Home » Committees at a Glance »Government »News » Currently Reading:

Strategy Session Tug of War

March 8, 2017 by Valerie Cury filed under Committees at a Glance, Government, News No Comments
towncouncil

Grim pointed out that the residential portion of Vineyard Square (the John Chapman and Mark Nelis development on 21st Street) is 40 condos. “So we lost 39 availabilities, and that falls back to policy… that is 39 availabilities that we have lost. And that is approximately $2 million.”
– Council Member Kelli Grim

On February 22, the Purcellville Town Council held a second Special Financial Strategy Session meeting with their two consultants, David Rose of Davenport, and Eric Callocchia of Municipal and Financial Services Group. During the previous meeting, the Council asked the consultants to return with alternative scenarios, given the broad agreement that growth will not reduce the debt and utility rate burden.

However, the follow-up meeting was contentious, with the consultants backtracking on the assertion that you can’t grow out of debt, and pressing a familiar growth agenda. Members of the Town Council challenged the reversal, pressing the consultants to come up with innovative alternatives for reducing debt and utility rate burdens on citizens, by reducing costs and monetizing the Towns substantial assets.

This meeting was a follow-up with instructions from the Town Council to bring forward multiple concepts for utility rate structures and tiers, and debt finance and consolidation options to tackle the two large balloon payments due in 2020 and 2021. The previous Lazaro Town Council incurred, and then refinanced, most of its existing debt and repackaged it in restrictive nonprofit bonds.

The Town debt is currently just under $60 million. There are two types of debt: tax-supported debt consisting of the General Fund, and Parks and Recreation Fund, totaling $18.1 million; and the self-supported utility debt, consisting of the Water and Sewer Fund totaling $41.3 million. The current Town Council has not added to the debt, but instead has lowered it by well over $1 million.

The difference between the two debts is the tax-supported debt comes primarily from General Fund revenues, and the self-supporting utility debt comes from user fee rates and other charges.

Currently, the Fireman’s Field income is restricted by the nature of the nonprofit bonds and the way the current management contract is structured. If the debt is not refinanced, the other option is to change how the ball fields and the skating rink are managed. The Town could pay a firm a flat rate to manage the properties, allowing the Town to use the revenue for maintenance and debt reduction.

The recurring narrative of both consultants, along with Town Manager Rob Lohr, concentrated on growth as the primary means to paying down the Town debt. “You have a bunch of debt outstanding, no doubt about it,” said Rose.

Mayor Kwasi Fraser asked the consultants to consider a variety of operational efficiencies as part of a solution to manage the town’s high debt and utility rates.

Council Member Nedim Ogelman said, “So, you are saying if we grew a lot, that wouldn’t increase the infrastructure costs?” Rose replied, “We’ll talk about that later.” Ogelman continued, “I don’t think that you are necessarily capturing the whole variety of potential negative externalities … Did you look at other things, like cutting our government expenditures?” He pointed out that the Town has roughly 9,000 residents and, “maybe we are operating like a Town that serves 25,000 people instead of 9,000 people.” Ogelman was referring to a February statement made by Lohr who said he runs the Town as if it were a town of 25,000 residents.

Rose responded, “Whether you have one town manager or seven town managers, that wouldn’t have an impact on the Enterprise Fund.” Ogelman replied, “It will have an impact on the General Fund. But, these are all parts of our debt. Can we cut some of the expenses? Can we bring these costs down?”

“Let’s say you get additional houses, there are additional cars, there are additional other kinds of utilities that have to come in. There is additional wear and tear; there is additional stress on citizens, like traffic. You need additional staff to deal with the additional houses. I want to make sure that we are not looking at something as if there are no costs to it,” said Ogelman.

“The second thing I want to say is I am sensitive to this issue because there is a narrative politically in our town that tries to push the idea that there are no solutions other than significant additional growth … and I am not just willing to accept that on its face,” said Ogelman. Rose responded, “Maybe it does require one or two new policemen or another public works person, and those things have to be taken into account.”

