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Special Meeting
Monday, May 7, 2012 - - 7:00 p.m.

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Present: Mayor William D. Euille, Vice Mayor Kerry J. Donley, Members of Council Frank H. Fannon, Alicia R. Hughes, K. Rob Krupicka, Redella S. Pepper and Paul C. Smedberg.

Absent: None.

Also Present: Mr. Young, City Manager; Mr. Banks, City Attorney; Mr. Johnson, Chief of Staff, City Manager's Office; Mr. Jinks, Deputy City Manager; Police Captain Ogden; Mr. Trobridge, Director, Office of Information Technology; Ms. Triggs, Office of Finance; Ms. Triggs, Acting Chief Financial Officer; Ms. Taylor, Office of Management and Budget; Mr. Routt, Office of Management and Budget; Ms. Boyd, City Manager's Office; Deputy Police Chief Spruill; Mr. Castrilli, Director, Office of Communications; Mr. Martinez, ITS; and Mr. Lloyd.

Recorded by: Jacqueline M. Henderson, City Clerk and Clerk of Council.

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City Council held a work session at 6:00 p.m. in the Council Work Room to discuss the add/delete budget items.
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OPENING

1. Calling the Roll.

The meeting was called to order by Mayor Euille, and the City Clerk called the roll. All the members of Council were present.

REPORTS AND RECOMMENDATIONS OF THE CITY MANAGER FOR DISCUSSION

2. Consideration of the Proposed Annual Operating Budget for FY 2013 (including Schools) and the Proposed Capital Improvements Program for FY 2013-2018 (including the Schools CIP.)

WHEREUPON, upon motion by Vice Mayor Donley and seconded by Councilman Smedberg, City Council moved adoption of the annual general fund operating budget for FY 2013 of $587,861,196 with the following amendments to the City Manager's proposed budget. The details of each amendment are described in the May 4, 2012 budget memo from the City Manager "FY 2013 Final Add/Delete List" and will accompany docket item #2 as the final adoption staff report:

Technical expenditure increases (net of decreases) of $115,713; other expenditure increases of 42,139,725; revenue re-estimate decreases (net of increases) of $1,250,888; and an increase in the use of general fund balance of $1,004,550 including the reappropriation of FY 2012 expenditure savings. Included in the FY 2013 general fund operating budget is an appropriation of $179,486,405 to the Alexandria City Public Schools, which remains unchanged from the City Manager's proposed budget. The total increase in expenditures compared to the City Manager's proposed budget is $2,225,438 including an increase in cash capital funding of the FY 2013 - 2022 Capital Improvement Program of $350,000 and an increase in contingent reserves of $59,983. In addition, City Council authorized the City Manager to make technical adjustments to each affected departmental budget from the non-departmental budget to reflect the proper allocation to departmental budgets of the adjustments related to items such as health insurance premiums and salary adjustments and resulting benefits impacts from the VRS contribution rate shift, details of these adjustments will be presented for approval by City Council in the context of the FY 2013 appropriations ordinance in June. City Council moved the City's general government and Sheriff salary scales, as published in the City Manager's proposed budget be increased by one percent to offset the one percent increase in the VRS employee contribution rate that will take effect on July 1. A one percent salary adjustment is also provided for the employees whose pay is administratively determined and who are members of the Virginia Retirement System. These positions are detailed in budget memo number 68.

A MOTION WAS MADE by Councilwoman Hughes that the appropriation to the Alexandria City Schools budget of $179,486,405 be allocated based on the nine categories identified by the Virginia Board of Education, and that Council make the determination of what the actual percentages per category will be as part of the June 2012 appropriation.

The motion failed for lack of a second.

A MOTION WAS MADE by Councilman Krupicka to adjust the School allocation from the number stated to $180,686,405, which is a $1.2 million increase to bring them in line and give them the money the General Assembly allocated to them.

The motion failed for lack of a second.

The motion carried unanimously and was as follows:

Donley "aye" Fannon "aye"
Smedberg "aye" Hughes "aye"
Euille "aye" Krupicka "aye"
Pepper "aye"

WHEREUPON, upon motion by Councilman Fannon, seconded by Councilwoman Hughes and carried 6-1, City Council authorized the appropriation from the general fund balance of $6,839,528. This reflects an increase of $1,004,550 compared to the City Manager's proposed budget. The source of this increase will be $75,661 from a reappropriated contingent reserve project currently budgeted in FY 2012, $12,509 based on revenue re-estimates and $916,380 in FY 2012 surplus revenue.

