Operating Budget 2025-2026

ADOPTED OPERATING BUDGET

FISCAL YEAR 2025/2026

Town of Blacksburg FY 2025-2026 Adopted Operating Budget

TOWN COUNCIL Leslie Hager-Smith, Mayor Michael Sutphin, Vice Mayor Susan Anderson Lauren Colliver

Jerry R. Ford, Jr. Susan Mattingly Liam J. Watson

TOWN ADMINISTRATIVE STAFF Town Manager – Marc A. Verniel Deputy Town Manager – Community Development – Matthew T. Hanratty Deputy Town Manager – Operations – Steven F. Ross Town Attorney – Lawrence S. Spencer, Jr. Town Clerk – Lorraine S. Spaulding

Director of Financial Services – Jeff D. Lazenby Director of Human Resources – Teresa A. Harless Community Relations Manager – Heather D. Browning Police Chief – Kendrick T. Brewster Fire Chief – Drew Smith Rescue Chief – David English Director of Parks and Recreation – Dean B. Crane Director of Engineering and G.I.S. – Carolyn A. Howard Director of Planning and Building – Andrew F. Warren

Director of Public Works – John N. Boyer Director of Technology – Steven B. Jones Director of Transit – Brian D. Booth

July 1, 2025

Citizens of the Town of Blacksburg Blacksburg, Virginia Dear Citizens:

The FY 2025/2026 Budget was presented to Town Council for review and consideration on April 1, 2025. Several Work Sessions were held to review the budget before a Public Hearing took place on May 13, 2025. Town Council adopted the Town’s Budget for Fiscal Year 2025/2026 on May 27, 2025. The Council approved the Recommended Budget with the following changes to agency funding: Literacy NRV to $3,500 from the Town Manager’s recommendation of $3,200. • NRV Agency on Aging to $9,350 from the Town Manager’s recommendation of $8,500. • Blacksburg Master Chorale to $1,000 from the Town Manager’s recommendation of $700. • Blacksburg Summer Arts Festival to $16,000 from the Town Manager’s recommendation of $10,000. • Wonder Universe to $3,000 from the Town Manager’s recommendation of $2,000. • YMCA at Virginia Tech to $3,500 from the Town Manager’s recommendation of $3,000. • Blacksburg Partnership to $40,000 from the Town Manager’s recommendation of $30,000. • Cayambis Institute for Latin American Studies in Music to $400 from the Town Manager’s recommendation of $0. • Imagination Library of Montgomery County to $3,500 from the Town Manager’s recommendation of $0. • Lyric Council-Capital Campaign to $70,000 from the Town Manager’s recommendation of $0. The Town Manager’s letter transmitting the budget to Town Council follows the Table of Contents and provides highlights of the budget. The budget is available online at www.blacksburg.gov/budget. A copy of the Ordinances adopting the budget for FY 2025/2026 is included in the Adopted Operating Budget following the Town Manager’s transmittal letter. A copy of the Resolution adopting the Capital Improvement Program is included in the separately issued Capital Improvement Program . The Town Council approved the FY 2026-2030 Capital Improvement Program on January 28, 2025. •

Sincerely,

Marc A. Verniel Town Manager

GENERAL FUND APPROPRIATIONS

4.

(a) The following sums are appropriated from the General Fund ofthe Town for the

annual operation of the Town departments and non-departmental accounts as set forth below:

Town Council/Town Clerk Town Manager/Human Resources/Community Relations Housing and Community Connections

$ 339,896 2,636,462

(i) General Fund 683,232 (ii) New River Home Trust 86,212 (iii) Total

769,444

Agencies and Authorities Parking Services Town Attorney

2,785,665 2,692,815 155,292 486,958

Planning and Building Engineering and GIS Financial Services Technology Police Fire Rescue Public Works Parks and Recreation Debt Service Non-Departmental & Transfers

2,073,749 1,835,788 2,730,575 1,461,516 11,331,739 7,726,120 4,173,493 3,343,325 9,192,060 30,000 986,349 877,316

Street Paving Contingency

484,750

577,600

TOTAL GENERAL FUND APPROPRIATION

$ 53,420,497

(b) Sums so appropriated that have not been encumbered or expended as ofJune 30,

2025, except capital expenditures as set forth in§ 6.10 of the Town Charter, shall lapse and

revert to the unappropriated balance ofthe General Fund.

(c) The Town Manager may transfer funds from "General Fund Contingency" to

other departments, offices, agencies, or accounts as appropriate and to effectuate the pay plan

approved by this ordinance.

(d) The total number of full-time permanent positions set forth in the budget shall be

the maximum number ofpositions authorized for the various departments of the Town during

the Fiscal Year, except for changes or additions authorized by Town Council. The Town

Manager may from time to time increase or decrease the number ofpart-time or temporary

positions: provided, however, that the aggregate amount expended for such services shall not

exceed the respective appropriations made therefore.

