PETERSBURG, Va (WRIC) — An alarm of financial distress–sounded in 2016–is being silenced, as Petersburg officials tout a budget turnaround following a deficit of over $7 million in the city’s general fund balance.
After city officials announced findings from the 2017-18 Comprehensive Annual Financial Report last week, 8News dug deeper into how Petersburg made its way to a general fund balance surplus of $2.8 million.
City Manager Aretha Ferrell-Benavides said the financial turnaround starts with collections, noting in Fiscal Year (FY) 2015-16, Petersburg saw delinquencies in real estate taxes and bills, like water and sewer.
“We were at, I think, at one point in time at a 68 percent collection rate with the city,” Ferrell-Benavides said.
Today’s estimates are around 90 percent in collections, she says due to enforcement mechanisms including teaming up with legal help for tax payments, plus water shut-offs where people needed to pay their bills.
“We also did something this year that was important, we reintroduced DMV stops. So, this has been a mechanism to ensure that individuals who owe money to the city are not able to renew their driver’s license until that collection has happened,” Ferrell-Benavides said.
Petersburg officials say they plan to keep devoting $1 million annually to the general fund balance in order to restore city savings.
The budgetary regrouping isn’t limited to efforts within Petersburg.
Virginia’s General Assembly is moving through legislation that would permit localities, like Petersburg, to impose a tax on property owners of buildings in blight.
Petersburg Councilman Howard Myers says the bill pressures property owners to restore, and renovate and will help raise residential property values, thus increasing city tax revenue.
“The difference in property tax rate is about 5 to 10 percent,” Myers said. “Depending on whether it’s blighted or derelict and it would be assessed by the city assessor.”
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