The Virginia Beach School Board wanted to beef up its health insurance fund balance using an extra $5.8 million in revenue left over from the 2024-2025 fiscal year.
But city council said the school board’s insurance fund was healthy enough and denied the request, which meant division leaders needed another project for the $5.8 million.
Instead, district leaders now propose using $2.8 million for a new human resources system. And they suggest — at the request of Virginia Beach City Manager Patrick Duhaney — allocating the remaining $3 million for a cross-country trail within the city’s Interfacility Traffic Area, or ITA.
“We are looking for an opportunity to access the special reserve funds in a manner where we feel like the funding body — in this case, the city council — is going to approve that request,” Superintendent Donald Robertson told the board on Tuesday. “This gives us an opportunity to do so.”
The proposal received pushback from school board members who want answers about how the trail would directly benefit students or educators, outside of a general answer that, in theory, it will attract tourism dollars.
Robertson told board members they don't have to support the proposal. But because the city has the final say over the school board’s budget and could deny whatever the board proposed next.
“We're looking for an opportunity to again access that $5.8 million,” Robertson said, “or it likely could sit there for a very long time.”
Building goodwill
Every year the school board creates a budget that is approved by the city council. As part of the revenue sharing formula between the two, excess or deficit in revenue is “shored up” at the end of the fiscal year.
After the 2024-2025 fiscal year, $5.8 million was added to the “school reserve special revenue fund.” The school board originally voted to put that money toward its health insurance fund with a stipulation that it could only be used for reserves, not to lower insurance premiums.
The fund is at about $15 million, and the recommendation is to continue building it to about $20 million, or about two months of the division’s gross insurance expenses.
But the city denied that request, claiming it would only allow an appropriation when the fund reaches a negative balance, Robertson told board members.
Robertson emailed the board about two weeks before its Sept. 22 meeting and told them that over the summer Duhaney talked with him about a “request from some members of city council” for the board to support the construction of the cross-country trail.
Robertson pitched it as a good-will measure between the two.
The city and school division partner on several funding projects, he wrote in the email. And some, like the school resource officer program, come at no charge to the division.
“I think the availability of a true cross-country trail will benefit not only the students who participate in cross country,” Robertson wrote, “but also could attract regional, state or national events that would contribute revenue for the city that we access through the Revenue Sharing Formula.”
What is the ITA?
Council members Stacy Cummings and Barbara Henley support a cross-country trail in the ITA, which is between Naval Air Station Oceana and Naval Auxiliary Landing Field Fentress in Chesapeake. Henley represents the area and she and Cummings are liaisons to a citizens committee that advises the city on land use in the ITA.
Development within the ITA is limited to prevent encroaching on the master jet base, and plans for the area are being updated by the city. Controversially, industrial uses are being considered, while recreational uses are already allowed.
Earlier this year, council set aside nearly $1.4 million from unallocated revenue sharing formula funds toward design and construction of the cross-country trail.
In a budget reconciliation letter in May, Mayor Bobby Dyer and Vice Mayor Rosemary Wilson wrote that, in addition to looking at its own capital budget, the city should explore partnership with VBCPS to pay for projects students will use.
Via email, a city spokesperson said the $3 million would be on top of the nearly $1.4 million set aside.
On Tuesday, Cummings told WHRO that members of council have supported the trail and schools would use it.
“My proposal was, ‘Hey, look. Our schools are going to use this more than anybody, and, you know, maybe we should ask them if they’ll participate,” Cummings said.
Cummings said more money for the course could be part of the city's next budget cycle.
“We can merge our plans together,” he said.
What happens next?
But at Tuesday’s meeting, Board Member Melinda Rogers pushed back against the proposal. She said the proposed trail didn’t directly support students and that constituents in her district are concerned about development around the ITA.
“I will never support something that does not support our staff and the healthcare that they say that we need to improve,” she said. “This absolutely does the exact opposite of that.”
Board Member Matt Cummings, who is not related to Stacy Cummings, said he wants more information from the city about how the funding would be used and how the trail would be used by VBCPS.
Board Member Mark Bohensteil questioned how the division would make money from the project.
“I don't see where the school board or the school division is really going to profit from this,” he said. “It sounds to me like the city council wants to do something in this line to benefit themselves, and they're kind of using the reversion fund.”
Robertson said he would help coordinate a meeting between the city and school board for members.
The board will vote on whether to support the proposed spending at its Oct. 13 meeting. If it does support it, it could be presented to council Oct. 20 and that body may take action in October or November.
Virginia Beach City Public Schools is a member of the Hampton Roads Educational Telecommunications Association, which holds WHRO’s license