5. MIDTOWN SPECIAL SERVICE DISTRICT FUND APPROPRIATION

There is hereby appropriated from the Midtown Special Service District Fund, for

expenditures related to the operation ofthe Midtown Special Service District during the Fiscal

Year, $692,900. The Midtown Special Service District additional tax for the calendar year

2025 is $.20 per one hundred dollars of assessed valuation ofreal property and improvements

in the district, pursuant to Town Code § 22-1106.

CDBG ENTITLEMENT FUND APPROPRIATION

6.

There is hereby appropriated from the CDBG Entitlement Fund, for expenditures

related to the Federal CDBG Entitlement Program during the Fiscal Year, $517,900.

HOME CONSORTIUM FUND APPROPRIATION

7.

There is hereby appropriated from the HOME Consortium Fund, for expenditures

related to the Federal HOME Consortium Program during the Fiscal Year, $712,800.

EQUIPMENT OPERATIONS FUND APPROPRIATION

8.

There is hereby appropriated from the Equipment Operations Fund, for the operation

of the internal garage and maintenance facility during the Fiscal Year, $1,489,600.

TRANSIT FUND APPROPRIATION

9.

There is hereby appropriated from the Transit Fund, for the operation of the transit

system during the Fiscal Year, $16,055,620. There is hereby appropriated from the Transit

14.

GENERAL CAPITAL IMPROVEMENT FUND APPROPRIATION

There is hereby appropriated from the General Capital Improvement Fund, for the

capital improvement expenditures in the approved Capital Improvement Program during the

Fiscal Year, $4,853,400. These are capital expenditures and this appropriation shall not lapse

at the close of the Fiscal Year, as set forth in§ 6.10 ofthe Town Charter.

15.

EFFECTIVE DATES

(a) As provided by Town Code§ 22-200, Paragraph 3 ofthis ordinance shall be

effective on and after its adoption; the rest of this ordinance, and the

appropriations set forth herein, shall become effective July 1, 2025. The pay

rates for the fiscal year shall be effective for the entire first paycheck in July.

(b) Effective Julv 1. 2025, the annual salary o[the TownAttornevshall be $218,569,

the annual salary ofthe Town Manger shall be $235,775, and the annual

salary o(the Town Clerk shall be $76,431.

REAL ESTATE TAX DUE AND PAYABLE

16.

The June 5 th due date contained in Town Code§ 22-202 for the payment of first half

real estate taxes is extended to June 27, 2025.

1h

own Clerk I oduction: Apvi\ B, 2o2'5

Public Hearing and Action: tv'\Q� 1.. 1, '2.02 '5 -Pvb\iC- \.-\eorir19 \t\elct Of\ VY\l\� 13, 'JJJ}.,'5

APPROVED AS TO LEGAL SUFFICIENCY:

APP VEDAS TO CONTENT:

1:�s-5:1,,-- 7 Lawrence S. Spencer, Jr., Town Attorney

Steven Ross, eputy Town Manager

the payment ofthe Montgomery Regional Solid Waste Authority tipping fee, and for the

improvement ofthe general public health and environment, a solid waste collection service

charge for each dwelling unit and commercial or residential establishment generating solid

waste within the town and required by section 20-200 ofthis chapter to participate in the

curbside collection and curbside recycling program. The service charge for collection of

Class A residential solid waste and Class II bulky rubbish shall be$� 32.67 per calendar

month. The service charge for collection oflight commercial solid waste shall be$�

32. 67 per establishment, in both cases, for up to one solid waste container, or its equivalent,

excluding recycling containers, and$� 32.67 for each additional unit or its equivalent,

excluding recycling containers, per calendar month. The service charge for all other

generators ofother types ofsolid waste contracting with the town for curbside refuse and

recycling service under this chapter shall be$� 32.67 per dwelling unit or per

establishment, as appropriate, per calendar month.

***

Sec. 24-602. Rates and fees established.

(a) The charges for water service for a customer shall be a flat billing service charge,

plus a rate based on the amount ofwater passing through and recorded by a meter for the

billing period, whether used or wasted as a result ofleaks or neglect ofthe customer, at the

following rates:

Billing service charge inside the corporate limits of� 3.24 and a rate of�

(1)

8.54 for each 1,000 gallons or fraction thereof.

Billing service charge outside the corporate limits of� 5.68 and a rate of

(2)

$14.23 14.94 for each 1,000 gallons or fraction thereof.

***

2. This ordinance shall become effective July 1, 2025, and shall apply to all billing

periods beginning on or after that date.

