STAUNTON — “Not now, but it’s coming.”
Those were the words of Staunton Councilor Alice Woods to the city’s school board Thursday night. Mayor Stephen Claffey agreed, telling Woods that was “well said.”
The two council members were referring to new construction at Shelburne Middle School. The school board approved a resolution earlier this month requesting council to issue general obligation school bonds to help fund the next phase of renovations at the school. They were asking for $6.6 million to complete a multi-tiered collaboration space with seating for up to 350 people that would be built adjacent to Shelburne’s Hern Gymnasium between Shelburne Middle and Ware Elementary schools.
Council discussed the request at its regular meeting Thursday night but never put it to a vote. It seemed to be the consensus of the seven members who all spoke that it was not the time for the city to take on new debt.
“The outcome of last night’s meeting appeared to be predetermined which is a major disappointment to us,” Staunton Schools Superintendent Garett Smith told The News Leader. “The message received is that the schools are to blame for the city’s financial stress.”
Staunton’s Chief Financial Officer Jessie Moyers told council that there are several factors that needed to be taken into consideration before approving the school bonds. The largest, she said, would be a larger-than-normal increase of $1.3 million to schools based on the funding formula. That is a direct effect from the increase in the real estate tax assessment in 2023.
It wasn’t all school-related financial strain though.
Moyers said the 10-year Harrisonburg/Rockingham County buy-in to the Middle River Regional Jail is close to ending. The two localities agreed in 2015 to a $21.5 million buy-in, dividing the money between Staunton, Waynesboro and Augusta County. That ends in 2025, meaning Staunton will lose that revenue in 2026.
There’s also the debt taken on for the Staunton Juvenile & Domestic Relations Courthouse, as well as funding for additional Sheriff’s Office staff related to the courthouse.
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“So the city already needs about $2.9 million dollars or the equivalent of almost 10 cents on the real estate tax rate in new revenue before we even begin to address cost of living increases for city employees, increases in operating expenses or increases in outside agency funding,” Moyers said
She said the single biggest challenge in issuing new debt is that there are no revenue streams to support it. And several projects the city has discussed are either unfunded or underfunded, including public safety facilities, West End revitalization, Uniontown improvements, affordable housing and aging infrastructure.
Moyers said if council wanted to issue the nearly $7 million bond for the school division they had two options. One was an additional tax increase and amending the school funding formula to set aside the increase for Shelburne.
The second option would be to take the 3 cents on the real estate tax rate set aside in 2024 for eventual improvements to the library, West End revitalization and Uniontown and redesignate it to Shelburne. Moyers said in order to do that, school renovations would replace two of the existing three projects.
Councilor Brad Arrowood called the idea of renovating Shelburne a “great project,” which seemed to be the consensus of the other council members, but like his fellow members, he believes now is not the time.
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“I want to see this happen but is right now the best climate for it?” Arrowood said.
He believes putting the project out for rebid in hopes of getting more competitive offers may be the route to go.
“I don’t know,” he said. “It may be more later and it might be less later, no idea.”
To Arrowood’s point, Federal Reserve Chair Jerome Powell said in written remarks Friday morning that the “time has come for policy to adjust,” signaling that the central bank plans to begin cutting high interest rates in September.
The urgency in the request for the bond came about because the application deadline for the Virginia Public School Authority 2024 Fall Bond Pool is Aug. 26.
Staunton School Board Chair Kristin Siegel called the decision a huge disappointment.
“We have attempted to be transparent with our needs for this addition since its inception, and have done everything possible to keep the project from adding debt to the city budget,” she said in a statement to The News Leader. “However, as a citizen, it is concerning to hear that the city doesn’t have the funds to finance this project in addition to its other priorities.”
She said the school board will keep fighting for the needs of the students and staff.
“I look forward to the day when our city’s financial investments reflect the priorities and needs of its community,” Siegel said.
Council members seemed to want to wait for the next budget cycle to consider new construction, possibly giving them a better view of the city’s finances.
“With these unknowns and what we’re facing, a project of this magnitude, we’re talking a 10% request of our overall annual city general fund, it has to go through the budget process,” said Councilor Adam Campbell. “It has to be considered as a complete picture with the needs of the entire city.”
— Patrick Hite is a reporter at The News Leader. Story ideas and tips always welcome. Connect with Patrick (he/him/his) at phite@newsleader.com and on Instagram @hitepatrick. Subscribe to us at newsleader.com