Council for the City of Waynesboro, Virginia, Held a Regular Meeting on Monday, March 10, 2003, at 7:00 P.M

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Council for the City of Waynesboro, Virginia, held a regular meeting on Monday, March 10, 2003, at 7:00 P.M. in Council Chambers of the Charles T. Yancey Municipal Building, 503 West Main Street, Waynesboro, Virginia, with Mayor Charles L. Ricketts III presiding and calling the meeting to order:

PRESENT: Council Members: Charles L. Ricketts III, Esq., Mayor R. Jack Higgs, Vice Mayor Nancy M. Dowdy, Councilwoman Reo B. Hatfield, Councilman Thomas W. Reynolds, Councilman

Planning Commission Members: Harold B. Stepp, Acting Chairman Harry Colman Pamela E. Reynolds (Reo B. Hatfield, Councilman)

Staff: Douglas C. Walker, City Manager Michael G. Hamp II, Assistant City Manager J. B. Yount III, Esq., City Attorney Bonnie S. Hamby, Clerk of Council

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MAYOR'S OPENING REMARKS: Mayor Ricketts welcomed all in attendance and asked that they stand and join in the pledge of allegiance to the flag.

Mayor Ricketts asked if there were any high school (or other) students present and asked that if there were that they all please stand, give their name and where they go to school.

Mayor Ricketts stated that if anyone present had matters to bring to Council that were not items on the agenda, there would be an opportunity for them to do so at item #11 on the agenda.

Mayor Ricketts stated that he had received a message from Mr. Hatfield who had been contacted by Scott Rogers of the Waynesboro Post Office who complimented the Department of Public Works for the excellent job of snow removal during the recent storms. He stated that Mr. Rogers is in charge of the letter carriers who deliver door-to-door mail. He commended those involved in the snow removal process and stated how proud Council was of the many compliments received.

Mayor Ricketts stated also that a letter of commendation regarding snow removal was also received from Dr. Robin G. Crowder, Assistant Superintendent of Waynesboro Public Schools. He read that letter aloud as follows:

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March 6, 2003

Mr. Charles L. Ricketts Ill, Esquire, Mayor City of Waynesboro P.O. Box 1028 Waynesboro, Virginia 22980

Dear Mayor Ricketts:

Over the last several weeks our community has experienced an unusual amount of snowfall. Not only has the snowfall disrupted our community, but also has played havoc on the operations of our schools. I am sure you recognize how complex it can be to determine if we can open our schools and get our buses on the road for the children of Waynesboro.

This letter is to acknowledge the wonderful partnership we have developed with the Waynesboro Public Works Department and the Waynesboro Police Department. Over the last several weeks, we have contacted Mr. Pete Fitzgerald and Mr. Terry Ellison in the Public Works Department to share concerns about icy or snowy roads on which our buses have to travel. These two gentlemen have gone beyond the call of duty to be responsive and assist the school division in providing safe passage for our buses throughout the community during this difficult time.

I also want to recognize Police Chief Phil Broadfoot and his department for their ongoing support of our students. Chief Broadfoot has provided additional visibility and patrols of our schools throughout this period of inclement weather. The school division works very hard to have schools ready and parking lots cleared, but it is often difficult for us to provide that same support for the route children walk. His staff has provided direction and guidance for our children as they are walking to and from school. The Waynesboro Police Department is to be commended for their help.

While trying to make difficult decisions about opening school, the partnership with these two departments certainly adds confidence when we open school. It is with sincere appreciation that we bring to your attention to these individuals for their help and support of the Waynesboro Public Schools.

Sincerely,

Robin G. Crowder Assistant Superintendent cc: Doug Walker, City Manager School Board Members

Mayor Ricketts stated that another letter had been received commending City employee Mr. Bert Smith, husband of School Board Member Lorie Smith, for his efforts in assisting Adelphia Cable with a project in Waynesboro. He read aloud the following letter:

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February 21, 2003

City Managers Office P.O. Box 1028 Waynesboro, VA 22980

Mr. Doug Walker:

Over the past month, I have had the pleasure of working with one of your employees, Bert Smith. You have a good employee and he was enjoyable to work with.

We had to remove street lights on North Delphine Avenue to get our fiber optic cable lines over top of the street lights, and Bert really went all out to help and accommodate us.

Thanks very much to the City of Waynesboro and Bert Smith for working with us on this project.

Sincerely,

Joe A. Minter Lead Tech. Projects Adelphia

Council recognized the value Bert Smith adds to the City’s organization and commended him for his dedication to Waynesboro.

Mr. Hatfield read aloud the following letter that had been sent to Waynesboro Police Officer Jesse Shaver:

March 6, 2003

Officer Jessie H. Shaver Waynesboro Police Department P.O. Box 1028 Waynesboro, VA 22980

Dear Jessie,

I want to thank you for taking the time and initiative while teaching the February monthly training to note suggested changes to the five General Orders pertaining to firearms and use of force. Your suggestions, coupled with some changes that Captain Oliver initiated, will certainly improve the quality and clarity of these orders. Ultimately, they will provide the officers with an order that is easier to read and thus creates less doubt when that split-second decision has to be made on the street. I hope everyone can appreciate that the department only improves when we

3 FIRST DRAFT 03/10/03 all work together and that your example of individual effort on behalf of the team is exactly what it takes to find a "better way". Again, thanks and good work.

Sincerely yours,

Reo B. Hatfield City Councilman cc: Chief Broadfoot Lt. Martin

Mr. Hatfield commended the Police Reserve officers and noted the valuable service that they provide to the City.

Vice Mayor Higgs stated that he was fortunate to have attended one of the performances of Oliver at Waynesboro High School over the past weekend. He stated the students gave an excellent performance and should be commended for the excellent quality of family entertainment that they provided. He noted also that his grandson, Joshua Osteen, portrayed the part of Oliver.

Mr. Reynolds stated that he had been fortunate to attend a band festival with the cadets of Fishburne Military School over the weekend. He stated that the college was short a few band members and he had the opportunity to fill in and play bass in the jazz band.

