Special Meeting – May 2, 2012

Special Meeting, Wednesday, May 2, 2012, at 7:00 p.m. Government Center, Verona, VA.

PRESENT: Tracy C. Pyles, Jr., Chairman
Jeffrey A. Moore, Vice-Chairman
David R. Beyeler
David A. Karaffa
Marshall W. Pattie
Michael L. Shull
Larry J. Wills
Timmy Fitzgerald, Director of Community Development
Jennifer M. Whetzel, Director of Finance
Patrick J. Morgan, County Attorney
John C. McGehee, Assistant County Administrator
Patrick J. Coffield, County Administrator
Rita R. Austin, CMC, Executive Secretary

VIRGINIA: At a special meeting of the Augusta County Board of Supervisors held on Wednesday, May 2, 2012, at 7:00 p.m., at the Government Center, Verona, Virginia, and in the 236th year of the Commonwealth….

Chairman Pyles welcomed the citizens in the audience and asked that a form be completed by anyone who plans to speak.

Dr. Chuck Bishop, Augusta County Schools Superintendent, led the Pledge of Allegiance.

David A. Karaffa, Supervisor for the Beverley Manor District, delivered the invocation.

Chairman Pyles explained tonight’s procedures with the following comment:

The purpose of this Special Meeting tonight is strictly for the budget. We have gone through a process, several months of Staff putting together information; us meeting with Staff; us putting together a tentative budget; presenting it to the public and having the public respond to it. Tonight we will take definitive action on that budget. There are three items on the agenda and the first is to look at the Revised Budget for FY2011-2012.

Jennifer M. Whetzel, Director of Finance, reiterated that this has been a process. On March 26th and 28th, the Board met and reviewed the revenues and expenditures. A list had been provided to be considered for advertisement. On April 4th, it was decided what the advertised tax rates would be as follows:

Real Estate 51¢(3¢ inc.) Vehicles and Motorcycles Tangible Personal Property $2.57 (32¢ inc.) Machinery and Tools and all other Tangible Personal Property $1.90 It also showed what the total school funding would be based on what has been advertised. The appropriations before the Board tonight are based on the advertised budget. The total revised budget would be $216,244,291 which would include transfers between the funds. The total FY 2013 Proposed Budget would be $211,445,542. If the Board makes changes from the advertised budget, it should be noted in the motion “as amended” and the appropriations approved tonight will be reflected in the minutes.

REVISED BUDGET FOR FY2011-2012

The Board considered revised budget for Fiscal Year 2011-2012.

Mr. Wills moved, seconded by Mr. Beyeler, that the revised budget and appropriations for the fiscal year 2011-12, as presented at the public hearing held on April 18, 2012, and as revised, be approved.

BE IT RESOLVED by the Board of Supervisors of the County of Augusta, Virginia, that the following appropriation be made for the fiscal year 2011-2012 from the funds and for the functions or purposes indicated:

BE IT FURTHER RESOLVED that the Treasurer be, and is hereby authorized to transfer to other funds from the GENERAL OPERATING FUND from time to time as money becomes available, sums equal to, but not in excess of the appropriations made to these funds from GENERAL OPERATING FUND for the period covered by the appropriation.

BE IT STILL RESOLVED that the County Administrator is authorized, pursuant to a resolution adopted by this Board of Supervisors on November, 11, 1959, to pay all normal and routine claims, when presented for which appropriations are hereinafter made, with his own warrant.

