Regular Meeting – April 22, 2020

Regular Meeting, Wednesday, April 22, 2020, 7:00 p.m. Government Center, Verona, VA.

PRESENT: Gerald Garber, Chairman
Pam L. Carter, Vice-Chair
Butch Wells
Michael L. Shull
Scott Seaton
Jeffrey Slaven
Steven Morelli
Timothy K. Fitzgerald, County Administrator
Jennifer M. Whetzel, Deputy County Administrator
James Benkahla, County Attorney
Angie Michael, Executive Assistant (Via Electronic)

VIRGINIA: At a regular meeting of the Augusta County Board of Supervisors held on Wednesday, April 22 2020, at 7:00 p.m., at the Government Center, Verona, Virginia, and in the 244th year of the Commonwealth….

Chairman Garber welcomed the citizens present.

Mr. Morelli led the Pledge of Allegiance.

Mr. Shull, Supervisor for the Riverheads District, delivered the invocation.

PUBLIC HEARINGS – Director of Finance Presentation Misty Cook, Director of Finance, announced that there would be two public hearings.

One hearing is on the proposed tax rate and the second hearing is on the revised budget for 2019-2020 and the proposed budget for 2020-2021. Ms. Cook gave a PowerPoint presentation with the following highlights:

The Code of Virginia (§ 15.2503) does the following:

• Sets the fiscal year for localities (July 1 through June 30) • Sets deadline for presentation of budget to Board of Supervisors by April 1 (Work session March 18th) • Sets public hearing notice requirements (seven days before the public hearing) • Sets minimum period before budget approval • Sets deadline for State agencies to provide information to localities after General Assembly session (within 15 days) • The County is required to approve a budget by July 1 Budget process is a cooperative effort:

• Departments of the County • Community Agencies • School Board • Shenandoah Valley Social Services • Regional Agencies The budget is a cooperative effort that is affected by many components.

Departments/Schools/Regional entities draft a budget, Finance and Co. Admin compile a balanced budget within current revenue streams, the Board of Supervisors reviews and decides what to advertise. At the public hearing, the public input is shared with the Board of Supervisors and taken into consideration before approving the budget and setting a tax rate. The budget is set to be approved Wednesday, May 13, 2020.

School Funding Increase:

Formula Funding FY20 $ 44,197,758 Funding School Captial-Buses $ 1,080,000 Total Funding FY20 $ 45,277,758 FY20 Formula Funding $ 44,197,758 Formula Funding-Growth FY21 $ 1,346,575 Total Formula Funding FY21 $ 45,544,333 Plus Recurring CIP School Transfer-buses $ 1,080,000 Total Funding FY21 $ 46,624,333 The advertised proposed tax rates for 2020 are:

Rate per $100/assessed value as advertised:

2019 2020 Real Estate $0.63 $0.63 Personal Property:

Vehicles $2.50 $2.50 Other(1) $2.00 $2.00 Other(2) $2.50 $2.50 (1) Business, large trucks and trailers, machinery & tools (2) Campers, boats, boat trailers, horse trailers, airplanes and trailers.

Total revenue in the FY20 Budget: $202,177,315 Property Taxes $ 68,238,500 Local Revenue $ 41,878,649 State Revenue $ 80,038,528 Federal Rev. $ 11,175,452 Other(1) $ 846,186 (1)non-revenue receipts Expenditures for the FY20 Budget: $204,378,752 General Govt $ 4,957,761 Judicial $ 2,675,124 Public Safety $ 25,044,305 Public Works $ 4,634,556 Health & Welfare $ 20,421,062 Recreation $ 2,897,124 Community Dev. $ 2,293,133 Contributions $ 1,328,250 Education $123,313,948 School Capital Improv. $ 1,503,488 Debt Service $ 7,956,961 Capital Improvements $ 7,353,040 Creating a budget has been in process since December 2019. The advertised revenue estimates were completed prior to the COVID-19 crisis.