ATTEST:

Introduction: Apvil a, 2025 Public Hearing and Action: VY\oJ 2] , 7D2 5 W�\ic \-\�otin� V\e\d c,n VV1 \,\ l'), 1-0LS APPROVED AS TO CONTENT: f t /J� t y Town Manager

APPROVED AS TO LEGAL SUFFICIENCY:

, r., Town Attorney

TABLE OF CONTENTS

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Transmittal Letter .........................................................................................................................1 Distinguished Budget Presentation Award ..................................................................................7 Town Council Strategic Goals ......................................................................................................8 Budget Guidance ..........................................................................................................................10 Principles of Sound Financial Management ..............................................................................11 Budget in Brief Town of Blacksburg Organizational Chart ........................................................................14 Description of Town Funds ...............................................................................................15 Expenditures - All Funds ...................................................................................................19 Fund Balance Determination .............................................................................................20 General Fund General Fund Five-Year Summary ....................................................................................21 General Fund Revenues .....................................................................................................22 General Fund Budget Summary.........................................................................................26 Debt Service/Contingency .................................................................................................27 Town Council ...................................................................................................................28 Town Clerk ........................................................................................................................30 Agencies and Authorities ...................................................................................................33 Town Manager .................................................................................................................36 Human Resources Office ...................................................................................................39 Community Relations Office .............................................................................................43 Housing and Community Connections Office – Community Connection Division..........46 Town Attorney .................................................................................................................52 Financial Services Department Financial Services Department Organizational Chart/Narrative .......................................55 Financial Services Department Funding Summary ...........................................................58 General Services ................................................................................................................59 Accounting .........................................................................................................................60 Purchasing ..........................................................................................................................61 Management Information Systems ....................................................................................62 Technology Department Technology Department Organizational Chart/Narrative..................................................63 Technology Department Funding Summary......................................................................65 Public Safety and Justice Police Department Organizational Chart/Narrative...........................................................66 Police Department Funding Summary...............................................................................68 Office of the Police Chief ..................................................................................................69 Police Services ...................................................................................................................70 Administrative Services .....................................................................................................71 Police Operations ...............................................................................................................72

TABLE OF CONTENTS (continued)

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Volunteer Fire Department Organizational Chart/Narrative .............................................72 Volunteer Fire Department Funding Summary .................................................................75 Volunteer Rescue Squad Organizational Chart/Narrative .................................................76 Volunteer Rescue Squad Funding Summary .....................................................................78 Public Works Department Public Works Department Organizational Chart/Narrative .............................................. 79 Public Works Department Funding Summary ...................................................................82 Public Works Administration ............................................................................................83 Streets Division ..................................................................................................................84 Property Division ...............................................................................................................85 Landscape Maintenance Division ......................................................................................86 Parks and Recreation Department Parks and Recreation Department Organizational Chart/Narrative...................................87 Parks and Recreation Department Funding Summary.......................................................89 Administration Division.....................................................................................................90 Indoor Aquatic Division ....................................................................................................91 Parks Division ....................................................................................................................92 Golf Course Shop...............................................................................................................93 Golf Course Maintenance ..................................................................................................94 Athletic Division ................................................................................................................95 Community Center Division ..............................................................................................96 Community Programs/Special Events Division.................................................................97 Outdoor Division ...............................................................................................................98 Senior Division ..................................................................................................................99 Engineering and Geographic Information Systems (GIS) Department Engineering and GIS Department Organizational Chart/Narrative .................................100 Engineering and GIS Department Funding Summary .....................................................103 Engineering Division .......................................................................................................104 GIS Division ....................................................................................................................105 Street Lighting Division...................................................................................................106 Planning and Building Department Planning and Building Department Organizational Chart/Narrative...............................107 Planning and Building Department Funding Summary...................................................110 Planning Division.............................................................................................................111 Building Safety Division..................................................................................................112 Capital Improvement Fund Description of Capital Improvement Funds.....................................................................113 General Fund Capital Improvements Funding Summary ................................................114

TABLE OF CONTENTS (continued)

