Several largely-intact ship hulls found underground in Old Town a few years ago could see new life in a proposed “Waterfront Museum” in the early stages of consideration in the upcoming budget.

The possible museum could house and display the timbers of at least one of the four-total ships found under new developments in 2018.

To be clear: the idea of the museum is still in its nascent stage. A feasibility study to “assess the viability” of the potential museum.

In addition, in FY 2022 $125,000 is requested to conduct a Waterfront Museum Feasibility Study to assess the viability of a history center as recommended in the Waterfront History Plan and the Waterfront Area Plan. If supported, the museum would house items such as the conserved ship timbers of an 18th century merchant ship and associated artifacts excavated as part of the Robinson Terminal South and Hotel Indigo construction projects.

Derelict ships were often used part of the foundation when the city was expanding its waterfront at the end of the 18th century. One of the most intact ships was once a cargo freighter, with holes showing where certain Caribbean worms had eaten away at the wood and dendrochronology indicating that the ship’s timbers were originally from Boston and had been cut down in 1741.

The discovery of the ships made national headlines, with the relatively intact state giving archeologists a chance to analyze artifacts from the city’s heyday as a port.

The timbers from the ships were shipped to Texas A&M for further study and preservation — mainly involving the slow extraction of water from the long-buried timbers and careful treatment to ensure the frames don’t lose integrity in the process.

A scale model of the ship is available in the Alexandria Archaeology Museum on the top floor of the Torpedo Factory Art Center, but the museum would be too small to house timbers from the ship, which is around 25 feet wide and 46 feet long.

The feasibility study comes in addition to $102 million also being considered for infrastructure improvements along the waterfront. The budget item notes that prices have increased dramatically since many of the infrastructure improvements were first proposed.

According to the budget memo:

$102 million over the ten-year CIP to support the design and construction of the Plan-recommended infrastructure, including flood mitigation, prioritized through community engagement processes. Projected construction costs have increased due to further scope refinement, further design development, and market drivers. Cost estimates have been escalated to anticipated mid-construction date. The most significant changes were due to more detailed design for stormwater and pumping system, structural bulkhead, and electrical infrastructure. The current CIP budget is funded at approximately 50% of the current cost estimate. Alternative strategies and value engineering studies are currently underway. The design-build process will likely include further alternatives analysis and cost development to facilitate a firm budget. It is anticipated that the CIP budget request will be further refined after the project alternatives and value engineering process is complete.

The waterfront items are part of a larger FY 2022 budget discussion scheduled for the April 8 Planning Commission meeting.

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In the latest adaptation of Brewster’s Millions, Alexandria is sorting through how to make the most of $59.4 million in federal COVID-19 relief funding coming to the city over the next two years with an emphasis on not leaving a penny unspent.

The challenge for Alexandria is sorting through some ill-defined language. According to the city, funding can be allocated in the following ways:

(A) To respond to the public health emergency with respect to Coronavirus Disease 2019 (COVID-19) or its negative economic impacts, including assistance to households, small businesses, and nonprofits, or aid to impacted industries such as tourism, travel, and hospitality; or

(B) For the provision of government services to the extent of the reduction in revenue of such metropolitan city, non-entitlement unit of government or county due to such emergency; or

(C) To make necessary investments in water, sewer, or broadband infrastructure.

Members of the City Council noted in a meeting last night (Tuesday) that the first and third items are fairly clear, but what is considered making up for a reduction in revenue is more vague.

“It does seem like the second item on the list, revenue lost item… how that gets defined by the federal government is going to be really decisive to what we can and can’t spend money on,” said Mayor Justin Wilson. “That second point could be defined very broadly or very narrowly. And how they define that will determine how expansive that will be.”

Staff are currently planning to present options to the City Council at the July 6 meeting so the city can get more defined answers on funding requirements and restrictions.

But even with just the more well defined points, the funding comes as a welcome relief for a city still grappling with the economic impact of COVID-19. The region also combatted severe flooding over the last few years, and the city has been working to prioritize stormwater improvements in the aftermath.

