eNews – May 17, 2024
FOIA/COIA training this summer, Parsing the budget, VOAA workshops...and more!
Friday, May 17, 2024/Categories: eNews
This edition of eNews is sponsored by Southern Software, Inc. dedicated to creating software solutions to solve difficult problems for the safety of both the first responders and the citizens they serve. Learn more >
In this issue:
VML News
Budget
Transportation
Opportunities
VML News
FOIA/COIA training confirmed for VML’s Elected Officials Conference: June 26
The Elected Officials Conference is a valuable training and networking opportunity for newly elected and veteran local officials from across the Commonwealth. This in-person event will be held in Richmond at the offices of McGuireWoods LLP (800 E Canal St, Richmond, VA 23219).
FOIA/COIA training confirmed: As part of the conference, representatives from the Virginia Freedom of Information Act Council (FOIA) and the Conflict of Interest and Ethics Advisory Council (COIA) will provide the training required every two years for certain state and local government officers and employees including local government elected officials.
Room block now available: Rooms at a block rate of $169 are available for the night of June 25 at the Delta Hotel Richmond Downtown (555 E Canal St, Richmond, VA 23219). The hotel is offering a discounted parking rate of $10 per day for those registered under the VML room block.
Learn more and register for the event and lodging here >.
Pre-conference event: Baseball at the Diamond (June 25, 6:00 p.m.)*
VML is hosting an evening of bonding, baseball, and ballpark fare as Richmond's Flying Squirrels take on the Somerset Patriots at the Diamond. Transportation will be provided from and to the Delta Hotel Richmond Downtown (555 E Canal St, Richmond, VA 23219).
*Please indicate your intention to participate by selecting this option during the registration process.
VML Contact: Mitchell Smiley, msmiley@vml.org
Budget
Parsing a prickly budget
As VML staff continues to pore over the newly signed budgets for the remainder of the current fiscal year and the biennial budget that begins on July 1, 2024, we have been tripped up more than once, attempting to determine if a change was made or not.
The reason for the confusion is that changes to the budget were already baked into HB 6001 and HB 6002 (Caboose bill), the bills reflecting the budget agreement, which the General Assembly quickly approved, and the Governor promptly signed. It’s akin to that adage about searching for a needle in a haystack.
Let me explain.
In a typical budget process, a bill is introduced by the Governor, then the House and Senate propose discrete changes to the budget, memorialized as “budget amendments”, that highlight the proposed change to a specific Item in the Appropriations Act including a description of the intent behind the adjustment. In other words, the amendment, the dollars involved, and any implementing budget language stand out.
Not this year. This year the changes were incorporated into the budget, making it nearly impossible to track changes in the final agreement.
In fairness, House and Senate staff anticipated the possibility of confusion and provided a helpful spreadsheet that attempted to explain each amendment, describing them as either new or technical. The vast majority of the 96 changes are technical.
The other thing that is critically important to understand about the budget agreement is that the starting point for any changes to the budget was the Appropriations Act that was initially agreed upon by House and Senate budget conferees at the end of the 2024 Regular Session; the deal that was ultimately sent to the Governor before he submitted his proposed amendments at the Reconvened Session.
In other words, if the attached spreadsheet didn’t mention a change to an item from the General Assembly’s previously approved budget, then that provision was sustained.
For example, the General Assembly formerly agreed to restore funding that the Governor had proposed to eliminate for local school divisions, holding them harmless from the repeal of the statewide sales tax on groceries. That decision was reflected in HB 30, as enrolled in early March. Because there was no amendment in HB 6001 to modify this allocation, funding for the hold harmless payments was approved.
The same is true of funding for 3% salary increases each year of the biennium for teachers, state employees, and state-supported local employees. The spreadsheet provided by the money committee staff didn’t highlight an amendment to these salary increases therefore it was retained from the original budget agreed to by the House and Senate.
That said, there are few substantive changes to the budget unveiled over the weekend and voted upon this past Monday, with the exception of amendments to reduce general fund revenues related to the sales tax on digital services that was removed, and amendments to swap out general fund cash for debt, for a variety of capital projects.
