Motions:

1. The Arlington County Civic Federation recommends to the Arlington County Board that it adopt a Fiscal Year 2001 General Fund Budget that is balanced at $536.8 million. This would be accomplished by:

A) modifying the County Manager's Proposed Budget as follows: a net decrease of $0.3 million transfer to the Schools (recognizing increased Commonwealth funding); activating the 1.5% COLA contingent for County and Schools employees; recognition of an additional carryover of $1.1 million; $0.3 million in other additional fees and revenues; net program reductions of $2.9 million;

B) providing retirement system enhancements for County and Schools employees paid for by an increase in the real estate property tax rate of up to 5.0 cents raising $16.2 million (a net increase of $15.9 million over A above).

2. The Arlington County Civic Federation recognizes and appreciates the continued outstanding support provided by staff of the Office of Management and Finance to the members of its Revenues and Expenditures Committee in this year's budget review.

3. The Arlington County Civic Federation recommends to the Arlington County Board a number of procedural improvements in budget presentation and in program operation as well as expressing its thanks to the Board for adoption of a number of past Federation recommendations.

4. The Arlington County Civic Federation recommends to the County Board that it schedule its public hearing on the FY'02 budget so that Federation members might attend that hearing after our regular monthly meeting.

The President of the Federation is authorized to transmit approved motions and supporting information to the County Board, the School Board, the media, and other interested parties and to offer to make Federation Committee members available to explain the motions and attached text.

Table of Contents                Page
Overview..........................2
Summary of Recommendations........4
Explanation of Recommendations....4
Procedural Improvements...........9
Report of the Schools Committee..10

The Superintendent had not presented his proposed budget to the School Board when the County Manager made his presentation to the County Board.

Major Factors:

A. Increased Expenditures:

1. $1.3 million for debt service for the County's ongoing Y2K-related computer hardware and software program.

2. $1.3 million for Metro's new capital rehabilitation and improvement program.

3 $1.4 million to increase debt service related to the planned sale of voter-approved library, park and recreation, Metro, and public infrastructure bonds.

4. A $4.9 million contingent for a COLA (cost of living adjustment) of 1.5% for County and Schools employees.

5. A $1.8 million increase in funds for capital improvements consistent with the previously approved Capital Improvement Program (CIP).

6. A 2% increase in the school operations transfer to the Schools; a total of 4.9% for all Schools' categories including debt service and COLA.

7. Full year funding for a number of projects begun during FY'00, such as the Barcroft sports complex.

[It also assumes an unspecified increase in the transfer to the General Operating Reserve to be funded out of expected unexpended FY'00 funds.]

B. Increased Revenues:

1. Because of increased assessments and new building, real estate tax collections would increase by 4.6%. Personal Property taxes would increase by 1.5%. Also, BPOL, sales, and transient taxes would increase by 3%. Unlike last year, County staff have not made a current estimate of the amount of additional funds which will be available from the Commonwealth that can displace otherwise coming from local revenues. And, revenues from the Federal Government are projected to decrease by 1.4%.

2. The loss of waste-to-energy facility revenues which have subsidized the Department of Environmental Service's Solid Waste Division's budget in past years is to be made up for by an increase of $21.84 per household/per year (revenues of $700K) to keep full cost recovery.

3. On February 12, 2000 the County Board voted to advertise maximum tax rates: it voted no increase in the maximum for the personal property rate and a maximum rate of $1.07 for $100 assessed for the real estate tax rate (a maximum increase of 7.2 cents). These decisions limited maximum revenues increases beyond current rates from these sources to $23.3 million for FY 2001.

4. As in past years, the Committee believes that there are incremental opportunities for increases in fees which would move some County programs which serve only a few persons closer to full fee recovery.

5. The Manager proposed a $6.3 million "adjustment" in retirement contributions; less funds were scheduled to be paid into employee retirement accounts than in the current fiscal year.

6. The Manager provided the option to the County Board of reinstituting a car decal fee of $25 per vehicle which would eliminate the proposed deficit in the County's General Fund.

C. Both revenues and expenditures:

The Manager's Proposed Budget contains Program Change Proposals which, taken as a whole, would increase expenditures by $4.6 million. Many of these proposals would have been shown as Base Budget items if the Manager had been given different directives by the County Board.