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Special Revenue Funds Housing and Community Connections Office Narrative – Housing Division ................115 American Rescue Plan Act (ARPA) Fund ARPA Fund Narrative......................................................................................................117 ARPA Fund Five-Year Summary ....................................................................................119 ARPA Project Summary ..................................................................................................120 CDBG Entitlement Fund CDBG Entitlement Fund Five-Year Summary................................................................121 CDBG Entitlement Funding Summary ...........................................................................122 HOME Consortium Fund Home Consortium Fund Five-Year Summary .................................................................123 Home Consortium Funding Summary .............................................................................124 Affordable Housing Development Fund Affordable Housing Development Fund Narrative..........................................................125 Affordable Housing Development Fund Five-Year Summary........................................127 Midtown Special Service District Fund Midtown Special Service District Fund Narrative...........................................................128 Midtown Special Service District Fund Five-Year Summary .........................................129 Midtown Special Service District Funding Summary .....................................................130 Equipment Operations Fund Equipment Operations Narrative .....................................................................................131 Equipment Operations Fund Five-Year Summary ..........................................................132 Equipment Operations Funding Summary.......................................................................133 Transit Fund Transit Fund Organizational Chart ..................................................................................134 Transit Narrative ..............................................................................................................135 Transit Fund Five-Year Summary ...................................................................................136 Transit Funding Summary ...............................................................................................137 Administration .................................................................................................................138 Communications and Customer Support .........................................................................139 Information Technology ..................................................................................................140 Operations ........................................................................................................................141 Training ............................................................................................................................142 Maintenance .....................................................................................................................143 Mode of Service ...............................................................................................................144 Solid Waste and Recycling Fund Solid Waste and Recycling Narrative ............................................................................. 145 Solid Waste and Recycling Fund Five-Year Summary .................................................. 146 Solid Waste and Recycling Funding Summary .............................................................. 147

TABLE OF CONTENTS (continued)

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Stormwater Fund Stormwater Narrative.......................................................................................................148 Stormwater Fund Five-Year Summary ............................................................................150 Stormwater Funding Summary ........................................................................................151 Water and Sewer Fund Water and Sewer Narrative ............................................................................................. 152 Water and Sewer Fund Five-Year Summary .................................................................. 154 Water and Sewer Funding Summary .............................................................................. 155 Utility Services................................................................................................................ 156 Utility Division ............................................................................................................... 157 Utility Contracts and Testing ......................................................................................... 158 Water and Sewer Fund Debt Service/Capital Improvements ......................................... 159 Supplemental Information General Information - Town of Blacksburg.....................................................................160 Miscellaneous Statistics ...................................................................................................161 Demographic Statistics ....................................................................................................162 Principal Taxpayers and Water/Sewer Customers...........................................................163 Location Map - Town of Blacksburg...............................................................................164 Authorities, Boards, Commissions, Committees and Task Forces ..................................165 The Budget Process and Budget Calendar.......................................................................166 Description of General Fund Revenues ...........................................................................170 Personnel Services Narrative ...........................................................................................179 Allocation of Positions to Pay Plans FY2025/26.............................................................180 Personnel Funding Summary ...........................................................................................181 Town Pay Plan Summary FY2025/26 .............................................................................182 Sworn Police Pay Plan FY2025/26..................................................................................185 Debt Service Information.................................................................................................190 Glossary of Terms............................................................................................................193 Additional Information Town Council Work Sessions on the FY2025/26 Recommended Budget ......................200 Comparative Analysis of Water and Sewer Rates ...........................................................201 Historical Utility Rates.....................................................................................................202 2024 Tax Rates in Selected Virginia Cities, Counties and Towns ..................................203

March 28, 2025

The Honorable Mayor and Members of the Town Council

Town of Blacksburg 300 South Main Street Blacksburg, Virginia 24060 Dear Mayor and Members of Town Council:

We are pleased to submit for your review and consideration the Recommended FY 2025/2026 Budget for the period beginning July 1, 2025 through June 30, 2026. The recommended budget was developed by our town staff to support the wide array of high-quality services and initiatives the community has come to expect from the Town. The Recommended FY 2025/2026 Budget is guided by Town Council’s Strategic Goals and the Town’s Principles of Sound Financial Management and communicates the Town’s financial plan for the upcoming fiscal year. The Recommended FY 2025/2026 Budget for all funds totals $108,349,500. Allocation by fund, as well as a comparison to the FY 2025/2026 budget is as follows:

RECOMMENDED BUDGET ALLOCATION BY FUND FY 2026

FY 2025/26 Manager Recommended

Percent Increase (Decrease)

FY 2024/25 Budget $53,758,200

Difference $ (337,703) 4,323,400

General Fund

$53,420,497 4,853,400

(0.6)% 815.7% (6.6)% 12.3% 11.5% (5.5)% 19.1%

General Capital Improvement Fund CDBG Entitlement Fund HOME Consortium Fund Water and Sewer Fund Stormwater Fund Midtown Special Service District Fund Solid Waste and Recycling Fund

530,000 554,600 634,500 621,500

517,900 712,800 692,900

(36,700)

78,300

71,400

18,547,000 1,185,600 2,821,500 25,180,000 1,468,300

17,527,349 1,411,999 2,949,335 24,773,720 1,489,600

(1,019,651)

226,399 127,835

4.5% (1.6)% 1.4%

Transit Fund

(406,280)

Equipment Operations

21,300

Total

$105,301,200

$108,349,500

$ 3,048,300

2.9%

The Recommended FY 2025/2026 Budget provides funding to support the broad array of Town services at expected service levels under current economic conditions. The local economy has continued to grow moderately while nationally inflation has remained at around 3%. While this is a positive sign, the economy remains somewhat unsettled. Town revenues have recovered and

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remained stable over the past two years. Inflation continues to impact the Town’s operational expenses and the cost of capital projects. This recommended budget accounts for these inflationary increases within our projected revenues.