Potential Revenue Losses for FY20 Type of Tax Projected loss % Projected loss $ Sales 10% June only 60,000 Meals 50% x 3 months 350,000 Lodging 50% x 3 months 100,000 Business License (due N/A N/A 3/1/20) Interest Income 70%-Change in rate mid- 175,000 March Real Estate 1% decrease in collections 250,000 Penalty on Taxes Penalty 0% from 6/5-6/30 50,000 Interest on Taxes Rate reduced from 10% to 16,500 5%-6/5 to 6/30 Total 1,001,500 Proposed reductions for the FY20 budget include eliminating a capital transfer of $442,000.00 and reduce the FY20 operating expenses by $559,500 to include a hiring freeze, utilizing savings related to part time positions and non-personnel expenditure reductions.

Potential Revenue Losses FY21:

Type of Tax Projected % loss Projected $ loss Real Property 1% 460,560 Personal Property 5% 650,550 Sales 10% 640,000 Business License 25% 950,000 Lodging 25% 155,750 Meals 25% 637,500 All other 5% 1,699,387 Total 5,193,747 Ms. Carter asked for examples of what qualifies as all other.

Ms. Cook stated that all other would include penalty and interest for the property taxes.

Interest on investments is included in that category. There is also an allocation for state funding.

Proposed reductions for FY21 include the following:

• Eliminate proposed pay increase • Continue hiring freeze on all open positions and re-classes in the recommended FY21 budget • Reduce operating budgets of all departments by 5-10% • Reallocate one-time capital funding, previously allocated to the courthouse • Reduce regional contribution funding • Analysis of potential adjustments in services These proposed reductions do not affect any funding for the schools for FY21.

Mr. Fitzgerald stated that he is comfortable with the FY20 reductions. The FY21 budget is a harder goal to achieve. At the meeting in May, the Board will be considering the revised revenue numbers. This is an estimate. There is no way of knowing what the outcome will be. Also not included are the grant opportunities that will be available.

Ms. Carter asked what the references are that are being monitored to come up with projections.

Ms. Cook stated that Old Dominion University put out a survey based on the Commonwealth of Virginia with projections. That study will be updated periodically.

VGLMA also put out a study.

Mr. Shull asked if there were suggestions from the state of what may be cut from the budget.

Ms. Cook stated that there were no projections from the state to date.

Mr. Fitzgerald pointed out that the schools would be making changes due to state funding being reduced.

Mr. Fitzgerald gave the call in information for citizens to be able to call in during the public hearing.

The Chairman declared the public hearing on the FY20 revised and FY21 budget to be open.

Tracy Pyles of Churchville made the following statement via telephone:

I am glad for the opportunity to address the Board. I am hoping that the Board has a change of heart in priority. Over the years, there has been a tax increases placed upon the citizens of Augusta County that totals more the $7 million. This tax increase equates to more than $100.00 per taxpayer in Augusta County. That was wrong to do and needs to be reversed. The assessment increase is acceptable. It is reflective of inflation and growing businesses and that is appropriate to take. The tax rate increase was something that should not have happened. The people of Augusta County work hard and more is being taken from them than is needed. The additional money is being taken to build a courthouse. Mrs. Carter has stated that she wanted to hear from the people. The people spoke very solidly three years ago about not wanting a courthouse and $35 million. How that can be interpreted to a courthouse and $70 million defies all logic. Defies the ability to access what the people want and how they should deliver it.

This is taxation with poor representation. It is misrepresentation. When I look at the budget, I am not able to see the full budget, as I should be able to see as a member of the public. Many of the appendixes should have been included with details of where the money is going to go, but they are not. Ms. Cook spoke about the changes in revenue and that should have been included in the complete budget, but it was not.

We are going to weigh in on budget tonight that is irreverent in terms of what money is coming in and how it is going out. It is unfair to the people. We cannot speak knowledgably about the budget. It should be an open door. My belief is that you must return us back to $.58 tax rate. The $.63 is the largest in memory. When I was on the Board, $.58 was considered what we had to live within for a sufficient budget.

Everybody in the County has to limit what he or she gets. The ability to take people’s money should always be a last resort not a first resort. As we see what is going on in the Nation today, we know that the average person is being hurt. The Board talks about the hits the budget is going to have. What are the hits that the people are going have? The reason that the state budget is hurting is because the people are hurting.