Reviewing this Proposed Budget is more difficult than those proposed for recent past years because the County Departments were not required to identify any specific reduction options and a number of reorganizations took place in areas of previous concern to and recommendations by the Federation, significantly limiting available program detail. These factors will also influence County Board review of the proposal.

Within the constraints of this Overview, the Revenues and Expenditures Committee makes the following recommendations:

Expenditures

County Manager's BASE BUDGET............................$523.7

1.  Transfer to Schools: Schools' Committee Recomends....-$0.3
2.  General Government.....................................0.0
3.  Courts and Constitutional Offices......................0.0
4.  Public Works.........................................+$0.2
5.  Economic Development...................................0.0
6.  Libraries............................................+$0.1
7.  Public Safety........................................+$1.2
8.  Environmental Services.................................0.0
9.  Human Services.......................................+$0.1
10.  Community Planning, Housing, and Development........+$0.1
11.  Parks, Recreation, and Community Resources..........+$0.3
12.  Non-Departmental & Debt Service.....................-$1.5
13.  Regionals/Contributions and METRO.....................0.0
14.  Pay-As-You-Go Capital...............................-$1.2
15.  Enterprise Funds....................................-$2.1 
16.  Retirement System Changes..........................+$16.2

                                             TOTAL:     $536.8

Revenues:

County Manager's BASE BUDGET............................$519.5

17.  Increased Carryover................................ +$1.1
18.  Miscellaneous Fees and Revenues.................... +$0.3
19.  Recognition of Additional Commonwealth Funding........0.0
20.  Increased Real Estate Taxes........................+$15.9

                                             TOTAL:     $536.8

Note: Each 1/10 cent increase in the real estate tax rate would increase revenues by $323K (including carryover from the increased May 2000 payment).

(1) Transfer to the Schools (-$0.3M):

• The County Manager proposed a transfer to the Schools; including: Operations, Comprehensive Services Act, Capital, Debt Service, Community Activities Fund, and Other of ............................$192.0 million
• The Federations Schools Committee recommends; recognition of increased Commonwealth revenues (see item #19) of..............$2.3 million
  County Board appropriation in FY'01 of all FY'00 Schools' carryover and, a net transfer, including a 1.5% COLA, of............................................$189.4 million
  A difference of........................................-$0.3 million

See the report of the Schools Committee, beginning on page 10. For illustrative purposes, this recommended transfer of $189.4 million is equal to about 36.0% of recommended General Fund revenues and about 86.9% of real estate tax revenues at current rates. It is the largest single programmatic category in the County's budget.

(2) General Government ($0.0):

(3) Courts and Constitutional Offices ($0.0):

Of the six Program Change Proposals, the Committee accepted two in their entirety and one in principle which the Committee believes should have been included within base budget funding (assignment pay for new Deputy Sheriffs). We accepted: the Electoral Board request for $30K for additional voting machines and $30K for the Treasurer's Office's Compliance Division for new software.

(4) Public Works (+$0.2):

In concrete maintenance, we would have welcomed the inclusion of the Performance Measures used in prior years for sidewalk maintenance, including years to next maintenance cycle. We support the Program Change Proposal for $145K to shorten the sidewalk maintenance cycle from 15 years to 6 years, with the caveat that management must be more careful about quality control and refuse to accept shoddy contractor work.

Under the Storm Sewer and Maintenance Program we note that the linear feet of sewer repaired has been dropping in recent years to about half the level in FY'98. Since our storm sewer system is aging, we find this disturbing.

The Capital Construction Program does not account for the loss of revenues from the recent County Board decision to stop collecting assessments from homeowners for new sidewalks. In fact, such revenues are not shown for prior Fiscal Years either.

The Snow Removal Program shows no expenditures for clearing the sidewalks and trails that are the County's own responsibility. These routes are important for pedestrians and bicycles after a snowfall. County ordinance requires homeowners to clear sidewalks in front of their own homes, but there is no obligation for the County to clear its own sidewalks, and many pedestrians observed after snowfalls in 2000 that County-owned walkways were not cleared.

There is no funding in the Public Works budget for installation of the new Carlyle streetlights. At minimum there should be some lights converted each year, and a long-term conversion strategy laid out.