Council Member Kelli Grim suggested using a portion of the Meals Tax to pay down the debt. “Two percent of the Meals Tax could be used for capital and maintenance, for example,” said Grim. Rose answered, “You don’t rob Peter to pay Paul.” However, Grim pointed out that the Lazaro Council used one percent of the Meals Tax to pay for legal fees.

Fraser echoed this point saying that the Meals Tax could be used for the General Fund and the Utility Fund as long as it does not create a deficit in another fund. “Right?” he asked. Rose confirmed that it can be used for any fund. But, for years Lohr had been saying that the funds could not be mixed.

“When you are talking about the Meals Tax and this is robbing Peter to pay Paul concept, what is the analogy for chargebacks? Is that also robbing Peter to pay Paul?” asked Ogelman. Rose said that he wasn’t “qualified enough to give an answer on that one.”

Chargebacks are a portion of expenditures, charged to different funds, for staff work, since staff members do multiple jobs in different departments. Since the Town has separate funds and they are supposed to be self-supporting, the Town bills that way. The Town currently charges each fund $500,000 (General and Sewer) for the chargebacks, which started in 20008.

Grim pointed out that the residential portion of Vineyard Square (the John Chapman and Mark Nelis development on 21st Street) is 40 condos. “So we lost 39 availabilities, and that falls back to policy… that is 39 availabilities that we have lost. And that is approximately $2 million. So if there is a policy that hurts us – there is a policy that allowed that.”

Grim was referring to managements recommendation of charging a single tap fee for the 40 condos, instead of separately metered taps for each of them. Lohr said, “We never really dealt with condominiums, same way with apartments. Condominiums are relatively new in western Loudoun.”

The growth scenario stuck throughout the whole meeting with Rose repeating that the Town has to grow. Ogelman said, “Of course, this all just assumes the closed system. That is to say your whole model is operating in the context of just water and sewer, not all other aspects of a town.” “Absolutely,” replied Callocchia.

“More houses bring additional service needs, and other infrastructure and capital improvement needs,” said Ogelman. “But so, the real challenge we are facing is not how to deal with this closed system that has capital improvement costs and has scale issues. To me, the real issue is how do you look at the costs and potential added revenue from the whole system, and how can we overcome the challenges of getting that potential revenue, and being able to invest it in our sewer and utility. That is the real challenge that we are facing,” said Ogelman.

Comment on this article


By commenting, you agree to abide by our Terms of Service.





XHTML: You can use these tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>


 

 

 

 

 

Columns

The Holocene Climate

noerpel_new

(Public Input Loudoun County Board of Supervisors, 7 March, 2017) Figure 1 shows the climate variation over the last million years. The low points on the curve correspond to ice ages when glaciers up to a mile thick covered New …

Choosing To Forgive

moore-sobelnewmug

By Samuel Moore-Sobel “Truly forgiving is the ability to say, ‘Thank you for giving me that experience.’” James Arthur Ray vaulted into fame on the Oprah Winfrey Show back in the mid-2000’s. Stunned hearing these words while watching The Rise and …

Five Key Retirement Questions

Smith0035

Beyond asking yourself where you see yourself and even what your lifelong goal are, effective retirement and longevity planning begs some very big questions. Review the points below and consider how housing, transportation and health considerations all play a role …

Work Woes

drmikenewpic

By Michael Oberschneider, Psy.D. Dr. Mike, I’m a manager at a large tech company and my boss has directed me to fire someone on my team, but as a Christian, I just can’t do it. It’s true that the employee …

Joy or Suffering

Lunde new

By Mary Rose Lunde No one likes to suffer. When given the chance, many people would choose to laugh rather than cry, to sit in silence with their friends rather than talk through their feelings, because not even their friends …

