THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Wednesday, February 28, 1996 TAG: 9602280370
SECTION: LOCAL PAGE: B2 EDITION: FINAL
SOURCE: BY MAC DANIEL, STAFF WRITER
DATELINE: CHESAPEAKE LENGTH: Short : 39 lines
Despite concerns that it might lead to higher interest rates on borrowed money, the City Council passed a five-year capital budget Tuesday that included funding for the first two years of the School Board's request for additional school projects.
The city plans to spend $578 million over the next five years for large construction and land acquisition projects. That is 29.3 percent less than the five-year budget the council approved last year.
The council said it will wait to see about funding the district's final three-year capital plan, hoping that there will be an upturn in city revenues and an increase in student enrollment.
The school district had asked for an additional $48.2 million to cover major school building projects, including several new high schools and middle schools.
By funding only the first two years of that request, the city hopes to avoid additional debt and keep in good graces with the bond-rating services when the city's finances are reviewed in April.
If the council had fully funded the school district's request, it was feared that the city would take on too much debt, resulting in a downgrade in bond ratings, which would raise the cost of borrowing money.
As a result of a slowdown in Chesapeake's growth, city revenues have not increased as much as had been hoped. Instead of the expected 3.6 percent population increase in 1995, the city grew by 2.3 percent.
The capital budget includes $534,000 for the Chesapeake Municipal Airport. In addition, funding was approved for engineering for several storm water projects, preliminary design for the expansion of the Indian River Library, and lights for fields at Western Branch High School. by CNB