We do not support additional funding for the sign shop; more efficient use of private sector sign providers can produce more cost-effective results, even for custom signs.

Observation indicates that the pavement markings program has not kept pace with the demand for street markings. Better performance measures are needed for this section of the budget indicating such time-oriented measures as the number of weeks or months wait for remarking repaved streets. The Subdivision and Bond Administration Program also needs time-oriented performance measures.

With new initiatives in the pedestrian field, Public Works Planning may need to consider designating an additional planner for pedestrian and bicycle projects. This segment of the planning workload should be broken out with separate workload measures.

The transit program writeup does not make clear what types of regional coordination are undertaken. The Transit Operations Program for Crystal City needs some fare or private subsidy increase to be on a full cost recovery basis, and to provide for the increases foreseen for coming fiscal years. This will save $42K in this year's budget.

The Neighborhood Traffic Calming program needs realistic performance and workload measures rather than the "per cent satisfied" measure now shown.

We recommend approval of the Program Change Proposal for the increased expenditure of $53K for traffic signal maintenance, parking meter maintenance and replacement of graffiti-damaged signs. The Committee did not support approval of the remaining Program Change Proposals believing that some properly should have been achieved through reprioritizations within the Department and others were not adequately justified.

(5) Economic Development (0.0):

There is no clear indication that the Department is willing to eliminate obsolete programs to move to the kind of Web-based operating environment most used by the business we most want to attract to Arlington. Such technology issues are in program change proposals and not a part of the base budget.

(6) Libraries (+$0.1):

(7) Public Safety (+$1.2M):

For the Emergency Communications Center (ECC), the Committee supported the Program Change Proposal for the replacement/upgrade of the 911 system; $355K. A thorough analysis of the efficacy of adding a 311 option to the 911 system, as many other metropolitan areas have done, appears both timely and prudent. We are concerned about improvements to ECC facilities that are planned to be moved "soon".

(8) Environmental Services ($0.0):

The Committee supports the increase of $21.84 per household/per year for household solid waste to continue full cost recovery for this service; an increase already a part of the base budget. This is consistent with prior Federation recommendations for full cost recovery.

There has been recent media speculation about a possible additional $20 million in costs to enhance sewage treatment facilities to reduce odors both at the County's plant and at disposal sites. Since no formal proposals have been made either in this budget or for public hearing by the County Board, the Committee has taken no position on this matter at this time.

The Committee is willing to consider a further increase in the water/sewer rate at some future date if the additional funds would be held in reserve to cover anticipated, but not yet quantified, costs of system quality improvements.

(9) Human Services (+$0.1M):

The Committee again joined the Housing Commission in partially supporting one of FY'99's reduction options. That would cut the $2.1 million in Housing grants program by $30K by reducing asset eligibility to $20K per household. In addition, it voted to raise the eligibility age for grants for seniors to 65 years, from the current 55, with a grandfathering of all current recipients. This would result in a FY 2001 savings of $7K and $72K annual savings after 10 years.

The Committee believes that the County has not aggressively enrolled eligible Arlingtonians into the `State Child Health Insurance Program'. This new program can provide equal, or better benefits, using State/Federal funds for Arlingtonians than are now provided out of local funds. This would result in a minimum FY 2001 savings, with better services, of $100K in General Fund amounts and greater amounts available in future fiscal years.

(10) Community Planning, Housing, and Development (+$0.1M):

In prior years, the Federation had recommended increases in various user fees in the Planning Division to move toward full cost recovery. These have been substantially achieved. The Committee commends the County Board and Manager for these continued efforts.

In 1998 and 1999, the Federation supported a civil penalties program for violations as a means of code enforcement (replacing most criminal penalties). That program has been adopted by the County Board and is widely seen by the public as desirable. The Committee urges the County Manager to continue to fully implement this program which has both public benefits and budgetary savings.

(11) Parks, Recreation, and Community Resources (+$0.3M):

We are concerned that the Department's call for more maintenance funding for parks facilities has been ignored for several budget cycles. Park users and the Federation's Parks Committee have noted the need for better maintenance of our tree stock, trails, shelters, signage and other park features. We again support a ten percent increase in the Par's maintenance budget; for FY'01 this would be $270K.

In addition, The Department has noted that making facilities ADA compliant is still being delayed. We again this year recommend the reprogramming of funds within the PRCR budget to allocate more for park maintenance and ADA compliance actions.