Other changes included in HB 6001 (Biennial bill) and HB 6002 (Caboose bill) can largely be characterized as follows:
- New spending and savings items
- Technical changes to reflect the Governor’s action on bills
- Technical changes to the budget reflecting the Governor’s recommendations
A few of the new spending and savings items in the area of tax policy that localities should be aware of include:
- Budget language that requires the Joint Subcommittee On Taxation to explore efforts to modernize the Commonwealth’s income and sales and use taxes during the 2024 interim by (i) evaluating existing sales and use tax exemptions; (ii) applying sales and use tax to digital goods and services, including transactions involving businesses; (iii) evaluating efforts to increase the progressivity of the income tax; (iv) and long-term revenue growth to maintain core government services.
- Budget language requiring three members each from the House Appropriations and Senate Finance and Appropriations Committees to “assess the trends in pari-mutuel pools generated by historic horse racing wagering at satellite facilities, including the corresponding distribution of revenues to localities, and make recommendations regarding future distributions of such revenues beginning July 1, 2025.”
VML Contact: Joe Flores, jflores@vml.org
Funding items of interest to local governments
In addition to the tax policy items outlined above, VML staff have highlighted other funding items of importance to local governments that are reflected in the final bills signed into law on Monday, May 15.
Use the links below to view funding items by topic:
K-12 Education
Unspent local allocations to school divisions. Item 125 (Section B, paragraph 24) (Biennial Budget) maintains the conference report language stating that that “localities are encouraged to allow school boards to carry over any unspent local allocations into the next fiscal year.” This language was also added to the Code of Virginia. VML supported this change, which is a part of our Human Development & Education policy statement.
Teacher retirement funding. Item 125 (Section C, paragraph 2.c) (Biennial Budget) changes the conference report approach to using Literary Funds proceeds for the state share of teacher retirement. In the approved budget the state will use $150.0 million in Literary Fund resources in the second year (instead of the first year as approved in the conference report) and use $150.0 million in state general funds in the first year The gubernatorial amendment had proposed using $150.0 in Literary Fund proceeds each year of the biennium.
Salary increases for SOQ-recognized instructional and support positions. Item 125 (Section C, paragraph 38) (Biennial Budget) maintains the conference report language/funding to provide the state share of a three percent salary increase on July 1, of each year of the biennium for SOQ-recognized instructional and support positions, amounting to a 6.09 percent salary increase over the biennium. The state share would be pro-rated for local school divisions offering less than an average three percent increase, but to get state funds, a school division must provide at least an average 1.5 percent increase in each of the two years. School divisions providing an average increase of more than three percent during the first year can credit the excess portion of the increase toward the second year.
School construction funds from Literary Fund. Item 125 (Section C, paragraph 13.c) (Biennial Budget) maintains the conference report approach to allow up to $200 million the first year and $50.0 million the second year in Literary Fund proceeds for school construction loans over the biennium (thereby rejected gubernatorial amendment to reduce the amount to $175 million).
School construction funds from Casino gaming proceeds. Item 125 (Section C, paragraph 42) (Biennial Budget) retains the conference report funding of $80.0 million each year from casino gaming proceeds to the School Construction Assistance Program. The School Construction Grant Fund was created in 2022 to help fund school construction and modernization initiatives through grants distributed by the Board of Education as determined by a series of criteria outlined in the Code of Virginia. This grant fund is to be funded by the Gaming Proceeds Fund which is funded by casino revenues in Virginia.
Land Use
Extension of Subdivision Plat Validity. Item 65 (paragraph N) (Biennial Budget) includes budget language extending the validity of subdivision plats that were deemed valid through July 1, 2020, pursuant to Section 15.2-2209.1.A., Code of Virginia, but were unable to be recorded prior to the commencement of the Judicial Emergency that extended from March 16, 2020 through July 19, 2020. Language extends the validity of the plat extensions until December 31, 2024.
Transportation
Additional WMATA Funding Item 433 F.1 and F.2 (Biennial Budget) includes $60.2 million in the first year and $84.5 million in the second year of General Funds for WMATA operating assistance. Additionally, the budget suspends the cap in the Code of Virginia (33.2-1526.1 (K)) that restricts growth in WMATA operating expenses which will provide additionally flexibility and directs WMATA to conduct a review of similar transit system’s total and overhead costs. Increased funding was necessary as federal relief funds expire during the next biennium leaving WMATA with significant revenue shortfalls that would have impacted service in Virginia, Maryland and the District of Columbia. This budget action provides critical funding and funding flexibility for WMATA member localities to provide operating revenue and avoids transit service reductions which would have had the potential to significantly impact the region’s economy.
