OPENPUBLICA · PUBLIC MEETING RECORD
Record of Proceedings

Chesapeake City Council Meeting – August 11, 2026: Budget Amendments, Data Center Debate, and Public Concerns

City Council — Tuesday, August 11, 2026
BodyChesapeake, Virginia
SessionCity Council
DateTuesday, August 11, 2026
StatusNEW · FILED
Video Record
0:00 / 3:00:01
Transcript — Verbatim
5:14

We want to welcome everyone to our City Council work session on August 11, 2026.

5:19

I'll turn over to Mr.

5:20

Manager to talk about our topic.

5:23

Thank you, Mr.

5:23

Mayor.

5:24

This is sort of finalizing the FY27 budget process.

5:29

As you know, we normally adopt the budget in May and do final amendments in June based on information that we have from the state budget and other sources of information this year since the state budget wasn't done until the end of June.

5:44

This meeting is happening in August, and I'll turn it over to Jonathan Hobbs, our budget director, to go through the proposed amendments.

5:51

Thank you, Chris.

5:53

Good evening, Mayor West, Vice Mayor Ritter.

5:57

So I am here, as Chris mentioned, to go through a few final amendments to the 27 budget based on the adopted state budget.

6:06

Actually had fewer amendments than I anticipated.

6:10

So I think that's probably a positive thing.

6:13

Just quickly walking you through the agenda for this evening.

6:16

First, we're going to go through the requested school amendments.

6:20

Then I'm going to talk to you a little bit about some factors that are influencing our recommendations on the amendments to the city budget, and then finally go through those recommended amendments to the city's budget.

6:33

So in terms of the amendments being requested by the school board, the first amendment is for the appropriation of about 10.6 million dollars of additional state revenue that they received that was allocated to them as part of the adopted state budget.

6:59

An additional $350,000 for increased fuel cost, and then about $1.6 million of that in a transfer from their operating fund to the school's capital projects fund.

7:15

The next amendment that's being requested by the school board is for the allocation of the unallocated portion of the revenue sharing uh dollars.

7:27

When the budget is prepared, when we initially communicate the revenue sharing dollars to the schools, that is based on our preliminary revenue estimates due to the timing of when the superintendent has to present his budget.

7:44

Then once we finalize our revenue estimates, sometimes the amount of the revenue share uh changes.

7:50

Uh for fiscal year 27 that happened uh and there was an additional 1.6 million dollars.

7:57

So when that number changes, what we do in the proposed budget is we place that in a reserve in the school's operating fund until the school board has an opportunity to determine how they would like to allocate those funds.

8:12

Uh with the state budget not being adopted, typically what they would do is they would come back during final amendments and allocate those dollars or request to have those dollars allocated.

8:23

But uh I believe what they were wanting to do is wait until they knew how much money they were receiving from the state before they made a final determination.

8:31

So uh their request here is to allocate those funds from the reserve to a transfer from their operating fund to their capital projects fund.

8:45

They also received uh just over $300,000 for their uh nutrition services fund.

8:51

This again is state revenue.

8:53

Uh and they are allocating that, as you see, just over $200,000 for personnel costs, some general expenses increases, and the total increase to the fund is just over $333,000.

9:09

And then in the first two amendments from the schools, I mentioned that uh increase in the transfer to the Capital Projects Fund.

9:16

This amendment is on the capital project side, so the transfer goes from the operating fund over to the capital projects fund, and they are requesting that it be put in their non-routine routine renewal and replacement project.

9:30

This is for things like HVAC systems, roofs, other things uh that they need to replace from time to time.

9:38

So they are requesting to increase that project by just over $3.2 million.

9:44

Moving over to the city side, and again, before we go into the actual amendments that we're recommending, and we want to provide a little context for why we're making the recommendations that we're making.

10:00

There's really two major factors that are influencing our recommendations, and both of them involve significant cost increase that as we prepared the FY27 budget, we did not anticipate while we anticipated increases in both.

10:12

We did not anticipate the level of increase.

10:16

So the first is electricity rates.

10:19

In June, the Virginia Energy Purchasing Governmental Association, never heard of that one before, but that's a group that negotiates with Dominion Power on behalf of localities, and they agreed to a 24.9% increase in electric rates.

10:39

Again, we we knew that there was going to be an increase, we knew it was going to be relatively significant.

10:44

However, we did not anticipate an approximately 25% increase.

10:50

That increase went into effect on July 1st, so those rates have increased.

10:55

Again, as I mentioned, we did add funding for an increase in electric rates in the adopted budget.

11:01

However, it was not to this level.

11:04

This is going to be about a $2.5 million increase in costs.

11:20

So that is something that we will need to incorporate as we develop the budget for fiscal year 28.

