THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Wednesday, August 28, 1996 TAG: 9608280434
SECTION: FRONT PAGE: A1 EDITION: FINAL
SOURCE: BY KAREN WEINTRAUB, STAFF WRITER
DATELINE: VIRGINIA BEACH LENGTH: 82 lines
A year after being financially crippled by a $12.1 million deficit, the school district is back in the black.
The city closed out the district's 1995-96 books Tuesday and concluded that the school system had $138,108 to spare after spending $354 million.
The council also got good news Tuesday, learning the city had a year-end surplus of more than $20 million.
Almost exactly a year ago, the last time the city finished compiling year-end figures, the district's finances were a mess. It took more than three months and a detailed audit to figure out exactly how far apart the district's revenues and expenditures had been.
Nine of the 11 School Board members and several top administrators left or were asked to leave because of the financial troubles. An almost entirely new board took over this summer.
The city's director of finances, Patricia A. Phillips, praised the district to the council Tuesday, saying it managed to balance its books for the 1995-96 school year by making $4.8 million in mid-year cuts.
``They've done a good job, despite the fact that federal and state revenue was down,'' Phillips said.
The city's own surplus was due mostly to an unexpected increase in personal property taxes, Phillips said, and some savings in the Public Works and Police departments. Real estate taxes also were higher than estimated, as were hotel and restaurant taxes, she said.
Personal property taxes are hard to predict, Phillips said, because they vary widely from year to year and the city must estimate them 18 months before they are paid.
Vice Mayor W.D. Sessoms Jr. said he was thrilled with the surplus, which should help maintain the city's bond rating - and therefore its cost of borrowing money.
``It's some mighty nice information for this council to receive,'' Sessoms said.
Phillips said the surplus was about the same size as it has been for the past three years. It appears higher, she said, because unlike in previous years, the extra money was not used as it came in to pay for capital projects already approved by the council.
Phillips said the city's budget director held off on spending the money because he was unsure of how the school district would manage its finances this year. Last year's council surplus was dedicated almost entirely to bailing out the schools, and it was not clear until recently that the district would balance its books this year.
The council already has a wish list for the extra money, some of which it will save for next year's budget cycle. The rest will be spent right away.
The first priority will likely be a proposed multipurpose stadium that could eventually house a major league soccer team.
The first phase of the stadium, which would also be shared by a local high school and amateur sports, would cost about $6 million, city staff members estimate. Tuesday, the council agreed to spend $100,000 to complete preliminary designs for the stadium, which would be located on the Lake Ridge parcel off Princess Anne Road next to the Virginia Beach Amphitheater.
The council's wish list, which far exceeds $20 million, also includes money to expand the Pavilion or build a new convention center and convention hotel; funding to build several top-quality golf courses; $2 million to $5 million for major maintenance and repairs to city buildings; $18 million to complete the city's library network; an extra $125,000 a year for arts funding; money to build an arts and performance center; funding for the proposed light rail system between Norfolk and the Virginia Beach Oceanfront; and $2.5 million to complete Corporate Landing Parkway.
The council could also use some of the surplus to defray about $16 million in costs it knows it will have next year, including higher employee salaries and retirement contributions.
At the council retreat last week, council member Nancy K. Parker said she would like the council to consider using at least part of the surplus to defer any tax increases that would otherwise be needed next year. ILLUSTRATION: Graphic
'95 - '96:
$138,108 surplus
Beach schools, with a $354 million budget, ended this fiscal year in
the black.
'94 - '95:
$12.1 million deficit
KEYWORDS: BUDGET VIRGINIA BEACH SCHOOLS VIRGINIA BEACH CITY
COUNCIL by CNB