City officials: Budget tight; worst probably stil ahead

When presenting the proposed fiscal 2011 budget to the City Council, Charlottesville officials again warned that things likely will get worse.
City Manager Gary O’Connell on Monday presented a $140.8 million spending proposal, roughly $1.7 million, or 1.19 percent, less than the city’s current budget. The proposed budget leaves the city’s real-estate tax rate at 95 cents per $100 of assessed value and does not raise any fees, make staff cuts or give pay raises to city employees.

O’Connell also said there would be no cuts to city services.
“That was our goal. I’m surprised we can do it,” O’Connell said.
Compared with other localities, O’Connell said, “we’re in a different place.” But he warned of difficult years ahead because of local revenues that are expected to keep declining and cuts in state funding as well.
“We think another storm is brewing,” O’Connell said. “We really need to keep an eye on those future years.”
During the council’s meeting, Councilor David Brown added, “I think it’s going to get a lot worse before it gets better.”
Councilors have indicated that they would not raise the real-estate tax rate, which will be set in April.
The city advertised a real-estate tax rate of 95 cents per $100 of assessed value on Tuesday. The council cannot approve a rate higher than what it advertises. If the 95-cent rate is approved, many property owners would see lower tax bills because the average value of existing residential properties declined by 2.19 percent in the latest reassessments.

The city has yet to lay off employees because of the recession, but this is the second straight year that across-the-board raises have not been proposed. Three more employees would also be added to the city’s workforce of 916 — two bus drivers to expand service on the Charlottesville Area Transit’s routes 3, 4 and 6 at a cost of $110,000, and an administrator of the Comprehensive Services Act.
The regional bus service was renamed Monday from the Charlottesville Transit Service.
According to the spending plan, the city is saving roughly $250,000 on its contract for trash and recycling collection and another $250,000 on remediation of the Ivy landfill. Other spending reductions are coming from city departments — roughly $182,000 — and from reduced costs on items such as fuel.
Like this year, O’Connell has proposed to set aside $2.8 million in an economic downturn reserve to help cushion the blow of less local revenue and more funding reductions that seem inevitable.

“Having this cushion helps. Clearly these are unknown times,” said Leslie Beauregard, the city’s budget director.
The budget would fully fund the city school system’s request for $40.1 million, a decrease of 0.32 percent. Superintendent Rosa S. Atkins also formally presented the division’s fiscal 2011 budget, roughly $68.3 million, to councilors Monday.
Councilor Kristin Szakos said she was pleased to live in a community that values education.
“I really want to thank our taxpayers,” she said.

The proposed budget for capital projects comes in at roughly $33.9 million, but the vast majority of that — about $22.2 million — is federal and state funding to pay for the interchange at the U.S. 250 Bypass and McIntire Road.
Apart from that, the proposed fiscal 2011 Capital Improvement Program lacks many pricey projects, but O’Connell has proposed to set aside $1 million for affordable housing, the same amount as the current budget.