11:29

The other factor that's influencing our recommendation is the increased costs in fuel.

11:36

Fuel costs really began to increase nationwide back in February.

11:45

Again, we did include funding when we initially began the preparation of the budget, and the budget that was adopted did have increased funding for fuel costs.

11:56

However, these increased costs have persisted and based on our revised projections for the current fiscal year, we do not believe that there's enough funding in the budget for fuel.

12:09

So we are going one of our recommendations is to add funding for fuel costs.

12:17

So getting to the specific amendments now that we provided a little bit of context.

12:22

So the state provided additional funding, the compensation board reimbursement to our constitutional offices.

12:31

So this particular amendment is going to deal with that revenue for four of the five constitutional officers, and I'll talk about the fifth constitutional office in just a moment.

12:42

But the compensation board is providing this funding based on a 3.5% salary increase that was granted to employees of constitutional officers.

12:54

But remember, not all 3.5% salary increases are created equally.

13:12

So let me give you a practical example of what I mean.

13:16

While the city may pay an employee $60,000, and it's a comp board position, and we pay $60,000 for that position, the comp board may own may only re reimburse about $30,000 for that position.

13:37

That is it's $100 percent reimbursement, and really it's truly just a handful of the compensation board position.

13:45

So they're only providing that 3.5% on the $30,000 that they are reimbursing in my example.

13:53

The other thing is there are a multitude of fully funded positions that are completely funded by the city that the council has granted to the constitutional offices.

Discussion Breakdown — Share of Meeting
Procedural█████████████████████████25%
Budget Equity Analysis███████████████15%
Data Centers████████████12%
Public Engagement██████████10%
Public Safety█████████9%
National Security██████6%
Energy Infrastructure███3%
Education███3%
Fiscal Sustainability███3%
Summary of Proceedings

Chesapeake City Council Meeting – August 11, 2026

The Chesapeake City Council held a work session at 5:15 PM followed by a regular meeting at 6:35 PM on August 11, 2026, in City Hall Council Chamber. The work session focused on final FY 2027 budget amendments for schools and the city. The regular meeting included a public hearing withdrawal, approval of a consent agenda (with several items pulled for discussion), unanimous approval of all regular agenda items, extensive public comments on city services and policies, a closed session, and new business items. All votes were 8-0 unless noted.

Work Session (5:15 PM – 6:30 PM)

  • FY 2027 Budget Amendments: Budget Director Jonathan Hobbs presented final amendments based on the adopted state budget. Key factors influencing city budget recommendations were a 24.9% increase in electricity rates (effective July 1, 2026) from the Virginia Energy Purchasing Governmental Association (VEPGA) – an unexpected $2.5 million impact – and persistent fuel cost increases.
  • School Amendments (unanimously adopted later): Requested appropriation of $10,648,794 in additional state revenue to the school operating fund; reallocation of $1,616,313 from the city manager reserve to the school operating fund for capital projects; $333,860 for the School Nutrition Services Fund; and a $3.2 million increase in the “Schools Non-Routine Renewal and Replacement Project II” capital improvement project. School CFO Melissa Glaude explained the state’s 4% salary increase for SOQ-covered staff does not cover the 5% raise given to all contracted employees, and that the city’s revenue share is critical for compensation.
  • City Budget Amendments (unanimously adopted later): Appropriation of $965,000 in state Compensation Board revenue for constitutional officers (swapping state funds for general fund support, freeing about half for fuel and electricity reserves); reduction of excess fee revenue for the Clerk of Circuit Court by $67,000 offset by increased Compensation Board revenue; and $96,000 in additional state funding for juvenile services, reducing the general fund transfer.
  • Discussion on Electricity Rates: Vice Mayor Ritter and other council members expressed outrage over the 24.9% increase (with another 12% expected) and its impact on residents and the city. The council directed staff to investigate the rate increase and coordinate with other localities and state legislators.

Consent Calendar

  • Public Hearing Item Withdrawal: The city manager requested withdrawal of a resolution to lease office space in the South Norfolk Health Center to Peninsula Institute for Community Health, Inc. (PICH). The withdrawal was approved 8-0.
  • Consent Agenda (City Clerk Items): Acknowledged zoning reclassification requests (2728 Battlefield Blvd and Jerry Harris Remodeling), a $13,117.61 refund to PNC Equipment Finance LLC, and resignations from four city boards/commissions.
  • Consent Agenda (City Manager Items 1-10): Authority to apply for 10 grants for fire and police departments, totaling over $1.6 million. Items 1-10 were pulled by Vice Mayor Ritter for clarification but then approved 8-0 after she explained the backup material is available online. Grant applications include: $297,475 for decontamination equipment (Fire), $8,900 for mayday training (Fire), $180,000 for child exploitation investigation equipment, $200,000 for recruitment, $35,000 for unmanned aerial systems, $24,365 for narcotics equipment, $33,333 for Byrne JAG, $500,000 for a SAFE unit, $500,000 for Urban Areas Security Initiative equipment, and $74,800 for communications equipment (all Police).
  • Consent Agenda (City Attorney Items 1-2): Adopted a resolution for remote participation policy for council members and an ordinance amending animal cruelty penalty to align with state law (approved 8-0).