Knowing that the above recommendation is likely to be ignored again this year we propose a more fundamental change to resolve this problem: splitting Parks out into a new Department as it had been in the past. There is a bias within any organization that deals with both maintaining physical facilities and providing program resources to clients in need that tends to favor the client needs. In this proposed budget, for example, the County Manager recommends an increase of 18% for new personnel for County Wide Recreational Programs. We expect and approve of this bias toward the human need first, but in the case of Parks it will inevitably lead to under- maintenance of facilities unless the Parks function is a separate Department. We believe it is time for this pendulum to swing once again.

Noting that the majority of day-users at the Thomas Jefferson Community Center facilities are not County residents, we recommend that fees for this category of use be set at the full cost-recovery level. The number of seniors participating in the County's Wellness programs is listed in the budget at only 135 for FY'99 and estimated at 150 for the current year. This seems very low and leads us to ask if those services could be provided at less cost by private sector programs. This is difficult to estimate, since there is no breakout for the senior program.

The Urban Operations Initiative provides welcome maintenance for our central business district, but at the expense of parks maintenance. In other jurisdictions, this type of program has been willingly supported by the businesses and commercial landlords who benefit. If this program could be supported by the beneficiaries in Arlington, it would free up some resources to return to parks maintenance.

Parks should provide in the budget a more definitive schedule for making our facilities ADA compliant. The vague statement that this needs to be done at some future time is insufficient.

Snow and ice removal on the County's trails and sidewalks has lagged this year even beyond previous years. Some portion of the PRCR budget should be earmarked for this activity.

For this Department, a large number of the performance satisfaction measures are vague or technically unmeasurable; see Improvement Recommendation below. In addition, meaningful breakouts of miscellaneous revenues for programs (e.g. ticket sales and sponsorships) would help in evaluating these expenditures.

(12) Non-Departmental/Debt Service (-$1.5 million)

Retirees Health Insurance (-$0.4M) Reduce expenditure estimate by $46K to more accurately reflect FY'01 projected costs. Reduction reflects better managed care; e.g. greater reliance on 'primary payer' of MEDICARE. In addition, the "health adjustment" drops from $1.1M to nothing. Your Committee believes that at least $350K is probable for this "adjustment". Manager's proposal shows an overall 37% increase in this category; these recommendations reduce it by about one-third.

Tax Refunds (-$0.1) Reduce expenditure estimate by $77K to more accurately reflect FY'01 projected costs [Prior fiscal year Revised data already shows the utility of previous ACCF recommendations on this matter].

Debt Service (-$0.2) The County has historically issued bonds and therefore begun debt repayments AFTER the dates used for budget planing. This reduction (-$209K) is equal to less than a month's delay in issuing all proposed bonded debt throughout the fiscal year and assumes higher rates of interest at bond issuance than does the County.

The Committee accepts the Manager's proposed 1.5% COLA for County and Schools employees; the COLA Contingent of $4,872K will be added to payroll accounts throughout County agencies and in the Schools' transfer as the budget is approved.

(13) Regionals/Contributions and METRO ($0.0):

It is recommended that the grant to the Hispanic Committee of Virginia (HCV) be reduced by $34,234K and that amount be used to fund "unfunded requests" for: Offender Aid and Restoration ($14,703), the Ethiopian Community Development Council ($16,259), Friends of Guest House ($152) and Rehabilitation Services Incentive Fund ($3,120). HCV's services significantly duplicate those already provided by the County.

(14) Pay-As-You-Go Capital (-$1.2M):

We recommend three project reductions for a savings of $1,772K: a) elimination of funding for a Trades Center storage facility ($538K) and deferral of repaving of a parking lot ($524K); b) elimination of furniture reconfiguration and carpeting at Courthouse Plaza offices ($460K); and the elimination of the "contribution" of $250K to a single vendor of social services to the County and others -- Vanguard Services, Ltd. Further, any such County transfer, if made to any party including Vanguard, should be an interest-free loan and not a contribution.