Wage Radio

wage

I will always remember – very fondly – the first time I ever set foot on the property at 711 Wage Drive Southwest in Leesburg, Virginia. It was a warm, sunny July morning in 1997, and I’d driven all the …

Speaking Truth to Power

noerpel_new

“With public sentiment nothing can fail. Without it nothing can succeed.” Abraham Lincoln On Thursday evening, February 23, I requested the Board of Supervisors pass a proclamation resolving to support the March for Science on Earth Day, April 22 [1]. …

Student News

Congratulations, Class of 2016

6 Jul 2016

grads_woodgrove

Woodgrove High School’s Class Of 2016 Graduation – By Amanda Clark On June 16, Woodgrove’s Class of 2016 was the 5th graduating class to walk the stage and accept their diploma. The ceremony was filled with anticipation as the chorus, …

(Be the first to comment)

Buckland Earns Degree In Medicine

6 Jul 2016

buckland

Molly Buckland, D.O., graduated from the West Virginia School of Osteopathic Medicine with a degree of Doctor of Osteopathic Medicine on May 28. While at WVSOM, Dr. Buckland received the Dr. Roland P. Sharp President’s Award and the James R. …

(Be the first to comment)

Adams Promoted To Lieutenant

6 Jul 2016

adamspromoted

Lt. James Adams, from Sterling and a Potomac Falls Halls Graduate, earned the promotion to the rank of Lieutenant. Adams is a Navy Week and Executive Outreach Planner for the Navy Office of Community Outreach in Millington, Tennessee. U.S. Navy …

(Be the first to comment)

Calendar

March 2017
Monday Tuesday Wednesday Thursday Friday Saturday Sunday
February 27, 2017 February 28, 2017 March 1, 2017 March 2, 2017 March 3, 2017

LAST HAM STANDING COMEDY IMPROV

LAST HAM STANDING COMEDY IMPROV
March 4, 2017

Notaviva Vineyards - Bluegrass Jam - FREE event

Notaviva Vineyards - Bluegrass Jam - FREE event
March 5, 2017
March 6, 2017 March 7, 2017 March 8, 2017 March 9, 2017 March 10, 2017 March 11, 2017 March 12, 2017
March 13, 2017 March 14, 2017 March 15, 2017 March 16, 2017 March 17, 2017 March 18, 2017

Wine & Chili Weekend

Wine & Chili Weekend
March 19, 2017

Joshua Carr River Safety Foundation Rummage Sale

Joshua Carr River Safety Foundation Rummage Sale
March 20, 2017 March 21, 2017 March 22, 2017 March 23, 2017 March 24, 2017

March Fourth Friday

March Fourth Friday
March 25, 2017 March 26, 2017

Spring Brunch

Spring Brunch

Spring Brunch

Spring Brunch
March 27, 2017 March 28, 2017 March 29, 2017 March 30, 2017 March 31, 2017 April 1, 2017

”Homage to Mother Earth”

”Homage to Mother Earth”

Nebbiolo Vertical Tasting

Nebbiolo Vertical Tasting

Notaviva Vineyards - Bluegrass Jam - FREE event

Notaviva Vineyards - Bluegrass Jam - FREE event

Old Time Country Ham and Turkey Dinner

Old Time Country Ham and Turkey Dinner
April 2, 2017

”Homage to Mother Earth”

”Homage to Mother Earth”

GALLERY COFFEEHOUSE: Readers Theater, “One Slight Hitch”

GALLERY COFFEEHOUSE: Readers Theater, “One Slight Hitch”
Current Print Issue:
Sign up for our email newsletter:

Recent Comments

  • David on Protecting Free Speech: Constitutionally protected speech is exactly what it sounds like, protected. We all have the legal right to utter nonsensical and...
  • Martha on Protecting Free Speech: Free speech is not a cherished right at the not-quite accredited Patrick Henry College, a religious school that Del. LaRock...
  • Martha Polkey on First Look at Envision Loudoun Results: It remains to be seen whether the direction citizens have provided to the Envision process is actually incorporated into the...
  • David on Protecting Free Speech: Mr. LaRock, I assume that the only reason you weren’t at every School Board meeting in 2005 passionately defending the...
  • LongTimePville on Purcellville Emergency Meeting Postponed to March 10: I bet Kelli Grim flip flops on her conflicts of interest and transparency campaign she ran on and does not...