The voting was as follows:

Fannon "aye" Donley "aye"
Hughes "aye" Krupicka "no"
Euille "aye" Pepper "aye"
Smedberg "aye"

WHEREUPON, upon motion by Councilman Fannon, seconded by Vice Mayor Donley and carried unanimously, City Council committed the assignments of fund balance proposed by the City Manager in the FY 2013 general fund operating budget with the following adjustments for one-time expenditures. The source of these commitments is surplus revenue in FY 2012. The assignments proposed by the City Manager in the proposed operating budget include:

$1,700,000 in existing encumbrances
$535,000 in one-time land use and planning studies
$1,000,000 to comply with current financial polices
$1,775,000 to fund the FY 2014 CIP
In addition, based on the April revenue re-estimates and additional surplus revenue, the following commitments are approved:
$255,762 for equipment replacement
$200,000 for professional development
$200,000 for an innovation fund and
$50,000 to implement AlexStat
To maintain the City's current financial policies regarding spendable fund balance as a percentage of general fund revenue, $100,421 of the City's surplus revenue is recommended to be added to spendable fund balance.

The voting was as follows:

Fannon "aye" Hughes "aye"
Donley "aye" Krupicka "aye"
Euille "aye" Pepper "aye"
Smedberg "aye"

WHEREUPON, upon motion by Councilwoman Pepper, seconded by Councilman Krupicka and carried unanimously, City Council moved adoption of the proposed FY 2013 to FY 2022 Capital Improvement Program of $1137,922,637 in total and $1,109,278,387 in local funding, with $134,504,335 in total and $128,352,585 in local funding in FY 2013; $59,311,578 in total and $55,865,328 in local fund in FY 2013; $59,311,578 in total and $55,865,328 in local funding in FY 2014; $361,880,603 in total and $358,629,353 in local funding in FY 2015; $95,726,178 in total and $91,991,178 in local funding in FY 2016; $87,648,501 in total and $83,298,501 in local funding in FY 2017; $85,050,442 in total and $81,340,442 in local funding in FY 2018; $67,271,500 in total and $66,271,500 in local funding in FY 2019; $78,111,500 in total and $77,111,500 in local funding in FY 2020; $82,406,500 in total and $81,406,500 in local funding in FY 2012; and $86,011,500 in total and $85,011,500 in local funding in FY 2022.

The voting was as follows:

Pepper "aye" Donley "aye"
Krupicka "aye" Fannon "aye"
Euille "aye" Hughes "aye"
Smedberg "aye"

ORDINANCES AND RESOLUTIONS

3. Second Reading and Final Passage of an Ordinance on the Increase in Real Estate Tax Revenue, at a Rate Not to Exceed $1.008 per $100 of Assessed Value, Attributable to the Increase in Value of Assessed Property as of January 1, 2012, and Known as the "Effective Rate Increase" Pursuant to Section 58.1-3321 of the Virginia Code. (#18, 3/13/2012, #6, 4/14/2012) [ROLL-CALL VOTE]

WHEREUPON, upon motion by Councilman Smedberg, seconded by Councilwoman Hughes and carried 6-1 by roll-call vote, City Council moved final passage of an ordinance to set the City’s 2012 blended real property tax rate at ninety-nine point eight cents ($0.998) on each $100 of assessed value. The 2012 real property tax rate contains the following:

ORDINANCE NO. 4761

AN ORDINANCE to amend and reordain Section 3-2-181 (LEVIED; AMOUNT), Section 3-2-188 (CLASSIFICATION AND TAXATION OF CERTAIN COMMERCIAL AND INDUSTRIAL PROPERTY), and Section 3-2-189 (TIER 1 POTOMAC YARD METRORAIL STATION SPECIAL SERVICES DISTRICT TAX) of Division 1, (REAL ESTATE), and Section 3-2-221 (LEVIED ON TANGIBLE PERSONAL PROPERTY OTHER THAN MOBILE HOMES, AUTOMOBILES, TRUCKS, ANTIQUE MOTOR VEHICLES, TAXICABS, MOTOR VEHICLES WITH SPECIALLY DESIGNED EQUIPMENT FOR USE BY THE HANDICAPPED, MOTORCYCLES, CAMPERS AND OTHER RECREATIONAL VEHICLES, BOATS AND TRAILERS; AMOUNT), Section 3-2-222 (LEVIED ON MACHINERY AND TOOLS USED IN MINING OR MANUFACTURING BUSINESS; AMOUNT), Section 3-2-223 (LEVIED ON MOBILE HOMES; AMOUNT), Section 3-2-224 (LEVIED ON AUTOMOBILES, TRUCKS, TRAILERS, SEMI-TRAILERS ANTIQUE MOTOR VEHICLES, TAXICABS, MOTORCYCLES, CAMPERS AND OTHER RECREATIONAL VEHICLES, BOATS AND TRAILERS; AMOUNT) of Division 3 (TANGIBLE PERSONAL PROPERTY AND MACHINERY AND TOOLS), all of Article M (LEVY AND COLLECTION OF PROPERTY TAXES), Chapter 2 (TAXATION), Title 3 (FINANCE, TAXATION AND PROCUREMENT) of The Code of the City of Alexandria, Virginia, 1981, as amended.