GENERAL OPERATING FUND

11010 BOARD OF SUPERVISORS 167,290

12010 COUNTY ADMINISTRATOR 611,750

12030 PERSONNEL 172,745

12040 LEGAL SERVICES 233,855

12090 COMMISSIONER OF REVENUE 771,795

12130 TREASURER 545,430

12150 CENTRAL ACCOUNTING 326,295

12200 MANAGEMENT INFORMATION SYSTEMS 508,090

13010 BOARD OF ELECTIONS 257,715

21010 CIRCUIT COURT 89,150

21020 GENERAL DISTRICT COURT 5,600

21030 MAGISTRATE 3,025

21060 CLERK OF THE CIRCUIT COURT 720,605

22010 COMMONWEALTH ATTORNEY 884,770

31020 SHERIFF 5,159,080

31040 EMERGENCY SERVICES OPERATIONS 1,562,515

32010 FIRE DEPARTMENT 3,770,156

32020 EMERGENCY SERVICES – VOLUNTEERS 1,742,556

32030 FIRE TRAINING CENTER 262,225

33030 J&D COURT 40,425

33040 COURT SERVICES 2,750

33050 JUVENILE & PROBATION 1,356,000

34010 BUILDING INSPECTIONS 408,865

35010 ANIMAL CONTROL 358,625

41020 HIGHWAYS & ROADS 12,000

41040 STREET LIGHTS 114,000

42010 SANITATION & WASTE 1,808,570

42020 RECYCLING 141,750

43010 BUILDING & GROUNDS 1,279,440

51010 HEALTH DEPARTMENT 501,000

51020 TAX RELIEF FOR THE ELDERLY 263,000

71010 PARKS & REC 1,367,010

71020 NATURAL CHIMNEYS 173,895

73010 LIBRARY-FISHERSVILLE 1,086,330

73020 LIBRARY-CHURCHVILLE 102,115

81010 COMMUNITY DEVELOPMENT 883,760

81020 TOURISM 197,460

81050 ECONOMIC DEVELOPMENT 180,610

82010 ENVIRONMENTAL MGMT. SYSTEMS 61,565

83010 EXTENSION OFFICE 87,950

83050 COUNTY FARM 13,000

92020 OTHER OPERATIONAL FUNCTIONS 887,447

92030 CONTRIBUTIONS 306,196

92040 CONTINGENCIES 55,000

94000 TRANSFERS TO OTHER FUNDS 46,807,037

GRAND TOTAL – GENERAL OPERATING FUND (11) 76,290,447

FROM: Fire Revolving Loan Fund (12) TO: Fire Revolving Loan Fund (12) 50000 Disbursement of Loans 0 Grand Total – Fire Revolving Loan Fund (12) 0 FROM: Drug Enforcement Fund (13) TO: Drug Enforcement Fund (13) 31030 – Operations 184,005 Grand Total – Drug Enforcement Fund (13) 184,005 FROM: Economic Development Fund (14) TO: Economic Development Fund (14) 53000 – Payments to E.D.A. 88,000 Grand Total – Industrial Development Fund (14) 88,000 FROM: Revenue Recovery Fund (15) TO: Revenue Recovery Fund (15) 32020 – Payments to Agencies 553,600 94000 – Transfers to Other Funds 122,000 Grand Total – Revenue Recovery Fund (15) 675,600 FROM: Virginia Public Assistance Fund (23) TO: Virginia Public Assistance Fund (23) For the operation of the Augusta County Department of Public Welfare, Virginia Public Assistance Fund and to be expended only on order of the Board of Welfare for the functions and objects as outlined in the budget requests as presented to the Board of Supervisors for informative and fiscal purposes only:

53010 – Administration 7,181,500 53020 – Public Assistance 3,005,000 53070 – Family Resource Center 220,000 Grand Total – Virginia Public Assistance Fund (23) 10,406,500 FROM: Comprehensive Services Act Fund (24) TO: Comprehensive Services Act Fund (24) 53060 – Comprehensive Services 3,390,000 Grand Total – Comprehensive Services Act Fund (24) 3,390,000 FROM: School Operating Fund (41) TO: School Operating Fund (41) For the operation of the Public Schools of the School Operating Fund (41) and to be expended only on order of the Augusta County School Board of Augusta County, Virginia, for the functions and objects a contained in their budget requests as presented to the Board of Supervisors for financial and fiscal purposes:

11000 – Instruction 73,030,753 20000 – Admin/Attend/Health 2,922,405 30000 – Pupil Transportation 5,651,929 40000 – Operation/Maintenance 10,201,872 Grand Total – School Operating Fund (41) 91,806,959 FROM: School Cafeteria Fund (43) TO: School Cafeteria Fund (43) To be expended on order of the Augusta County School Board for the operation of the School Cafeteria Fund:

50000 – School Food Services 4,673,705 Grand Total – School Cafeteria Fund (43) 4,673,705 FROM: School Capital Improvement Fund (44) TO: School Capital Improvement Fund (44) 62320 – Wilson Elementary 7,491,894 62500 – Special Capital Projects (High Schools) 245,079 Grand Total – School Capital Improvement Fund (44) 7,736,973 FROM: School Debt Fund (45) TO: School Debt Fund (45) 92050 – Debt Service 8,855,303 Grand Total – School Debt Service (45) 8,855,303 FROM: Head Start Fund (47) TO: Head Start Fund (47) 10000 – Instruction 1,743,856 20000 – Admin/Attend/Health 366,740 30000 – Pupil Transportation 60,131 40000 – Maintenance Services 74,019 Grand Total – Head Start Fund ( 47) 2,244,746 FROM: Governor's School Fund (48) TO: Governor's School Fund (48) 11000 – Instruction 1,205,277 40000 – Operations/Maintenance 31,200 Grand Total – Governor's School Fund (48) 1,236,477 FROM: County Capital Improvement Fund (70) TO: County Capital Improvement Fund (70) 8005 – Landfill 964,000 8011- Infrastructure – Beverley Manor 50,000 8012 – Infrastructure – Middle River 50,000 8013 – Infrastructure – North River 50,000 8014 – Infrastructure – Pastures 50,000 8015 – Infrastructure – Riverheads 50,000 8016 – Infrastructure – South River 50,000 8017 – Infrastructure – Wayne 50,000 8021 – Matching Grants – Beverley Manor 5,000 8022 – Matching Grants – Middle River 5,000 8023 – Matching Grants – North River 5,000 8024 – Matching Grants – Pastures 5,000 8025 – Matching Grants – Riverheads 5,000 8026 – Matching Grants – South River 5,000 8027 – Matching Grants – Wayne 5,000 8049 – Electoral Board-Voting Machines 65,938 8053 – Library – Automation 70,284 8057 – Fire Apparatus & Equipment 15,087 8134 – County School 304,299 8141 – Geographical Information System 97,304 8144 – Information Technology 697,482 8145 – Economic Development 200,000 8149 – A.C.S.A.Contribution 200,000 8151 – Flood Control Dams 51,775 8152 – Fire & Rescue Equipment 200,000 8161 – Blue Ridge Community College 85,000 8162 – Secondary Roads – Revenue Sharing 500,000 8165 – Homeland Security-Local 309,774 8166 – Vehicle Sinking Fund 966,017 8198 – Building Sinking Fund 392,642 94000 – Transfers To Other Funds 1,270,974 Grand Total – Capital Improvement Fund (70) 6,775,576 GRAND TOTAL – APPROPRIATIONS (All Funds) 214,364,291 Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles Nays: None Motion carried.

