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HomeMy WebLinkAboutDraft Minutes - Steering Committee - 01/22/2024 PAGE 1 DRAFT MINUTES STEERING COMMITTEE JANUARY 22, 2024 The South Burlington Steering Committee held a regular meeting on Monday, 22 January 2024, at 6:30 p.m., in the Auditorium, 180 Market Street, and by Go to Meeting remote participation. MEMBERS PRESENT: City Council: H. Riehle, Chair; M. Emery, T. Barritt, A. Chalnick, L. Kupferman; School Board: K. Bailey, A. McHenry, C. Tillinghast, T. Warren; J. Baker, City Manager; V. Nichols, Superintendent of Schools ALSO PRESENT: T. DiPietro, Public Works Director; T. Jarvis, School District; G. Silverstein, Rep. M. Lalonde, Rep. N. Hyman; E. Fitzgerald, B. Sirvis, D. Bugbee, P. Taylor 1. Instructions on exiting building in case of emergency and review of technology option: Ms. Baker provided instructions on emergency exit from the building and reviewed technology options. 2. Additions, deletions or changes in the order of Agenda items: Ms. Emery moved to add a discussion of “Safe Routes to School” under Other Business. Mr. Barritt seconded. Motion passed with all present voting in favor. 3. Comments and questions from the public not related to the agenda: There were no comments or questions from the public. 4. Consent Agenda: a. Minutes of 2 November 2023 CITY COUNCIL/STEERING COMMITTEE JANUARY 22, 2024 | PAGE 2 Ms. Emery moved to approve the Consent Agenda as presented. Mr. Barritt seconded. Motion passed with all present voting in favor. 5. Presentation of FY25 School Budget: Ms. Riehle noted that at a recent meeting between City administration and the School District, new information regarding the impact of Act 127 on the school budget had just been received. It was decided to give the public time to understand the new changes and their unintended repercussions on the City’s school budget. This is the first of many opportunities to gain that understanding. Supt. Nichols said this is a fiscally responsible budget that supports South Burlington’s students. She added that the School District values the partnership and commitment of the City’s Legislators and hoped to be able to move forward. The current proposed tax increase is 18.2%. It would have been 5% if not for the common level of appraisal (CLA) decrease. Supt. Nichols also noted that 60% of City homestead owners receive property tax credit based on household income and home value. Priorities in preparing the FY25 budget included prioritizing “student-facing” positions, elementary literacy program, math and literacy specialists, sports, multi-language students, special ed, and facilities upgrades. Supt. Nichols stressed that if the proposed budget fails and they are forced to go back to the FY24 budgets, the tax reduction would be only 2% Some of the contributing factors to the budget are: less inflation than last year, 10% increase from negotiations, increased health insurance costs, and greater than anticipated revenues from impact fees which will cover more than 91% of the cost of the ZEMs. There is a surplus of $2,200,000 from FY22 and voters will be asked whether to add this to the facilities reserve fund. Supt. Nichols stressed that due to Act 127, adding that surplus to the FY25 budget revenues would not have decreased the tax rate. CITY COUNCIL/STEERING COMMITTEE JANUARY 22, 2024 | PAGE 3 Major contributors to the increased tax rate are the yield which was down significantly and the CLA. Two years ago, the CLA was at 100%. It has now dropped to 82%, which was a crushing blow. The CLA represents the difference between a properties’ assessed valuation and the price at which properties are selling. Mr. Jarvis then presented the figures. The total budget is 71,200,000. Revenues are anticipated at $13,400,000. This results in $54,800,000 to be raised by taxes. Mr. Jarvis said one main difference this year is how the Education Department counts pupils. The have changed from the former “equalized pupil” system, and this has had an impact on South Burlington. The change results from how English language learners and low-income families are measured. With regard to net education spending per pupil, Mr. Jarvis said that the increase had to be below 10% to avoid a review to see if the budget was “egregious.” This figure is at 9.4%, so that review has been avoided. The net education spending per pupil is $14,005. When you divide that figure by the yield (9.17%), this results in a State tax rate of 1.5271. This figure added to the decreased CLA (which was capped at 5%) results in the South Burlington tax rate. Mr. Jarvis noted that homes in South Burlington continue to sell at higher than their assessed values. Supt. Nichols added that this situation is compounded by the fact that there is a shortage of appraisers in Vermont, and some smaller communities have been waiting a decade for an appraisal. She stressed that South Burlington is a very desirable community, but this means that the further the city gets from a reappraisal, the more significant the drop in the CLA will become. Mr. Jarvis noted that if the State had not granted the 5% cap on the CLA calculation, the tax rate would have gone to 38%. Mr. Barritt said the CLA model is broken at this point. There is a lot of demand to come to South Burlington. You can’t get an appraiser to address the CLA, and it will have to be capped every year until that changes. Mr. Chalnick asked whether the money the City is giving to the State can be calculated. Mr. Jarvis said they receive a statement every year. Last year, the City paid $5,000,000 more than it got back. He said South Burlington is a “net giver.” Mr. Jarvis had no idea what that figure would be for the coming year. CITY COUNCIL/STEERING COMMITTEE