THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Wednesday, November 30, 1994 TAG: 9411300476
SECTION: LOCAL PAGE: B2 EDITION: FINAL
SOURCE: BY TONI WHITT, STAFF WRITER
DATELINE: PORTSMOUTH LENGTH: Medium: 87 lines
Dreams really can come true - if you're willing to pay the price. That's what City Manager V. Wayne Orton told the City Council on Tuesday when he recommended it enact a 4-cent real estate tax increase.
Orton told the council that if it wants to show its commitment to the economic development plan put together by Ray Gindroz and his company, Urban Design Associates, the city should start saving now.
Revenues from the tax increase, Orton said, should be put into a fund earmarked for economic development. He also suggested that the council dedicate an additional $500,000 a year from the city's building budget for the same purpose.
The building budget is funded through general-obligation bonds - low-interest loans from investors.
Over the next 10 years, Orton said, the city would have $15 million with which to build its dreams.
``I'm saying let's put in conservative, responsible spending,'' Orton said during an interview Tuesday. ``As a smaller city, we have to be much more efficient.
``I'm stepping out there, but I think the citizens expect me to do my job. I have to offer the council - as elected representatives - these initiatives.''
But council members weren't ready to step out quite so far Tuesday, although they didn't rule out Orton's plan.
``I have to look at all the options,'' Councilman James T. Martin said. ``I don't favor a tax increase, but we have to look at all the options.''
Martin suggested that special taxing districts - in which an area of a city is taxed to pay for projects there - might be another option.
Mayor Gloria O. Webb said she needed time to digest the proposal, which was presented for the first time Tuesday.
Councilman Cameron C. Pitts said that because the city has a tax freeze for the elderly, he would be willing to consider a real estate tax increase.
``As far as an idea of investing in the future, if that's the only way, then that's what we need to do,'' Pitts said.
If the council approves the tax increase, Portsmouth's tax rate would be $1.36 per $100 of assessed value - remaining the second highest in the region just behind Norfolk's, which is $1.38.
In Portsmouth, the increase would amount to $32 more a year in taxes on the average home, which is assessed at $80,000.
Orton also recommended that the city complete King's Crossing, a waterfront condominium project that went under in the savings-and-loan crisis.
Orton suggested that the city, which bought the unfinished project for $2.5 million several years ago, borrow money from the U.S. Department of Housing and Urban Development to complete the condominiums.
The city could borrow $7.5 million against future Community Development Block Grants, he said, and then repay the loan by leasing the condominiums at ``high-end rents.'' Once the market improves, Orton said, the city could sell the condominiums.
``I think this project is of such significance we should get it done,'' Orton said. ``If there's money to be made and the city has to take a risk anyway, then we shouldn't be lining someone else's pockets. If there's a profit to be made, then it should come back to the public.''
But several council members said they are awaiting negotiations with private companies interested in completing the project.
Orton warned that if a private company does the work, the city should not take on any risk without receiving a substantial payoff.
While Orton recommended expansive ideas for economic development, he suggested trimming the city's other building plans.
In recent years, Portsmouth has borrowed $10 million a year to fund repairs and new construction for schools, recreational facilities, city buildings, drainage projects and streets. Orton recommending cutting that amount to $8 million a year so that the city could better meet its debt payments.
Under Orton's recommendation, the cut means that $3.9 million would be dedicated for construction of I.C. Norcom High School and $100,000 for other school repairs. In recent years, the city has earmarked $4.7 million for I.C. Norcom and $300,000 for other school needs.
Other city projects also would be scaled back. The remaining $4 million would be used for a myriad of city needs, including drainage and street improvements in Simonsdale, North Truxtun, Highland Biltmore and Brighton.
Some of the other projects also recommended include: spending $500,000 to relocate a ball park from St. Juliens Creek annex to a new facility off George Washington Highway; spending $573,000 to continue expanding the city jail on the waterfront; and buying a new $325,000 firetruck.
Residents will have an opportunity to comment on the plan at a public hearing set for Dec. 13. by CNB