PROPOSED BUDGET FOR FY2012-2013

The Board considered proposed budget for Fiscal Year 2012-2013 as presented at a public hearing held on April 18, 2012.

Mr. Wills moved, seconded by Mr. Moore, that the Board remove all the items that were added to Mr. Coffield’s original budget from the budget to allow for the Board to discuss them individually.

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles Nays: None Motion carried.

* * *

1. VRS 5.7%/5% – $286,500

Mr. Moore, moved, seconded by Mr. Karaffa, that the Board include in budget for FY2012-2013.

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles Nays: None Motion carried.

* * * 2. Contract Services – $30,000 Mr. Beyeler stated that, at times the County Attorney may need legal assistance. It is understood that if not needed, it will not be expended.

Mr. Karaffa moved, seconded by Mr. Beyeler, that the Board include in budget for FY2012-2013.

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles Nays: None Motion carried.

* * * 3. Business Auditor (Commissioner of Revenue) – $16,800 Mr. Wills moved, seconded by Mr. Shull, that the Board remove from budget for FY2012-2013.

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, and Pyles Nays: Beyeler Motion carried.

* * * 4. Sheriff Deputies (2) – $90,600 Mr. Beyeler moved, seconded by Mr. Wills, that the Board remove from budget for FY2012-2013.

Vote was as follows: Yeas: Pattie, Shull, Wills, Moore, Beyeler and Pyles Nays: Karaffa Motion carried.

* * * 5. ECC Position – $43,900 Mr. Wills moved, seconded by Mr. Karaffa, that the Board remove from budget for FY2012-2013.

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles Nays: None Motion carried.

6. Fire and Rescue – Captain – $77,400 Mr. Beyeler moved, seconded by Mr. Wills, that the Board remove from budget for FY2012-2013.

Mr. Pattie stated that the Fire Chief recommended 14 positions; the Board had decided on 4 (unanimous vote). “Nothing has changed as far as safety in the need of our citizens.” Mr. Karaffa pointed out that a recent administrative hire had been made: Deputy Chief.

Vote was as follows: Yeas: Karaffa, Shull, Wills, Moore and Beyeler Nays: Pattie and Pyles Motion carried.

* * * 7. Mt. Solon Firefighters (3) – $182,500 Mr. Pattie moved, seconded by Mr. Karaffa, that the Board include in budget for FY2012-2013.

Mr. Pattie pointed out that the County has 58 paid personnel and that each supervisor represents 10,000 citizens and that there is not one paid position in North River. “There is a glaring need in Mt. Solon and Fire and Rescue staff puts this as their top priority.” Vote was as follows: Yeas: Pattie, Karaffa, Moore and Pyles Nays: Shull, Beyeler and Wills Motion carried.

* * * 8. Training – $28,000 Mr. Wills moved, seconded by Mr. Beyeler, that the Board remove from budget for FY2012-2013.

Ms. Whetzel clarified that this was not a position; it is changes in the training standards by the state.

Mr. Wills withdrew motion.

Mr. Karaffa moved, seconded by Mr. Shull, that the Board include in budget for FY2012- 2013.

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles Nays: None Motion carried.

* * *

9. OMD – $3,000

Mr. Karaffa moved, seconded by Mr. Moore, that the Board remove from budget for FY2012-2013.

Mr. Beyeler felt that the OMD needed an increase in pay. Mr. Karaffa felt that, while this pay increase may be deserved, they are looking at severe cuts across the board.

Vote was as follows: Yeas: Karaffa, Shull, Wills and Moore Nays: Beyeler, Pattie and Pyles Motion carried.

* * * 10. Pay for Participation – $232,000 Chairman Pyles explained that this is funding to establish an incentive program for the Volunteers. Mr. Beyeler stated that the $232,000 is the equivalent of four positions. “If we can get additional volunteers, it’s a whole lot cheaper than paying for additional paid firemen.” Mr. Beyeler moved, seconded by Mr. Shull, that the Board include in proposed budget for FY2012-2013. Mr. Wills suggested that the motion be amended to state that the money be set aside and approval would have to be made by the Board for actual expenditure.

Mr. Karaffa added, if approved, he would like to see this not go into a county-wide program but be set up as a pilot program to determine how successful it might be.

Chairman Pyles said that he would prefer the motion remain as stated rather than encumber it with stating that it be a pilot program.

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles Nays: None Motion carried, as amended.

* * * 11. Riverheads Volunteer Contribution – $22,195 Mr. Shull moved, seconded by Mr. Moore, that the Board remove from budget for FY2012-2013.

Vote was as follows: Yeas: Pattie, Shull, Wills, Moore and Pyles Nays: Karaffa and Beyeler Motion carried.

* * * 12. Economic Development Travel – $3,250 Mr. Beyeler stated that it is hard to gauge travel expenses.

Mr. Beyeler moved, seconded by Mr. Karaffa, that the Board include in budget for FY2012-2013.

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles Nays: None Motion carried.

* * * 13. Company 10 Contribution – $21,798 Mr. Karaffa moved, seconded by Mr. Wills, that the Board restore Company 10’s funding to $31,798 ($10,000 had already been approved), and that it be included in proposed budget for FY2012-2013 ($21,798 additional).

