ROANOKE TIMES 
                      Copyright (c) 1996, Roanoke Times

DATE: Thursday, October 17, 1996             TAG: 9610170014
SECTION: CURRENT                  PAGE: NRV-11 EDITION: NEW RIVER VALLEY 
DATELINE: PULASKI
SOURCE: PAUL DELLINGER STAFF WRITER

CREDIT LINE NOT NEEDED BY PULASKI

Pulaski has not needed to use its $400,000 line of credit secured from Community National Bank last month to get the town through a dry revenue period.

Town Manager Tom Combiths told the town's Finance Committee Wednesday that cash flow will continue tight for about three more weeks before tax payments start coming in. He did not anticipate that he would have to use the line of credit.

Mayor Andy Graham had asked Combiths for a detailed report on why it was necessary.

Three large expenses - $317,000 for street paving, $219,000 for debt service and $94,000 for insurance - hit during the time when town revenues were at a low period.

Another factor this year was the change from August to March for selling town vehicle decals, which brings in about $130,000.

"We could have done a better job here," Combiths said. A new town computer system will allow its staff to monitor revenues, expenses and encumbrances more closely in the future. Cash balances in the town's three major funds continue to average $750,000, he said, so the town is in good shape financially.

"Let's say we've learned a lesson," said Rocky Shrader, Finance Committee chairman.

On an economic development issue, Councilwoman Polly Mitchell questioned the use of principal as well as interest from the town's federal urban development grant to fund the town's economic development department. She thought that department could better be funded from general revenue, even if it meant a slight tax increase, so the federal money could stay intact for economic development loans.

The town secured the federal grant years ago to lend an expanding industry and, when the loan was repaid, decided to earmark the money for economic development. Interest on the fund itself is down because a lot of the fund's money has been loaned to Pulaski Furniture Corp. and Renfro Corp. for expansions.

Combiths said the expansions themselves are good news for the town's economy, though, and will be repaid with interest. He said it is necessary to view the use of the federal grant money on a long-term basis.

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