“I don’t know how far along we are with our flooding stuff, but want us to focus on that,” said Council member Del Pepper. “Everyone is tired of the flooded basement and raw sewage.”

Council member John Chapman said the city should also use some of that funding to leverage public-private partnerships, with the new assistant city manager tasked with managing those partnerships mentioned now at least twice in a public meeting this past week.

“I think this is a great opportunity, if not too early, to engage our P3 coordinator to see how we can leverage these one time funds to get something popping in his portfolio,” Chapman said.

One of the important points reiterated multiple times is that the city should scrape the bottom of the barrel on this funding and ensure nothing is left to waste.

“Let us be mindful at all times that this community will be unforgiving if we do not spend all of that money,” Pepper said. “Now we just can’t go out and throw it in the streets, but there has to be — maybe not the best plan — but some plan, and God only knows we have plenty of things we can spend it on.”

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Like a lot of Americans, Alexandria is working on figuring out how to put its upcoming stimulus checks to good use.

The City of Alexandria is preparing to receive around $59.4 million from the American Rescue Plan (ARP) and the city is currently working through how and where to put that money to use.

The funding is scheduled to arrive in two parts: first in May of this year, then again in May 2022. Unlike the CARES Act funding, this funding will go directly to the city rather than passing through the state.

In a presentation prepared for the City Council meeting on Tuesday, March 23, staff laid out the timeline for how and when the city will allocated the funding.

According to the city, the plan is to:

  • Develop a plan this spring for spending part or all of the first $29.7 million tranche and present the plan for City Council’s consideration on July 6. The exact amount will depend upon further guidance on use of funds for revenue loss.
  • Designate $450,000 now for use towards continuing food distribution and housing eviction programs between now and July.
  • The second $29.7 million (plus any amounts of the first tranche not allocated) could be considered as part of the FY 2023 budget process plan for the spending of during FY 2023 and beyond.
  • Focus primarily on programs that have a finite end as well as long term capital investments that meet the ARP spending purposes, and not initiate programs where there would be an expectation of continuation when the ARP funding ends.
  • When considering CIP projects, determine what can be realistically completed by 2024.
  • Consider what may already be covered through other sections of the legislation and other potential federal resources. (Targeted Appropriations, Infrastructure Funding, etc.)

As the city works to put together its plan, the presentation noted that staff will conduct community engagement to help establish priorities throughout April, along with coordinating with departments like Department of Community and Human Services, the Housing Office, the Alexandria Economic Development Partnership and Visit Alexandria.

Over the course of April and May, staff will work on proposal development for presentation to the City Council on July 6.

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In the middle of the ongoing budget season, the City Council is looking back at the dramatic drop-off in tax revenue over the last year, yet another reflection of the dramatic toll of the coronavirus pandemic.

A financial report to the City Council includes a summary of the $17.4 million consumptive tax revenue — taxable revenue from the sale of goods or services, like sales taxes — lost since March 2020.

The chart shows a 25% decline in consumer spending in 2020 compared to 2019, with taxes on admissions being particularly hard hit with an 84.3% decline, from $562,660 collected in taxes on admissions in 2019 and only $88,548 in 2020. Last April, tax revenue showed that only four people in the entire city purchased movie theater tickets.

Transient lodging (hotels) took a similar hit, down 69.5% from 2019 to 2020. Some of the city’s hotels may not survive the pandemic, and the city and the Alexandria Economic Development Partnership (AEDP) are currently looking into converting closing hotels into affordable housing units.

The decline in consumer spending accounted for part of the budget’s initial $41 million budget gap that was eventually resolved into the proposed FY 2022 budget. City Manager Mark Jinks proposed a 2 cent real estate tax rate reduction, though some in the city have noted that taxes are still likely to go up for local residents as they shoulder the burden of the decline in commercial revenue.

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In the latest Agenda Alexandria conversation, local business and civic leaders came together to discuss the highs and lows of the recently proposed City Manager’s budget.