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore and Beyeler Nays: Pyles Motion carried.

* * * 14. Reassessment – $408,000 Mr. Wills moved, seconded by Mr. Beyeler, that the reassessment money be taken from budget fund balance and not be placed within the budget itself.

Mr. Wills noted that this would not be a reoccurring expense. Ms. Whetzel explained that it is in the 2013 budget but will be coming out of Fund Balance.

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles Nays: None Motion carried.

* * * 15. North River Salary/Infrastructure Account Mr. Pattie moved, seconded by Mr. Karaffa, that the Board approve the allocation of his deferred salary to be placed in the North River Infrastructure Account (Account #80000- 8013).

Mr. Beyeler made the following comment:

When a person runs for a position and commits to his community that he is not going to accept any monies for his services, then comes back within less than six months and wants us to add that so he can put it in his infrastructure account in that area without taxes, I will oppose.

Mr. Pattie made the following comment:

It makes no sense to send it to the Federal government and send it to the State government, take taxpayer money that they paid into the local budget, remove $3,000 to $4,000 of that and then give them the remaining part. What I want to do with that money, is every year, I want to help my community and put money into my community rather than putting money into my pockets. What I would like to do with that money specifically is to help start a library branch in Mount Solon. This isn’t going to profit me at all. What you’re suggesting is that I take $3,000 or $4,000, give it to another government agency, rather than giving it back to our own taxpayers who provided it to us.

Mr. Beyeler’s response:

No, what I’m suggesting is that you take the money in salary, which you said you wouldn’t, and then you pay taxes just like the rest of us do and then, whoever you want to give it to, you are allowed to do so. But to do it the other way, we’re always trying to find people who want to not pay taxes on income that are paid to them.

Mr. Pattie’s response:

It would be a tax deduction, anyway, so it wouldn’t matter. It would be a wash.

Mr. Beyeler’s response:

You’re talking about a library in your area which is not in the budget. If we start it, then it is a continuous expense in that area. That isn’t what you ran on.

Mr. Pattie’s response:

It’s exactly what I ran on.

Chairman Pyles made the following comment:

Unfortunately, I’ve seen this Board bring up new things in a budget in the middle of the year. We did Greenville Fire Department, which we hadn’t planned to do and it is an ongoing expense. It’s not unheard of and to think a man is giving up his own salary for the benefit of his people, I find that hard to fault.

Vote was as follows: Yeas: Pattie, Karaffa, Wills, Moore and Pyles Nays: Beyeler and Shull Motion carried.

* * * 16. Schools – $580,000 Mr. Wills made the following comment:

In regards to the distribution on this, looking at the Schools’ funding, in the original proposal from Mr. Coffield, there was about $800-and some thousand that was non- reoccurring revenue. I think we need to readjust that and make it the $580,000 as non- reoccurring revenue that would come from our Capital Account and allow the schools to use it as the Superintendent outlined in his proposal to us. That leaves them fully funded for the year, as we suggested the $3 million, and it allows the schools to use the capital as he had requested and it takes it to a one-time expense for us rather than a reoccurring one. In other words, I would like to split it up so that the reoccurring revenue is truly that—reoccurring revenue. Whether it comes from tax increases, or whether it comes from our CIP, we will determine that.

Chairman Pyles:

I would think, on this, we’re working on the funding and we can direct whether it goes into Capital or Operating, but the next part of our agenda will be setting the tax rate and then that would come up.

Mr. Wills’ response:

We need to clarify that this is part of the budget and where it comes from. I would think that we would need to move that $580,000 from our Capital into their Capital and it not become part of the Operating Budget either for the schools or for the County.

Mr. Karaffa made the following comment:

I would respectfully request that we amend the motion. I believe that we need to give the School Board some direction with where their reoccurring funds are coming from and where their capital funds are going to total the $3 million. Could we discuss this after we have decided on the tax rate?

Mr. Wills’ response:

If it is the will of the Board. I just want to make sure that we get this balanced out and know where it’s coming from.

Chairman Pyles asked for clarification.

Mr. Wills’ clarification:

Basically, in the budget proposed by Mr. Coffield, he was moving $850,000 from non- reoccurring CIP to the Schools. What I’m saying is, instead of $850,000, that number should be $580,000 as non-reoccurring and the balance of the $3 million should be from reoccurring sources.

Chairman Pyles’ response:

You can’t say that at this point. You can suggest it, but we’re just voting on spending the money and then we’ll come up with how we’re going to fund it. The budget is two different issues: One is the revenue, and one is expenses. We’re determining expenses now.

Mr. Wills’ response:

I’m saying this expense needs to be non-reoccurring. We need to have less non- reoccurring expense going to the schools.

Chairman Pyles was unclear as to how the motion should be done.

Mr. Wills moved, seconded by Mr. Moore, that the Board direct the County Administrator to devy up the funds from CIP reoccurring and from CIP non-reoccurring accounts.

Chairman Pyles asked if the County Administrator understood the motion.

Patrick J. Coffield, County Administrator, responded that he understood.

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles Nays: None Motion carried.

Mr. Karaffa clarified that this would not affect the state money that the Schools are receiving.