Instead, we recommend that part of these savings be used for the following three investments:

1) The County still lacks a strategy for conversion of older street lights on residential street to the new Carlyle lights. If we had a long-term strategy, additional funding for this purpose should have been a part of this proposed budget. In many neighborhoods, this is a significant safety and security issue. Consequently, we recommend allocation of $100K in FY'01 for this purpose and increased amounts in future fiscal years. If Public Works does not yet have a plan to determine where the new lights are most needed, the funds could readily be channeled through the Neighborhood Conservation program; letting neighborhoods determine where the need is greatest.

2) We were dismayed to see no funding at all in this budget for Arlington's increasingly popular and crowded pedestrian/bicycle trails. Even the title of the segment "Bicycle Trails" does not reflect the realities of how Arlingtonians use these facilities. We recommend a steady stream of funding for these facilities and recommend that $250K be allocated in FY'01. Note, this is for construction and upgrading of trails; not for routine maintenance which is a separate problem area.

3) We were also dismayed to see that funding for Disability Access was only $50K and was devoted to a single wheelchair-user playground. The County's continued failure to produce a plan to upgrade ALL of its facilities to ADA standards is unconscionable. We recommend increasing funding for these facilities by $200K in FY'01 and maintaining funding at least that new level until ALL County facilities have been brought into full compliance.

(15) Enterprise Funds (-$2.1M):

(16) Retirement System Changes (+$16.2M):

(17) Carryover (+$1.1M):

One of these committed uses is to increasing the size of the County's Operating Reserve; the Federation supports this use within reasonable limits; another is to reappropriate Schools' carryover to the Schools.

(18). Miscellaneous Fees and Revenues (+$0.3M):

For #9 above, Human Services, the Committee recommends two fee increases. Increase the food establishment licensing/inspection fee to achieve an increase of $15K to move closer to full cost recovery for basic, non- complaint-driven, costs. Also, initiate a $10 per slot/per year fee for the licensing of day care facilities raising $47.5K in revenue. The site inspectors in the 11 FTE child care office currently have no cost recovery at all.

The County's dog licensing fee should be increased; a $5 increase would yield $41K. Also, it should be better enforced; increasing licensure to 50% of the estimated number of dogs in the County would yield an additional $15K. These two steps would begin in FY 2001 as a start toward full cost recovery via fees for the Animal Welfare League's dog-related activities (funded under Contributions). Furthermore, incremental County dog run expenses should, at least in part, be covered by further increases in such fees.

(19) Recognition of Additional Commonwealth Revenue (+$0.0M):

At this time, the Committee does not project any additional Commonwealth funding beyond that for the Schools. Some is indeed possible if not likely, but cannot be reasonably and prudently estimated.

(20) Real Estate Tax Increase (+$15.9M):

The Committee voted not to accept the Manager's proposal for a car decal fee.

Thus, the Committee reluctantly accepts raising the real estate tax rate to balance the budget. If additional revenues or further savings are achieved prior to the County Board's adoption of the budget, the amount necessary to achieve balance might be reduced. However, it is now 4.9 cents -- this would raise approximately $15.9 million. [This is a 5.0 cent increase in the real estate rate noted in #16 above minus the 0.1 cent reduction which would have been possible without any retirement system changes.] Procedural Improvements: The Federation recommends (not in priority sequence) that:

1. Whenever a Program Change Proposal is presented which will require expenditures in more than one fiscal year, it should be accompanied by: a) a "fiscal impact" analysis for future fiscal years, and b) an itemization of performance/workload measures which will be used to evaluate it if it is accepted.

2. Prior to the next County bond referendum, a consistent County policy should be developed, with full public participation, on the criteria for the use of bond proceeds to fund any County operating staff.

3. Routine maintenance costs for County facilities must be shown as a part of the base budget and not presented as Program Change Proposals. Such costs should have been recognized in the fiscal impact statements when new facilities were approved by the County Board and/or the voters of Arlington.

4. After all Y2K issues are fully resolved (preferably by mid-year 2000), the County should prepare and publish a report detailing: the total remediation expenditures and lessons learned for future IT investments by the County, such as plans for "e government".

5. The County Board and the School Board must establish a more productive and amicable consultation process for budget procedures, including Fall planning estimates for the Manager and Superintendent, and deadlines. At a minimum, the School Board should vote to approve its budget (based upon the Superintendent's proposal) before the County Board's public hearing on the budget.