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RESOLUTION HONORING EAGLE SCOUT JUSTIN CHARLES TYREE: Mayor Ricketts stated that Council was honored this date to have among them an outstanding young man from Waynesboro who had recently been awarded the prestigious title of Eagle Scout. He read aloud the following resolution:

RESOLUTION

WHEREAS, Justin Charles Tyree of Waynesboro, Virginia, son of Harold and Glenda Tyree and a senior at Waynesboro High School, has earned the honor of Eagle Scout which will be officially accorded him on Saturday, March 8, 2003, in a ceremony at the Church of Jesus Christ of Latter Day Saints in Waynesboro; and

WHEREAS, in recognition of the special qualities of honor, loyalty, courage, cheer, and service that every Eagle Scout must possess and that are exemplified in this most worthy young man, his City desires to add its tribute to others who are here to laud him for his excellence and accomplishments; and

WHEREAS, the Council of the City of Waynesboro, Virginia, desires to express its hearty congratulations, on behalf of all citizens of Waynesboro, to Mr. Tyree, his family, his

4 FIRST DRAFT 03/10/03 scoutmaster, Mr. Tom Teerlink, and his fellow members of Boy Scout Troop #47 and the said sponsoring church;

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Waynesboro, Virginia, that Saturday, March 8, 2003, be hereby designated as

EAGLE SCOUT JUSTIN CHARLES TYREE DAY IN WAYNESBORO in special individual honor of this outstanding young member of our community as he receives this significant and singular honor.

Mr. Reynolds moved adoption of the foregoing resolution. Seconded by Mr. Higgs, the motion carried and the resolution was adopted on the unanimous affirmative votes of Council members Dowdy, Hatfield, Higgs, Reynolds and Ricketts.

Mayor Ricketts presented the resolution to Mr. Tyree and he was congratulated by Council and staff. Mayor Ricketts also presented to Mr. Tyree a commendation from Virginia’s Governor Mark Warner on his behalf, noting that it had been signed by Governor Warner and the Secretary of the Commonwealth.

Mr. Harry Colman, Planning Commissioner, stated that Mr. Tyree’s Eagle Scout project was planters at the Adult Daily Living Center. He stated that the residents there are enjoying the fruits of Mr. Tyree’s labor.

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APPROVAL OF MINUTES: Mr. Higgs moved that the minutes of Council’s last regular meeting as held on Monday, February 24, 2003, be approved as presented. Seconded by Mr. Hatfield, the motion carried on the unanimous affirmative votes of Council members Dowdy, Hatfield, Higgs, Reynolds and Ricketts.

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JOINT PUBLIC HEARING/REQUEST OF ARTHUR W. HARRISON, JR., FOR COMMONWEALTH INVESTORS, LC/REZONING: Mayor Ricketts stated that this was the date and time set and advertised to hold a Joint Public Hearing with the Planning Commission to consider the request of Arthur W. Harrison, Jr., agent for Commonwealth Investors, LC, owner, to rezone from RA-2 (Single Family District) to C-2 (General Business District) a 7.499 acre tract off of Lew DeWitt Boulevard, Waynesboro, Virginia.

Mayor Ricketts announced that the applicant had sent a letter proffering conditions that would be applicable to the request if approved. He requested that the City Attorney read the said

5 FIRST DRAFT 03/10/03 letter in advance of the Joint Public Hearing as required by the City Code. Mr. Yount read aloud the following letter as submitted:

March 4, 2003

To The Mayor and Members of Waynesboro City Council; and The Chair and Members of Waynesboro Planning Commission

Ladies and Gentlemen:

The undersigned, Commonwealth Investors, L.C., hereby proffer the following conditions to be incorporated as express conditions for approval of the City of Waynesboro, Virginia, of the undersigned’s application for rezoning of a certain 7.499 acre parcel, known as tax map parcel E1A-3-12B, located on Lew Dewitt Boulevard, Waynesboro, Virginia (also shown as Lot 1 of 7.499 acres on a certain “Plat Showing A Division of 8.916 Acres of Land Presently In The Name of the Virginia Presbytery of the Associate Reformed Presbyterian Church, City of Waynesboro, Virginia,” dated January 2, 2002, by Barry C. Lotts, P.C.), from RA-2 Single Family District to C-2 General Business District:

1. No gas stations will be allowed on the premises to be rezoned.

2. No fast food restaurants will be allowed to operate on the premises to be rezoned.

3. No convenience stores will be allowed to operate on the premises to be rezoned.

4. The existing natural vegetative buffer shall remain to a width of 20', where the proposed business district abuts any dwelling area, said buffer shall be selectively landscaped if necessary and augmented by additional plantings as required by city ordinance as outlined in the required landscaping plan for development. Where buildings and improvements encroach on the 20' buffer, fencing will be installed according to Sec. 98- 495 of the Zoning Code and the setback reduced per regulations.

5. All buildings, site plans and signage design and materials will be subject to architectural review and approval of owner.

6. No commercial vehicular access shall be allowed at any time from Red Top Orchard Road to the premises to be rezoned through any portion of Lot 2 of 1.417 acres as shown on the above-mentioned plat.

This applicant further understands that they will abide by applicable zoning and building codes. Architectural review by the developer/owner does not substitute for the City’s site plan review.

Yours respectfully, Commonwealth Investors, L.C. By John Johnston, Manager

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Mayor Ricketts noted that Mr. Harold Stepp would be acting as Chairman of the Planning Commission this date in the absence of Chair Moulton and Vice Chair Bass. After establishing that a quorum of the Planning Commission was present, Mayor Ricketts opened the Joint Public Hearing and called on the City Manager to present the matter and also for the staff’s recommendation. Mr. Walker explained the nature of the request and stated that the staff recommends approval of the request conditioned as set forth in the staff report and accompanying proffered conditions.

Mayor Ricketts then called on those in attendance to speak.

Mr. Arthur Harrison, agent for Commonwealth Investors , stated that the parcel in question is surrounded on at least two sides by property zoned for business and property that has been purchased for such or is currently under contract for the same. He stated that the parcel is located where it can be easily served by public utilities.