Natural Resources
Improvements: Wastewater Treatments Upgrades. Item C-53.50 (Biennial Budget) appropriates $200 million each year of the biennial budget from the proceeds of state bonds to the water quality improvement fund for nutrient reduction projects at wastewater facilities across Virginia. This $400 million in appropriated funding will be directed to statutorily mandated Water Quality Improvement Fund projects over the coming biennium by the Department of Environmental Quality.
Without this funding, utility rate payers and localities would still be required to meet statutorily directed wastewater standards and shoulder 100% of the cost. With this appropriation, Virginia continues the Commonwealth’s decades long commitment to meeting clean water goals across Virginia by supporting local wastewater capital projects.
Wastewater funding has been a priority for VML this year and are pleased that this funding was included in the budget signed this week.
Health & Human Services
PIPP reimbursement to local DSS. Item 340 G (Caboose Budget) maintains language from conference report clarifying that nongeneral funds from the Percentage of Income Payment Program (PIPP) Fund shall be used to reimburse local Departments of Social Services for the administration of the PIPP program, consistent with § 56-585.6, Code of Virginia, and increases the maximum allowable reimbursement from the fund from $3.0 million to $5.5 million. VML, VACo, and VLSSE sought this amendment.
VDH cost analysis of PFAS and copper rule impacts. Item 280 G (Biennial Budget) retains the conference report language directing the Virginia Department of Health (VDH) to conduct a cost analysis of implementing pending federal Per- and Polyfluorinated Substances (PFAS) regulations for Virginia local water systems and directs VDH to conduct an analysis of the cost to Virginia localities that will be incurred to implement pending Environmental Protection Agency Copper Rules for water system lead service lines. The report must include a cost analysis, possible funding models, and identify federal funding that may be available. The report is due to House and Senate budget committees by Dec. 1, 2024.
CSB workforce needs. Item 295 (Biennial Budget) keeps the conference report funding (rejecting gubernatorial amendment to reduce funding) and provides $7.5 million each year to support efforts to increase the Community Services Board workforce. The funding will be used for recruitment and retention in the short term as well as to develop a pipeline for staff at all levels.
Supportive housing. Item 297 Y.2 (Biennial Budget) restores the funding from the conference report to add $3.0 million each year to expand permanent supportive housing for individuals with serious mental illness.
STEP-VA funding for CSBs. Item 297 KK1 (Biennial Budget) restores the conference report additional funding (and rejects gubernatorial amendment to reduce the funding); this adds $4.5 million each year to increase funding for STEP-VA. Of this amount, $1.2 million each year is to increase funding for outpatient mental health and substance use services and $3.3 million each year is to increase funding for six steps of STEP-VA to account for inflation for services that did not receive funding adjustments in the 2023 budget. This also increases funding for outpatient mental health and substance use services, crisis services, military and veteran services, peer services, case management, psychiatric rehabilitation services, and care coordination services.
Children’s mental health services. Item 297 2J (Biennial Budget) maintains funding from the conference report to add $1.2 million each year for children's mental health services and encourages flexible uses of funds to build service capacity focused on specialized needs of children across the crisis services continuum.
CSB crisis stabilization staffing. Item 297 TT (Biennial Budget) maintains the conference report funding (rejecting gubernatorial amendment to reduce funding) to add $2.5 million each year to help community services boards hire additional staff for crisis stabilization units whose bed capacity is not fully utilized because of a lack of staff.
CCCA alternative placements. Item 301 D (Biennial Budget) makes no changes to the conference report language directing the Department of Behavioral Health and Developmental Services to identify and develop alternative placements for children who would otherwise be admitted to the Commonwealth Center for Children and Adolescents. This comes from a recommendation of the 2023 Joint Legislative Audit and Review Commission Report on Virginia's State Psychiatric Hospitals.
