Blog posts are the personal views of Letty Hardi and not official statements or records on behalf of the Falls Church City Council

Dear Friends,

Thanks for all the good feedback on last week’s mythbusting post – I’m glad many of you found it helpful. It’s been one of the most popular of the year! Ahead of Thanksgiving next week, this will be my final post of November. Read on for what I call #boringbutimportant topics – financial policies, Q1 financial update, and legislative priorities for Richmond. And a look ahead to our final meetings of the year and what’s to come in 2025, including Accessory Dwellings (ADs) next Monday, so make sure to read to the end.

Remember November is Live Local Month in Falls Church. As you celebrate the holidays, consider keeping it local – and not just your spending, but also your time and your impact. I’m thankful for the privilege of serving the community alongside so many others, past and present, who have given their time and dedication to the city.

Take care,
Letty

What Happened This Week:

(1) Financial Policies Review

We had a meaty presentation and discussion with the city’s financial advisors on the city’s financial policies, which were last updated in 2018 ahead of the large debt we took on for Meridian High School, City Hall, and Library. These policies serve as the financial guardrails for how we run the city in the short and long term – ie, how we meet the city’s public goals while maintaining a sound and sustainable financial footing, spanning topics like how much debt we can afford to take on, how much money do we keep in reserves for a rainy day, how our utilities funds for infrastructure like sewer and stormwater are managed, how we maintain and reinvest in capital projects.

The TL;DR good news conclusion from our advisors: the city continues to be a strong financial position with triple A bond ratings, we’re in compliance with our policies, we stack healthily vs our peers in Virginia and across the US, and therefore our advisors recommended no change to our policies. You can see the full presentation here.

Blast from the past: we had revised our policies in 2018 ahead of the large debt issuance and built up reserves in anticipation of the debt and began the West Falls project as a key part of the financing strategy. Our current reserves are more than healthy at 44%, with a planned, strategic drawdown in the coming years, now we have come down from the peak exposure on various metrics such as debt service to expenditures.

(2) Q1 FY2025 Report

We also saw the first quarter financial report (July-September 2024) for the current fiscal year. While 2-3 months don’t make a trend, this is the best look at various indicators as we head into budget season. Of note is potentially worrisome data on sales and meals tax, which are coming in behind budget. Q1 meals tax in particular is below where we were last year (plug to live local – it matters!)

While real estate taxes make up 60% of our revenues, local taxes have become a larger contributor as we’ve diversified our tax base. And local taxes, like sales and meals tax, are one of the best leading indicators of consumer sentiment, so this is something we’ll need to watch ahead of the coming year especially in light of potential impacts from the incoming administration. The good news is that we have new economic development projects on track to open in 2025, which will contribute to the tax base, and we don’t have a commercial vacancy issue which will continue to drag down revenues elsewhere.

(3) 2025 Legislative Priorities

Ahead of the 2025 General Assembly session, every year we adopt Legislative Program, which include requests that we ask our Richmond delegation to carry for us and other priorities we support. As Virginia is a Dillon Rule state (aka, a “Mother May I?” where we only have powers expressly granted to us by the General Assembly), we often are constrained in what we can legislate. This comes up regularly around community priorities like tree canopy requirements, stormwater retention, automated speed enforcement, and more. This year, new priorities include additional authority for more affordable housing, tenants rights, traffic safety enforcement, pedestrian and bicycle safety. Here is the updated Legislative Program that we will set to adopt next week, based on our work session discussion this week.

What’s Coming Up (with special notes below and the Council Agenda that we review weekly):

Monday, November 25 – City Council Meeting*

–> For those tuning into housing issues – next week at our November 25 meeting, we’ll be taking up Accessory Dwellings and consider a first reading vote, which would refer out the proposal to boards, commissions, and the community for further iteration – including community meetings, walking tours, and more work sessions ahead of a final consideration in March 2025. The staff report has been updated based on guidance from both the City Council and Planning Commission’s work sessions a few weeks ago, so I encourage you check it out and share your thoughts with us – either in person, virtually, or in advance via email.

The community is also invited to officially celebrate our new Councilmember Laura Downs at a reception before our meeting.

Monday, December 2 – City Council & School Board Annual Joint Meeting (6 pm, City Hall)

–> This is our annual joint meeting with our School Board colleagues. Besides sharing a meal, it’s our opportunity to celebrate a good partnership and officially kick off the FY26 budget season. Both elected bodies will see revenue forecasts and discuss expected priorities and challenges for the coming year.

Tuesday, December 3 – Winter Wonderland in Falls Church (530 pm, Founders Row)

–> Start the holidays here in the Little City with our annual Winter Wonderland and lighting of the trees!

Monday, December 9 – City Council Meeting*

–> This is our final meeting of the year and where we will adopt formal budget guidance to the schools and general government. We will recess until our first regular meeting of 2025 on Monday, January 6, 2025. Between January and March, staff and School Board will be working on their proposed budgets which will come before us on March 24, 2025. Then City Council’s role in budget season takes over where we’ll hold our own work sessions, community town halls, etc. We will adopt the FY26 budget in May 2025.

Wednesday, December 11 – Ask the Council Office Hours (9 am, City Hall)

*Mondays (except 5th Mondays and holidays) at 7:30 pm. You can access the agenda and livestream here, including recordings of past meetings