City Council approves budget (with a few changes)

With a $5.2 million cut from the Mayor’s initial proposal, Richmond City Council members adopted the Fiscal Year 2011 Richmond Government Budget Monday night after several months of deliberation.

May 27, 2010; 6:00 AM • by Erica Terrini

With a $5.2 million cut from the Mayor’s initial proposal, Richmond City Council members adopted the Fiscal Year 2011 Richmond Government Budget Monday night after several months of deliberation.

Mayor Dwight C. Jones issued a statement Tuesday, praising the council’s approval of the budget.

“I am pleased to see that City Council has embraced our outcomes-based budgeting plan with an overwhelming vote,” Jones stated on the City of Richmond website. “We presented a responsible budget that is sound and addresses the fiscal challenges we are facing.”

According to Ellen Robertson, vice president of Richmond City Council, the new budget will go into effect July 1 this year.

A News Advisory by Richmond City Council states the 2011 budget is about $1.37 billion, which is about a 5.6 percent decrease from last year’s budget.

Robertson stated the net effect of Council Amendments is approximately $600,000, which covers changes to the General Fund, Capital Improvement Plan (CIP), and Special Revenue Funds.

“The biggest change was the removal of funding for the Downtown Acquisition Capital Improvement Plan,” Robertson stated.

The Mayor made recommendations in his budget brief earlier this year as he identified a potential $34 million gap in the fiscal year revenue, according to Robertson. The list of suggestion included:

• Improved revenue collection methods.
• Recognize and utilize savings from debt service (i.e. lower interest rates and semi-annual real estate collections).
• Recognize and utilize savings in employee healthcare benefits through combined insurance package with Richmond public schools and other targeted operating and personnel savings.

Robertson stated the Council generally agreed with him and added that the only significant variance was with regard to the 2011 capital improvements expenditures—the Council removed funding for open space acquisition in downtown ($2.5 million) and reallocated it to Schools Repair and Maintenance. The Council also made a policy decision to not use CIP expenditures, which are primarily funded by debt, for planning and pre-development costs.

Kathy Graziano, president of Richmond City Council, said the Council did not make many amendments to the Mayor’s proposed budget. She said council members focused on city infrastructure throughout budget deliberations.

“I think something the Mayor has put an emphasis on is infrastructure of this city,” Graziano said.

Graziano said in addition to committing funds to city maintenance — including pot holes, bumpy roads, and storm water management — other highlights included the Council’s approval of two loan programs and the fact that the Council did not raise the real estate tax.

“I think it’s important to the citizens that even though we had less in income, we did not raise the real estate tax,” Graziano said. “The other thing that we’re starting this year, we’re going to get real estate tax collections twice a year, in January and in June. It saves about 1.3 million because we won’t have to borrow the money.”

According to Robertson, this will save the city money by reducing the amount of short-term debt that the City will need to cover annual operations. To minimize the one time impact on citizens, the City Administration is preparing an awareness program and monthly payment plan for 2011 real estate tax bills. The roll-out of these programs is expected this summer.

“Most of the proposed initiatives will provide positive impact on government operations and provide additional resource for human services programs, much needed street repairs and economic development,” Robertson said.

Here are some highlights for the Fiscal Year 2011 Richmond Government Budget:

• The Council established the designation of special funds for affordable housing and special parking districts. The affordable housing fund will be used to assist low to moderate income residents in obtaining housing. However, the specific parameters of this program are still in undefined; no expenditure can be made until the Council adopts a formal program. The special parking district funds will use a portion of parking ticket revenue collected in parts of town that have a high congestion of vehicles (like the Fan) to provide additional signage, street markings, etc. in these areas.
• The Council approved loan programs for small businesses and community development projects. Both of these loan programs were proposed by the Mayor, as vehicles for economic and community development.
• Council restored funding for Richmond Public School’s Spanish Immersion Program. As part of its proposals to address reduced revenue, the RPS had removed funding for one of its Spanish language programs for elementary school students. The Council increased the City’s appropriation to RPS to ensure that this program continued ($132,000).
• The Council provided funding for Community of Caring Program (Teen Pregnancy Prevention), allocating $50,000 to support efforts to reduce teen pregnancy.
• The Council provided funding for video equipment to combat illegal dumping in highly impacted area. The Council provided $30,000 for surveillance equipment at the Cannon Creek Greenway in Northside. Over the years, this open space had become an illegal dumping ground. The City is committed to restoring this park and strictly enforcing a no dumping policy.

(Information provided by Richmond City Council Vice President, Ellen Robertson.)

If you’re interested taking a look at the numbers yourself, check out a Google doc version of the Fiscal Year 2011 Richmond Government Budget.

May 27, 2010 6:00 AM 1