Mr. Wills made the following comment:

I would like to make a point on this and for the public’s benefit to understand that in light of the concern raised by members of this Board and raised by a few members of the public at our public hearing to reduce the amount of proposed tax increases. What we have done tonight and what we have so far included in the budget, we do not have in the budget items such as our District Infrastructure Accounts; our Matching Parks and Recreation grants; any money in the budget to assist the Service Authority with extension of lines or any other project that may be in there. We do not have money in the budget to do VDOT Revenue Sharing, where we can get a 50-50 grant. We do not have money in the budget for Stormwater Management. We do not have money in the budget for Flood Control Dams.

These are all items that have been cut from this budget in order to try to meet and stay within the guidelines that the public has requested.

* * * Mr. Moore asked Ms. Whetzel for the revised increase. Ms. Whetzel said it would be $794,440. She noted that, with a tax increase, that would automatically be split 50-50 with the Schools which could be applied to reduce dependence of non-reoccurring funding. She reiterated that if taxes are raised, there is a growth formula with the schools that automatically split any increase 50-50 with the schools.

Mr. Karaffa asked if his clarification was correct of allocating $3 million to the Schools (some of it reoccurring); if the Board were to raise taxes, he asked if it would be inconsistent with the formula that they would take from the reoccurring revenue already used to fund the $3 million and that the matching money would take its place. “In essence, we have already given the schools an advance on any kind of tax increase that may be coming.” Chairman Pyles added that “this increases the amount that comes from growth.” Ms. Whetzel agreed.

Mr. Wills moved, seconded by Mr. Karaffa, that the proposed budget and appropriations for the fiscal year 2012-13, as presented at the public hearing held on April 18, 2012, and as revised, be approved.

BE IT RESOLVED by the Board of Supervisors of the County of Augusta, Virginia, that the following appropriation be made for the fiscal year 2012-2013 from the funds and for the functions or purposes indicated:

GENERAL OPERATING FUND

11010 BOARD OF SUPERVISORS 155,447

12010 COUNTY ADMINISTRATOR 545,590

12030 PERSONNEL 177,890

12040 LEGAL SERVICES 236,155

12090 COMMISSIONER OF REVENUE 769,830

12100 REASSESSMENT 408,000

12130 TREASURER 525,460

12150 CENTRAL ACCOUNTING 359,635

12200 MANAGEMENT INFORMATION SYSTEMS 615,345

13010 BOARD OF ELECTIONS 243,810

21010 CIRCUIT COURT 93,340

21020 GENERAL DISTRICT COURT 5,600

21030 MAGISTRATE 3,975

21060 CLERK OF THE CIRCUIT COURT 755,225

22010 COMMONWEALTH ATTORNEY 931,510

31020 SHERIFF 5,302,105

31040 EMERGENCY SERVICES OPERATIONS 1,550,185

32010 FIRE DEPARTMENT 4,191,235

32020 EMERGENCY SERVICES – VOLUNTEERS 2,015,941

32030 FIRE TRAINING CENTER 283,820

33030 J&D COURT 14,435

33040 COURT SERVICES 2,800

33050 JUVENILE & PROBATION 1,343,720

34010 BUILDING INSPECTIONS 387,865

35010 ANIMAL CONTROL 369,025

41020 HIGHWAYS & ROADS 19,950

41040 STREET LIGHTS 116,000

42010 SANITATION & WASTE 1,810,330

42020 RECYCLING 145,750

43010 BUILDING & GROUNDS 1,357,190

51010 HEALTH DEPARTMENT 516,300

51020 TAX RELIEF FOR THE ELDERLY 263,000

71010 PARKS & REC 1,400,405

71020 NATURAL CHIMNEYS 175,175

73010 LIBRARY-FISHERSVILLE 1,089,670

73020 LIBRARY-CHURCHVILLE 105,545

81010 COMMUNITY DEVELOPMENT 929,345

81020 TOURISM 195,960

81050 ECONOMIC DEVELOPMENT 211,259

82010 ENVIRONMENTAL MGMT. SYSTEMS 44,905

83010 EXTENSION OFFICE 94,660

83050 COUNTY FARM 13,000

92020 OTHER OPERATIONAL FUNCTIONS 762,640

92030 CONTRIBUTIONS 316,012

92040 CONTINGENCIES 70,489

94000 TRANSFERS TO OTHER FUNDS 44,282,442

GRAND TOTAL – GENERAL OPERATING FUND (11) 75,207,970

FROM: Fire Revolving Loan Fund (12) TO: Fire Revolving Loan Fund (12) 50000 Disbursement of Loans 505,000 Grand Total – Fire Revolving Loan Fund (12) 505,000 FROM: Drug Enforcement Fund (13) TO: Drug Enforcement Fund (13) 31030 – Operations 95,620 Grand Total – Drug Enforcement Fund (13) 95,620 FROM: Economic Development Fund (14) TO: Economic Development Fund (14) 53000 – Payments to E.D.A. 74,000 Grand Total – Industrial Development Fund (14) 74,000 FROM: Revenue Recovery Fund (15) TO: Revenue Recovery Fund (15) 32020 – Payments to Agencies 578,300 94000 – Transfers to Other Funds 164,000 Grand Total – Revenue Recovery Fund (15) 742,300 FROM: Virginia Public Assistance Fund (23) TO: Virginia Public Assistance Fund (23) For the operation of the Augusta County Department of Public Welfare, Virginia Public Assistance Fund and to be expended only on order of the Board of Welfare for the functions and objects as outlined in the budget requests as presented to the Board of Supervisors for informative and fiscal purposes only:

53010 – Administration 7,422,022 53020 – Public Assistance 2,737,000 53070 – Family Resource Center 285,000 Grand Total – Virginia Public Assistance Fund (23) 10,444,022 FROM: Comprehensive Services Act Fund (24) TO: Comprehensive Services Act Fund (24) 53060 – Comprehensive Services 3,500,000 Grand Total – Comprehensive Services Act Fund (24) 3,500,000 FROM: School Operating Fund (41) TO: School Operating Fund (41) For the operation of the Public Schools of the School Operating Fund (41) and to be expended only on order of the Augusta County School Board of Augusta County, Virginia, for the functions and objects a contained in their budget requests as presented to the Board of Supervisors for financial and fiscal purposes:

11000 – Instruction 73,654,278 20000 – Admin/Attend/Health 2,960,525 30000 – Pupil Transportation 5,516,692 40000 – Operation/Maintenance 8,955,728 Grand Total – School Operating Fund (41) 91,087,223 FROM: School Cafeteria Fund (43) TO: School Cafeteria Fund (43) To be expended on order of the Augusta County School Board for the operation of the School Cafeteria Fund:

50000 – School Food Services 4,713,225 Grand Total – School Cafeteria Fund (43) 4,713,225 FROM: School Capital Improvement Fund (44) TO: School Capital Improvement Fund (44) 62320 – Wilson Elementary 6,728,561 Grand Total – School Capital Improvement Fund (44) 6,728,561 FROM: School Debt Fund (45) TO: School Debt Fund (45) 92050 – Debt Service 9,094,960 Grand Total – School Debt Service (45) 9,094,960 FROM: Head Start Fund (47) TO: Head Start Fund (47) 10000 – Instruction 1,776,198 20000 – Admin/Attend/Health 351,827 30000 – Pupil Transportation 60,474 40000 – Maintenance Services 29,807 Grand Total – Head Start Fund ( 47) 2,218,306 FROM: Governor's School Fund (48) TO: Governor's School Fund (48) 11000 – Instruction 1,233,089 40000 – Operations/Maintenance 31,200 Grand Total – Governor's School Fund (48) 1,264,289 FROM: County Capital Improvement Fund (70) TO: County Capital Improvement Fund (70) 8057 – Fire Apparatus & Equipment 16,350 8139 – Tourist Information Center 10,000 8152 – Fire & Rescue Equipment 200,000 8161 – Blue Ridge Community College 85,000 8198 – Building Sinking Fund 253,376 94000 – Transfers To Other Funds 2,162,156 Grand Total – Capital Improvement Fund (70) 2,726,882 GRAND TOTAL – APPROPRIATIONS (All Funds) 208,402,358 Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles Nays: None Motion carried.

2012 TAX RATES

The Board considered adoption of real and personal tax rates for 2012, as proposed at a public hearing held on April 18, 2012.

The Board had directed staff to advertise the draft budget with the following tax rates:

Real Estate 51¢ (current 48¢) Mr. Karaffa moved, seconded by Mr. Shull, that the Board approve a Real Estate tax rate of 48¢.

Mr. Moore made the following comment:

I would just like to bring up a couple of points. Rockingham, who is our County to the very north of us, just approved a budget going from 60¢ to 64¢. City of Staunton has just approved a budget to go from 90¢ to 95¢ and Waynesboro has not adopted theirs, but it is based on a recommendation of going from 70¢ to 78¢. With all the people that came in here and said that we should not raise taxes. Just about every one of them talked about Federal government and State government not spending money wisely and that is not really what we’re talking about here. What we’re talking about is our local government trying to provide the services that we need. The 48¢ is half of what the City of Staunton is and I cannot imagine that we’re twice as good in what we do as the City of Staunton is. I think we do a good job here and it comes to a point that you have got to be able to fund the services that you have. We just added almost $800,000 of reoccurring money to our budget. I know there is a feeling that we can make this up in taking it out of reserves because things are going to get better, but I can tell you there is a lot of people on Wall Street right now that would love to have that reassurance because nobody really knows what is going to happen. I think the prudent thing is to make sure that you are supporting those things being important with reoccurring revenue. What is really shocking to me: Rockingham, which has a higher tax rate, funds their School Board an additional $714 per student over us. For every student, 11,412, that they have in their system, they get an additional $714 per student. When you start talking about teacher pay and technology and buses and all the parts that go into having a good school system, that comes into a considerable amount of money. I’m very proud that we committed to the $3 million, but I really think that we’re to the point that we’re not holding ground anymore; we’re going in the wrong direction. I would like to think that this Board would be willing to move the County forward instead of just trying to stay where we’re at.

Mr. Karaffa made the following statement:

I would just like to make the point that Augusta County went through a rough reassessment process and that I believe that any change in the real estate tax rates at this point in time with the uneasiness of our real estate tax assessment, or reassessment, would not be prudent. Again, we’ll have a new reassessment on the books in January of 2014. We’ve already hired the company. I think the Board has shown considerable progress forward in how fast that we have moved on the reassessment and the path and direction that we’re taking.