You can go around the county and look at the people who are not having the same revenue they had before. Look at the agriculture people. Lamb sales are not happening because restaurants are not buying lambs. Milk is being thrown away throughout the country and the prices are not good. People are out of work. I have been on social security for ten years. The tax increases over the past two years have been greater than my increases in social security over the ten years of receiving it. We need to start thinking about the people and shared burdens. I have sent ideas on how to lower the cost more. We should not have three emergency centers. Offer early retirement to employees with thirty plus years of service. Cut as necessary to meet your income that the citizens can afford to pay. To do less is to renege on the promise to the people to look out for them. If your first message is to look out for the government, you are in the wrong business. Too many of us struggle in our lives trying to make ends meet. You need to bring your tax rate down. If you want to do what is right, you will reduce the tax rate and adjust your spending to that.

Robin Hawks of Mt. Sidney submitted the following email for public record:

Dear BOS and Mr. Fitzgerald: I am concerned that you are presenting a pre-COVID-19 budget proposal. You know that there will be significant cuts in state and local revenue. By submitting an unrealistic budget, you are essentially removing the taxpayer's ability to comment or express concern about where the cuts will occur. This process does not allow any access, oversight, or input from the public regarding the "real" budget. To remedy this, I am requesting that you hold another public hearing when the actual budget is formulated. The taxpayer is at the top of your organizational chart. I ask that you honor this position by committing to another public hearing on the budget as soon as the budget figures are known. For the record, please include these comments in the public hearing. Thank you.

By the way- I applaud your efforts to correct the technology problems of the last board meeting.

Barry DeLange submitted the following email for public record:

Dear BOS and Mr. Fitzgerald: I am concerned that you are presenting a pre-COVID-19 budget proposal. You know that there will be significant cuts in state and local revenue. By submitting an unrealistic budget, you are essentially removing the taxpayer's ability to comment or express concern about where the cuts will occur. This process does not allow any access, oversight, or input from the public regarding the "real" budget. To remedy this, I am requesting that you hold another public hearing when the actual budget is formulated. The taxpayer is at the top of your organizational chart. I ask that you honor this position by committing to another public hearing on the budget as soon as the budget figures are known. For the record, please include these comments in the public hearing. Thank you.

Kristina DeLange submitted the following email for public record:

Dear BOS and Mr. Fitzgerald: I am concerned that you are presenting a pre-COVID-19 budget proposal. You know that there will be significant cuts in state and local revenue. By submitting an unrealistic budget, you are essentially removing the taxpayer's ability to comment or express concern about where the cuts will occur. This process does not allow any access, oversight, or input from the public regarding the "real" budget. To remedy this, I am requesting that you hold another public hearing when the actual budget is formulated. The taxpayer is at the top of your organizational chart. I ask that you honor this position by committing to another public hearing on the budget as soon as the budget figures are known. For the record, please include these comments in the public hearing. Thank you.

There being no other speakers, the Chairman declared the public hearing closed.

END OF PUBLIC HEARINGS

AUGUSTA HEALTH CERTIFICATE OF PUBLIC NEED REQUEST RESOLUTION

The Board considered the following resolution:

WHEREAS, the County of Augusta, Virginia benefits greatly from a healthy community and the provision of healthcare services by Augusta Health; and WHEREAS, Augusta Health has been providing access to high quality medical care to our (residents/employees) for more than 25 years; and WHEREAS, Augusta Health has recognized an increasing need for additional diagnostic testing procedures for its patients; and WHEREAS, Augusta Health is perfectly positioned to establish a freestanding diagnostic testing facility on its campus to further serve ours and the surrounding communities; and WHEREAS, Augusta Health and its providers will be able to provide comprehensive outpatient diagnostic services with this facility and provide an enhanced level of care to its patients; and WHEREAS, Augusta Health strives to provide comprehensive, local care for its patients and this project will allow it to deliver a full complement of services for the local patient population in their home communities; now, therefore, be it RESOLVED by the County of Augusta, Virginia that it hereby supports and urges the Virginia State Health Commissioner to approve Augusta Health’s project and allow for the establishment of an outpatient diagnostic testing facility on its campus, thereby meeting the community need and expanding its ability to provide optimal care for its patients.