The Town is continuing to implement projects and programs funded by the $13 million received through the American Rescue Plan Act (ARPA). All of the Town’s ARPA funds were obligated to projects by the end of calendar year 2024. All ARPA projects must be completed by the end of calendar year 2026. The Town is continuing to implement programs supporting food security, childcare, economic development, and affordable housing. ARPA funded capital projects constructing trails, outdoor spaces, and bicycle and pedestrian improvements are in various stages of planning and design. Construction of the North Main Trail has begun and construction of the first phase of the Meadowbrook Greenway Trail will begin later this year. Sections of the Huckleberry Trail in most need of repair will also be completed this year. There are several new initiatives funded in the recommended budget. These initiatives are listed below: • The recommended budget includes funding to support affordable housing projects in Blacksburg. Funds are planned in the Town’s general fund to offset the cost of waiving water and sewer availability fees for these projects. The projects include The Legacy on South Main Street, the Airport Road Habitat for Humanity townhomes, 402 Clay Street development, and Stroubles Ridge located off Merrimac Road. • The Town partnered with New River Valley Community Services and other law enforcement agencies in Montgomery County to develop a behavioral health co-response program. The program pairs a police officer with a behavioral health specialist to respond to specific calls for service. For the initial year, the program was funded with grant funds from the Commonwealth of Virginia. This recommended budget contains funding to pay for the full cost of the law enforcement components of the program in case state grants are not available next year. • The Town is beginning to collect revenues from the EMS revenue recovery program to fund the growing cost of emergency medical services. These funds will be collected in the next fiscal year but are not appropriated for spending. These funds will be appropriated towards Rescue Squad expenses in upcoming budgets. • The New River Emergency Communications Regional Authority is working on a project to upgrade Montgomery County’s emergency radio communications systems. The project will address ongoing issues of capacity, coverage, clarity, and lack of security experienced with the current outdated technology. This recommended budget includes funding to begin paying the Town’s share of the debt to procure and construct the infrastructure to support the project. Radios for the Police Department, Fire Department, and Rescue Squad will be funded in an upcoming fiscal year once the infrastructure is complete.

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• The Town is participating in the New River Valley Housing Trust Fund and providing funding to support its work. The New River Valley Regional Commission established the Trust as a regional housing initiative to support affordable housing development in Blacksburg and throughout the New River Valley. • Town Council has set a priority for the Town to comprehensively review and update the Town’s Zoning Ordinance. The recommended budget includes funding to hire a consultant to assist with this work. A request for proposals has been issued and work will begin in the upcoming fiscal year. • The New River Valley Regional Commission is planning to purchase and renovate new office space in Christiansburg. The Town is a partner in the NRVRC with all the other local governments in the New River Valley. The recommended budget includes funding for the Town’s share of the costs to support the new office space. • Work continues to bring passenger rail service back to the New River Valley by 2027. This budget includes the Town’s share of funding to support the renovation and construction of the new passenger rail station in the Cambria area of Christiansburg. Revenue – The FY 2025/2026 Budget projects revenue growth in all major categories. Economically sensitive revenue sources such as meals tax, lodging tax, and sales tax are all projected to increase. The increased revenues are due primarily to inflationary cost increases for meals, lodging and goods purchased in local retailers and online. The current real estate tax rate of $0.26 per $100 of assessed value is maintained in the recommended budget. Modest real estate tax revenue increases will be seen from new construction. Personnel and Benefits – The Town remains a desirable employer and we are fortunate to have dedicated employees who are committed to providing exceptional service to the community. The recent implementation of an updated employee compensation system, along with ongoing recruitment efforts and an improving labor market, has helped address staffing shortages experienced in recent years. As a result, staffing levels in most operating departments have returned to normal. Many current vacancies are due to staff retirements. Human Resources continues to explore creative strategies to attract applicants and fill open positions. The success of the updated compensation system is largely due to the Town’s commitment to fund cost-of-living increases to keep pace with inflation, as well as fund step increases to advance experienced employees within the pay structure. The recommended budget includes funding for a 2.5% cost-of-living pay increase, effective July 1, 2025. Additionally, a mid-year step increase of 2% is proposed for employees with satisfactory annual evaluations, beginning January 1, 2026. The total recommended compensation increase for employees in FY 2025/2026 is 4.5%. This adjustment aligns with current inflation rates, is consistent with pay increases in neighboring localities, and appropriately recognizes employees for their contributions throughout the year. The Town’s largest benefit expense is health insurance. For the third year in a row, the Town will not have a health insurance premium increase from our health insurance provider. This is welcome