Local social services training academy. Item 324 J (Biennial Budget) keeps the conference report language (rejecting gubernatorial amendment to eliminate funding) providing state and federal funds each year to establish a centralized training academy model for staff of local departments of social services to bring Virginia in line with best practices used by states with similar social services models. This will better prepare workers to handle complicated and demanding caseloads and provide more flexibility in training formats.
PIPP local reimbursement. Item 324G (Biennial Budget) maintains conference report language clarifying that nongeneral funds from the Percentage of Income Payment Program (PIPP) Fund shall be used to reimburse local Departments of Social Services for the administration of the PIPP program, consistent with § 56-585.6, Code of Virginia, and increases the maximum allowable reimbursement from the fund from $3.0 million to $5.5 million. VML, VACo, and VLSSE sought this amendment.
Legislative Agencies
Local audits to include opioid settlement funds. Item 2.F (Biennial Budget) maintains language under the Auditor of Public Accounts directing annual audits of local expenditures to include a review of the use of any opioid settlement funds to ensure compliance with guidelines, procedures, and criteria set forth by the Opioid Abatement Authority, and in turn, compliance with specific national agreements and Virginia court orders related to such settlements, the overarching statewide memorandum of understanding for allocation of opioid abatement monies, and the provisions of the Code of Virginia. A companion amendment in HB 29 proposes the same language to require such reviews in the current fiscal year.
Remove certain reporting requirements. Item 2.D (Biennial Budget) retains the conference report amendment to remove language under the Auditor of Public Accounts (APA) requiring that localities establishing a utility or enacting a system of service charges to support a local stormwater management program pursuant to Code of Virginia § 15.2-2114, provide to the APA a report as to each program funded by these fees and the expected nutrient and sediment reductions for each of these programs. Other language remains in the budget that ensures stormwater management funds are expended in accordance with § 15.2-2114 A.)
Continue pandemic response joint subcommittee. Item 6D (Biennial Budget) retains the conference language extending the term for the Joint Subcommittee to study the state’s pandemic response to Dec. 1, 2024.
COIA staff position added. Item 15 (Biennial Budget) retains the conference language adding a position to the Virginia Conflict of Interest and Ethics Advisory Council to help with training and technical assistance. VML sought this amendment.
Crime commission access to state and local agency records and operations. Item 23 B.1 (Biennial Budget) keeps the conference report language and rejects the more friendly gubernatorial amendments addressing the Virginia State Crime Commission’s authority to access the records, information, facilities, and employees of every department, division, board, bureau, commission, authority, or other agency of the Commonwealth or to which the Commonwealth is a party or from any political subdivision of the Commonwealth. Upon request, such entities shall provide the Commission with records and any other information deemed necessary by the Commission for the performance of its duties. Additionally, upon request, such entities shall allow the Commission access to their facilities and ample opportunity to observe their operations. Such entities may not require the Commission to pay a fee to obtain records or any other information, or to access their facilities or observe their operations.
Judicial Branch
Study of jail diversion programs. Item 31 T (Biennial Budget) retains the conference report language and funding ($46,000 in the first year) for the Office of the Executive Secretary of the Supreme Court, in collaboration with the Department of Behavioral Health and Developmental Services, to study existing jail diversion programs for individuals with a serious mental illness and the feasibility of implementing an expedited diversion to court-ordered treatment process to divert individuals with a serious mental illness to court-supervised mental health treatment. This is a recommendation from the Behavioral Health Commission.
Public Safety
State assistance to local law enforcement (HB 599). Item 396 (Biennial Budget) maintains the conference report increase in funding ($10.0 million each year) for a total of $296.65 million each year for localities with police departments.
Fire and EMS funding sufficiency study. Item 377 E (Biennial Budget) keeps the language from the conference report directing the Secretary of Public Safety and Homeland Security to complete a review and assessment of the sufficiency of fire and emergency medical services funding in the Commonwealth. VML is among the groups to be included in stakeholder group discussions. A report is due to the House and Senate budget-writing committees by Nov. 1, 2024.