THE CITY COUNCIL OF ALEXANDRIA HEREBY ORDAINS:

Section 1. That Section 3-2-181 of The Code of the City of Alexandria, Virginia, 1981, as amended, be, and the same hereby is, amended and reordained to read as follows:

Sec. 3-2-181 Levied; amount.

There shall be levied and collected for the calendar year 20112 on all real estate located within the territorial boundaries of the city and subject to taxation for city purposes under the constitution and laws of this state and city, a tax of $0.998 on each $100 of the assessed residential property value thereof and $0.998 on each $100 of the assessed commercial residential property value thereof, for the support of the city government, for the payment of principal and interest of the city debt and for other municipal expenses and purposes.

Section 2. That Sec. 3-2-188 of The Code of the City of Alexandria, 1981 as amended, be, and the same hereby is, amended and reordained to read as follows:

Sec. 3-2-188 Classification and taxation of certain commercial and industrial real property.

(a) Pursuant to the authority granted by Section 58.1-3221.3 of the Code of Virginia (1950), as amended, all commercial and industrial real property in the City of Alexandria classified by the General Assembly as a separate class of real property for local taxation shall be designated, assessed and taxed as a separate class of real property. Such separate class of real property shall not include any residential uses excluded by Section 58.1-3221.3 of the Code of Virginia.

(b) In addition to all other taxes and fees permitted by law, the class of real property designated in this section may, and if imposed by ordinance shall, be subject to a real property tax, in addition to that imposed by City Code Section 3-2-181 and any other applicable law, at the rate established by the City Council of the City of Alexandria not to exceed the rate authorized by the Code of Virginia.

(c) All revenues generated from the real property tax imposed by this Section 3-2-188 shall be used exclusively for transportation-related projects and services that benefit the City of Alexandria.

(d) The real property tax imposed by this Section 3-2-188 shall be levied, administered, enforced and collected in the same manner as set forth in Subtitle III of Title 58.1 of the Code of Virginia and Chapter 2 of this Title for the levy, administration, enforcement and collection of local taxes.

(e) The director of the department of real estate assessments shall separately assess and set forth upon the City of Alexandria's land book the fair market value of that property that is designated as a separate class of real property in accordance with the provisions of this section.

(f) There shall be levied and collected for the calendar year 20112 on all real estate located within the territorial boundaries of the city and subject to taxation pursuant to this section, a tax of $0.00 on each $100 of the assessed value thereof, for the purposes set forth in subsection (c) above.

Section 3. That Section 3-2-189 of The Code of the City of Alexandria, Virginia, 1981, as amended, be, and the same hereby is, amended and reordained to read as follows:

Sec. 3-2-189 Tier I Potomac Yard Metrorail Station Special Services District Tax.

(a) Pursuant to the authority granted by Section 15.2-2400, et seq. of the Code of Virginia (1950), as amended, all real property located in the Tier I Potomac Yard Metrorail Station Special Services District, established pursuant to Ordinance Number 4693, classified by the city council as a separate class of real property for local taxation shall be designated, assessed and taxed as a separate class of real property.

(b) In addition to all other taxes and fees permitted by law, the class of real property designated in this section may, and if imposed by ordinance shall, be subject to a real property tax, in addition to that imposed by city code section 3-2-181 and any other applicable law, at the rate established by the city council of the City of Alexandria.

(c) As detailed in Ordinance Number 4693, all revenues generated from the real property tax imposed by this Section 3-2-189 shall be used exclusively for the purpose of providing facilities and services related to the construction of the Potomac Yard Metro Station in the City of Alexandria and the construction of a pedestrian bridge from Potomac Greens to Potomac Yard.