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news for the town and our employees. The Town’s Virginia Retirement System costs are also not increasing in the next fiscal year as we are in the 2 nd year of a 2-year rate cycle. Employee benefit costs are monitored carefully to ensure a balance between providing valuable benefits and a cost that is reasonable to both the employee and the Town. Three new full-time positions are recommended in the Town’s General Fund. Two new full-time positions are recommended in the Finance Department. A new Accountant position to provide professional support to the Town’s Accounting Division and a Buyer position is included in the Purchasing Division to provide additional staffing to assist with the Town’s procurement functions. The current Budget Analyst position in the Finance Department is being reclassified to a Budget Manager position. This reclassification is intended to attract an experienced candidate to take on greater responsibility for preparation and management of the Town’s Budget and Capital Improvement Program. A full-time Maintenance Specialist I position is being added to the Parks and Recreation Department by shifting funding from two part-time positions into a single full-time position. The full-time position will be more attractive to applicants and will provide more consistent maintenance staffing levels throughout the year. Several other position requests were considered. The three new positions recommended in the budget are the highest priorities to address service needs and are supported within projected revenues. Blacksburg Transit – Blacksburg Transit service is critical to the Town’s transportation system. The Transit Center on the Virginia Tech campus was recently completed and includes 17 bus slips and a two-story building with a passenger waiting area, office space for BT staff as well as space for Virginia Tech’s Bike Hub and Office of Sustainable Transportation. Routes were modified this past fall and the combination of the transit center and modified routes has led to greater efficiencies in the transit system. Transit ridership has been steadily increasing since the pandemic but until this year has remained below the peak of 4.6 million passengers in 2019. Since the completion of the Transit Center, system efficiency has increased with ridership expected to surpass the 2019 record this year. Blacksburg Transit continues to operate fare-free as it has since 2020. Most of the funding for Blacksburg Transit comes from the Town’s receipt of federal and state grants in addition to contract funding from Virginia Tech and the Town of Christiansburg. Five new full-time positions are recommended at Blacksburg Transit. • 1 full-time Accounting Specialist to assist with financial management, procurement and grant support. • 2 full-time Mechanics to increase maintenance staffing and reduce reliance on external contracts. • 1 full-time Lead Data Analyst and one full-time Data Entry Specialist . These positions replace two part-time positions.

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Utilities – The Town provides public water, operates a sanitary sewer collection system, collects household trash and recyclable materials, and manages the stormwater system. Increases are proposed to rates for public water, public sewer and solid waste and recycling in the next fiscal year. Increases are primarily due to inflationary cost increases to electricity, fuel, labor and operating supplies and equipment. The stormwater utility rate is remaining unchanged. The Town is planning a comprehensive utility rate study in the upcoming year to provide a long-range plan for utility rates that considers operating costs and upcoming capital improvement needs. • Water rates are increasing 5% due to increased operating costs at the NRV Water Authority and inflationary increases to operate the water system and capital cost increases to maintain the water distribution system. • Sewer rates are increasing 5% due to increasing operating and capital costs at the Sanitation Authority and Town capital projects to replace aging sewer infrastructure. • Solid waste and recycling rates are increasing 3.7%. There was no rate increase in the current budget year. The increased costs result from increased tipping fees at the Regional Solid Waste Authority and inflationary cost increases from the Town’s solid waste and recycling collection contractor. • The utility bill for the average Blacksburg utility customer is expected to increase 4.47%, or $6.02 per month for a customer with 6,000 gallons of water usage. Agency Funding - The Town provides funding for non-profit agencies that provide public services in the Town of Blacksburg. The Town received funding requests from twenty-nine organizations this year. As has been past practice, recommended funding is at the same level as approved last year by Town Council. Town Council will have an opportunity to discuss agency funding over the next two months in budget work sessions. Several Town Council Work Sessions are scheduled over the next two months to review and discuss the Recommended FY 2025/2026 Budget in more detail. The budget approval schedule is a month later this year than in typical years due to recent vacancies in the Finance Department. The Public Hearing on the Recommended FY 2025/2026 Budget is scheduled for Tuesday, May 13, 2025. Town Council is scheduled to consider adopting a budget ordinance on May 27, 2025. Copies of the Recommended FY 2025/2026 Budget are available at the Blacksburg branch of the Montgomery-Floyd Regional Library, as well as in the Town Clerk and Town Manager’s offices. The Recommended FY 2025/2026 Budget document is available on the Town’s web site at www.blacksburg.gov/budget. Acknowledgements – I sincerely appreciate the staff’s dedication and teamwork in preparing this budget for the Town Council’s review. Recent vacancies in the Finance Department required several employees to take on additional responsibilities. I want to thank Accounting Supervisor Melanie Minnick, MIS Manager Terri Self, Utility Services Manager Cary Quesenberry, and MIS Specialist Brad Wright for their extra efforts in this year’s budget preparation. I also appreciate the

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Town’s department heads, departmental staff, and Deputy Town Manager Matt Hanratty for managing an increased workload during this process. A special thank you goes to Deputy Town Manager Steve Ross for his leadership in overseeing the Town’s operating budget and capital improvement program preparations. Lastly, I want to thank the Mayor and Town Council members for their continued support of our staff. The Town of Blacksburg is fortunate to have such dedicated individuals who take pride in their work every day, ensuring that our community remains a great place to live and work.

