City proposes #036;418M in projects
Published 12:00 am Wednesday, December 3, 2003
The stewards of Suffolk’s bank account are hearing the same advice repeatedly echoed by financial advisors to consumers this Christmas season: exercise caution, don’t overextend, and plan way ahead.
Suffolk Finance Director M. Christine Ledford and the city’s outside financial advisors stressed Wednesday that the city’s proposed 10-year $418 million Capital Improvements Plan (CIP) hinges on those three denominators.
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In exercising caution due to stagnant interest rates on idle investments, the plan recommends reducing the city’s debt assumption by $6 million in 2004-2005, which includes $48.3 million in projects. Officials are seeking to borrow $12 million of that, and increase to $18 million the following fiscal year.
&uot;This is financially prudent to allow us to continue borrowing in future years,&uot; explained Ledford in a press conference yesterday with regard to balancing affordability, project demands, and future revenue capacity to support any debt incurred.
City Manager R. Steve Herbert officially presented the proposed 10-year budget to council during Wednesday’s work session, outlining major expenditures for schools, industrial and economic development, public safety, public utilities and a myriad of other projects.
In a memorandum to council, Herbert elaborated relative to the city reducing its borrowing level for the coming year.
&uot;As interest earnings are a source for funding debt service, this has made an impact,&uot; he wrote. &uot;By reducing our borrowing in the coming year, we more quickly correct this shortfall and, more importantly, strengthen our ability to borrow for capital needs in the coming year.&uot;
School funding, 57 percent of the CIP, has increased by $120 million over the current year 10-year requests. To address burgeoning growth, a new northern Suffolk elementary school is an integral component of the budget at a price tag of $14.1 million. Funding is spread between 2004-2006.
Renovations totaling $3.4 million are included for Forest Glen, John F. Kennedy, and John Yeates Middle School.
Other key projects include the Suffolk Center for Cultural Arts (the former Suffolk High School), funded at $4.8 million next fiscal year; a north Suffolk library, $1.2 million adding to $3.4 million previously allocated. Money for a central library replacement is incorporated between 2005-2007, totaling $5 million.
On the east side, the former East Suffolk high school property is scheduled to receive $5.5 million via a with the Boys & Girls Club of America, which will provide half of the proposed funding.
The city has earmarked a $4.5 million over the 10 years for the Hampton Roads Technology Park in northern Suffolk, where the officials plan to acquire 50 acres on the former Tidewater Community College property.
A Driver Park Sports Complex will require $1.1 million between 2004-2009, paving the way for the possibility for a new Driver and Peanut Festival sites.
On the utility side, the CIP includes $74.1 million – solely supported by revenues generated. Public Utilities Director Al Moor explained that the budget paves the way for water source development, plant expansions, distribution system upgrades, neighborhood extensions, sewer system upgrades, and promotes economic development.
In view of all the projects Suffolk has planned, JoAnne Carter, managing director of Arlington-based Public Finance Management, stated during the work session that Suffolk’s debt level in an &uot;affordable&uot; range. She praised Suffolk’s financial policies, which has contributed to the city’s high ratings on Wall Street. Just today, the city was able to secure an interest rate of just over 4 percent on a 30-year bond.
Mayor E. Dana Dickens proudly reiterated that Wall Street has upgraded the city’s rating four times over the past five years, crediting the finance department. Suffolk has, in part, been able to do this by increasing its reserve funds and pursuing more aggressive debt payoffs.
Despite what appeared on the surface to be a great funding road map from all accounts, Councilman Charles F. Brown wasn’t buying it. Brown argued that the CIP is a gerrymandered approach based on council favoritism, failing to address the needs of people.
&uot;It has not adequately addressed the living conditions of people,&uot; stressed Brown in an interview after the meeting. &uot;People are just as important as buildings. The plan is based on council member favoritism. This is not a plan.&uot;
Brown stated during the meeting that he believes the funding should be redirected to address neighborhoods surrounding downtown plagued with substandard housing and high crime statistics.
Dickens countered that the plan &uot;has done a good job of addressing the community’s needs set within the frame of the budget.&uot; Beginning in the 1998, the council set a &uot;clear path that we’re trying to follow,&uot; he added, &uot;We have to stay within the frame of what our financial capacity is. The problems didn’t occur in a short period of time and we’re probably not going to solve it in a short period.&uot;
A public hearing on the proposed CIP is scheduled for Dec. 17 during council’s regularly scheduled meeting at 7 p.m. Adoption is anticipated on Jan. 7.