Steady and NoBull

Lifestyle

Sterling Library Moving To New Location

25 Mar 2017

Library

Sterling Library’s current location, 120 Enterprise St., Sterling, will close beginning Saturday, March 25, to prepare for the opening of the new Sterling Library on Saturday, April 15. Patrons can return library materials using the drop box at the new location, 22330 S. Sterling Boulevard. Printer-friendly Related

(Be the first to comment)

Middleburg Gallery Presents Country Pursuits Exhibit

25 Mar 2017

Mr and Mrs Andrews 24x35 59 2016 whelan

The Gallery on Madison in Middleburg is presenting an exhibit of Brian Whelan’s (a London Irish painter now settled in Waterford) ) transcriptions of a gallery of paintings by Thomas Gainsborough, ‘Mr. and Mrs. Andrews’ through April 2. The exhibit includes 23 paintings, two masks, two graphics, and nine preparatory drawings. Printer-friendly Related

(Be the first to comment)

Loudoun Workforce Resource Center Presents STEM Career Fair March 28

16 Mar 2017

Illustration of STEM education word typography design in orange theme with icon ornament elements

Anyone interested in a career in the rapidly growing field of STEM (Science, Technology, Engineering and Math) is encouraged to attend an upcoming STEM Career Fair in Loudoun. The Loudoun Workforce Resource Center, in partnership with Northern Virginia Community College (NVCC)’s Loudoun campus and NOVA SySTEMic Solutions, is holding a STEM Career Fair Tuesday, March 28, from 1:00 to 4:00 …

(Be the first to comment)

Around Virginia

Virginia Schools Kick Off Statewide Campaign To Encourage Safe Teen Driving

image004

More teen drivers in Virginia will be involved in traffic crashes between the months of May and August than any other time of the year, statistics show. To help save lives and prevent such crashes during the high-risk warm weather months, Virginia schools are kicking off a statewide teen safety …

(Be the first to comment)

Protecting Free Speech

Dave_larock

By Dave LaRock (R-33) As elected officials and members of the legislature, our most fundamental responsibility is to protect God-given constitutionally protected rights. The First Amendment of the United States Constitution prohibits the government, including governmental public colleges and universities, from infringing on free speech and the free exercise of …

(3 comments)

Walbridge To Run for State Delegate in the 33rd District

Tia walbridge

Tia Walbridge announces her run for the District 33 seat in the Virginia House of Delegates. Walbridge is a wife and mother of two daughters and an active member of the Round Hill community. “Like many people in our district, my family has found its prosperity in a Virginia-based small …

(Be the first to comment)

Sports

Vikings Runner-Up at the State Championship 

8 Mar 2017

vikings

The Loudoun Valley Vikings are the boy’s runner-up at the VHSL 4A State Indoor Track and Field Championships at Roanoke College.  During the 2015-2016 school year, the Loudoun County School Board approved Indoor Track and Field as a Tier 2 (self-funded) sport.  The seven boys competing scored 48 points, second …

(Be the first to comment)

WLVBC U14 Boys Finish 3rd at VA Beach Event

23 Feb 2017

WLVBC300

The Western Loudoun Volleyball Club’s U14 Boys Team garnered 3rd place in their first travel tournament of 2017, the Virginia Beach Invitational. This event was held Feb. 18-19 and featured more than 24 teams from the U14 to U18 age group. The team was second on their net on day …

(Be the first to comment)

Archives

  • +2017
  • +2016
  • +2015
  • +2014
  • +2013
  • +2012
  • +2011
  • +2010
  • +2009