MINUTES PURCELLVILLE TOWN COUNCIL SPECIAL MEETING BUDGET WORK SESSION WEDNESDAY, APRIL 2, 2025, 6:00 PM TOWN HALL COUNCIL CHAMBERS COUNCIL MEMBERS PRESENT: Mayor Christopher Bertaut, Vice Mayor Ben Nett, Council members Erin Rayner, Susan Khalil, Carol Luke, Caleb Stought, Kevin Wright STAFF PRESENT: Interim Town Manager Kwasi Fraser, Assistant Town Manager Diana Hays, Police Department Interim Chief Sara Lombrana, Director of Administration Darya Thompson, Director of Human Resources LaDonna Snellbaker, Director of Finance Elizabeth Krens, Accounting Manager Paula Hicks, Financial Analyst Linda Jackson, Director of Public Works Jason Didawick, Director of Engineering and Capital Projects Andrea Broshkevitch, Division Manager Parks and Recreation Amie Ware, Town Clerk Kimberly Bandy CALL' TO ORDER: Mayor Bertaut called the special meeting to order at 6:00 PM. The Pledge of Allegiance followed. Interim Town Manager Fraser gave a briefintroduction. The proposed Fiscal Plan can be found at the following link on the town website: masahNlm.DasNNnhisaths 03 1925 DISCUSSIONINFORMATIONAL ITEMS a. Parks & Recreation Fund Revenue Fiscal Year 2026 Budget (pgs. 120-121) b. Parks and Recreation Fund Expenditures Fiscal Year 2026 Budget (pg. 195) C. Water Fund Revenue Fiscal Year 2026 Budget (pgs. 126-127) d. Water Fund Expenditures Fiscal Year 2026 Budget (pg. 206) e. Wastewater Fund Revenue Fiscal Year 2026 Budget (pgs. 132-133) f. Wastewater Fund Expenditures Fiscal Year 2026 Budget (pg. 210) g. Proposed Utility CIP Plan Changes h. General Q&A (The Q&A can be found at the Town website under the Finance page.) MIADseaNdTISAAESne and-A?bidid= Town Council Special Meeting Budget Work Session April 2, 2025 Page 2 of2 ADJOURNMENT: At 7:31PM, Council member Stought moved to adjourn the meeting, which was unanimously approved. - CAEL M. 1 Kudbulrbandy Christopher Bertaut, Mayor Kimberly Bandy Jown Clerk Proposed CIP Budget Changes April 2, 2025 The FY26 Operating Budget proposed by the Interim Town Manager does not include additional debt service for the new Utility loan proposed in the CIP plan presented during the 1/28/25 work session and the proposed budget book. After locking the budget, the ITM met with Utility CIP project managers to discuss project funding implications and project timing. During this meeting, 3 projects were determined to be critical: additional funding required for the completion ofthe New Water Tank by the ARPA deadline of Dec. 2026; Well 6F Water Line to expand water resources; Wastewater Treatment Plant Screen replacement important for staff safety and plant management. Other projects were deferred in order to reallocate resources to these projects as a new loan is not expected to move forward in FY26. FY25 (Current Year) The following budget adjustments are needed in the current year to replace "New Loan" as a CIP funding source. Water CIP Change: New Water Tank- Identify other funding sources totaling $983k to replace the new loan: Proffers $246K Water CIP Fund Investment Earnings $88K ARPA Interest (GF) $295K Use of Water Fund Cash $354K Wastewater CIP: , Defund VIP Pump Station project ($413K) and project contingency ($54K) as the project will not move forward until a new loan is issued. Reallocate $986K Cash from West End Pump Station to the Screen Replacement project. FY26 Proposed Utility CIP Budget Changes The following budget changes are needed to fund the 3 critical utility projects and defund the new loan. Water CIP Change: Change Well 6F Water Line funding source from $600K new loan to Water Cash. Defer Million Gallon Tank Rehab project until a new loan is issued. Wastewater CIP Change: Eliminate new loan funding for Screen Replacement. Replace with $1.58M in Wastewater Cash in FY26. (Note: FY25 adjustment above provided $986K cash for total project funding of $2.566M). Defer VIP Pump Station and West End Pump Station until a new loan is issued. FY26 Proposed Parks & Rec CIP Budget Changes o Defer FF Warning Track ($348K) and Outfield Press Box ($65K) as funding was not allocated by Loudoun County. Fiscal Policy Compliance - Cash Implications Water Cash- FY26 100% Policy Target is $3,818,084 FY26 Budget Cash Estimate $4,306,898 Less: 353,539 for New Water Tank (FY25) Less: 600,000 for Well 6F (FY26) New FY26 Water Cash $3,353,359 or 88% of annual exp + debt service or "10.5 months coverage Reimbursement Resolution would enable loan reimbursement of $953,539 Wastewater Cash- FY26 100% Policy Target is $5,808,692 FY26 Budget Cash Estimate $5,170,463 Less: 1, 580,000 for Screen Replacement (FY26) New FY26 Wastewater Cash $3,590,463 or 62% of annual exp + debt service or "7.5 months coverage Reimbursement Resolution would enable loan reimbursement of $1,580,000 This plan avoids additional interfund transfers and retains strong GF Cash metric of 58% of revenues. Excess General Fund Cash $4.1M will serve as an emergency reserve and help to stabilize cash flow fluctuations during year across all funds. FY26 General Fund Unassigned Fund Balance $8,343,778 Less Policy Target $4,281,150 GF Cash Available in Excess of Policy- $4,062,628 Reimbursement Resolution A reimbursement resolution, also known as a declaration of official intent, is a municipal resolution required by the IRS that declares a municipality's intent to reimburse cash reserves with proceeds from at tax-exempt bond for capital projects. The resolution must generally describe the projects and state the maximum costs for which expenditures may be reimbursed. While there is no obligation to reimburse capital project costs with a future bond, this action preserves Council's fiscal flexibility. There are time constraints associated with a reimbursement resolution as it applies to expenditures made up to 60 days prior to the date of adoption. Typically, the loan must be issued and costs reimbursed within 18 months of the expenditure date. If directed, staff will work with the Town 's bond counsel to prepare a reimbursement resolution for Council adoption. 1 1