6. While the Federation generally found the proposed budget well organized and presented, there are a number of specific problems which will be identified in writing to the Department of Management and Finance. In particular, the Federation urges consistent budget presentation including the current budget year's Adopted Budget. In addition, the year-to-year percentage increase should be calculated using the prior year's Adopted budget amount rather than the prior year's revised budget amount. A consistent presentation would provide more meaningful trends. Use of the revised budget amount has consistently produced lower year-to-year changes for public review.

7. The contribution to the Arlington Community Access Corporation shown in the Regionals/Contributions section of the budget is unclear. In future years, the monetary relationship of this contribution to the County's net revenues from the cable licensing fee should be better explained to the taxpayers.

8. As a part of its Capital Improvement Program, the County Board should create a five year plan to fully fund all improvements in County facilities necessary to achieve full compliance with the access requirements of the Americans With Disabilities Act. [See also, Federation recommendations in Pay-As-You-Go Capital above.]

9. The Department of Human Services should initiate a study to determine which components of its day care licensing, training, and inspection services are suitable for fee recovery of costs.

10. Since it is an important part of the budget process to determine how well individual programs are serving the community, the County Board should create a policy statement itemizing guidelines for determining levels of user satisfaction and when levels of satisfaction are to be collected by County operating units.

For Parks, we noted with amusement the Workload Measure titled: Number of hours in which youth participated in each program and did not engage in anti-social behaviors. While the number impressive, there is no indication of whether this is a gross figure or possibly some hours have been netted out when the participants did indeed engage in anti-social behaviors.

11. The Ballston Parking Garage is a very underutilized and poorly understood County asset. As a part of the County's planned "Off Street Parking" study program, this asset should be thoroughly evaluated and considered for sale/privatization.

Report of the Schools Committee

General Fund Transfer Total APS Budget

Superintendent's Proposal ..........................................$193.7 Million $251.4 Million

County Manager's Proposal........................................$192.0 Million NA

Schools Committee Recommendation.........................$189.4 Million $249.9 Million

The Schools Committee recommends an FY2001 school budget of $249.9 million, a reduction of $1.5 million from the proposed budget, including a General Fund transfer of $189.4 million.

The Committee savings were found primarily in the new spending initiatives proposed by the Superintendent. The largest cuts were in the Gifted services ($449K), assistant principals ($218K), and art and music teachers ($207K).

The Committee supports the enhancement of the retirement plans for school and county employees, not to exceed five cents on the real estate tax rate and making such use of the over funding in the retirement fund as may be appropriately consistent with actuarially sound practices.

The Committee notes that the Superintendent reduced the County transfer to the Capital Projects Fund by the $1 million received from the State construction fund and lottery proceeds. This action seems to negate the purpose of the increased State funds for capital improvements.

With mixed results, some approaches used by the schools in recent years to control rising costs are leases, employee suggestions, and budget reviews. The Incentive Awards program has received few employee suggestions and made no monetary award in five years. While the impact of leasing is seen, it is unknown if lease versus buy analysis has been done to determine if this is the most cost effective way to acquire the equipment. The Committee continues to be disappointed with the results of the Comprehensive Budget Review Process, which has saved no money.

The Committee feels that some lease agreements at school facilities put the school system at a disadvantage. The leasing rates that the school system pays are not the same as what they charge. This distorts the true cost of educating students as well as masking the cost to operate the program receiving the advantageous lease agreement. The Reed building particularly came to the Committee's attention as having poor lease agreements. Two areas are being leased there at rates that do not even pay for the custodial service. This also puts APS in the position of having to lease space at commercial rates or lease trailers to accommodate their needs.

The Committee is encouraged to note that the special education budget has held the line on increased positions this year. The Committee will continue to monitor this important program area. The swim program (drown proofing) should be removed from APS not so much to save money as classroom time. Students needing this training could be better served by the Parks & Recreation Department in the summer time.

IB and AP exams should not be mandatory and the tests should be paid for on a sliding scale, similar to that used for determining fees in programs such as the preschool programs.

There should be extensive cross referencing in and between the budget book and the detail sheets using page numbers. There should be three columns on every tabular section. It should have actual, adopted and proposed numbers. The detail sheets should be available on the web. We recommend that the budget work sessions be televised to increase public access to the budget process.

This page was last revised on: December 28, 2003.