Reserve proposed to fund new projects

Second in a two-part series.

The upcoming year might not be all doom and gloom for Charlottesville officials and their spending options.

While the proposed fiscal 2010 budget does not contain many of the larger, more costly programs that have characterized past plans, the City Council may still be able to squeeze in a few new programs despite ongoing revenue declines.

Knowing the council’s aspiration to establish more social welfare programs for poorer residents, the city manager has proposed $250,000 of unallocated revenues for the council’s reserve fund. This would give the body more freedom in allocating money to the initiatives it most wants to support and to potentially create new programs.

“The hope is for a comprehensive approach because what we’re doing now is piecemeal,” Councilor Holly Edwards said. “This year we can do that.”

The proposed reserve is nearly $210,000 more than what was allocated in the current budget.

City Manager Gary O’Connell said the $142.5 million proposed budget sets aside more than $2.17 million toward the council’s priority initiatives. Spending for the city’s internal departments likely will fluctuate only slightly, with most budgets increasing or decreasing nominally.

“I was surprised we were able to meet their priorities,” O’Connell said.

Outside of the reserve, money already has been allocated in the proposed budget for specific programs councilors wanted — such as $50,000 for a community dialogue on race, $63,000 to cover transit fares for people in the Department of Social Services’ welfare-to-work program and $85,373 to expand the Youth Internship Program’s budget.

In capital improvements, $600,000 for stormwater system repairs and $125,000 for home energy conservation grants also have been proposed. But at the same time, there were ideas that O’Connell said he knew councilors supported, but did not know the exact programs where the money could be spent.

“I think we can afford to do some smaller, new programs,” he said.

A push for priorities

City staff has come up with a list of possible uses for the reserve, which councilors will discuss at a budget work session next week. The draft list includes creating workforce development programs for Walker Upper Elementary School, Buford Middle School and Charlottesville High School, more funding for the Medical Sciences Club at CHS and a program for public housing residents.

Others pointed out, though, that the spending required to support pilot programs and to create initiatives for next year means that money must be cut from other places.

For example, the Charlottesville Housing Fund that was created to help address affordable housing, councilors’ top priority, is expected to receive $400,000 less than was included in the current budget.

“Whenever funds are cut, it’s saddening to our community,” said Rickey White, pastor at Union Run Baptist Church and a member of IMPACT, a local interfaith group that has been credited with affordable housing accomplishments. “But we understand the economic situation that we’re in.”

Councilor David Brown said that funding new initiatives is important and that he completely favors coming up with new ideas to improve residents’ lives.

“But something’s gotta give,” he said, adding that he was concerned about the funding being taken out of capital programs to address these issues.

Theoretically, councilors could take some of their reserve, or funding from other programs, and lump it in with the rest of the housing fund, set to total $1 million next fiscal year. Surpluses from the last couple of years have allowed the body to put up more capital to address the issue — the fund had $2.1 million in fiscal 2008 and has $1.4 million in it this year — but that is a luxury that is fading.

“Is this the right time to put even less funding than we did in the current year?” Mayor Dave Norris said.

O’Connell said the $1 million contribution is the city’s bottom-line commitment, and with what officials know about the economy, he thinks the amount is sustainable. Many councilors are in agreement.

“I think we have enough money for housing funds right now,” Councilor Satyendra Huja said, adding that he would like to see some of the reserves directed toward transit initiatives.

“We all are in agreement, it’s a huge problem for the city,” Brown said, referring to affordable housing. But he said there are many other forces at play that the city has no control over, such as rent costs.

“I’m leery of just trying to spend more money,” Brown said. “I’d like to see the ideas come first rather than the funding.”

Elected officials were already pushing to spend more on some of their biggest priorities last year, when the city tabulated in December that there was roughly $5.7 million in unspent fiscal 2008 funds.

City staff proposed giving back a sizable chunk of that money to the respective departments and funneling it into existing programs, but councilors expressed dissatisfaction with that idea.

The way funds have been set aside now seems to have worked in councilors’ favor. Instead of shifting money from particular budget line items, Norris said having unspent money in the council’s reserves “gives us a chance during the budget development process to make sure those council priorities are reflected in the budget.”

“We often have our own suggestions, our own priorities, and they’re not always reflected in the city manager’s budget,” Norris added.

Balancing the spending

O’Connell said about $40,000 of the fund, roughly the amount set aside in the reserve this year, still should be kept on the backburner in case there are spending-related emergencies or other unforeseen circumstances.

“Generally, council doesn’t spend all that money up,” O’Connell said. But, he said, “we thought it was important to give council the opportunity” to have funds available to support programs related to workforce development and poverty.

O’Connell said that in the proposed budget, no new programs created by outside agencies, such as area nonprofits, are being funded. And many organizations that already address social and health issues are slated to get the same amount or less than they did this year.

The Shelter for Help in Emergency, United Way Child Care and the Region Ten Community Services Board are three agencies that could see their funding stagnate. And the Monticello Area Community Action Agency; Juvenile Justice Services; Children, Youth and Family Services; and the Charlottesville Commission on Children and Families are four that may have their allocations reduced by thousands of dollars.

“A lot of nonprofits in the area apply for city and county funding,” said Lisa Godwin, coordinator for the Partnership for Children, a workgroup of the Commission on Children and Families. Godwin there has been “a lot of discussion” about the funds agencies could receive from local governments next year.

Only two agencies are set to get more funding next year. The Charlottesville Free Clinic is proposed to get an increase of $92,951 because it has taken over a new dental program for the uninsured. The same amount, however, is being reduced in funding for the Charlottesville-Albemarle Health Department, which runs the clinic. And the Jefferson Area Children’s Health Improvement Program is getting $316,192, but that money was also removed from the Partnership for Children funding.

The proposed changes amount to $40,763 less for many children, youth and family-oriented programs for the next fiscal year.

“People have a different sense of security in terms of what they expect,” Godwin said.

Councilors soon will decide how to allocate the $250,000 in unspent funds. And O’Connell said that as local governments and agencies continue to see revenue declines, it is possible that some organizations may implore the city to fill the widening gaps during the year. What will happen has yet to be determined.

“I don’t see how we can do all that,” O’Connell said. “Should the city be stepping in and funding that cost?”