Mr. Beyeler made the following comment:

There has been a lot of discussion about the old assessment. I’m not saying it is 100% correct, but I think some members on this Board is going to get a real shock when we get our new one because what they’re hoping for, I don’t think we’re going to get. Property is based on a willing buyer and a willing seller and whether you have a whole lot more on the real estate side, or the house side, or building, it’s a total. I think we’re going to find out that our assessment is not that far off. The other thing is we’re pulling money out of the reserves. One thing that doesn’t show up, and I bring up every time, is we’re falling a million dollars more behind on retirement. In this year’s budget, in this one we’re proposing, we’re going to fall back probably $1 million. Where will that money come from? I don’t like to pay anymore taxes than I have to, either. I do pay a good bit more taxes than some of you. The only thing that I can compare in what we’re doing is we’re doing exactly what the Federal government is doing. We’re spending more than what we’re taking in. How long can you do that? We can do it a year or two, maybe, but you can’t do that very long because we’re guilty of the same thing we accuse the Federal and State government of and we’re doing it here locally. Now, again, you ask people if they want to pay more real estate tax at the public hearing. I kept a count of the people who talked to me privately and I’m here to tell you that there are more people who talked to me about increasing a little bit on the real estate than the other way around. I don’t believe that the majority of people out here are necessarily in favor of cutting services to keep the present real estate rate. Now, the motion is on the real estate side. Are we going to consider the other at the same time?

Chairman Pyles said each item was going to be considered separately.

Mr. Wills made the following comment:

As I’ve said throughout this process, what really concerns me is the amount of dollars we’re taking out of our CIP. If you look at what was designated for the CIP for County projects, there was about $5 million originally in there. This will be the sixth time that a Board has reached into the CIP and taken reoccurring revenue from the CIP. It’s leaving less than $500,000 as reoccurring revenue going into it. That is less than 10% of what we determine that we probably would need to properly fund it on a yearly basis. On the proposal that Mr. Coffield gave us, the smallest yearly amount in the plan was $1.4 million. We’re not anywhere near it. We’re one-third of that amount going in. In terms of the tax increase, it is always my opinion that it is a whole lot easier to do in a couple of small steps than one huge step. I’m afraid what we’re putting ourselves in position for is that once the reassessment occurs, and we find out that we really were not that out of line with what we did, that we’re putting ourselves in a position to face a fairly large tax increase at one shot. As Mr. Beyeler said, we cannot continue to take from our other funds. I will not support the motion.

Vote was as follows: Yeas: Pattie, Karaffa, Shull and Pyles Nays: Wills, Beyeler and Moore Motion carried.

* * * Vehicles and Motorcycles Tangible Personal Property $2.57 (current $2.25) Mr. Wills moved, seconded by Mr. Moore, that the Board approve the 32¢ increase.

Mr. Karaffa felt that it would not be necessary to increase it 32¢. He suggested increasing it 25¢, which would allow $596,000 out of the non-occurring account.

Mr. Moore added that, during his research, Rockingham County’s tax rate is $2.85 per $100 and Staunton is $2.75 per $100.

Chairman Pyles made the following comment:

I think over this process everybody is right. The schools need more money. It is not sustainable to keep going into Capital. I don’t think anybody thinks it is. But the other people are right – they’re paying enough. There is a disconnect in what is happening to our money. I don’t know if any of you guys are offended, but I would be offended by Governor McDonnell’s latest ad where he is talking about $1 billion surplus, no tax increases, how everything is wonderful. Our people out there is saying, ‘We got a $1 billion extra, no tax increase, but I don’t think Governor McDonnell goes by the saying for parents, ‘You’re only as happy as your saddest child’ because we got a lot of sad children out here in this County—out here in this State. Rockingham doesn’t like to raise their taxes. Staunton doesn’t like to raise their taxes. Waynesboro doesn’t like to do that, but we are being abused by the State. The biennium budget for 2006-2008 was $76 billion; this year it’s $85 billion. It has gone up something like 20%. Yet, there is less money going to direct Aid and Education. You’re talking about the $700 Rockingham is increasing for their schools, we’ve had that much of a drop from the State on our kids.

We’re going up in students and down in funding. And nobody wants to do anything about it. Mr. Karaffa is not wrong about the principal of having a legislative liaison in Richmond to do the work of the people. That should be what our delegates are up there to do. But they’re not doing it. All you have to do is look at all the tax credits that are being generated every year and never touched. In the last two years, there has been over a $100 million going to land preservation. There’s been $60 million in historical restoration.

That’s $60 million from us and that’s 25% from the State and then they can get 20% from the Federal government. So our 25 and their 20 and our 60, there is $100 million of tax money going to restored housing. So we got one program to stop buildings and then we have another program to stop us from taking down buildings. Maybe, if we built something, we would have something that we wouldn’t have to restore. This year, while we’re taxing public education, there’s a $25 million new credit for private schools. The argument was well, we’ll take it off of our public schools. There’s 29,000 student presently in private schools. They can all get the $2,000 each. It is for low income families as determined by the State, which is $70,000 and below. The job that we have to do is to press everybody besides our taxpayers. We have to press our delegates to start making it fair what is being sent out there. We’re sending all that money up there and it is not coming back. And we sit there and listen to excuses, ‘well, it’s the other party; oh, it’s northern Virginia; oh, it’s a committee chairman’. We have to raise heck and say, ‘You know, your basic job is education, law enforcement and roads’. They’re the things you’re supposed to be about. Not getting all these other extraneous things, to get everybody what they want. If somebody doesn’t want to develop their land, don’t develop it, but don’t make us pay for it. Don’t keep having that money come back. My problem with going ahead with any tax increase is that we haven’t beat the bushes hard enough against our legislators.

