Building a budget is like assembling a puzzle, making sure that the pieces come together in the right way. After nearly 6 months of working on the FY2019 budget the unknown pieces are coming together neatly for the City of Falls Church. Through diligent work, we’ve been able to reduce the tax increase from an initial projection of 6 cents to 5.5 cents to 4.5 cents to 2.5 cents. That is remarkable. At this point, City Council needs to stop reducing and fund the programs and people that are essential to the City’s well being. The only piece that remains under consideration is the School Board budget request. All other parts of the budget have been covered - senior tax relief, neighborhood traffic calming, city employee salary improvements, obligations for WMATA funding and the three capital buildng projects. Organic growth in revenues is increasing at a robust 3.7%. Fully funding the FCCPS budget request reflects the values of the citizens - the 64% who voted “Yes” to the school bond last fall - expecting that it would mean a 6 cent increase in taxes. Fully funding is the responsible and forward-thinking way to move into the future.
Economic Development Works
Yes, taxes are going up to pay for three big projects - a high school, city hall and library - but not as much as we thought they would. (Instead of 6 cents, we are down to 2.5 cents.) That’s because the City’s robust economic development program is bringing in revenue to help cover many expected costs. The mixed use buildings, retail, services, restaurants and hotels are providing significant increase in revenue for the City. Fully funding the FCCPS budget request is possible because organic growth of city’s tax base is one of the highest in the region.
Schools Serve Vulnerable Populations
Much has been said throughout the budget conversations by City Council members about the need to serve vulnerable populations in the City - a value we all share. School employees do this every day in FCCPS, and funding transferred to the schools goes directly to help students and families. Public schools serve the most vulnerable populations. Schools are the first point of contact for families in need: those in housing crisis; low income families; non-English speakers; special education students; students who have experienced trauma. Schools serve as social service agencies, providing access to food, clothing, school supplies, counseling, language instruction, in addition to academics. A considerable portion of the FCCPS internal cost savings and reorganization is to improve services to the most vulnerable among us. The number of students and families being served increases every year. School social workers serve more people than any other agency in Falls Church, including the city’s Human Services, with whom they work in partnership. Fully funding the FCCPS budget request affects the services that can be provided to all students and families.
A Short Tutorial on Public Employee Salaries
Public school and government employees enter their careers knowing what their salary progression will be. Salary scales (or bands) are public knowledge and employees get a view early on as to how their salaries will increase over the course of their careers. This social compact has served us well for decades: Local, state and federal government employees get a small, reliable increase every year with income growing steadily. Public employees don’t get bonuses. Federal employees may earn one-time pay awards. School employees do not. They do not renegotiate their contracts. They get salary scales pre-planned in lanes, steps or bands. It is reasonable for public employees to expect a step increase and a Cost of Living Adjustment (COLA) every year. That’s how it has worked in public education and public service for decades.
In recent years because of tight budgets FCCPS has not been able to provide a Step and COLA every year. This means that even though FCCPS ambitiously adjusted salary scales to come close to neighbors in Arlington, employees are not earning as much as those who have served the same number of years next door. Someone who has served 9 years in FCCPS is only on Step 7. The School Board and Superintendent would have preferred to offer both a step and COLA, but in the interest of keeping the request as low as possible, opted for a 3% COLA so that all employees are eligible for a bump in pay. Well-educated, dedicated professionals, are being asked to beg for their reasonable salary increases every year. Fully funding the FCCPS budget request provides adequate (but not extreme) salary increase for all employees - teachers, custodians, bus drivers, principals and food services staff.
Recently the Consumer Price Index (CPI) has been brought into the conversation about salary increases. Matching salaries to CPI provides just enough to paddle along, keeping pace with inflation. True salary increases are more than just paddling along. They are also rewards for experience, and work well done and incentives to stay in the organization.
Salary increases are not going away. We should not shy away from increasing salaries this year because we will also have to next year. That is a given. Salaries are going to need to be funded every single year. (just as they have been for the past 70 years). Fully funding the FCCPS budget request provides adequate (but not extreme) salary increase for all employees.