(d) The real property tax imposed by this section 3-2-189 shall be levied, administered, enforced and collected in the same manner as set forth in Subtitle III of Title 58.1 of the Code of Virginia and chapter 2 of this title for the levy, administration, enforcement and collection of local taxes.

(e) The director of the department of real estate assessments shall separately assess and set forth upon the City of Alexandria’s land book the fair market value of that property that is designated as a separate class of real property in accordance with the provisions of this section.

(f) There shall be levied and collected for the calendar year 20112 on all real estate located within the territorial boundaries of the city and subject to taxation pursuant to this section, a tax of $0.20 on each $100 of the assessed value thereof, for the purposes set forth in subsection (c) above.

Section 4. That Section 3-2-221 of The Code of the City of Alexandria, Virginia, 1981, as amended, be, and the same hereby is, amended and reordained to read as follows:

Sec. 3-2-221Levied on tangible personal property other than mobile homes, automobiles, trucks, antique motor vehicles, taxicabs, motor vehicles with specially designed equipment for use by the handicapped, motorcycles, campers and other recreational vehicles, boats and boat trailers; amount.

There shall be levied and collected for the calendar year 20112 on all tangible personal property, other than mobile homes, automobiles, trucks, antique motor vehicles, taxicabs, motor vehicles with specially designed equipment for use by the handicapped, motorcycles, campers and other recreational vehicles, boats and trailers, owned or held by residents or citizens of the city or located within the territorial boundaries of the city or otherwise having a situs within the city and subject to taxation for city purposes under the constitution and laws of this state and city, a tax of $4.75 on every $100 of assessed value thereof, for the support of the city government, for the payment of principal and interest of the city debt and for other municipal expenses and purposes.

Section 5. That Section 3-2-222 of The Code of the City of Alexandria, Virginia, 1981, as amended, be, and the same hereby is, amended and reordained to read as follows:

Sec. 3-2-222 Levied on machinery and tools used in mining or manufacturing business; amount.

There shall be levied and collected for the calendar year 20112 on all machinery and tools used in a mining or manufacturing business taxable on capital and subject to taxation for city purposes under the constitution and laws of this state and city, a tax of $4.50 on each $100 of assessed value thereof, for the support of the city government, for the payment of principal and interest of the city debt and for other municipal expenses and purposes.

Section 6. That Section 3-2-223 of The Code of the City of Alexandria, Virginia, 1981, as amended, be, and the same hereby is, amended and reordained to read as follows:

Sec. 3-2-223 Levied on mobile homes; amount.

There shall be levied and collected for the calendar year 20112 on all vehicles without motor power, used or designed to be used as mobile homes as defined in section 46.2-100 of the Code of Virginia, owned or held by residents or citizens of the city or located within the territorial boundaries of the city or otherwise having a situs within the city and subject to taxation for city purposes under the constitution and laws of this state and city, a tax of $0.978 on each $100 of assessed value thereof, for the support of the city government, for the payment of principal and interest of the city debt and for other municipal expenses and purposes.

Section 7. That Section 3-2-224 of The Code of the City of Alexandria, Virginia, 1981, as amended, be, and the same hereby is, amended and reordained to read as follows:

Sec. 3-2-224 Levied on automobiles, trucks, trailers, semi-trailers, antique motor vehicles, taxicabs, motorcycles, campers and other recreational vehicles, boats and trailers; amount.

(a) Except as provided in subsections (b), (c) and (d), there shall be levied and collected for the calendar year 20112 on all automobiles, trucks, trailers, semi-trailers, antique motor vehicles (as defined in section 46.2-100 of the Code of Virginia, 1950, as amended, which may be used for general transportation purposes as provided in subsection C of section 46.2-730 of the Code of Virginia, 1950, as amended), taxicabs, motorcycles, campers and other recreational vehicles, boats and boat trailers owned or held by residents or citizens of the city or located within the territorial boundaries of the city or otherwise having a situs for taxation in the city, a tax of $4.75 on every $100 of assessed value thereof, for the support of the city government, for the payment of principal and interest of the city debt and for other municipal expenses and purposes.

(b) There shall be levied on and collected for the calendar year 20112 on all automobiles, trucks, trailers and semi-trailers with a gross vehicle weight of 10,000 pounds or more which are used to transport property for hire by a motor carrier engaged in interstate commerce, and are owned or held by residents or citizens of the city, are located within the territorial boundaries of the city or otherwise have a situs for taxation in the city, a tax of $4.50 on every $100 of assessed value thereof, for the support of the city government, for the payment of principal and interest of the city debt and for other municipal expenses and purposes.