Dr. Bishop is over there and I think there’s some savings there of non-educational things.

We need to work on that. That’s why they’re sending us here for us to see that the money is well-spent. We need to get some of those things changed so next year we won’t have to have that big tax increase. Right now, the people are right. They’re paying enough taxes. They send it to Washington and there’s a big bite out of and something comes back and they send it to Richmond, there’s two bites out of it, and they send it back. We do the best job of anybody in using their money. We give them a pass when we’re not holding them accountable to take care of our people and they’re not doing it.

Before we pass on anything to our people, I would rather make a bigger demand on the money that is going to Richmond and not getting back to us. Just to put it in focus for you a little bit, $85 billion for two years, $42 billion a year; there’s 8 million people in Virginia. That’s $5,000 a person. We’ve got 70,000 people in Augusta County; $350 million. That’s how much money ought to be allotted to us. What are we getting; $70-80 million; where’s it all going? It’s not coming back here. It’s all these other complications that are out there. I just think before we push on the people that have the least who are up against it everyday, that we ought to push on the folks that are diverting the money away from the basic premises that we need to fund.

Mr. Karaffa asked Ms. Whetzel if $133,500 was added to the budget for Aid to the Commonwealth. Ms. Whetzel responded that it was not reflected in the advertised budget. “We were already sending a prescribed amount for Aid to the Commonwealth, and they have come back said that we had to give more back. Taking that $133,500 to account, what does that actually raise us to?” Ms. Whetzel said it was up to $927,950.

Chairman Pyles said he had spoken with the County Legislative Liaison asking where the $60 million was going to in the budget. She said it goes into the Governor’s surplus.

Chairman Pyles further stated, “That’s what our Aid to the Commonwealth is—their surplus. They can cut tax credits; they would rather demand that we send money back to them.” Vote was as follows: Yeas: Wills, Moore and Beyeler Nays: Karaffa, Pattie, Shull and Pyles Motion failed.

* * * Mr. Moore moved, seconded by Mr. Wills, that the Board approve the rate at $2.56.

Mr. Beyeler made the following comment:

We can play this game all night. As Ms. Whetzel said, we have to send the State more money. Somehow, we can criticize the State but they’ve got funding problems, too. I don’t agree with everything they’re spending on, but the buck stops here. We’re being looked to provide good services for the people of Augusta County. We can talk about State and Federal all night long, but that doesn’t change our responsibility.

Vote was as follows: Yeas: Wills, Moore and Beyeler Nays: Karaffa, Pattie, Shull and Pyles Motion failed.

* * * Mr. Beyeler moved, seconded by Mr. Karaffa, that the Board approve the Vehicles and Motorcycles Tangible Personal Property tax rate to $2.50.

Mr. Karaffa made the following comment:

I made this comment about a week ago that at the local level, at least what I have realized in the almost four months that we’ve been in office, that the majority of our job is to decide how we’re going to pay for State and Federal mandates. It’s less an ability for us, as a locality, to determine our own destiny and more for us to just deliver the bad news to the people. To raise the personal property tax by 25¢ to $2.50, it would raise enough money to slip back what we’re pulling out of the CIP to just under $1 million. It would be somewhere in the neighborhood of $740,000. That is consistent with where our County Administrator felt comfortable in taking money out of the CIP, taking it out of the Department of Social Services funding for their building, which I believe we just put a roof on; and taking monies out of the Fire Training Center, which I think we all realized without a regional partner, will be a very long time before we can move forward on it. I think it is responsible and it is equitable to take those monies out and use them in this tough budget; however, further cuts than that, I would not support.

Vote was as follows: Yeas: Karaffa, Wills, Moore and Beyeler Nays: Pattie, Shull and Pyles Motion carried.

Machinery and Tools and all other Tangible Personal Property $1.90 Mr. Beyeler moved, seconded by Mr. Moore, that the Board approve Machinery and Tools and all other Tangible Personal Property tax rate to remain at $1.90.

Mr. Wills made the following comment:

In doing this, we’re showing Business that we do truly value what they bring to our community and that we’re not trying to live off the backs of the Business and we’re trying to give them every break so that they can be successful.

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles Nays: None Motion carried.

Mr. Karaffa made the following comment:

I would just like to point for the benefit of the public who is here with us. With the taxes for personal property going from $2.25 to $2.50, somebody owning $5,000 worth of vehicles will see a $12.50 raise in the amount that they pay. Somebody who has $40,000 in vehicles, would see $100 in a yearly difference. That does not take into account what the State puts aside as part of the car tax relief.

CLOSED SESSION

On motion of Mr. Moore, seconded by Mr. Wills, 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) Performance On motion of Mr. Beyeler, seconded by Mr. Wills, the Board came out of closed Session.

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles 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:

1. Public business matters lawfully exempted from statutory open meeting 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.

Roll Call Vote was as follows:

AYE: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles NAY: None The Chairman authorized the County Administrator/Clerk of the Board to record this certification in the minutes.

ADJOURNMENT

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

Vote was as follows: Yeas: Pattie, Karaffa, Shull, Wills, Moore, Beyeler and Pyles Nays: None Motion carried.

Chairman County Administrator H:/minutes5-2budmin.12