Last night, the Charlottesville City Council got the latest details on the plans for reconfiguration of the city’s middle schools. Go back and read/listen to the September 14, 2021 edition of the show for the details.
Since that was posted, a Community Design Team that has been shepherding the work of architectural firm VMDO has made their final recommendation. Here’s Wyck Knox of VMDO with the latest information. (presentation from September 14, 2021 CDT meeting)
“The unanimous choice by the CDT was Option 3 that builds in the bowl and gives a new look to the school and the most square footage and the most variety of outdoor spaces to the new building,” Knox said.
This is also the most expensive option at an estimate of $73 million.
The five-year capital improvement program budget has a $50 million placeholder for reconfiguration. If Council agrees to proceed with the project, they’ll need to approve a budget with actual numbers in order to calculate how many millions of dollars in bonds need to be sold to pay for the capital costs. (FY22 adopted CIP)
For the Council meeting, the city’s budget office presented funding scenarios all of which include an increase in the property tax rate to cover the cost of the additional debt service to pay the bond proceeds back. These hinge on whether the city proceeds with a long-planned and multi-phased project to upgrade West Main Street that grew out of a $350,000 planning study requested in 2012 by the PLACE Design Task Force.
While the currently adopted CIP does not include any additional funding for the $49 million project, Council has previously allocated $20.54 million in local money to match state funding for the first two phases. That’s according to a slide presented to Council back in February. Council could opt to transfer that to the school project.
The tax increases were initially to have been phased in gradually at two cents a year to cover the five-year plan as adopted by Council in April. For the purposes of these scenarios, the tax increases are shown happening next year all at once, and include an additional five cents to cover the additional cost to finance the reconfigured schools.
“If you want to start construction in FY23, which is next year, then we have to have the money to sign a contract, so that means all the money all at once,” said Krissy Hamill, the city’s budget performance analyst.
Option 1 would cover just the cost of that $50 million placeholder and would include the West Main project. This would result in a 15 cent tax increase next year to a rate of $1.10 per $100 of assessed value.
“Option 2 would decrease the amount of tax increase that would be required if West Main Street were removed,” said City Manager Chip Boyles.
That would be a 13 cent tax rate to $1.08 per $100 of assessed value.
The next two options raise the reconfiguration cost to $75 million. Option 3 keeps West Main Street with a 18 cent tax rate increase. Option 4 drops West Main and is also a 15 cent tax increase.
Those actual rates could be different depending on the results of the 2022 assessment. That’s why you see the phrase “tax rate equivalent” in the options.
There will be no room for any additional capital projects for at least two years under these scenarios.
“There are a lot of variables in this,” said Boyles. “This is making the assumption that there is no sales referendum and no sales tax increase.”
Boyles estimates the one percent increase in the tax would bring in an additional $12 million a year.
The current sales tax is 5.3 percent, but Charlottesville only gets one percent of that amount. The budget for the current fiscal year anticipates the city will collect $12 million a year. In Fiscal Year 2020, the city collected $11.4 million according to data compiled by the Auditor of Public Accounts for the Commonwealth of Virginia. That’s up from $9.3 million in 2010.
The capital budget for FY22 includes $1 million for a parking structure at Market Street and East High. Earlier this year, Council opted to wait a year on that project and wait until next year to spend the remaining $7 million. So far, the options presented to Council did not factor in what happens if the project is dropped but that project cannot get totally zeroed out. (FY22 adopted CIP)
“What we have been looking at is reserving at least a couple of million if we had to create surface parking on the properties that we own,” Boyles said. “I would say definitely $5 million could be transferred if needed.”
However, Hammill said that would not affect the projected tax rates because the capital budget already assumes bonds will be sold to cover the cost of paying projects.
The housing plan adopted by City Council calls for $10 million a year to be dedicated to affordable projects.
The current five-year capital improvement program anticipates $13.5 million on public housing, $925,000 a year on the city’s affordable housing plan, $900,000 a year for housing vouchers, and $11.4 million in city funds for the redevelopment of Friendship Court. (FY22 adopted CIP)
There was no specific decision point on the agenda last night but Knox said he wanted to know what Council is thinking. There will be an information item presented to Council on October 4.
A decision on West Main?
Mayor Nikuyah Walker wanted to know where Councilors stood on the West Main Street project. The results were pretty clear.
“The only way I can see West Main Street surviving is if we get this one [percent] sales tax for the school reconfiguration,” said vice mayor Sena Magill. “That’s it.”
“I would definitely fully support reallocating the West Main project to schools,” said Councilor Michael Payne. “I can see West Main continuing as just as Hail Mary of if Congress passes the stimulus bill and there’s no local city money required.”
“I would prioritize this ahead of West Main,” said City Councilor Heather Hill. “Projects like West Main had a lot of revenue come in from other sources and I’ve said before that it’s a hard one to swallow but I think we’re at a point where there’s not another option.”
“As probably maybe the last defender of the West Main project, I also agree that whatever option we end up taking is going to have to be an option that does not include the West Main project,” said City Councilor Lloyd Snook.
Much of the Virginia Department of Transportation funding for West Main Street comes in the form of Smart Scale, which requires projects to be completed within six years. In the current round, the city was awarded $10.4 million for the third phase. None of that funding requires a local match. The University of Virginia committed $5 million to the West Main project as well.
Before you go: The time to write and research of this article is covered by paid subscribers to Charlottesville Community Engagement. In fact, this particular installment comes from the September 16, 2021 edition of the program. To ensure this research can be sustained, please consider becoming a paid subscriber or contributing monthly through Patreon.