The budget included a proposed tax rate reduction, but City Council candidate Bill Rosssello challenged the overly sunny narrative about the reduction.

“I look at the budget the way it’s been presented and something that always seems to concern me is when we lead with a narrative around the tax rate,” Rossello said. “The tax rate is only one part of the equation for the actual taxes that people pay… While we’re looking at a proposed 2 cent tax rate decrease, when you do the math, for the average household it comes out to be almost a 6% tax increase in real dollars and that’s what really matters to residents: how much more or how much less am I going to pay?”

Rossello was joined on the panel by Rob Krupicka, former City Council member and Delegate and owner of Elizabeth’s Counter, and Janet Blair Fleetwood, Secretary of the Budget & Fiscal Affairs Advisory Committee and the Mayor’s representative on Budget and Fiscal Affairs Advisory Committee (BFAAC).

The group discussed the current imbalance between the residential and commercial tax bases, which has only gotten worse during the pandemic.

“Back in 2009, we used to get 30.5% of revenue from commercial, said Fleetwood. “It is now 21.3%. We have a good situation here, with Virginia Tech’s Innovation area coming in, Amazon, the Patent office, the National Science Foundation, and Landmark. We should start looking to grow businesses that will come in and bring good jobs and use commercial real estate.”

Fleetwood said there has been talk that post-pandemic, companies may not want to use commercial real estate as they did before, but Fleetwood said she has also heard from companies that they will still need physical footprints for team projects.

“I don’t think commercial footprint is going away,” Fleetwood said.

Krupicka noted that questions about the balance between residential revenue and commercial revenue may fundamentally change post-pandemic.

“The balance between residential revenues and commercial revenue… there are fundamental shifts happening right now that make that an old debate,” Krupicka said. “People are working from home now, and you’re going to see a lot of businesses that don’t go back to commercial office when COVID ends.”

Krupicka said one of the larger concerns is that small business have to compete against larger companies like Amazon and pay taxes those companies don’t.

“Small businesses are competing against Amazon and large internet companies,” Krupicka said. “There is big international competition that pays a lot less taxes than small mom and pop. Small mom and pop has to pay BPOL tax… small businesses like mine are writing checks to government, but doing it in the hole. If you broke even on COVID, you’re paying on gross receipts, not profits.”

Krupicka said Amazon pays retail taxes, which benefits the city, but in general pays less on taxes per transaction than small restaurants or retailers.

“We need to have conversation about if we want small businesses to be at a disadvantage tax wise,” Krupicka said.

On the other side, Rossello said the burden on residential taxpayers has grown considerably and is pushing people out of Alexandria.

“We’ve taxed out so many middle class folks, who can afford to pay decent mortgage or rent, but find it more affordable to leave,” Rossello said. “We’ve seen whole neighborhoods turn over from diverse middle class neighborhoods to gentrified neighborhoods where houses on very small lots are $1.5 million dollars.”

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For all the earlier talk of doom and gloom early in the coronavirus financial forecasts, City Manager Mark Jinks’ proposed FY 2021 budget seems relatively painless.

As laid out by Jinks, the operating budget is a 1.9% proposed increase over last year’s, with a 2 cent real estate tax rate reduction, no major service reductions, and fully funds the proposed school CIP and operating budget.

The budget was reviewed at a City Council meeting last night (Tuesday) with a public hearing planned tomorrow (Thursday).

Jinks said the budget was made possible by $11.8 million in expenditure savings, driven in part by leaving 38 currently vacant positions unfilled. These positions, Jinks said, weren’t concentrated in any one particular department but were spread out across the city. No police department, fire department or emergency medical personnel were among the unfilled positions, he said.

The main budget proposed by Jinks includes a real estate tax rate reduction from $1.13 to $1.11, though Jinks also included other options to leave the tax rate as-is and fully finance some programs like a planned overhaul of DASH services.

In the existing budget, DASH will have to reallocate funding away from routes in less dense parts of the city if it wants to achieve its high density transit corridor goals — meaning some residents in areas like Seminary Hill could lose their local bus routes.