Mr. Fitzgerald stated that there has been a request from Augusta Health for the Board to adopt a resolution of support for a Certificate of Public Need. A memo was included in the agenda packet from Augusta Health in regards to the project. Augusta Health has a new strategic plan called, The Journey 2025 Plan and as part of that plan, they are going to develop a dedicated outpatient pavilion for surgical and breast care and imaging services. This will be on the hospital campus, but in a separate building. As part of the project, there is a 13,000 square foot imaging center on site. They would like to include an additional MRI unit and CT scanner unit in the imaging center. This would complement the CT’s and MRI’s that are in the current hospital. Because this is a freestanding facility, a lesser amount is taken from insurance companies, which would allow lower costs for the patient. The facility can be built without the Certificate of Public Need if the imaging devices were not involved. Support of the Board is requested for the Certificate of Public Need. There is also a support letter that will require Mr. Fitzgerald’s signature with Board authorization.

Ms. Carter stated that from what she has read, the area is adequately equipped with MRI and CT imaging. She would like to see a cost comparison that they are referencing as far as services being cheaper.

Dr. Seaton stated that by it being a freestanding facility you are only paying the one fee.

When the services are performed in the hospital, you are paying additional hospital fees as well the fee for the service. Dr. Seaton would like more information on the matter before making a decision. He is concerned with who owns the building and who will make the rules of operation within the facility.

AUGUSTA HEALTH CERTIFICATE OF PUBLIC NEED REQUEST RESOLUTION

Mr. Wells asked if there was a deadline.

Mr. Fitzgerald stated that there is a deadline of the first week of May for application submittal. Sentara has issued a COPN request as well. The Sentara request is for an MRI and a CT unit. This request is located at a facility in the City of Staunton. Sentara has made a request to the City of Staunton and Augusta Health has made a request to Staunton, Waynesboro and Augusta County. This will be a competitive project.

The Board agreed to move the resolution to the next Board of Supervisors meeting on May 13, 2020 to allow more information to be provided.

LIVESTOCK CLAIM

The Board considered a claim filed by Ricky Fridley in the amount of $150.00 Funding Source: Livestock Reimbursement Fund 35010-5802 $150.00 Mr. Fitzgerald stated that Chapter 5 of the County’s ordinance allows for the compensation of livestock or poultry that is killed by a dog. In the cases of the dog’s owner being unknown, the County reimburses the landowner for the incident. Under the current County code it is required that the Board determine the claim is supported by the investigation and the Animal Control Officer before payment is made. There was a case on Estaline Valley Road in Craigsville where a dog killed two kid goats. The Animal Control Officers have completed an investigation and determined it was a stray dog. Mr. Fitzgerald requests that the Ordinance Committee review this section of the code for possible changes in the future.

Mr. Shull pointed out a discrepcency in the paperwork.

Ms. Carter moved, seconded by Dr. Seaton, that the Board approve livestock claim amount with the paperwork corrected and completed appropriately.

Vote was as follows: Yeas: Garber, Carter, Wells, Shull, Slaven, Seaton and Morelli Nays: None Motion carried.

HERSHEY PERFORMANCE AGREEMENT

The Board considered the Hershey Performance Agreement-2019 Mr. Fitzgerald stated that on May 9, 2019 it was announced that Hershey Chocolate of Virginia committed to expand its operation in the County. Construction of the Peanut Roasting Center of Excellence would be a 111,000 square foot expansion. The expansion included $104.4 million investment in capital expenditures and 65 new jobs.

As part of the incentive package to secure the expansion, a $600,000 grant from the Commonwealth Opportunity Fund was given to Hershey as well as a $400,000 grant from the Virginia Investment Performance Program. The Board of Supervisors agreed to match these state grants with an additional $1 million. The County’s match was to be given in two parts; $300,000 when the Certificate of Occupancy was issued and $700,000 as a return on the company’s machinery and tools tax. The final performance agreement is completed and lays out how the incentive is paid out to Hershey. This performance agreement will satisfy the County’s commitment to Hershey Chocolate of Virginia for the expansion announced in 2019.