Mr. Reynolds asked where access to this property would come from. Mr. Harrison stated that access is available from the service road fronting on Lew DeWitt Boulevard and that additional efforts will be made to access the property from other streets.

Mayor Ricketts closed the Joint Public Hearing and referred the matter to the Planning Commission for their consideration at their meeting to be held on Tuesday, March 18, 2003, at 7:00 P.M., in Council Chambers of the Charles T. Yancey Municipal Building, 503 West Main Street, Waynesboro, Virginia.

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JOINT PUBLIC HEARING/REQUEST OF BARNWELL & JONES/CHARLES R. & SHARON L. JONES/REZONING: Mayor Ricketts stated that this was the date and time set and advertised to hold a Joint Public Hearing with the Planning Commission to consider the request of Barnwell & Jones, Inc., agent for Charles R. & Sharon L. Jones, owners, to rezone from C-1 (Local Business District) to M-1 (Light Industrial District) a 1.104 ac. Tract of land, known by street numbering as 1304 Ivy Street, Waynesboro, Virginia.

Mr. Walker explained that the request had been withdrawn.

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JOINT PUBLIC HEARING/PROPOSED RECODIFICATION OF CHAPTER 98, “ZONING”, OF THE WAYNESBORO CITY CODE: Mayor Ricketts stated that this was the date and time set to hold a Joint Public Hearing with the Planning Commission regarding the proposed recodification of Chapter 98, “Zoning”, of the Waynesboro City Code.

After establishing that a quorum of the Planning Commission was still present, Mayor Ricketts opened the Joint Public Hearing and called on the City Manager to present the matter and also for the staff’s recommendation. Mr. Walker called on the City Attorney and Director of

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Planning, Mr. J. B. Yount III, to present the matter. Mr. Yount stated that Mr. Brian Haluska, City Planner, would be presenting the matter to Council.

Mr. Haluska stated that he would be providing a brief overview of the proposed new ordinance. He stated that the ideal time to revise the zoning ordinance is directly after the update of the Comprehensive Plan, noting that it was last updated in 1998. He stated that in October 1998, Council authorized changes to the zoning ordinance limiting construction in the Tree Street Neighborhood. Mr. Haluska stated that three new zoning districts were added to the zoning in ordinance in 1999. He then provided an overview of the following:

LIST OF MAJOR CHANGES IN THE PROPOSED 2003 ZONING CODE UPDATE:

 The addition of Sections 98-250 and 98-251 – A major issue in the everyday use of the zoning code was looking up the type of uses permitted in a particular zoning classification. Under the old format, a user would frequently find that the list of use regulations in an RA-2 zone would refer to the list of use regulations in an RA-1 zone. With this new format, all such information is in one place. All potential uses are listed under each classification.

 RA-4 and C-4 name changes – The names of the RA-4 and C-4 previously referenced specific areas in the city. This was misleading, as the zoning classifications can be used anywhere in the city.

 C-1, C-2 and C-3 Districts – added stipulations to the minimum lot dimensions to address dwellings in a C-1 district.

 Home occupations in a C-4 district – Under the current code, a home occupation is allowed by right in a C-4 district. Under the proposed code, a home occupation would be allowed in a C-4 district by conditional use.

 Floating Districts – The existing floating districts have been placed under their own section to signify their difference with the established land use classifications:

 Planned Community District – Formerly referred to as the RA-1 Planned Community District. This district has been highlighted as a floating district.

 Planned Unit Development

 Planned Conditional Industrial District

 MH-1 Manufactured Housing District – Has been reclassified as a floating district to reflect the nature of this zoning classification.

 Overlay Districts – The 1998 Comprehensive Plan called for the creation of several overlay districts. Part Seven of the proposed code was added to combine the newly created overlay districts with existing overlay districts in one section. An overview of the overlay districts follows.

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 Floodplain Management Overlay District – an existing overlay district that was moved and slightly modified.

 Corridor Overlay District – new overlay district. Properties that fall in the proposed district will be party to no additional regulations. The sole purpose for the inclusion of this district is to enable its representation on the next zoning map.

 Historic Overlay District – new overlay district that will enable the Planning Department to highlight existing historic districts on the next zoning map. Also included is a new restriction of demolition of historic structures.

 Groundwater Management Overlay District – existing overlay district that was moved to the new Part of the code.

 Article III, Part 3 – This is a new section designed to regulate adult uses within the city. It is taken from a similar proposal designed by the City of Charlottesville.

 Article III, Part 7 – This is the current city Sign Ordinance (Chapter 62 in the City Code). It has been moved into the zoning ordinance to create an all-inclusive document comprising all zoning regulations.

 Article III, Part 8 – This is the current city Telecommunications Ordinance (Chapter 80 in the City Code). It has been moved into the zoning ordinance to create an all-inclusive document comprising all zoning regulations.

 Sec. 98-420(2)c – Increases the minimum horizontal separation from an accessory structure and the primary building to 5 feet. Also places a limit on the square footage of an accessory structure.

 Sec. 98-464(4) – Changed the dimensions for individual handicapped parking spaces to conform with current requirements.

 Sec. 98-589 – Placed the zoning code definitions in a separate article for easy reference. Added definitions for the following terms: hospital and professional office.

Council thanked Mr. Haluska for that presentation.

Mayor Ricketts then called on those in attendance to speak. No speakers appeared.

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RECEIPT OF CITY MANAGER’S PROPOSED BUDGET FOR FISCAL YEAR 2003-2004: Mayor Ricketts stated that this was the date and time set to receive the City Manager’s proposed budget for Fiscal Year 2003/2004. He then called on the City Manager to present the proposed budget.