On the topic of transit: the budget also included a note that the King Street Trolley is planned to return in September, hopefully at the start of a fall tourist season.

Some of the budget’s goals include a renewed focus on what Jinks called “aggressively increased stormwater utility work,” including increasing maintenance on the stormwater system and new hires from additional engineers to sanitation workers.

A $5 million Holmes Run Trail restoration is also included in capital funding, with the goal of building a stronger dam on the creek that can withstand a harder beating after 2019’s devastating floods.

One of the other anticipated projects moving forward in next year’s budget is municipal fiber.

“We’ve been talking about replacing our rental from Comcast with our own network, which will give us and the school system greater capacity,” Jinks said. “In this project, we’re building two tubes, digging one for ourselves and a vacant tube next to it that we will be working to get a private sector entity to provide broadband service of some kind.”

Jinks said the multi-year construction project to connect 100 city and school facilities will start next year.

One of the biggest expenditures pushed back is a planned City Hall renovation. The city’s facilities are badly outdated, with some infrastructure dating back to just after World War II. Jinks said that renovation was pushed back in part because, with teleworking coming into the fore during the pandemic, “we don’t know what the future workforce will look like yet.”

The budget added 26.5 new positions, 18 of which are in the Department of Transportation and Environmental Services. In large part, these new jobs were part of a process to bring the city’s sanitation work in-house. Jinks said most of those 18 jobs are staffing for vehicles to pick up yard waste.

Jinks said departments scrubbing their budget and Federal aid through the worst of the pandemic played a big role in putting the budget together.

“This was probably the most uncertain budget process we’ve ever had,” Jinks said.

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Morning Notes

Virginia Launching Statewide Vaccine Pre-Registration System — “The Virginia Department of Health (VDH) will launch a statewide system to help citizens pre-register for the COVID-19 vaccine. The new system will supersede the Alexandria Health Department’s own pre-registration form. It will be operational on Tuesday, Feb 16 at 8 a.m.” [Zebra]

Alexandria Firefighters Oppose Collective Bargaining Agreement — “Employees and labor unions within the City of #Alexandiava attempted to sit down with the City Manager to come up with fair Collective Bargaining agreement. He ignored the employee’s voices and made a management friendly agreement.” [Twitter]

Alexandria Budget Public Hearing on Thursday — “Alexandria City Manager Mark Jinks invites the public to a virtual presentation of his proposed Fiscal Year 2022 Operating Budget and Capital Improvement Program on Thursday, February 18, at 7 p.m.” [Twitter]

Homesense Opens Franconia Store — “Fans of the store Homesense now have a shorter trip to get their home goods fix. The popular home store opened its first location in the Alexandria area at 7005 Manchester Blvd. in the Festival at Manchester Lakes shopping center on Thursday.” [Alexandria Living]

Today’s Weather — “Intervals of clouds and sunshine (during the day). Slight chance of a rain shower. High 54F. W winds at 5 to 10 mph, increasing to 15 to 25 mph… Clear (in the evening). Low 24F. Winds NW at 15 to 25 mph.” [Weather.com]

New Job: Entry Level Personal Fitness Trainer — “We are looking for coachable, enthusiastic, and dependable people who want to enter the field of personal training. No prior fitness experience or fitness education required! We will hire and teach you everything you need to know to become a Certified Personal Trainer with The Perfect Workout!” [Indeed]

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The annual showdown between the City Council and School Board over funding could be exacerbated this year by the lingering fiscal impact of coronavirus.

At the tail end of a joint work session between the two bodies last week, City Manager Mark Jinks outlined the dire fiscal situation as the city heads into its budget season.

“We’re closing the gap,” said Jinks. “We started with a $41 million gap in November. We’re not allowed to have a gap when the budget is proposed. That’s been a lot of discussion with departments about budget reduction options. Many of them are also ways of saving money, getting through the next year, without material service reduction.

Jinks says the city is gradually making progress on that and, later this month, a proposed budget will be sent to the City Council.

