot more about the schools than the others. She thinks there is hardly anyone who cares more than Mr. Martin and Ms. Humphris. She is not going to stick out. Mr. Bowerman asked if Ms. Thomas did not think he cares March 23, 1998 (Afternoon) (Page 27) 000 .45 as much about the schools as she does by excluding him and picking on Charles and Charlotte because he would disagree with that assumption. Mr. Marshall said he believes all the Board members care the same. He said the motion has been made and seconded. He asked the Clerk to call the roll. The motion carried by the following recorded vote: AYES: NAYS: Mr. Marshall, Mr. Martin, Mr. Perkins (reluctantly), Ms. Thomas, Mr. Bowerman and Ms. Humphris. None. Mr. Marshall said the Board needs to adopt a motion setting the public hearing, and using the same tax rates. Motion was offered by Mr. Perkins to set the public hearing on the FY 1998-99 County Operating Budget for April 8, 1998, and to set the tax rates at $0.72/$100 for real property and at $4.21/$100 on personal property. The motion was seconded by Ms. Humphris. AYES: NAYS: Roll was called, and the motion carried by the following recorded vote: Mr. Marshall, Mr. Martin, Mr. Perkins, Ms. Thomas, Mr. Bowerman and Ms. Humphris. None. Agenda Item No. 3. Other Matters Not listed on the Agenda from the Board. Ms. Humphris said she and Ms. Thomas represented the Board at the Piedmont Virginia Community College last week for their 25th Anniversary Celebration. For the County, they received a copy of PVCC's history which is a beautiful volume. It is inscribed ~To the citizens of Albemarle County with appreciation for past support and in partnership toward the Twenty-First Century, by Deborah M. DiCroce, President, March 19, 1998." Inscribed in the volume by the author, Joe Jenkins, "To Albemarle County, thanks for all the support furnished by the County.- Ms. Humphris said she read the volume last weekend and it is extremely interesting, most particularly the part about the Visitors Center and how that came about. She gave the volume to Mr. Tucker to put in the library on the Fourth Floor. Ms. Humphris said she also received from Mr. Richard Herskowitz, Director of the Virginia Film Festival, a volume which is a look back at the 1995 Virginia Film Festival. She said it is a fascinating volume and looking through it she cannot image how long it took the many people to put this volume together, when considering that this is just a review of one of the film festivals. That also was a gift for the County. Agenda Item No. 4. Adjourn. At 5:40 p.m., with no further business to come before the Board, the meeting was immediately adjourned.