Safer communities’ program. Item 394 (Biennial Budget) keeps the increased funding included in the conference report ($3.5 million each year) for the Safer Communities Program administered by the Department of Criminal Justice Services, which provides targeted grants and technical assistance to localities with disproportionately high violent crime rates. As approved in the conference report, adds the City of Roanoke, and continues grant funding for Norfolk, Richmond, and Portsmouth. This item includes funding for a contract with the VCU Wilder School of Government and Public Affairs, who may collaborate Virginia State University and Norfolk State University, to work with community violence reduction grantees to provide strategic planning, program evaluation, and data-driven innovations to improve response to community violence.
Transportation
VDOT’s supplemental payments for road maintenance set to return for third year
At the April meeting of the Virginia Commonwealth Transportation Board (CTB) the draft FY24-FY25 VDOT budget was presented with a significant caveat for local road maintenance payments for cities, towns and counties that maintain their own roads. During the April meeting it was unclear if this supplemental funding for maintenance would return for a third year. At the May meeting of the CTB it was announced that a supplemental maintenance payment would return for a third year in FY25 in the amount of $264 million.
In FY23 VDOT provided a supplemental maintenance payment for $121.5 million with $20.9 million for city street maintenance and $3.7 million for Arlington and Henrico County maintenance. This supplemental funding was provided in recognition of increased fuel and material costs that were impacting maintenance contracts administered by VDOT. It was also provided in recognition of the similar pressures affecting localities that maintain their own roads.
Initially these payments were expected to be temporary, but as high fuel and material costs have endured the CTB approved additional supplemental funding of $191.1 million in FY24. In FY24 aggregate funding for city and town maintenance payments will increase just over $44 million and payments to counties will increase by $6.7 million. In FY25 cities will receive an additional $61.5 million and counties will receive an additional $9.3 million.
|
|
FY23
|
FY24
|
FY25
|
|
Cities
|
$20.9
|
$44.1
|
$61.5
|
|
Counties
|
$3.7
|
$6.7
|
$9.3
|
|
VDOT
|
$90.4
|
$147.0
|
$202.5
|
|
Total Supplemental Payment
|
$121.5
|
$191.1
|
$264.0
|
Secretary of Transportation Shep Miller asked the CTB and VDOT staff to consider whether the CTB should continue the practice of providing supplemental payments in the coming years or if it may be preferable for VDOT and local maintenance payments to be increased in recognition of the permanence of higher fuel and materials costs. It is likely that this conversation will take place during the CTB’s summer meetings.
VML Contact: Mitchell Smiley, msmiley@vml.org
Opportunities
VDOT webinar: Right of Way Notice to Proceed (NTP) and Federal Authorization
Join VDOT's Right of Way Division and Federal Programs Management Division to receive guidance from those who conduct the reviews for Right of Way NTP and/or Federal Authorization to keep your project moving forward without delay! This webinar is intended for localities, project managers, and VDOT project coordinators to help gain a better understanding on when to request Right of Way Notice to Proceed (NTP) and/or Federal Authorization and have an opportunity to ask questions.
Date: Tuesday, June 11, 2024
Time: 10:00 a.m. – 11:30 a.m.
Register here >
Please Note: Due to security permissions, some external participants may not have use of the chat box feature in MS Teams.
VDOT Contacts: Traci Luu, Traci.Luu@vdot.virginia.gov; Michaela McCain, Michaela.McCain@vdot.virginia.gov
First of Virginia Opioid Abatement Authority’s 2024 workshops to be held June 11 in Hampton
The Virginia Opioid Abatement Authority (VOAA) is hosting a series of three in-person workshops for city and county officials on the topic of opioid abatement and how to apply for grants. The first of these workshops is being held in Hampton on June 11.
The Abatement Academy Workshops are an approved use of direct distribution funds. Only public sector and non-profit employees may attend the workshop. Service providers can only attend when invited by VOAA.
VOAA aims to ensure the accessibility of this workshop to City & County Leaders. If registration costs present a financial challenge, please feel free to reach out for assistance by sending an email to pamela@eameetings.com.
There are three (3) workshops scheduled for 2024.
- Tuesday, June 11 in Hampton
- Thursday, September 5 in Winchester
- Thursday, October 10 in Fredericksburg
Registration is now open until June 5 for the June 11 offering in Hampton.
Agenda and registration available here >.
VOAA Contact: Tony McDowell, tmcdowell@voaa.us