City council raises concerns over future deficit, fire pay

City council raises concerns over future deficit, fire pay

By Erich Wagner (File photo)

In their first work session for the fiscal 2017 proposed budget last week, city councilors expressed concerns about poor revenue growth projections and the way the city compares its compensation of firefighters with first responders.

The city operating budget proposal, unveiled by City Manager Mark Jinks last month, allocates $671.6 million in spending and proposes a 1-cent property tax rate increase to $1.053 per $100 in assessed property value, and includes options if city council elects to raise the tax rate by 2 cents.

In councilors’ first chance to publicly dig into the budget since its presentation February 23, they expressed worries about projections that entailed continued budget shortfalls in future years. According to city staff, under current funding rates and assuming “medium revenue growth,” the city would face a $13.2 million deficit in fiscal 2018, ballooning to as much as $41.4 million by fiscal 2021.

“What are some things we can do?” asked Vice Mayor Justin Wilson. “As you analyzed in the financial plan, you have somewhere between a $5 million and $28 million, again it’s a gap. So as we make changes in add-delete sessions, what will help narrow that gap in future years?”

Morgan Routt, director of the city’s office of management and budget, said the best cure for Alexandria’s fiscal woes would be growth of the city’s tax base.

“One way is obviously just to grow our tax base,” Routt said. “The revenue growth since the end of the recession has been lower than the average increase in the costs of services. We have major drivers like employee compensation, school enrollment and capital infrastructure needs.

“But the other thing is through the add-delete process, take a longer view of what the potential future impacts of [budget] items are. Talk not just about the impact of the 2017 budget, but in the future years.”

Wilson said hypothetically in an interview that one way to alleviate the budget crunch could be to focus on infrastructure projects in the short term, rather than expanding services.

“I had asked [during the meeting] what we can do to try to alleviate some of the budget gaps, and what we could do in this year’s budget to alleviate budget crunches in future years,” he said. “Option one would be to cut an operating-budget program and save that money now and whatever it inflates to next year. But another way to save money and narrow the gap is to take a capital project slated for fiscal 2018 and pay for it now.

“We could, instead of spending $5.3 million on paving this year, spend $6.3 million and have an extra $1 million next year. … One of the big reasons is that in this [fiscal] environment, when we have projected shortfalls, anything you can do to get that [infrastructure] funding off the table saves you money and reduces that budget gap in the future.”

Elsewhere in the budget, councilors questioned staff’s methodology for determining when to give firefighters a raise. All firefighters are slated to receive a 5 percent pay bump under the current budget proposal in addition to merit raises for officers. An oft-repeated ethos in City Hall is that Alexandria should remain at the middle of compensation when compared with surrounding jurisdictions.

“Back at the budget retreat, we went back and forth about certain cities and towns and how we can’t compare them,” said City Councilor Willie Bailey. “Montgomery and Prince George’s counties [in Maryland], [firefighters there] work fewer hours, so when we compare them to Arlington, Alexandria and Fairfax, it seems like it would skew the numbers some.”

Bailey said that while Alexandria firefighters typically work around 56 hours per week, their counterparts in Maryland suburbs only work around 42 hours per week. Before staff could respond to defend their model, City Councilor Del Pepper jumped in.

“But that is important,” she said. “And the reason is, if you’re earning a whole lot less than neighboring jurisdictions and you’re working 10 or more hours or something like that per week, for heaven’s sake, you’re not going to stay with us.”

Wilson said it is difficult to compare public safety compensation with Maryland jurisdictions because of the differences in labor laws between the Old Line State and Virginia.

“Prince George’s and Montgomery are both collective bargaining jurisdictions, and that creates kind of a strange comparison when we’re up against these folks,” Wilson said. “But I think Willie’s right. Most labor, like when we talk about general services, the benchmark is 40 [hours] vs. 40 [hours]. But when we’re talking about these positions that have different work schedules, you have to find a way to index it somehow.”

Jinks said that although Alexandria’s status as a midpoint in terms of regional compensation rates remains unchanged if one removes the Maryland jurisdictions, staff continue to explore
better ways to look at the issue.

“If you take out Montgomery and you take out Prince George’s from these numbers, you end up in basically the same place,” he said.

City council will host a public hearing on the budget proposal March 14 at City Hall, followed by a work session on the 10-year capital budget on March 15.