Mr. Morelli moved, seconded by Mr. Shull, that the Board approve performance agreement.

Vote was as follows: Yeas: Garber, Carter, Wells, Shull, Slaven, Seaton and Morelli Nays: None Motion carried.

WAIVERS–NONE

MATTERS TO BE PRESENTED BY THE BOARD

Ms. Carter sent an email to the Board asking them to identify needs in their district regarding COVID-19. She is asking for this information for the COVID-19 Community Task Force.

MATTERS TO BE PRESENTED BY STAFF

Timothy Fitzgerald, County Administrator discussed the following issues:

1) A resolution has been written in order to extend the real estate tax date from June 5 to June 26, 2020. Extending the deadline also effects penalty and interest. It is recommended that for 60 days beyond the June 26 deadline, the penalty would be 0% and the interest rate would be 5%. Currently it is 10% penalty and 10% interest if taxes are not paid on time. A public hearing is required to change the penalty and interest. Board authorization is needed to allow for advertising the public hearing.

RESOLUTION

At a regular meeting of the Board of Supervisors of Augusta County, Virginia (the “Board”), held in the Board Meeting Room in the Government Center at 18 Government Center Lane, Verona, Virginia on Wednesday, April 22, 2020, at which meeting a quorum was present and voting, the following resolution was adopted:

WHEREAS, as a result of the potential spread of COVID-19, a communicable disease of public health threat, the Governor of Virginia declared a state of emergency on March 12, 2020, and directed local governments to render appropriate assistance to prepare for this event, to alleviate any conditions resulting from the situation, and to implement recovery and mitigation operations and activities so as to return impacted areas to pre-event conditions as much as possible; and, WHEREAS, on March 13, 2020, the President of the United States declared a National Emergency beginning March 1, 2020, due to the outbreak of COVID-19; and, WHEREAS, on March 16, 2020, the Director of Emergency Management for Augusta County, in response to cases of COVID-19 and to prevent or alleviate the damage, loss, hardship, or suffering threatened by the potential spread of COVID-19, declared a local emergency. On April 8, 2020, the Board affirmed the Declaration, and said Declaration continues until the Board takes appropriate action to end the declared emergency; and, WHEREAS, pursuant to authority granted by Virginia Code Section 58.1-3916 of the Virginia Code, the Board has established by ordinance a due date of June 5 for the first of two equal installment payments of real property taxes, and pursuant to that same code section, the Board may further provide by resolution for reasonable extensions of time, not to exceed 90 days, for the payment of such taxes whenever good cause exists; and WHEREAS, the threat to the health, safety, and welfare of the citizens of Augusta County, Virginia, of a potential spread of COVID-19 resulted in national, state, and local declarations of emergency, and the economic circumstances resulting therefrom, constitute good cause; now, therefore be it RESOLVED, by the Board of Supervisors of Augusta County, Virginia, hereby extends the June 5, 2020 due date for the first installment payment of real property taxes until June 26, 2020, in accordance with its authority in Section 58.1-3916 of the Virginia Code.

Ms. Carter contacted several banks to find out how it works when taxes are paid. She was informed that whatever due date is on the tax bill is what and when they will pay.

Ms. Carter is not opposed to leaving the June 5 deadline because of this. She feels strongly that there should be zero penalty and zero interest for sixty days. This is the County’s way to offer citizens some type of relief during this time.

Mr. Shull asked how many homes were under the mortgages within the County.

Ms. Whetzel stated that approximately 70% would be paid through mortgage companies.

Mr. Fitzgerald stated that he has spoken with the Treasurer regarding the issue. One concern is if there is no penalty and no interest until August even with the due date at June 26 then citizens will wait until August to pay. This will cause revenue issues for the County.

Ms. Whetzel stated that if the penalty is zero and the interest rate is 5% between the due date of June 5 to June 30, revenue would be reduced by $16,500.00 for that period.

Dr. Seaton moved, seconded by Mr. Shull to adopt the resolution to change the tax due date to June 26, 2020.

