Waynesboro City Manager Mike Hamp summed up City Council’s second budget work session with one word before if even began — tension.
“(Tension) is the theme that I’ve identified for consideration this evening, and I would encourage council to consider the tension that exists between affordability and providing resources sufficient to maintain levels of service in our community and our organization and to provide sufficient resource to accomplish new investment,” Hamp said before Wednesday night’s work session began. “As staff begins to assemble a budget on both the revenue side and the expenditure side there is, to our eye, obvious tension between what we hope to accomplish for the organization and community and what we’ll be able to accomplish given certain assessments on revenue.”
Although Hamp’s opening remarks were cut short because of technical difficulties during the virtual meeting, Deputy City Manager Jim Shaw reviewed council’s priorities as identified during its annual retreat. Tier 1 priorities council identified at that time were employee compensation, the development of a West End fire station and the construction of Sunset Park.
“To be candid, we’re having trouble seeing a clear path to being able to address all these priorities,” Shaw said. “We would concur that these are the right priorities, but the challenge is having the resources to do all the things we want to do.”
Cameron McCormick, Waynesboro’s Director of Finance, said Wednesday current preliminary revenue and expenditure totals leave the city’s FY22 budget about $1.1 million out of balance.
Supplemental requests, which are not included in the base budget, total about $6.6 million with the largest departmental requests coming from public safety (more than $1.5 million) and implementing the compensation study that calls for a 3% raise for all city employees (more than $1.4 million).
Any supplemental requests granted would increase the amount by which the FY22 budget is out of balance. These requests, however, rarely make the final budget cut, Hamp noted.
Most of Wednesday’s budget work session centered around real estate tax. McCormick said the preliminary lowered tax rate calculation is 83 cents per $1. The current rate is 90 cents per $1.
“You calculate the lower tax rate based on 1% higher than your previous year’s appraisal value,” McCormick said.
The assessment change will require a public hearing, currently scheduled for April 12.
At-large councilman Terry Short Jr. asked city staff if the Tier 1 priorities — employee compensation, a West End fire station and Sunset Park — would still be possibilities with equalization of the tax rate.
Hamp responded that he “did not immediately see a way to do so” and would not recommend a project like Sunset Park in the budget.
Short said council identified those priorities just three months ago and didn’t feel comfortable directing staff to now do the opposite. He requested council “let staff develop the budget with those priorities and adapt from there.”
Mayor Bobby Henderson agreed he’d like to see employee compensation move forward in some way in the FY22 budget. Hamp said he anticipated something like a 3% pay raise for city employees would have to be phased into future budgets.
Lana Williams, councilwoman for Ward A, said three months ago when council identified those priorities they were unaware how long COVID would last.
“We don’t know what the future is going to look like,” she said. “The price and cost of living is going up, and I personally feel a little uncomfortable keeping the tax rate the same or not considering equalizing the tax rate when I know people are struggling or people have lost their jobs, and we may see more of that.”
Short clarified he wasn’t in favor of increasing the tax rate, but wanted staff to still consider items considered priorities. Ward D councilman Sam Hostetter agreed.
“Let’s move forward in trying to stick with some of the things we’ve highlighted while noting the fact that a large tax increase in a pandemic when people have been displaced and lose income is certainly a tough thing to take on,” Hostetter said, adding he wasn’t ready to commit to any one rate at this time, but would like to see how employee compensation may fit into the budget.
Ward B councilman Bruce Allen said he’s not against moving forward on the West End fire station project, but expressed concerns over increasing what residents have to pay.
“Today, my opinion has dampened a little bit from what we talked about three months ago because I see where we’re heading as a nation and all the money being spent by our federal government,” Allen said.
Hamp ended the city’s second budget work session by saying all of council’s comments will be used “for a path forward.”
Waynesboro City Council’s third budget work session will be held March 3. The city manager’s budget presentation is scheduled for April 5.