JANUARY 22, 2024 | PAGE 4 Mr. McHenry said the CLA could better be called “real estate inflation.” He felt this is easier to understand. He noted his neighbor’s house, which is appraised at $380,000 was offered for sale at $495,000. It sold for $505,000. Mr. Jarvis noted that one action the Board took was to transfer to the capital reserve fund for future facility’s needs. He stressed that this had no impact on the tax rate and was a good idea from a logical perspective. Supt. Nichols said that when Legislators enacted Act 127, they did not know what the impact on communities such as South Burlington would be. Looking forward, she said, if nothing changes, in 2030, there would be a 38% tax increase, and the city would have to close schools. The question is how to get to a functional tax rate. Just to reduce taxpayers tax burden by $9.00 a month (which is what would happen if the proposed budget fails and they have to go back to the FY24 budget) would result in increased class sizes, limited education support (e.g., literacy and math), re-evaluation of the mid-level model, removal of social/emotional/instructional supports, athletics, arts, drama, and significant staff reductions. Supt. Nichols said the second item on the ballot is the allocation of the surplus $2,200,000 to the reserve fund. Supt. Nichols then outlined proposed staffing changes elementary and middle schools, some of which are funded by grants. Mr. Jarvis said Vermont has the second highest per pupil spending in the country. Ms. Bailey said Vermont also has good education outcomes compared to other states that are underinvesting in education. She stressed that South Burlington has a very slim administration. Mr. Silverstein noted that only New York spends more than $28,000 per student. It is twice what other states are spending. He also cited the unfunded portion of the education pension fund and said the public is not hearing all the pieces of the puzzle. He noted that if the voters had approved the proposed new school bond, the tax rate would have been between 50% and 100%. Mr. Lalonde said there is a lot of conversation happening at the State level. For the last 2 years, the tax rate was historically lower. The 18% is from a figure that was artificially suppressed by ARPA funds. CITY COUNCIL/STEERING COMMITTEE JANUARY 22, 2024 | PAGE 5 Rep. Hyman said Vermont is not in the top 50% of states in education spending. He added he is proud of how Vermont is educating its students and said that states that are spending less have nothing to be proud of. Rep. Hyman also said that communities that invest in housing, as South Burlington is doing, should be rewarded for having more students to educate with the same amount of money. 6. Presentation of City FY25 Budget, bond vote, and possibly ballot items: Ms. Baker said that municipal finance is much simpler. The total city budget, including utilities and special funds is $64,916,064.64. The City Council was committed to maintain the current level of service in the city. This budget includes the second ambulance, an added highway position, sidewalk maintenance, an added Library person, reinstating of the Youth Service Sargent, 50% of the cost of crossing guards, the Capital Improvement Plan (CIP), a Climate Action person, funding for Green Mountain Transit, and the use of $417,000 of ARPA funds for the Climate Action Plan implementation items. The assumed growth in the Grand List is 2%, and the growth in the TIF Grand List is 4.4%. The budget also assumes a 7% increase in receipt of Local Option Taxes. The proposed city tax rate increase is 5.8% which includes at 17% increase in health insurance costs. This tax rate will result in an annual tax increase for the average condo of $84.00 and an annual tax increase for the average single family home of $124.00. Utilities will also be going up a total of $64.29 for the year. Ms. Baker showed a pie chart of where City tax money is spent. Ms. Bailey asked the role of the reinstated Youth Services Officer. Ms. Baker said this is a leadership position in school safety. The position had been vacant. Mr. DiPietro then reviewed the Water Tank Expansion Bond Item. This will build a second water tower with the same capacity as the existing tank. It will be sized to accommodate growth and to meet regulatory requirements. It can handle emergencies, such as happened on Christmas night, and allows for maintenance of one tank at a time. It will not increase the pressure in the system. Mr. DiPietro then showed a site plan of the new tank project. The total cost is $5,750,000. The city has already received at $500,000 grant toward the project and is applying for additional grant funding. The estimated annual increase for the CITY COUNCIL/STEERING COMMITTEE JANUARY 22, 2024 | PAGE 6 average water user is $38.66. South Burlington currently has the lowest water rates in the region and possibly in the State. The hope is to begin construction on the new water tower in the fall of 2024. Mr. Barritt asked if there will be any blasting for the base of the tank. Mr. DiPietro did not anticipate any. Ms. Baker said there is also a potential Charter Change item on the ballot to increase the School Board from 5 to 7 members. After a second public hearing on 29 January, the Council will vote on whether to approve that item. If it passes, it will then go to the Legislature for approval. It would not go into effect until 2025. 