Sincerely,

Marc Verniel

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GOVERNMENT FINANCE OFFICERS ASSOCIATION Distinguished Budget Presentation Award

PRESENTED TO

Town of Blacksburg Virginia

For the Fiscal Year Beginning July 01, 202 4

Executive Director The Government Finance Officers Association of the United States and Canada (GFOA) presented an award of Distinguished Budget Presentation to the Town of Blacksburg for its annual budget for the fiscal year beginning July 1, 202 4 . In order to receive this award, a governmental unit must publish a budget document that meets program criteria as a policy document, as an operations guide, as a financial plan and as a communication device. This award is valid for a period of one year only. We believe our current budget continues to conform to program requirements and we are submitting it to the GFOA to determine its eligibility for another award. 7

Town Council Strategic Goals 2024 - 2026

The Blacksburg Town Council establishes strategic goals to help focus the Council and staff on current issues of community interest and guide the Town’s work plan. Establishing strategic goals is a multi-step process consisting of a review of existing goals, determination of relevance, and development of new strategic goals. Engagement with the community, Town Council, and staff is a critical part of the process. Once established, Town Council adopts the strategic goals for a two-year period. Transportation Plan and construct transportation improvements that focus on “moving people, not cars” as well as prioritizing investments in pedestrian, bicycle, and transit facilities. Housing Implement strategies to encourage the development of affordable and middle income owner-occupied and rental housing for long-term residents, young professionals, families and seniors. Downtown and Economic Development Plan for additional structured parking, cultivate and support independent retail, protect the Town’s historic character, and continue to invest in streetscape and place-making projects in downtown. Expand Recreational Opportunities Provide amenities to improve the user experience in the park system, plan for indoor recreation improvements, continue to invest in trails and outdoor recreation, and further develop the supporting infrastructure for high-quality parks. Community Wellbeing and Engaged Community Promote initiatives and events to enhance community wellbeing and residents’ connection to each other, individually, and institutionally. Communication Focus on clear, intentional, and effective communication by actively engaging our citizens, welcoming their diverse perspectives, and ensuring they receive timely, accurate, and accessible information.

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Town Council Strategic Goals 2024 - 2026 (continued)

Continuing Community Values

 Environmental Sustainability – Continue the Town’s environmental sustainability efforts to implement the Town’s Climate Action Plan.  Neighborhood Quality – Continue the ongoing focus on code enforcement activities in key neighborhoods to address negative impacts of rental properties. Continue to look for and use all tools available to the town for effective neighborhood code enforcement.  Affordable Housing – Continue to support the development of affordable housing in Blacksburg and the surrounding region.  Regional Cooperation – Continue positive relationships with Virginia Tech and neighboring communities in the New River Valley. Work to build closer working relationships with the Roanoke Valley and communities in Southwest Virginia.

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BUDGET GUIDANCE

The review and adoption of the Annual Operating and Capital Budget represents one of the most important policy-making responsibilities for the Mayor and Town Council. The budget is more than just a legal document appropriating funds; it establishes service levels based on the priorities and fiscal capacity of the Town.

Preparation of the Adopted FY 2024/2025 Budget was guided by the following policies:

 Plan and manage the continuing pressures of growth from Virginia Tech.  Maintain the overall quality of life for residents.  Maintain the quality and variety of services provided.  Meet current infrastructure needs before acquiring or building additional infrastructure.  Evaluate functions, activities and personnel levels.  Determine whether cost savings or service level improvements can be achieved.  Replace equipment and vehicles when it is most cost effective.  Identify alternative revenue sources. This budget includes performance measures which are an excellent tool to assist in the decision-making process. These measures help with the prioritization and allocation of resources, which is especially important in times of financial uncertainty. Budget measures are quantifiable measures of outcomes, quality, efficiency, effectiveness, inputs, and outputs that are meaningful and relevant. Measures are presented by department/fund in the respective sections. The Government Finance Officers Association (GFOA) recommends that governments forecast major revenues and expenditures for a three to five-year period beyond the current budget in order to assess the long-term financial implications of current or proposed policies, programs, and assumptions. This recommendation is even more important today based on the volatile state of the economy and the uncertainty that lies ahead. Financial forecasting is intended to accomplish the following goals:  Provide an understanding of available funding.

