Monday, October 13, 2014
~Measure would establish $2 million reserve fund for short term~
Mayor Dwight C. Jones announced today that he intends to introduce an ordinance to establish a reserve fund for maintenance needs of Richmond Public Schools (RPS). The plan is designed to capture anticipated surplus funds that will result if City Council decides against rolling back the tax rate.
“While it was my desire to see us, as a government, offer the first reduction in the city’s real estate tax rate since 2007, it seems the will of the many is headed in a different direction and it is unlikely that City Council will approve the reduced rate,” said Mayor Jones. “I agree that the city has many needs that the additional funds can be directed toward, and I am suggesting that we initially establish a reserve fund for maintenance needs of Richmond Public Schools.”
RPS was allocated over $7 million in funds for FY2015 for school maintenance needs. Mayor Jones requested a status report on spending and learned that RPS has spent over $3 million of those funds in the first three months of the fiscal year. “Establishing this reserve fund is designed to provide a source of readily available funds for RPS to draw down from as their spending continues. This is a short-term measure to ensure they have a continuing source of available funds for maintenance needs that may arise in fiscal year 2015, while the long-term solutions are still being discussed and analyzed.”
Several long-term options are being explored by Jones’ finance working group, including possibly using funds from new assessed real estate to finance payments for a major loan, using savings from performance contracting to pay for maintenance needs, state and federal tax credits, and tax-exempt bond financing.
“I’m confident that we will chart a course for the long-term that will meet necessary needs,” continued Jones. “As the body responsible for the funding, we are doing our work to ensure we meet that responsibility. At the same time, I’m hoping to receive a plan from RPS that will address enrollment and performance concerns.”
A 2002 review of school facilities showed that Richmond Public Schools were under enrolled by more than 3,000 students at that time. Data today shows that trend continuing, as projected.
“I still believe that sometimes less is more and that if RPS can work towards correcting the size of the system they are operating, we can save money, better direct the available resources, and hopefully return to lowering the tax burden on the residents of the city.”
The Mayor also indicated that he was not ready to direct all surplus funds toward RPS’s needs, citing police and fire career development and salary increases as other funding priorities the city needs to find ongoing money to support.
Posted by Office of the Press Secretary to the Mayor at 1:15 PM