Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, March 26, 1994 TAG: 9403300013
SECTION: CURRENT PAGE: NRV-4 EDITION: NEW RIVER VALLEY
SOURCE: By RICK LINDQUIST STAFF WRITER
DATELINE: RADFORD LENGTH: Medium
Starnes said the city could not continue to dip into reserves to cover routine expenses. "Ultimately some new funds will come from some source," he said.
His comments were made after council decided to advertise a real-estate tax increase of up to 4 cents per $100 valuation and a personal property tax jump of up to 8 cents per $100 before its April 11 budget hearing.
City Councilman Bob Nicholson tended to agree.
"I think there's a strong possibility that taxes would be a part of our package," but not the only possibility, he said Friday.
Nicholson said the city also might look to other revenue sources - including utility-rate increases or municipal bonds - to balance the budget instead. "We know we have to generate revenue from some place," he said.
His council colleague, David Worrell - who's running against Starnes for mayor - said he doesn't think a tax increase is needed.
"We don't need the money," he said, pointing to the city's relatively flush reserves and about $409,000 unspent by the School Board last year. Worrell said he'd "lead the fight" for a tax increase when it became necessary. He also has called for bigger raises for city employees, set at 3 percent under the proposed $39 million budget.
"It concerns me that we can spend $40,000 for trees or $35,000 for an EMS jeep, but we can't give our employees a [bigger] raise," Worrell said.
Vice mayor Polly Corn sharply disagreed. "We certainly can't afford to spend our reserves down to nothing," she said. "I'm not just thinking about next year."
Corn - who's up for re-election in May - refused to go out on a limb about the possibility of a tax increase, but didn't rule it out either.
Despite the advertised rates, taxes could stay the same, city officials said. "We were at the deadline. We had to do this to comply with advertising requirements," Corn explained.
City Manager Robert Asbury said Friday he wanted to know council's priorities before saying whether he thinks a tax increase is needed.
Asbury said the city's general fund reserve stands at about $3 million and the electric fund reserve is approximately $2.5 million.
"The general fund reserve is in better position than it has been in years," Asbury said Friday. But the electric fund reserve was in the "poorest shape it's ever been," he said.
Both funds have taken big hits to cover the cost of new firefighting equipment and ice-storm cleanup and repair. In addition, the city's stores and equipment fund is about $422,000 in the hole, and Asbury said City Council should transfer money from the general fund reserve to "zero that out." The city has about a dozen other reserve funds.
Councilman Gary Weddle, who's stepping down when his term is up in June, conceded Friday there's "a chance" taxes would go up. He said the city needs healthy reserves.
Weddle said projected expenses so far are running ahead of projected revenues.
"There are some items that have to be done," he said, pointing to an anticipated $63,500 repair bill for the city pool and new equipment for the Fire Department.
He said council would have to go back through the budget looking for places to cut discretionary spending while not trimming city services."Once we do that, we'll be able to know [if a tax increase is needed]," he said.
by CNB