(c) There shall be levied on and collected for the calendar year 20112 on all automobiles and trucks which are equipped with specially designed equipment for use by the handicapped and are owned or held by residents or citizens of the city, are located within the territorial boundaries of the city or otherwise have a situs for taxation in the city, a tax of $3.55 on every $100 of assessed value thereof, for the support of the city government, for the payment of principal and interest of the city debt and for other municipal expenses and purposes.

(d) There shall be levied on and collected for the calendar year 20112 on all privately owned pleasure boats and watercraft, which are used for recreational purposes only, and are owned or held by residents or citizens of the city, or are located within the territorial boundaries of the city or otherwise have a situs for taxation in the city, a tax of $.01 on every $100 of assessed value thereof, for the support of the city government, for the payment of principal and interest of the city debt and for other municipal expenses and purposes.

(e) For tax years commencing in 2006, the City adopts the provisions of Item 503.E of Chapter 951 of the 2005 Acts of Assembly (the 2005 revisions to the 2004-06 Appropriations Act, the “2005 Appropriations Act”), providing for the computation of tax relief under the Personal Property Tax Relief Act of 1998, sections 58.1-3523 et seq. of the Code of Virginia, as amended, as a specific dollar amount to be offset against the total taxes that would otherwise be due but for the Personal Property Tax Relief Act of 1998, sections 58.1-3523 et seq. of the Code of Virginia, as amended, and the reporting of such specific dollar relief on the tax bill.

(i) The City shall, following adoption of the annual budget adopted pursuant to Chapter 25 of Title 15.2 of the Code of Virginia and sections 6.01 through 6.15 of the City Charter, set the rate of tax relief under this subsection at such a level that it is anticipated fully to exhaust relief funds under the Personal Property Tax Relief Act of 1998, sections 58.1-3523 et seq. of the Code of Virginia, as amended, provided to the City by the Commonwealth. Any amount of relief funds under the Personal Property Tax Relief Act of 1998, sections 58.1-3523 et seq. of the Code of Virginia, as amended, provided to the City by the Commonwealth, not used within the City’s fiscal year shall be carried forward and used to increase the funds available for personal property tax relief under this subsection in the following fiscal year. (ii) Personal property tax bills shall set forth on their face the specific dollar amount of relief under this subsection credited with respect to each qualifying vehicle, together with an explanation of the general manner in which such relief is allocated. (iii) Allocation of relief under this subsection shall be provided in accordance with the general provisions of this section, as implemented by the specific provisions of the City’s annual budget relating to relief under this subsection. (iv) Relief under this subsection shall be allocated in such as manner as to eliminate personal property taxation of each qualifying vehicle with an assessed value of $1,000 or less. (v) Relief under this subsection with respect to qualifying vehicles with assessed values of more than $1,000 shall be provided at a rate, annually fixed in the City budget and applied to the first $20,000 in value of each such qualifying vehicle, that is estimated fully to use all relief funds under the Personal Property Tax Relief Act of 1998, sections 58.1-3523 et seq. of the Code of Virginia, as amended, provided to the City by the Commonwealth.

Section 8. That this ordinance shall become effective January 1, 2012, nunc pro tunc.

4. Consideration of a Resolution Certifying that the City of Alexandria is Electing to Use the Virginia Retirement System Contribution Rates Certified by the Virginia Retirement System (VRS) Board of Trustees. [ROLL-CALL VOTE]

This item was deferred.

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THERE BEING NO FURTHER BUSINESS TO BE CONSIDERED, upon motion by Councilwoman Hughes, seconded by Councilwoman Pepper and carried unanimously, City Council adjourned the May 7, 2012 special meeting at 9:03 p.m. The voting was as follows:

Hughes "aye" Donley "aye"
Pepper "aye" Fannon "aye"
Euille "aye" Krupicka "aye"
Smedberg "aye"



APPROVED BY:

_______________________________
WILLIAM D. EUILLE MAYOR


ATTEST:

_______________________________________
Jacqueline M. Henderson
City Clerk and Clerk of Council




This docket is subject to change.

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Full-text copies of ordinances, resolutions, and agenda items are available in the Office of the City Clerk and Clerk of the Council.
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City Council meetings are closed-captioned for the hearing impaired.
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