Mr. Walker reviewed the following budget schedule:

Budget Schedule - 2003

Monday - 3-10-03 Budget Recommendation Presented to Council Monday - 3-17-03 Budget Work Session 3:00 PM to 5:00 PM Thursday - 3-20-03 Budget Work Session 3:00 PM to 5:00 PM Monday - 3-24-03 Public Hearing on Tax Rate - Introduce Tax Rate Ordinance Monday - 3-31-03 Budget Work Session (if necessary) Thursday - 4-03-03 Budget Work Session (if necessary) Monday - 4-14-03 Adopt Tax Rate Ordinance - Public Hearing on Budget Monday - 4-21-03 Budget Work Session 3:00 PM to 5:00 PM Monday - 4-24-03 Budget Work Session (if necessary) Monday - 4-28-03 Introduce Annual Appropriation Ordinance Monday - 5-12-03 Adopt Annual Appropriation Ordinance

Mr. Walker asked that Council consider authorizing advertisement of the real estate tax rate. He stated that the advertisement must be placed this week so the amount must be decided on this date in order to place the advertisement for the Public Hearing on the tax rate by the deadline.

Mr. Walker distributed to Council the General Fund Budget proposed by the City Manager. He stated that the other funds portion of the budget are currently being printed and will be provided to Council at the Budget Work Session on Monday, March 17, 2003. He stated that this is merely the beginning of the budget process and that much work is yet to be done. He thanked the staff and Constitutional Officers that were present and commended them all for their diligent work in assisting in the preparation of the proposed budget.

Mr. Walker then read aloud the following:

TO: Mayor and City Council

FROM: Douglas C. Walker, City Manager

CC: Department Directors, Constitutional Officers

DATE: March 10, 2003

RE: Fiscal Year 2004 Budget Message

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Background

The development of the Fiscal Year 2004 Budget occurred in a period of transition as the City Manager for the past seven years retired on December 31, 2002 and a new City Manager started on January 6, 2003. A new City Manager faces many challenges coming into an organization in the middle of a budget development cycle. Time and attention are required before the new manager is able to understand the needs of the organization and community and the resources available to meet those needs. This change in leadership was perhaps more significant in this case because of the traditional hands-on role of the City Manager in coordinating and facilitating the budgeting process and in developing, preparing and delivering the budget document with limited supporting resources within the organization. An additional challenge in developing the budget was the continuing challenge of transitioning to the new HTE general ledger and accounting system and its use as a budgeting platform. It is expected that prevailing issues regarding the resources required for effective municipal budgeting will be addressed prior to the start of the subsequent budget process.

Prevailing Fiscal Environment

The FY04 Budget was developed amid the second consecutive year of a recessed national economy and severe budget shortfalls at the State level. These factors have in the current year and will in the coming year affect the City’s budget in a number of meaningful ways. First, for the second consecutive year, reductions in state funding for Constitutional Officers, the library and other shared programs as well as reductions in non-categorical state aid will force the City to either reduce services or to utilize local revenues to make up for lost state revenues in those areas where services simply cannot be reduced without detriment to the public. The FY04 Budget, consequently, targets the use of local revenues to replace lost State support in order to maintain existing service levels in these key areas. Fortunately, and to the credit of the General Assembly, state support for K-12 education was not reduced for FY04.

A second factor attributable to the recessed national economy relates to the manufacturing sector and the reported reduction in machinery and tools values which affects the amount of local revenues received from the Machinery and Tools tax. This is generally a result of reduced actual inventories of taxable machinery and tools and/or the decision by businesses to not replace or upgrade existing machinery and tool stock resulting in depreciated value of that stock.

A third factor attributable to the current economy is prevailing low interest rates which reduce significantly the earnings from the City’s investments and cash reserves. The City necessarily includes interest earnings as part of General Fund revenues. Consequently, the loss of those interest earnings has a direct affect on the City’s current FY03 revenues and projected revenues for FY04.

The news is not all gloomy however. The construction and operation of a Wal-Mart Supercenter as well as a new restaurant on the west side of the City is expected to generate additional real estate, sales tax and meals tax revenues for the City. While the full benefit of this development

11 FIRST DRAFT 03/10/03 will not be realized until FY05, and the actual net benefit is as yet unknown, the prospect that this and any other retail development in this part of the city will translate into new revenues is certainly encouraging and a net increase in Sales Tax and Meals Tax revenues is anticipated for FY04.

Priorities for the FY04 Budget Process

1. Fund mandated programs 2. Fund debt service 3. Maintain existing service levels 4. Support local schools 5. Support market adjustment for all City employees 6. Support public safety 7. Improve financial planning and management 8. Maintain existing facilities and infrastructure 9. Complete on-going projects 10. Replace essential equipment 11. Provide local share of grants

Factors having a particular impact on the FY04 Budget

Revenues:

 General Assembly actions that reduce State revenues and/or require increased local expenditures to maintain acceptable service levels.

 Reduced revenues from Machinery and Tools tax

 Reduced revenues from interest earnings

 Increased revenues from local tax sources including Real Estate Tax, Sales and Use Tax, and Meals Tax

Expenditures:

 Adjustments required to reconcile operating expenditures with budgeted expenditures

 Dedication of required local match for State Lottery funds and School Construction funds

 Retiree Health Insurance Subsidy obligation

 Additional operating costs for regional jail due to overcrowding

 Additional cost for Juvenile Detention Center

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 Transfer of proceeds from sale of District Home to Infiltration and Inflow program

 Closure costs for the City landfill

 Creation of an operating contingency

 Maintenance/Rehabilitation at the wastewater treatment plant

 Increased costs for employee health insurance premiums

 Additional local contribution for School operations

 2% market adjustment for all city employees

 Additional support for public safety

 Additional support for financial management

Introduction to the Proposed Fiscal Year 2004 Budget

The recommended General Fund budget for FY2004 addresses shortfalls in State funding in order to maintain existing baseline service levels; reconciles expected operating expenditures with the operating budget revenues; enhances public safety services with targeted support for the City’s police, fire, emergency medical services and emergency operations functions; provides additional local funding for education; provides for a 2% market adjustment (COLA) for city employees and a long-overdue review of the City’s pay and classification system; enables meaningful improvements to the City’s financial planning and management capabilities; creates a Contingency Fund for unanticipated expenditures; and funds mandates and prior City commitments including the retiree health insurance subsidy. The recommended budget does not fully fund requests from the Schools, Department Directors or Constitutional Officers.

