New revenue sources proposed for Danville

April 28, 2004|LIZ MAPLES

Danville doesn't have money to build. It is quickly reaching its minimum fund balance, $2 million, and there are no reliable, steady sources of income.

These are the problems City Manager Darrell Blenniss presented to commissioners Tuesday at a budget workshop. Here are his suggestions for steady income:

* Have residents pay for their garbage collection that would free up $560,000 a year, the price of the collection contract now paid out of the general fund.

* Create a stormwater utility. Residents and businesses would pay a fee based on the amount of impervious surface, like asphalt, on their property. Fee could be used to pay for stormwater projects, saving the city $300,000 year.


* Annex industry, American Greetings and R.R. Donnelley, and residential areas. Could generate $500,000 a year.

Garbage collection debated

Commissioners immediately began to debate the garbage collection proposition. Blenniss said he estimates it would cost each household $7.50 a month or $9.50 a month with curbside recycling. The fee wouldn't generate any money for the city, but it would save money that it now pays for a collection contract.

Neither of the other options generated public discussion between commissioners. Blenniss said in a telephone interview Tuesday that it would take at least nine months to get the stormwater utility fee up and running.

The city's fund balance has been drawn down to the "bare minimum," Blenniss said. In July it is expected to be $2.4 million. That's about $400,000 above the minimal requirement to be kept so there are no cash flow problems.

The city cannot afford any more debt service.

"Right now we can't afford a new city hall.," Blenniss said, a proposal that is in the works.

All the while, the cost of running the city is increasing. Employee insurance premiums are rising. Blenniss said one option would be to stop paying 100 percent of the employee premiums, although he pointed out that some employees already make wages that are below the poverty line. General government expenses keep rising. Blenniss wants to look at outsourcing some things now done in-house, like bill collection.

Money could be put into fund for capital projects

Blenniss suggested that money from the stormwater utility, garbage fee or annexation could be put into a fund for capital projects.

Charging for garbage pickup was suggested by former City Manager Steve Biven when the city faced flat revenue and increasing demand for services. Residents quickly rebuked the idea. At the time, Biven said it would cost each resident $6.75 a month, or about the cost of an average property tax bill.

Later, the city's audit found $2 million.

About 60 percent of the city's funds don't come from steady sources - payroll taxes and state money can fluctuate with the economy. These sources of income could leave the city in a crunch if another factory has a number of layoffs or is sent overseas, Blenniss said.

"We should prepare ourselves for that," he said.

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