School employees should not be punished because they work for a larger organization than general government employees. When the limitation of 2% growth is placed on the general government all can receive 3% raises, because there are a smaller number of employees. When the limitation of 2% growth is placed on the schools, it is impossible to provide comparable 3% raises simply because of the number of employees. Fully funding the FCCPS budget request treats all city employees - school and general government - in an equal manner.
What About the Capital Program?
Employees should not be punished because a new library, city hall and high school are being planned. These are priorities of the citizens, who voted for 2 of the 3 projects. Capital projects should be done in addition to maintaining the operating budget programs and services that general government and schools provide (not at the expense of those programs). Most of the Capital expenses are being covered by the successful economic development.
Many School Employees Qualify for Affordable Housing. Let that Sink in a Minute.
Affordable Housing assistance helps individuals and families at all income levels to pay their rent or purchase a home. It is divided into 3 tiers - low income, moderate income and workforce income. This is a complex formula based on Area Median Income (AMI). When we talk about city and school employees we assume that police, teachers, and all public employees earn Work Force income. At the April 17, 2018 Affordable Policy Housing Workgroup meeting, a new Median Income Chart was shared.
FCCPS teacher Farrell Kelly recently addressed City Council to put a face and name to the situation of teachers. According to his self-reported income, Teacher of the Year Farrell Kelly earns about $70,000 per year. Looking at the Affordable Housing qualification chart his income falls between 70-80% of Area Median Income. The young teacher who lives in the Read Building whose letter was read to City Council earns 50-60% of AMI.
According to the chart, these two highly-qualified, educated, experienced professionals, entrusted with the well-being of the children of Falls Church qualify as moderate income (not even reaching the level of Work Force income). These two examples are representative of the salary situation of most of the FCCPS workforce.
One way to attack affordable housing dilemmas is to ensure that our public employees have a better chance of at least reaching the level of Work Force Housing. Fully funding the FCCPS budget request increases opportunity for employees to earn enough to live and work in the City.
The School Board Budget Cutting Already Happened
In December at the joint budget work session, the School Board shared that they wanted to ask for 4.7% budget increase. At that session it was made clear that organic growth would be around 3%, and that any increases would have to be in that range so that no tax increase would be required for operating growth. The school staff got to work, proactively cutting at that point, bringing the request to 3%.
At Dec. 11 guidance meeting, by a 5-2 vote, the City Council set the limit of 2% growth. However, most Council members requested that we start at 2% and see what happened with the unknown pieces, allowing us to increase from there.
The schools were not able to present 2% growth budget, although they were able to further reduce it to a 2.8% increase. This is to meet the needs of the students and the teachers - with cuts from 4.7% already incorporated from the initial request of the School Board.
To refuse a 2.8% increase, when every single piece of the budget puzzle has come into place in a positive way is unfathomable to me. The City Council was presented with a transparent, essential request, in a collaborative manner by the other elected body in Falls Church, the School Board.
Concern about WMATA funding did not materialize.
Concern about growth slowing did not materialize (In fact it continued to improve.)
Concern about health care and retirement increases did not materialize.
Concern about overspending on the first stage of GMHS planning was eliminated.
Fully funding the FCCPS budget request is the right thing to do because the unknown expenses that led to a low 2% growth cap are now known, and their effect is minimal, leaving adequate room within the city’s organic growth to fund the budget with a 2.5 cent increase.
What We Don’t Know Should Not Deter Us
We don’t know what will happen in the future with interest rates, national economy, international relations, but that cannot stop us from doing what needs to be done this year, now in the City of Falls Church. Fear of the future should not limit the City Council from doing the right thing in the present.
What I Hope the City Council Will Do
Through diligent work, we’ve been able to reduce the tax increase from an initial projection of 6 cents to 5.5 cents to 4.5 cents to 2.5 cents. That is remarkable . At this point, City Council needs to stop reducing and fund the programs and people who make our city who we are. Fully funding the FCCPS budget request reflects the values of the citizens. Fully funding is the responsible and forward-thinking way to move into the future.