The total recommended FY04 General Fund budget of $30,276,086 is an increase of 5.3% or $1,522,505 from the amended FY03 Budget.

Revenues

The City’s General Fund revenues are derived primarily from three sources; local revenues including taxes and fees; state revenues including categorical and non-categorical aid and federal revenues. Total local revenues for FY04 are projected to be $24,296,324 or 80% of the budget. This represents an increase in local revenues (gross) of $1,855,524 over the FY03 amended budget. Please note that even with the increase in projected local revenues for FY04, the City will receive $200,000 less than the actual local revenues received in FY02.

The total taxable value of real property (real estate) as of March 1, 2003 was estimated at $992,661,244 (including new construction). This represents an increase of $163,501,101 or

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19.7% over the previous year. Of this increased amount, approximately 6% is due to new construction and 14% is a result of the biennial reassessment.

As required by law, the City must advertise a real property tax rate that equalizes the effect of the reassessment. This advertised rate is known as the “lowered tax rate” and represents the rate necessary to generate the same amount of real property tax revenue as the previous rate, excluding any new construction. Given the new assessed value of real property as a result of the reassessment, the “lowered tax rate” is $.82.

The recommended budget assumes a real estate tax rate of $.93 which will generate revenues of $8,978,624 for FY04. This tax rate provides for a total increase in real estate tax revenues in the amount of $1,523,271 over the current year. Other significant changes in projected local revenues include a $250,000 increase in local Sales Tax and a $255,000 increase in Meals Tax. These revenue increases are offset however by a projected $800,000 decrease in Machinery and Tools Tax revenues, and a projected $370,000 decrease in interest income.

Other local General Fund revenues are generated by fees for services, fines, licenses, permits, and miscellaneous items which are projected to total $392,000 for FY04. Another component of local revenues includes building, zoning and other development related fees. These are projected to total about $65,000 in FY04. It is recommended that the City undertake a formal independent review of all development review and inspection fees with the intent that fee revenue generated will cover costs associated with providing development review and inspection services as allowed by law.

The recommended budget projects total State Revenues (excluding Schools) of $5,410,343. This represents a total increase of $166,343 or 3% over the current year. Major changes in State revenues include projected increases of $250,000 in Personal Property Tax Relief Act (PPTRA) reimbursement and $140,000 in Street Maintenance. These increases are offset by projected decreases of approximately $45,000 for Constitutional Officers, $36,000 for the Library and another $100,000 in Non-Categorical Aid. It is important to note that PPTRA reimbursement, which is now considered State Aid, is a replacement for Personal Property Tax revenues which used to be a local revenue source prior to the implementation of PPTRA in 1999.

The recommended General Fund budget projects total Federal Revenues (excluding Schools, Social Services and Youth and Family Services) of $35,000. This represents a decrease of $73,000 from the current year.

Expenditures

The General Fund finances most of the services that the City provides apart from Water, Sewer and Trash. This includes public safety such as police, fire, E911, animal control, correction and detention; building and zoning; courts; buildings and grounds maintenance; health and welfare; regional agencies; library; parks and recreation; community development; general government administration and the significant local share of public education.

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A significant challenge for the FY04 is the reconciliation of certain anticipated General Fund expenditures and the FY04 General Fund budgeted revenues. This reconciliation must occur in order to bring the FY04 budget up to par with current and prior years before addressing any other issues for the upcoming year. The reconciliation is required in three areas. First, understanding that the City matches State School Lottery funds and State School Construction Funds annually, these matches, while obligated and accounted for within the Fund Balance, are not currently budgeted in FY03. Therefore, to reconcile this annual match, approximately $330,000 in new local money is required for FY04. Second, the City supports its retired employees by supplementing a portion of their health insurance premiums. For the past three years, however, these supplements were not budgeted. To reconcile the past three years and to provide for these costs for the upcoming year, $335,000 is budgeted in FY04. Third, inexplicably, the Public Works department FY03 budget for street maintenance is under-funded by about $500,000. This amount of revenue is required in FY04 to cover actual annual operating expenses. The proposed FY04 budget provides for these reconciliations in the amount of $1,285,000.

As in any service organization, personnel costs make up the vast majority of the expenses related to the General Fund budget. These employees are vital to the success of the service delivery systems of the City and should be valued accordingly. The recommended FY04 Budget includes a 2% market adjustment for all full time and regular part time City employees effective July 1 st at a total cost of approximately $200,000 plus associated benefits. This relatively minor salary increase is necessary to offset the impact of expected increases in health insurance premium costs and to prevent any further eroding of our relative market position with respect to pay and benefits. No merit increase is recommended for FY04 due to insufficient funds although serious consideration must be given to future use of an effective merit based pay system as a means to better connect pay with actual performance. To this end, funding is provided in the recommended budget in the amount of $40,000 for a comprehensive study of the City’s compensation and classification system with the expectation that any implementation will be addressed within the FY05 budget and beyond. It is recommended further that the City amend its holiday schedule to better reflect the market by adding Veterans’ Day and Dr. Martin Luther King, Jr.’s Birthday. It is evident that even with these additional holidays, the City will provide fewer holidays than most other local governments in the market area. Similarly, the City’s accrual rate and policy for Annual Leave should be addressed so that the City is more competitive with the other local governments in the area.

