THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Monday, September 9, 1996 TAG: 9609090037
SECTION: LOCAL PAGE: B1 EDITION: FINAL
SOURCE: BY KAREN WEINTRAUB, STAFF WRITER
DATELINE: VIRGINIA BEACH LENGTH: 175 lines
What would you do if you peeked at your checkbook and realized you had a few grand to spare?
You already had paid your mortgage, made your car payment, covered all your bills and bought the kids' new school clothes, but still, there's this extra money burning a hole in your bank account.
Do you put it in a rainy day fund? Use it to fix the roof or add on the sun room you've always wanted? Or try to double it in the stock market?
The city of Virginia Beach is basically in this enviable spot and is trying to choose among its options.
The city closed out its latest fiscal year with more than $20.5 million to spare.
Although that sounds like a huge sum, it amounts to only 2.4 percent of the city's budget for that year. When it costs $10 million to build an elementary school, $20 million doesn't go as far as you'd think. And the city's wish list tops a staggering $700 million.
So where to start? What do you do first when you know you can't do it all? Or should the city just put the money aside for now and wait until next spring's budget process to dole out the funds?
That's what City Council members have to decide in the next two weeks.
``They've got a lot of tough choices to make,'' E. Dean Block, the city's budget director, said last week. ``Basically, our recommendation has been for them to wait a while, to look at this in the context of the upcoming (budget) program, or at least (hold off spending) a portion of it.''
The council members spent the weekend setting priorities for the 50 projects now on the city's wish list. On Tuesday, they will learn more details about a handful of those proposals. And Sept. 17, they will decide how much to spend now and how much to hold back until the spring.
They already have made a few decisions.
Of the $20,558,063 surplus, the council already has set aside:
$587,373 for its reserves, to guarantee that the city's cost of borrowing money won't go up;
$1.7 million for city employees to repay them for cost-saving suggestions they made this year;
$100,000 to design a proposed multi-purpose stadium;
$442,593 to replace the roof at Louise Luxford Elementary School, which started failing this spring.
That leaves $17,694,247 to spend.
It's not a bad problem to have. Block told the council Tuesday that it was in an unusually good spot this year because spending was down 2 percent, revenue was up 3.8 percent and emergencies - so far - have been fairly inexpensive.
Last year's surplus largely was eaten up by the school district's $12.1 deficit. The year before, the council spent most of a smaller surplus buying the 1,200-acre Lake Ridge tract that now houses the Virginia Beach Amphitheater.
In the years before that, the city usually compiled its long-term spending plan around this time of year, so any surplus was immediately dumped into that pot, Block said.
The school district managed to dramatically turn its finances around this year and finished the summer with a modest surplus of $138,000. As it usually does, the council turned that money back to the school district, which is expected to use it to pay the balance of the reroofing at Luxford Elementary.
So what to do with the city's surplus?
At its retreat last month, the council unanimously agreed to clear up the backlog of neighborhood street lighting projects.
Members also agreed to proceed with the first phase of a multi-purpose stadium that would serve local high schools and house the Hampton Roads Mariners, a professional soccer team that hopes to make it into the major leagues in the next five years. The council already has allocated $100,000 to design the expandable stadium and appears likely to approve as much as $6 million more to build the first 7,500 seats.
Other top priorities appear to include improvements to Oceana Boulevard, the eastward extension of Harbor Point Road, and the purchase of 112 acres of land next to the Municipal Center that would house a new juvenile detention facility and other public projects.
That brings the total down to about $7 million. (See how easy it is to spend huge amounts of cash?)
Block again cautioned the council to save some of that for next year's big-ticket budget items.
But what about the huge hit from the Virginia Retirement System, some council members wondered on Tuesday. Cities across the state will have to cover an increase in government employees' pensions. The city would save $32 million over 30 years by paying $7.5 million up front now. The money that's left would just about cover that.
But postponing other projects - like new roads and building repairs - could cost more money in the long run, council member Louisa M. Strayhorn cautioned. MEMO: THE WISH LIST
1. Complete backlogged neighborhood street lighting - $310,000.
2. Virginia Retirement System reserve - $7.5 million set aside now
saves $32 million over 30 years compared to phased-in funding approach.