Meanwhile, Alexandria City Public Schools (ACPS) is working through a parallel budget process. Dominic Turner, Chief Financial Officer for ACPS, said in the meeting that the schools will be requesting a $5 million increase.

“With that budget, asked for a city increase of $5 million,” Turner said. “That increase helps cover staff step increases and health benefits going into 2022.”

Turner said the schools have been leaning hard on grant funding to help equip students with the technology needed for virtual schooling. When ACPS does return to in-person schooling, the system has also said it will need contingencies in place for localized outbreaks at schools.

“The strategy is to have funding available when students get in the door to mitigate COVID-19 issues,” Turner said.

A joint work session for both groups to discuss their budgets is scheduled for March 3.

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For the second straight budget cycle, the pandemic is rearing its ugly head in Alexandria.

In a virtual town hall last night, Mayor Justin Wilson offered a look at the behind-the-scenes back and forth between local, state and federal agencies as the city works to get some assistance to help cover an estimated $41 million shortfall.

Last year, the city was the recipient of $23.9 million in CARES Act funding, which was put to use in things like rent and food assistance and couldn’t be used to cover other city expenses. The new federal assistance does not include local or state support, though, Wilson said, though he is hopeful a Democratic majority in the Senate can help to amend that.

“The Heroes Act adopted by house did include $87 million for Alexandria, which would have nearly replaced our estimated loss of revenue that we had assumed because of COVID,” Wilson said.

Last April, the pandemic forced Council to approve a drastically reduced Fiscal Year 2021 budget.

Beyond the immediate budget gap, concerns linger that it could be several years before the city’s economy fully recovers from a pandemic that permanently shut down businesses across the city and led to record unemployment that is gradually returning to normal levels.

“Right now, we’re facing a $41 million gap in the budget we will be working to adopt this spring,” Wilson said. “It’s a significant gap for us and we have more concerns down the line.”

Image via YouTube

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Alright, which of you went to a movie in April?

At the height of the pandemic, when nearly everything in the city was shut down, the city’s latest revenue report shows that the city still collected $2 in admissions tax. The city’s finance officials ran the numbers and said that meant that four people bought tickets at movie theaters in Alexandria while nearly everything in the city was shut down.

“I don’t have their names, but that is how little revenue we collected in admissions tax,” said Kendel Taylor, the Director of Finance. “There were four people who contributed to that.”

It was one of the few moments of levity in what was otherwise a particularly dour financial report at yesterday’s City Council meeting that showed millions lost in meals tax revenue and transient tax revenue. Sales tax remained high, but only because the figures were from March, before the shutdown started. The lack of tax revenue has led to a gutting of the city budget with projects like the redevelopment for T.C. Williams High School pushed back.

While Taylor said she was grateful that the city went into the pandemic with a strong economy, she was less optimistic about the rate the city will be able to recover. Taylor said there’s no guidebook or methodology for figuring out what happens next, and staff in cities and counties across the country are still working to figure out how deep the economic impact will be and how long it will take to climb out.

“One of the most prevalent theories right now is this recovery is going to be very long and slow,” Taylor said. “It is likely going to take us two years to get to where we ended in December 2019. The economy was really strong at the end of the year and all throughout the year. Everything was ahead of expected. We came into COVID in a really good position. That strength has helped us minimize the cut and the funds balance we’re going to have to use.”

Taylor said the city could benefit from additional federal funding currently in the pipeline — particularly since unlike the CARES Act that funding can be used more flexibly by local government. There were still concerns, Taylor said, that more federal funding for local governments will mean Virginia will feel less obliged to continue sending funding to localities. Alexandria has used CARES Act funding for programs like rental assistance and small business grants.

“The one concern about the federal government providing additional flexible monies is it might lessen the need from the state to push down the second traunch of CARES funding,” Taylor said. “[We’re] continuing to make the argument that the spirit of the CARES funding is direct that it impacts in localities and that the services provided closest to the problems are the best services.”

Staff photo by James Cullum

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