The Chesapeake City Council held a work session from 4:30 p.m. to 5:42 p.m. followed by a regular meeting beginning at 6:30 p.m. on April 8, 2025, in City Hall Council Chamber. The work session covered the Chesapeake Transportation System financial update and enhanced public safety budget priorities. The regular meeting featured a public hearing on the effective tax rate increase, approved a telecommunications franchise for Crown Castle, adopted a consent agenda containing routine items, passed several ordinances, heard public comments on city services, and concluded with nominations to the Planning Commission and a closed meeting. A notable action occurred when Council voted 8-1 to censure Council Member Ward for a closed session confidentiality breach.
Thank you, Ms. Mayor. Two items for your consideration uh and discussion tonight. Uh first is uh the annual update from Chesapeake Transportation System, and I'll be turning that um item over to uh Mr. Sorry to introduce the team and then second we'll continue the discussion on the enhanced uh public safety budget. So uh turn it over to public works director sorry. Uh thank you, Mr. Manager. Uh good evening, Mayor, uh Vice Mayor and members of the council. It's a pleasure to be here tonight to give you an update on the Chesapeake Transportation System operating results for fiscal year ending June thirtieth, twenty twenty four. Uh we have our city team uh here with us uh tonight, so uh led by Belinda Malone, our CTS administrator. Uh we're also joined by uh our consulting team uh to my right is Sean Eckert, managing director of Raymond James uh Financial to the far right, and then beside me is Dave Cunho, director of traffic and revenue forecast. We're having a hard time. It sounds a little muffled. Maybe if you get a little bit closer to the mic, maybe is this better. Yes, sorry. Okay, very good. Um so I'll I'll now turn the presentation over to Sean Eckert to lead us through tonight's presentation. Uh good afternoon, Mr. Mayor, members of council. Always a pleasure to be here to uh assist with the Chesapeake Transportation System uh update. Uh as Mr. Sorry mentioned, we'll be reviewing results primarily from the fiscal year end of June thirtieth, twenty twenty-four. Uh a few highlights for uh the results for that fiscal year. Uh toll revenue on the Chesapeake Expressway was up just slightly from the prior year, while toll revenue on Dominion Boulevard increased by seven point eight percent. Overall the system's uh revenue for the year was up by one point three million or three point seven percent from the prior year. Operating expenses increased by thirteen point eight percent over the prior year, uh primarily due to uh some updates of contracts related to uh revenue collection from the toll facilities. Uh so operating expenses were up but not up as much as was forecast, so that was favorable. Um investment income is also increased significantly on CTS reserve funds in recent years for fiscal year twenty-four. That investment income was four point eight million, which is a significant increase from where had it had been uh the years prior. Um a few other key developments in July of 2024, uh the uh CTS toll revenue bonds or a portion of them were refinanced to lower interest rates, resulting in a savings of about two and a half million dollars per year for the next three years. Uh we also had feedback from the credit rating agencies on the bond ratings. Uh SP upgraded its credit rating on the CTS senior bonds to a double A minus. Uh so at this time uh both SP and Fitch rate the bonds double A minus. That's the first time those bonds have been rated that highly by both agencies uh in the past. Uh just a little more detail on that bond refinancing. Um again, that was accomplished last summer. We refinanced 78, uh we issued 78 million of of bonds to refund the portion of the 2012 A bonds. The resulting savings was a total of 7.8 million dollars in reduced future debt service that will primarily be realized by the system uh over the next three fiscal years at about two and a half million dollars per year for those three years, and then a very small amount of savings uh for the remaining uh life of the bonds through 2047. I'm gonna turn it over to Dave Cunio now to talk through some of the uh the traffic trends on the system over the past year. Thank you, Sean. Um the next few slides just gonna walk through a bit of the details of the traffic and revenue performance. And so this slide shows the monthly trends in in toll revenues, and what you could see on the top with the Chesapeake Expressway is there's a very pronounced seasonal profile of the revenue uh during the the peak summer where there's a higher toll rate for the peak summer weekends, toll revenues are are higher. Um, and this this happens year over year. Uh looking at the performance of fiscal year 24 versus the prior years, um it was pretty similar is as uh Sean had mentioned overall the expressway's revenue was slightly up year over year, uh, but for some of the the months, and and you could see uh for example in in June, the blue line, which was fiscal year 2023, was was slightly above uh fiscal year 2024. I'll get into the peak weekend a little bit more later. Uh so the performance of the expressway and its seasonality um it differs from Dominion Boulevard, which is is pretty stable and consistent throughout the year. Um you could see those levels um generally uh consistent through the year. What you could see looking at fiscal year 2024 is that for 11 of the 12 months it was higher than the prior year, and that's reflecting the fact that toll rates increase every year by 5%, leading to an increase in traffic, give or take a little bit if if sorry, increase in revenue, give or take if if traffic trends are a little different. So on the next slide, uh this looks in greater depth at the uh Chesapeake Expressway and the peak summer weekend trends.