Six new positions are recommended in the FY04 budget to address identified priorities although funding for two of those positions will be offset by operational savings. Five of the six positions are in the area of Public Safety and are targeted to increase the ability to provide critical services consistent with our responsibility as first responders. These positions include three firefighters to increase minimum staffing per shift from six to seven in order to reflect increased call volume and urgently needed emergency medical support for the Waynesboro First Aid Crew; one administrative assistant for emergency operations to enable the Director of Emergency Operations to devote more time to his critical responsibilities for planning and managing E911, Wireless 911, natural disaster planning and response, terrorism planning and response, and issues related to emergency medical services; one clerk position for the Police Department in support of the five Command Staff positions that currently lack any secretarial

15 FIRST DRAFT 03/10/03 support. This position is also necessary to enable an expansion of the Neighborhood Watch program throughout the City. The remaining position is a budget manager that is critical to the need to support the City’s responsibilities for financial planning and management. This position’s primary responsibilities will include, but will not necessarily be limited to, the development and maintenance of a short term and long term Capital Improvement Plan for general government and schools including the financing plan for these projects; long-range planning for operating expenditures and forecasting for revenues; the preparation of a budget document that meets or exceeds established standards for such documents set by the Government Finance Officers Association; high level support for the City Manager, City Auditor, City Council members, Department Directors and Constitutional Officers in planning, preparing and delivering the annual budget.

It is expected that within the upcoming year, the Waynesboro Department of Social Services will be consolidated with the Staunton-Augusta Department of Social Services to form a new regional human services organization. The FY04 budget is structured accordingly. Cost savings are evident already in the upcoming year and long-term benefit for minimizing any escalation in service costs for DSS programs is projected. A positive consequence from this regionalization is the transfer of 27 full time and 3 part time City employees to the new regional agency, resulting in an actual decrease to the City of 21 authorized full time positions for FY04 (including the 6 recommended new positions). Obviously, the City will continue to support the services provided by those positions through its support to the regional agency.

Other items of note that are addressed in FY04 General Fund Budget include increased funding for the Juvenile Detention Center; increased funding for operations for the regional jail as a result of overcrowding; the transfer of proceeds from the sale of the District Home to the Infiltration and Inflow project as previously directed by Council; and the creation of a minimal but meaningful operating contingency to account for unanticipated expenditures during the course of the fiscal year. In addition, the closure of the City landfill will proceed with funds previously set aside as prescribed by State law.

School Operating Fund

The School Operating Fund receives money from the City, the State and the Federal government. The General Fund of the City transfers the local share to the School Operating fund as part of the annual budget process. In addition, the City funds debt service costs for previous school construction projects and matches State Lottery and State School Construction funding.

The recommended FY04 Budget includes a total of $530,297 in new funding for the local school division. This funding includes $200,000 for the School Operating Fund, $160,877 for the local match for School Construction Funds, and $169,420 for the local match for State Lottery Funds. An additional $169,419 in State Lottery match was used to offset school debt service consistent with the decision by the School Board to use half of the Lottery proceeds for operations. As mentioned previously herein, local match requirements for Lottery and School Construction funds were not provided in the FY03 budget. It is for this reason that such funds must be identified as new funds for the FY04 Budget. Therefore, while the total new local funding for

16 FIRST DRAFT 03/10/03 operations is $186,498 less than requested by the School Board, actual new funding for education is $143,799 above the request.

It is important to note that in addition to the $200,000 proposed increase from the City for operations, the Schools expect an increase of nearly $408,575 from the State and an increase of more than $361,219 from the Federal government which, along with other adjustments, provide for total budgeted revenue increase of $954,192.

It is also important to note that these funding increases notwithstanding, in FY2002, the City exceeded the Required Local Effort (RLE) for the Standards of Quality (SOQ) by over $6.7 million. In other words, while the SOQs require the City to only fund $4 million with local dollars, the City actually provided $10.7 million in local funding or 168% above the Required Local Effort. With this fact in mind, it is indeed unfortunate that the School Board finds itself with little choice but to continue to come to the City Council for additional funding that should be provided by the Commonwealth of Virginia.

Special Revenue Funds

Special Revenue Funds are established to support non General Fund activities that receive some General Fund support.

Youth Services Fund

The Youth Services Fund is budgeted to receive $160,678 in General Fund revenues for FY04. The total projected FY04 Budget for this fund is $834,076.

Pregnancy Prevention Fund

The Pregnancy Prevention Fund is budgeted to receive $15,000 in General Fund revenues for FY04. The total projected FY04 budget for this fund is 135,944.

Other Funds

Special Projects Fund

The Special Projects Fund supports capital construction and has been used for funding major capital improvements such as the Yancey Building and the old Municipal Building. Capital Projects anticipated for FY04 budgeted within this fund are limited to the Downtown Streetscape Improvement Project and the Greenway Project, utilizing primarily non-local money. Any local match requirement will be addressed using FY03 Carry-over, the operating contingency, or Fund Balance. During the course of the upcoming year it is anticipated that a Capital Improvement Plan will be developed and presented with the FY05 Budget and will include a financing plan for the Council to consider as a means to implement the CIP over a period of several years.

Debt Revenue Fund

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The Debt Revenue Fund was created to escrow one half of Consumer Utility Tax Revenues for use on capital projects. The FY04 Budget discontinues the utilization of this fund and, instead, budgets all Consumer Utility Tax Revenues within the General Fund.

Enterprise Funds

Enterprise Funds are necessarily excluded from the General Fund in that they are supported solely by fee revenues and operate as business units such that all expenditures within the fund are supported by revenues generated from fees for use of the service unless specific transfers are appropriated.

Water Fund

The Water fund is budgeted at $1,360,500 for FY04. No major changes are projected.

Sewer Fund

The Sewer Fund is budgeted at $5,616,188 and includes nearly $3 million in capital costs associated with the Infiltration and Inflow project. It is anticipated that revenues for these capital costs will come from Revenue Bond proceeds.

Garbage Fund

The Garbage Fund is budgeted at $701,200 for FY04 and includes a transfer from the General Fund in the amount of $61,000

Landfill Fund

The Landfill Fund is budgeted at $1,133,895 for FY04. This represents the City’s payment to the Augusta Service Authority for operation of the Regional Landfill, for non-closure costs associated with the continuing operation of the “old” municipal landfill in the City, and the recycling program including the drop-off center. Discontinuing operations at the “old” landfill will be a high priority as we move into the new fiscal year.