7. Continued discussion on the impacts of Act 127 and the Common Level of Appraisal (CLA) on the estimated Education Tax Rate and shared advocacy: Mr. Kupferman spoke to the headline “Legislators scold schools for spending.” He said he was surprised at that. Supt. Nichols said the education formula is very complicated and is a consistent balancing act. Legislators did not anticipate some of the impact of Act 127 though they had good intentions to increase equity statewide. It was noted that there was an emergency VSBA (Vermont School Boards Association) meeting today. Members felt there was a lack of accurate modeling and that the act was not thought through. It is really a CLA/”real estate inflation” problem which has to be gotten under control. It is not fair to blame a school district for this. There are also many things that Vermont provides for its students that other states do not. Supt. Nichols said it would make sense to have all the State data before they prepare a budget. They went through a very meaningful process that was all undone by the Legislature. Mr. Warren said when they considered adding the $1,900,000 to the general budget, the actual budget increase was 6-7%. He stressed that what is good for one locality is not necessarily good for another. CITY COUNCIL/STEERING COMMITTEE JANUARY 22, 2024 | PAGE 7 Mr. Kupferman asked how they can present this to the public. Supt. Nichols said this is the first time they have been in the position that even if they reduce spending, they cannot reduce the tax rate. She also said it is very expensive to live in Vermont, and she didn’t know how to fix that. She stressed that a lot of good has been undone by the CLA. She also noted that South Burlington is the only school district in the State with increasing enrollment. She again noted that the same budget last year would have been a 7% increase. Next year that same budget will be a 38% increase. Ms. Riehle said it is scary to think that people will just say “no,” and then where will things be. She said that even rolling back to last year’s budget is crazy. She stressed the need to keep appealing to the Legislators. Supt. Nichols said they have presentations planned on public TV, top employers in the City, SBBA, etc. Ms. Bailey said teachers are asking for more money because their expenses are going up. Gas is going up. South Burlington isn’t doing anything more than anywhere else in the State. But they have enrollment challenges and facilities needs. This isn’t not just increased spending. They went to mediation and were told the contracts were reasonable. They can’t hire bus drivers even with the new contract because it still isn’t enough. Mr. Chalnick said he supports the school system but questioned why the United States spends three times more than peer-developed countries to educate students. 8. Other Business: Ms. Bailey spoke to the agreement to establish a Safe Routes to School Task Force. The group has met a few times and is questioning how formal their process should be. The goal is to have an efficient task force that can make recommendations regarding school safety. She read the proposed Mission Statement. The task force Steering Committee would have 3 representatives each from the City and School Board. Mr. Chalnick said the facilitator said she would only be able to do this if it is not subject to the Open Meeting Law. Ms. Bailey was concerned with setting that precedent. She felt it should be treated the same as all other committees. Ms. Emery suggested there should be at least a Resolution that goes through the City Council. CITY COUNCIL/STEERING COMMITTEE JANUARY 22, 2024 | PAGE 8 Ms. Baker questioned whether this would be a standing committee or would do its work and then end. Supt. Nichols cited the importance of having minutes. Ms. Tillinghast said “the more formal the better.” Ms. Bailey felt they should conform to the open meeting law. Ms. Baker said that would be great if they can decide on the defined outcome. She stressed that there are a lot of planned safety projects for the streets, and she needed to know what the task force would do that is different from that. Ms. Bailey said it needs to be specific to the schools and cited traffic monitors, Dorset Street conditions, construction on Market Street, etc., and how things are communicated to the schools. Ms. Baker said if it’s just a communication tools, it doesn’t have to be according to the open meeting law. Ms. Riehle said she is hearing more than communication. Ms. Tillinghast said they want input on the impacts of construction, etc. A good thing for the task force would be to come up with a process on how to have that conversation. Supt. Nichols said they want to avoid getting to critical situations, and perhaps this is more of a long-term process. They need to be able to predict what safety provisions need to be put into place when development is happening. Mr. Barritt questioned whether the School Board can have someone attend DRB meetings. Ms. Bailey said they don’t have the capacity for that. Mr. Kupferman said someone from the School Board should attend the DRB when there is a project that affects the schools. Ms. Riehle suggested asking the DRB to make that one of the questions to be asked. Ms. Riehle also suggested having the impact on schools added to the Bike/Ped charge. Ms. Emery suggested having a map indicating the routes children actually take to schools. This could trigger something when there is a development reviewed. Ms. Riehle said the Council will consider a Resolution to create the Task Force. A Task Force member can take minutes. Each body can adopt the Resolution. Ms. Baker encouraged people to read the presentation she sent last week as a start to this conversation. As there was no further business to come before the Council Ms Bailey moved to adjourn. Mr. Chalnick seconded. Motion passed unanimously. The meeting was adjourned at 10:04 p.m. CITY COUNCIL/STEERING COMMITTEE JANUARY 22, 2024 | PAGE 9 _________________________________ Clerk _________________________________ School Board Clerk