Vote was as follows: Yeas: Garber, Carter, Wells, Shull, Slaven, Seaton and Morelli Nays: None Motion carried.

Ms. Carter moved, seconded by Dr. Seaton, that the Board approve advertising changes to eliminate the penalty and decrease the interest to 5% or less for sixty days.

Vote was as follows: Yeas: Garber, Carter, Wells, Shull, Slaven, Seaton and Morelli Nays: None Motion carried.

2) Staff is working hard. Mr. Fitzgerald and Ms. Whetzel joined in on a conference call with the Planning District Commission in regards to multiple grant opportunities because of COVID-19.

Mr. Garber stated that Staff is busy on a daily basis keeping up with the rule changes and how that effects the County.

MATTERS TO BE PRESENTED BY THE PUBLIC –NONE

CLOSED SESSION

On motion of Ms. Carter, seconded by Mr. Shull, the Board went into closed session pursuant to:

(1) the personnel exemption under Virginia Code § 2.2-3711(A)(1) [discussion, consideration or interviews of (a) prospective candidates for employment, or (b) assignment, appointment, promotion, performance, demotion, salaries, disciplining or resignation of specific employees]:

a) Boards and Commissions: Youth Commission, Economic Development Authority, Ag & Forestal Dist., Planning Commission, Shenandoah Workforce Development (2) the economic development exemption under Virginia Code § 2.2-3711(A)(5) [discussion concerning a prospective business or industry or the expansion of an existing business or industry where no previous announcement has been made of its interest in locating or expanding its facilities in the county]:

a) Proposed Office space, flex space, storage facilities, manufacturing facilities, utility and mixed use development.

(3) the real property exemption under Virginia Code § 2.2-3711(A)(3) [discussion of the acquisition for a public purpose, or disposition, of real property]:

a) Verona Elementary School (4) the legal counsel exemption under Virginia Code § 2.2 3711(A)(7) Consultation with legal counsel and briefings by staff members or consultants pertaining to actual or probable litigation, where such consultation or briefing in open meeting would adversely affect the negotiating or litigating posture of the public body. For the purposes of this subdivision, "probable litigation" means litigation that has been specifically threatened or on which the public body or its legal counsel has a reasonable basis to believe will be commenced by or against a known party. Nothing in this subdivision shall be construed to permit the closure of a meeting merely because an attorney representing the public body is in attendance or is consulted on a matter.

a) Payment of water and sewer connection On motion of Ms. Carter, seconded by Mr. Shull, the Board came out of Closed Session.

Vote was as follows: Yeas: Garber, Carter, Wells, Shull, Slaven Seaton and Morelli Nays: None Motion carried.

The Chairman advised that each member is required to certify that to the best of their knowledge during the closed session only the following was discussed:

Public business matters lawfully exempted from statutory open meeting 1. requirements, and 2. Only such public business matters identified in the motion to convene the executive session.

The Chairman asked if there is any Board member who cannot so certify.

Hearing none, the Chairman called upon the County Administrator/ Clerk of the Board to call the roll noting members of the Board who approve the certification shall answer AYE and those who cannot shall answer NAY.

Vote was as follows: Yeas: Garber, Carter, Wells, Shull, Slaven Seaton and Morelli Nays: None Motion carried.

The Chairman authorized the County Administrator/Clerk of the Board to record this certification in the minutes.

BOARDS AND COMMISSIONS

Dr. Seaton moved, seconded by Mr. Shull, that the Board appoint Robert Thomas to serve an unexpired term to the Planning Commission. Effective immediately and to expire on June 30, 2020.

Vote was as follows: Yeas: Garber, Carter, Wells, Shull, Slaven Seaton and Morelli Nays: None Motion carried.

ADJOURNMENT

There being no other business to come before the Board, Ms. Carter moved, seconded by Mr. Morelli that the Board adjourn subject to call of the Chairman.

Vote was as follows: Yeas: Garber, Carter, Wells, Shull, Slaven Seaton and Morelli Nays: None Motion carried.

Chairman County Administrator h:04-22min.2020