Acknowledgements

Appreciation is extended to all Department Directors and Constitutional Officers for their cooperation and participation through this compressed budget process. Special appreciation is extended to the Assistant City Manager and the City Auditor as well as the rest of the budget team including the Commissioner of the Revenue and the Director of Parks and Recreation. Valuable on-going support from the staff in the City Manager’s office is acknowledged also.

Mr. Walker stated that a real estate tax rate must be decided upon at this meeting for advertisement of the Public Hearing. He reminded Council that once that rate is advertised, it may be lowered but not raised without re-advertisement and an additional Public Hearing. He

18 FIRST DRAFT 03/10/03 recommended a real estate tax rate of $.93. He also noted that the City of Waynesboro has not had a tax rate below $.95 since 1981.

Mayor Ricketts commended Mr. Walker for his excellent work and presentation of the budget after only being with the City for two months. He stated that he was truly impressed and stated that he felt fortunate to have Mr. Walker on the staff. Mayor Ricketts recognized the department heads and Constitutional Officers who were present and worked so hard to help develop the proposed budget.

Mayor Ricketts stated that a motion must be made to authorize a tax rate to be advertised.

Mr. Higgs moved that the real estate tax rate be advertised at $.93 as recommended by the City Manager. Seconded by Mr. Hatfield, the motion carried on the unanimous affirmative votes of Council members Dowdy, Hatfield, Higgs, Reynolds and Ricketts.

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PRESENTATION BY EDDIE DAY REGARDING REAL ESTATE TAXES: Mayor Ricketts stated that this was the date and time set to hear from Mr. Eddie Day regarding Real Estate Taxes. He then called on Mr. Day for that presentation.

Mr. Day, 1100 S. Winchester Avenue, Waynesboro, Virginia, spoke regarding the increased real estate assessments in the City. He stated that he believes that his pr operties have been grossly over-assessed. He stated that lowering the tax rate does not make an impact on the actual tax bill when the assessments have increased so dramatically. Mr. Day stated that interest rates on investments and savings have continued to drop over the past several years. He stated that there are many retired citizens in Waynesboro who have to continue to work to keep up with the rising costs of living in this area. Mr. Day stated that the tax relief offered to elderly and disabled persons is of no assistance to those whose income exceeds the requirements but is still too low to pay their monthly expenses. He stated that the City of Waynesboro is a beautiful City and well managed but asked that some consideration be given to the retired community.

Mayor Ricketts thanked Mr. Day for taking the time to share his thoughts with Council and stated that they would keep his comments and concerns in mind as they work through the budget process.

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ORDINANCE, SECOND READING/REQUEST OF MICHAEL W. & BERNICE SHIFFLETT/C/U PERMIT: Mr. Reynolds moved that the second reading of this ordinance be dispensed with and that it be adopted by the reading of the title only. The City Manager read the title to the ordinance as follows: AN ORDINANCE GRANTING A CONDITIONAL USE PERMIT TO ALLOW PLACEMENT OF A SINGLE-FAMILY NONMANUFACTURED RESIDENCE IN THE C-2 GENERAL BUSINESS DISTRICT ON LOTS 23 & 24, TAX MAP PARCEL D7-(1), BLOCK 32, BCMM&L CO PLAT, (NO STREET NUMBER ASSIGNED), VACANT LOTS ADJACENT TO 608 NORTH COMMERCE AVENUE, WAYNESBORO,

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VIRGINIA. Seconded by Mr. Higgs, the motion carried and the ordinance was adopted on the unanimous affirmative votes of Council members Dowdy, Hatfield, Higgs, Reynolds and Ricketts. (2003-7)

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SECOND READING OF ORDINANCE AMENDING CERTAIN PROVISIONS OF SECTIONS 94-42, 94-49, 94-72, 94-74 AND 94-76 OF THE CITY CODE REGARDING CERTIFICATES OF PUBLIC CONVENIENCE AND NECESSITY/TAYLOR: Mr. Reynolds moved that the second reading of this ordinance be dispensed with and that it be adopted by the reading of the title only. The City Manager read the title to the ordinance as follows: AN ORDINANCE AMENDING CERTAIN PROVISIONS OF SECTIONS 94-42, 94-49, 94-72, 94-74, AND 94-76 REGARDING APPLICANTS FOR CERTIFICATES OF PUBLIC CONVENIENCE AND NECESSITY FOR TAXI BUSINESSES AND FOR DRIVERS OF AUTHORIZED TAXIS. Seconded by Mr. Hatfield, the motion carried and the ordinance was adopted on the unanimous affirmative votes of Council members Dowdy, Hatfield, Higgs, Reynolds and Ricketts. (2003-8)

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SECOND READING OF ORDINANCE MAKING ADDITIONAL APPROPRIATIONS TO THE SCHOOL FUND ($4,182.00): Mrs. Dowdy moved that the second reading of this ordinance be dispensed with and that it be adopted by the reading of the title only. The City Manager read the title to the ordinance as follows: AN ORDINANCE MAKING ADDITIONAL APPROPRIATIONS OF SUMS OF MONEY PROVIDED FOR BY FEDERAL OR STATE REVENUES, TO THE SCHOOL FUND FOR THE FOLLOWING NECESSARY EXPENDITURES FOR THE FISCAL YEAR ENDING JUNE 30, 2003, AS HEREIN SPECIFIED. Seconded by Mr. Hatfield, the motion carried and the ordinance was adopted on the unanimous affirmative votes of Council members Dowdy, Hatfield, Higgs, Reynolds and Ricketts. (2003-9)

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REFUND REQUEST: Mr. Walker stated that he is in receipt of a request from the Commissioner of the Revenue for a refund of $219.29 for overpayment of 2002 Personal Property Taxes to Jeffrey D. Farmer, 100 Guilford Lane – Apt. #3010, Waynesboro, Virginia, for personal property that the taxpayer failed to properly submit for personal property tax relief. He stated that the documentation has been provided and the refund is in order. He recommended that the request be approved.

Mr. Higgs moved that the refund be granted as requested and recommended by the City Manager. Seconded by Mr. Reynolds, the motion carried on the unanimous affirmative votes of Council members Dowdy, Hatfield, Higgs, Reynolds and Ricketts.