 Evaluate financial risk.  Assess service levels.  Assess resources for capital investments.  Identify future commitments and resource demands.

 Identify key variables that can affect future revenues or expenditures.  Plan effectively to meet financial principles and ensure fiscal responsibility.

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Principles of Sound Financial Management

Introduction These principles set forth the broad framework for overall fiscal planning and management of the Town’s resources. In addition, these principles address both current activities and long-term planning. Every two years, following a Council election, these principles will be reviewed to assure the highest standards of fiscal management. Overall Goals The financial goals of the Town of Blacksburg are designed to ensure the Town’s sound financial condition at all times. 1. Sound Financial Condition may be defined as:  Cash Solvency - The ability to pay bills.  Budgetary Solvency - The ability to annually balance the budget.  Long Term Solvency - The ability to pay future costs.  Service Level Solvency - The ability to provide needed and desired services. 2. Flexibility is a goal that ensures that the Town is in a position to react and respond to changes in the economy and new service challenges without measurable financial stress. 3. Adherence to Best Accounting and Management Practices in conformance with generally accepted accounting procedures as applied to governmental units, and the standards of the Governmental Accounting Standards Board (GASB) and the Government Finance Officers Association (GFOA). Financial Principles 1. A balanced budget should be prepared annually by the Town Manager and forwarded to the Town Council for consideration. 2. Ongoing operating costs should be funded by ongoing revenue sources. This protects the Town from fluctuating service levels and avoids concern when one-time revenues are reduced or removed. In addition: a. Cash balances should be used only for one-time expenditures, such as land acquisition, capital improvements and capital equipment or special one-time expenditures. b. Federal grants should not financially support essential Town services. Federal grant monies should be tied to programs and services with the understanding that those services delivered with grant funding may be revised and altered based on grant funding availability. c. New operating costs associated with capital projects should be funded through the operating budget but identified and outlined in the Capital Improvement Program. 3. The Town Manager should forward to the Town Council a quarterly financial report identifying meaningful trends in budget to actual for both revenues and expenditures for all major funds.

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Principles of Sound Financial Management (cont.) 4. Department Heads are responsible for managing departmental budgets within the total appropriated budget. 5. Replacement of Town vehicles, including Fire, Rescue and Police vehicles, should be fully funded through the Equipment Replacement Fund. 6. The Town’s goal is to add $120,000 annually to a capital reserve to set aside funds for future debt service or to be utilized for capital projects. Withdrawals from the reserve are only for “down payments” for large capital projects, to transition to debt service, or an emergency approved by Town Council. 7. The Town’s goal is to budget an amount of cash (pay-as-you-go) funding for capital projects equal to 5% of General Fund revenues (less capital transfers), with a minimum level of 3%. While it is the Town’s intent to use this pay-as-you-go funding annually for capital projects, should revenue shortfalls or unanticipated operating expenditures occur in the General Fund, this funding may be used as a source of budgetary flexibility. 8. Financial Trend Indicators should be prepared and reviewed annually to determine the Town’s financial condition. Town Council will review these indicators prior to the development of the Capital Improvement Program and annual operating budget. The Financial Trend Monitoring System (FTMS) offers the following: a. A method for quantifying a significant amount of information in relatively simple terms to gain better understanding of the Town’s financial condition; b. Places the events of a single year into a longer perspective and permits the Town to evaluate trends; and, c. A straightforward picture of financial strengths and weaknesses. 9. General Fund Unassigned Fund Balance is targeted at no less than 10% of operating expenditures exclusive of capital improvements. However, the Town will strive to increase the level to a target of 15% of operating expenditures exclusive of capital improvements. Unassigned Fund Balances should only be used for one-time uses. Bond Proceeds should be deposited and budgeted into the Capital Project Funds. 10. The Town Council may, from time-to-time, appropriate fund balances that will reduce available fund balances below the 10% policy for the purposes of a declared fiscal emergency or other such global purpose as to protect the long-term fiscal security of the Town. In such circumstances, the Council will adopt a plan to restore the available fund balances to the policy level within 36 months from the date of the appropriation. If restoration cannot be accomplished within such time period without severe hardship to the Town, then the Council will establish a different but appropriate time period. 11. Tax-supported debt service should strive to be less than 10% and not exceed 15% of operating expenditures exclusive of capital improvements. 12. The Town intends to maintain its ten-year tax-supported debt and lease payout ratio at or above 60% at the end of each adopted five-year Capital Improvement Program. 13. Net Debt as a percentage of total assessed value of taxable property should not exceed 2.0%. Net Debt is defined as any and all debt that is tax-supported. 14. A five-year financial forecast should be developed annually to determine net capital financing potential, to react to changes in the economy, and to accommodate regulatory and legislative mandates.

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