Public Comments & Testimony

  • Agenda-Related Comments (Vic Nichols): Criticized the council’s remote participation policy as unequal; requested adding rabbits to animal ordinances; questioned lack of specific measurable goals in police grants; opposed working with ATF; criticized campaign contributions by MEB General Contractors; urged council to loudly protest electricity rate increases; and requested Dwight Parker be kept on a board.
  • Non-Agenda Speakers (13 speakers, 3 minutes each):
    • Stephen Shawnee Hayes and Kate Durham (foster care): Detailed allegations of neglect, harassment, and cover-ups by Chesapeake Department of Human Services, including removal of a foster child without belongings after foster parents reported department neglect. Urged council to address systemic issues.
    • Kate Durham, Jimmy Culpepper, Tom Kennedy (nuclear abolition): Described catastrophic scenarios of nuclear war, urged council to pass the ICAN Cities Appeal to initiate mutual disarmament, noting Hampton Roads is a target.
    • Justice Greetings: Spoke about a “love train” movement and alleged administrators running circles around council.
    • Donald Newsom: Requested traffic safety measures on Spring Road near Cedar Grove Elementary, citing speeding vehicles including school buses. Council directed staff to investigate.
    • Jennifer Economy (data centers): Raised concerns about cumulative impacts of data centers on groundwater (citing a state DEQ report), electricity, and community character. Asked if council’s vision is to become “Silicon Valley of the East.” Requested independent public health expert input on noise and quality of life before adopting the data center ordinance next week.
    • Linda Tyndale (Frank Williams Farm): Questioned the zoning status of the 4,000-acre Praetorian Park proposal – only 1,400 acres are zoned industrial, the rest agricultural. Urged preservation of farmland.
    • Jennifer Knight (predators in Southern Chesapeake): Forcefully opposed data center development on the Williams Farm, citing historical and environmental significance, 2006 congressional resolution, 2015 survey showing 70% opposition, and cultural implications for Native American nations. Vowed to continue fight.
    • Jeff Staples (Chesapeake Environmental Improvement Council): Supported eliminating by-right data center development but expressed concern about reduced setbacks and noise standards in the revised ordinance compared to Planning Commission recommendations (preferred 1,320-foot setback from property lines, 60/55 dBC noise limits vs. staff’s 1,000-foot and 68/73 dBC). Also concerned about Fentress Airfield Overlay and Coastal Virginia Commerce Park exemptions.
    • Mike Hoffman (data centers): Asked for evidence that reduced setbacks and noise standards adequately protect residents, compatibility of data centers with Fentress Airfield Overlay, and plan for equivalent protections in Coastal Virginia Commerce Park.
    • David Robb (Chesapeake Alliance, representing 90 businesses): Supported data center regulations but argued requiring a conditional use permit for every data center and a half-mile separation from structures would make Chesapeake non-competitive; suggested allowing by-right development within certain districts with rigorous standards.

Discussion Items

  • Regular Agenda Items 11-16 (all approved 8-0 after brief discussion):
    • Item 11: Resolution to execute agreements with regional community services boards for forensic discharge planning grant funds.
    • Item 12: MOU with ATF for joint task force collaboration.
    • Item 13: Ordinance establishing an animal cruelty registry (covers felony offenses; councilmember Newens asked to include misdemeanors as future legislative priority).
    • Item 14: Economic development investment grant of $225,000 to MEB General Contractors Inc.
    • Item 15 (A-D): School budget amendments as detailed in work session.
    • Item 16 (A-C): City budget amendments as detailed in work session.
  • New Business:
    • Councilmember Newens requested analysis of public safety pay scales to reduce time to reach maximum pay (from 36 years to regional averages) and financial impact of transitioning fire department from 56-hour work week to a four-shift schedule.
    • Councilmember Jeffreys announced a September 10, 2026 evening vigil for the 25th anniversary of 9/11.
    • Councilmember Ward requested traffic calming measures on Spring Road near the elementary school.
    • Councilmember King inquired about the July 27 start of single-bin recycling; city manager confirmed it has begun.