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REQUEST OF BOY SCOUTS OF AMERICA TO USE RIDGEVIEW PARK FOR ANNUAL GOLD RUSH ACTIVITY ON APRIL 5, 2003, FROM 8:00 A.M. UNTIL 6:00 P.M.: Mayor Ricketts stated that this was the date and time set to consider the request of the Boy Scouts of America to use Ridgeview Park for their annual Gold Rush activity on Saturday, April 5, 2003, from 8:00 A.M. until 6:00 P.M. He then called on the City Manager to present the matter.

Mr. Walker stated that the following memo had been received from Mr. David Van Covern, Director of Parks and Recreation:

To: Douglas Walker, City Manager From: David T. Van Covern, Director of Parks & Recreation Re: Area Boy Scouts Use of Ridgeview Park Date: February 21, 2003

Doug, attached hereto please find a request by the Stonewall Jackson Area Council Boy Scouts to use Ridgeview Park on Saturday, April 5 th from 8am — 6pm for their Annual “Gold Rush” event.

Doug, it has been the City’s policy that if an organization wishes to use a large section of the park for a specific activity, Council’s actions are needed to approve that use. While their letter indicates that they will be using the picnic shelter and amphitheatre, it is more realistic that they will use the vast majority of the park between Westwood School and the playground.

It is my recommendation that Council approve this event with some limitations. The Boy Scouts have asked to have vehicular access to drop off materials and supplies. In years past, that has been problematic in that in the event of wet and rainy conditions they still believe they need to have vehicular access, which has in turn caused some damage to the park grounds. I would ask that Council approve their use of the general park and allow me, on the day of the event, to make a decision as to how much vehicular access is appropriate.

It is possible that we may be doing some repair work of the picnic pavilion at the time of this event. We have made mention of that to the Boy Scouts and they understand that possibility, and if need be, they have agreed to make other arrangements at their expense.

It would be my suggestion to have Council review this at their earliest possible meeting date so that we may respond appropriately to the scouts.

Should you have any questions in this regard, please don’t hesitate to call on me.

Mr. Walker recommended that the request be approved in accordance with the recommendations by Mr. Van Covern.

Mr. Hatfield moved that the request be approved in accordance with the recommendations by Mr. Van Covern as presented and recommended by the City Manager.

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Seconded by Mrs. Dowdy, the motion carried on the unanimous affirmative votes of Council members Dowdy, Hatfield, Higgs, Reynolds and Ricketts.

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REQUEST OF VIRGINIA FALL FOLIAGE FESTIVAL ART SHOW TO CLOSE MAIN STREET AND WAYNE AVENUE FOR 2003 EVENT: Mayor Ricketts stated that this was the date and time set to consider the request of the Virginia Fall Foliage Festival Art Show to close Main Street and Wayne Avenue on Friday, October 10, 2003, in the evening from 5:00 P.M. on, and Saturday and Sunday, October 11 and 12, 2003, until the show is cleared out on Sunday. He then called on the City Manager to present the matter.

Mr. Walker stated that he is looking forward to attending the show this year for the first time. He stated that the staff is working with the Fall Foliage Festival organizers in coordination with the downtown streetscape improvements. He recommended that the request be approved.

Mrs. Dowdy asked if arrangements have been made to accommodate the downtown merchants again this year during the show. She stated that she would not feel comfortable approving the request until those arrangements had been made. Mr. Walker stated that he had not yet discussed the matter with them.

Mr. Hatfield stated that an acceptable agreement and arrangements were made last year and that he hoped the same would be true for this year.

Mr. Walker asked if Council would be comfortable allowing him the discretion to decide if acceptable arrangements were made prior to the event or even that he have some type of agreement in writing. Mayor Ricketts suggested making the approval of closing the streets contingent upon an acceptable agreement between the festival organizers and the downtown merchants.

Mr. Higgs moved that the request be approved as presented and recommended by the City Manager contingent upon reasonable agreement between the Fall Foliage Festival organizers and the downtown merchants regarding access to the downtown businesses during the show. Mrs. Dowdy seconded the motion.

Mr. Frank Lucente, 2125 Pickett Road, Waynesboro, Virginia, owner of Sam’s Hot Dog Stand, stated that he was not a party to the agreement made last year and his business continued to be blocked by the show. He inquired about how to be involved this year so that his business does not suffer during the show. Mayor Ricketts suggested contacting the Chairman of the show, Mrs. Gina Snell. Mr. Reynolds suggested also contacting WDDI as they too are involved in the planning of the show.

There being no further discussion, the motion carried on the unanimous affirmative votes of Council members Dowdy, Hatfield, Higgs, Reynolds and Ricketts.

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VISITORS: Mayor Ricketts stated that now was the time to hear from visitors.

Mr. Harold Stepp, 941 Sherwood Avenue, Waynesboro, Virginia , acknowledged the fact that New York’s historic Trinity Episcopal Church in the Wall Street financial district had been extensively damaged during the September 11, 2001, terrorist attacks on New York City which resulted in the need for replacement of the church organ. He stated that a local Waynesboro business, Klann Incorporated, has been selected to construct the new elaborate organ to be placed in that church. He commended Klann for their continued business over many years of economic distress. Vice Mayor Higgs supported Mr. Stepp’s statements regarding the survival of Klann Incorporated and congratulated them on their success.

Mr. Charles W. Mayo, 1008 Frye Street, Waynesboro, Virginia , spoke regarding the real estate assessment increase. He stated that he received an $11.70 increase on his Social Security benefit per month this year, $4.70 of that which was applied to Medicare Insurance. He stated that he is left with an increase in income of $7.00 per month. Mr. Mayo stated that he can not continue to pay increased taxes with a declining income.

Vice Mayor Higgs suggested that he check with the Commissioner of the Revenue regarding real estate tax relief for the elderly and permanently disabled.

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On a motion by Mr. Higgs, the meeting was adjourned.

Bonnie S. Hamby, Clerk of Council Waynesboro, Virginia