3. Roof replacements on city buildings - $142,000 more than
originally estimated.
4. Health and safety improvements in city buildings - $1.1 million.
5. General Booth and Diamond Springs fire stations - $2.9 million.
6. Fire equipment replacement backlog - $275,000.
7. Southeastern Parkway & Greenbelt - Phase I costs estimated at $112
million; $260 million total for segment in Virginia Beach.
8. Emergency Management Services administrative space to replace
inadequate facilities - $300,000.
9. Sandbridge Sand Replenishment - $4.2 million initially; $1.2
million every year thereafter.
10. Red Wing Golf Course Expansion - estimated at $5.9 million
11. Reduce need for future tax increases for schools by paying cash
instead of issuing debt - up to $22.8 million.
12. Computers, hardware and software for schools - $64.4 million.
13. New classrooms and infrastructure to provide more computers in
schools - $42 million.
14. School modernization and additions requested but not funded at
Kempsville and Plaza middle schools and eight elementary schools - $32.9
million total.
15. Pavilion expansion - $94 million.
16. Equipment replacement backlog - $3.5 million.
17. Dome area revitalization - costs unknown.
18. Burton Station purchases and infrastructure construction for
industrial park - $13.4 million unbudgeted.
19. Social Services building replacement - $7.1 million total; as
much as $1.5 million needed in 1997-98 fiscal year.
20. Harbor Point Road eastern extension - $418,300 to $682,800.
21. Oceana Boulevard improvements - $2.7 million.
22. Development of new police training facility - $8 million.
23. Expansion of public resources and Internet access at libraries -
$480,000.
24. Library technology initiative - $3.2 million.
25. Expansion and renovation of library facilities - $11.1 million.
26. Construction of new libraries - $7.8 million.
27. Tidewater Community College improvements - $3 million to $10
million over the next six years.
28. New police property and evidence storage space - $1.9 million.
29. Central Business District - total costs unknown. $5.1 million
extension of Constitution Drive has been requested but not funded.
30. Homeless shelter and programs to make use of $800,000 federal
grant - costs unknown.
31. Third police precinct renovation and addition - $497,000.
32. New Landstown chemical storage facility - $396,000.
33. Sprinklers and exhaust systems for fire stations - $990,000.
34. New records storage facility - $975,000.
35. Renovation to city operations building - $350,000.
36. New courtroom for family court - $200,000 to $1 million in
construction costs.
37. Construct new park adjacent to the Boys/Girls' Club off Rosemont
Road - $275,000.
38. City and school building maintenance and renovations - possible
need for $2 million to $5 million more than budgeted.
39. Remote traffic controllers for Fire/EMS departments - $120,000.
40. New EMS training facility - $457,500.
41. Additional long-term road construction needs - $70 million to
$100 million between 2003 and 2010.
42. Pacific Avenue improvements - $69 million.
43. North Beach drainage improvements - $15.9 million.
44. Construction of Rudee Walk - costs unknown.
45. Communication system improvements - costs unknown but could be as
high as $30 million.
46. First-phase construction of multipurpose stadium - $4.5 million
to $6 million.
47. Corporate Landing Parkway and related improvements in Corporate
Landing industrial park - $1.9 million to $2.5 million.
48. Upgrade city's computers - $750,000 to $1 million annually.
49. Purchase of 112 acres next to Municipal Center as potential site
for juvenile detention center and other purposes - $2.2 million to $2.8
million.
Source: Virginia Beach Management Services Department ILLUSTRATION: MONEY THE COUNCIL HAS SET ASIDE SO FAR
Of the $20,558,063 surplus, the council already has set aside:
$587,373 for its reserves, to guarantee that the city's cost of
borrowing money won't rise.
$1.7 million to repay city employees for cost-saving suggestions
they made this year.
$100,000 to design a proposed multi-purpose stadium.
$442,593 to replace the roof at Louise Luxford Elementary School.
The roof started failing this spring.
That leaves $17,694,247 to spend.
KEYWORDS: VIRGINIA BEACH BUDGET by CNB