Key Outcomes

  • All votes on regular agenda items and consent agenda (after removal of items 1-10) were 8-0.
  • The closed meeting (4:30 PM) was certified as lawful; later a closed session was held during the regular meeting to discuss board appointments and real estate negotiations.
  • Appointments: Approved a slate for the Chesapeake Agricultural Advisory Commission and other boards (motion by Councilmember Newens, second by Councilmember Ritter, adopted 8-0).
  • Council directed staff to:
    • Investigate the 24.9% electricity rate increase from VEPGA and coordinate with regional leaders and state legislators.
    • Analyze public safety pay scale compression and fire department shift change financial impacts.
    • Evaluate traffic safety measures on Spring Road.
    • Provide a situation report on the new single-bin recycling program.
  • The next regular council meeting is scheduled for September 8, 2026; a planning meeting will be held the last week of August.

Meeting Transcript

We want to welcome everyone to our City Council work session on August 11, 2026. I'll turn over to Mr. Manager to talk about our topic. Thank you, Mr. Mayor. This is sort of finalizing the FY27 budget process. As you know, we normally adopt the budget in May and do final amendments in June based on information that we have from the state budget and other sources of information this year since the state budget wasn't done until the end of June. This meeting is happening in August, and I'll turn it over to Jonathan Hobbs, our budget director, to go through the proposed amendments. Thank you, Chris. Good evening, Mayor West, Vice Mayor Ritter. So I am here, as Chris mentioned, to go through a few final amendments to the 27 budget based on the adopted state budget. Actually had fewer amendments than I anticipated. So I think that's probably a positive thing. Just quickly walking you through the agenda for this evening. First, we're going to go through the requested school amendments. Then I'm going to talk to you a little bit about some factors that are influencing our recommendations on the amendments to the city budget, and then finally go through those recommended amendments to the city's budget. So in terms of the amendments being requested by the school board, the first amendment is for the appropriation of about 10.6 million dollars of additional state revenue that they received that was allocated to them as part of the adopted state budget. An additional $350,000 for increased fuel cost, and then about $1.6 million of that in a transfer from their operating fund to the school's capital projects fund. The next amendment that's being requested by the school board is for the allocation of the unallocated portion of the revenue sharing uh dollars. When the budget is prepared, when we initially communicate the revenue sharing dollars to the schools, that is based on our preliminary revenue estimates due to the timing of when the superintendent has to present his budget. Then once we finalize our revenue estimates, sometimes the amount of the revenue share uh changes. Uh for fiscal year 27 that happened uh and there was an additional 1.6 million dollars. So when that number changes, what we do in the proposed budget is we place that in a reserve in the school's operating fund until the school board has an opportunity to determine how they would like to allocate those funds. Uh with the state budget not being adopted, typically what they would do is they would come back during final amendments and allocate those dollars or request to have those dollars allocated. But uh I believe what they were wanting to do is wait until they knew how much money they were receiving from the state before they made a final determination. So uh their request here is to allocate those funds from the reserve to a transfer from their operating fund to their capital projects fund. They also received uh just over $300,000 for their uh nutrition services fund. This again is state revenue. Uh and they are allocating that, as you see, just over $200,000 for personnel costs, some general expenses increases, and the total increase to the fund is just over $333,000. And then in the first two amendments from the schools, I mentioned that uh increase in the transfer to the Capital Projects Fund. This amendment is on the capital project side, so the transfer goes from the operating fund over to the capital projects fund, and they are requesting that it be put in their non-routine routine renewal and replacement project. This is for things like HVAC systems, roofs, other things uh that they need to replace from time to time. So they are requesting to increase that project by just over $3.2 million. Moving over to the city side, and again, before we go into the actual amendments that we're recommending, and we want to provide a little context for why we're making the recommendations that we're making. There's really two major factors that are influencing our recommendations, and both of them involve significant cost increase that as we prepared the FY27 budget, we did not anticipate while we anticipated increases in both. We did not anticipate the level of increase. So the first is electricity rates. In June, the Virginia Energy Purchasing Governmental Association, never heard of that one before, but that's a group that negotiates with Dominion Power on behalf of localities, and they agreed to a 24.9% increase in electric rates. Again, we we knew that there was going to be an increase, we knew it was going to be relatively significant. However, we did not anticipate an approximately 25% increase. That increase went into effect on July 1st, so those rates have increased. Again, as I mentioned, we did add funding for an increase in electric rates in the adopted budget. However, it was not to this level. This is going to be about a $2.5 million increase in costs. So that is something that we will need to incorporate as we develop the budget for fiscal year 28. The other factor that's influencing our recommendation is the increased costs in fuel. Fuel costs really began to increase nationwide back in February. Again, we did include funding when we initially began the preparation of the budget, and the budget that was adopted did have increased funding for fuel costs. However, these increased costs have persisted and based on our revised projections for the current fiscal year, we do not believe that there's enough funding in the budget for fuel. So we are going one of our recommendations is to add funding for fuel costs.

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