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City Manager Ken Larking on Tuesday night submitted to City Council a proposed budget that maintains basic government services and invests in eight key areas, including education, economic development and public safety.
No tax rate or fee increases are proposed and Larking is recommending that City Council adopt modifications to utility rate structures that will result in a net decrease in monthly costs for Danville Utilities customers. The lower utility costs are due primarily to expiring contracts that now allow for the purchase of electricity and gas on the market at a lower cost.
Also, this year’s budget does not include the use of unassigned reserves. In previous years, the City has relied on these reserves to pay for economic development initiatives. Instead, the City will leverage the upfront payment received in December from Caesars to fund economic development initiatives and other projects. When Caesars is operational, annual gaming revenue will be used.
The proposed budget is a working draft for the next fiscal year, which begins July 1. City Council will hold public hearings prior to adopting a budget. Final adoption must take place no later than June 30. The final budget will serve as a framework for city operations from July 1, 2021, through June 30, 2022.
Revenue forecasts for the next fiscal year are favorable as compared to a year ago. A $410,000 increase in current and delinquent real estate tax collection is expected as well as a $130,160 increase in personal property tax collection and an additional $200,000 from business licenses.
The City is also expecting a nearly $965,880 increase in sales tax revenue mainly because of new state legislation for collection of sales tax from internet-based businesses.
However, the City is anticipating a reduction in meals tax and hotel/motel revenue because of COVID-19 pandemic in the amount of $252,230.
Besides maintaining traditional government services at current levels, 747,990 is budgeted to continue the City employee pay-for-performance system, with average increases of 2 percent for employees, depending on performance.
The proposed budget invests in eight key areas: education, economic development, public safety, infrastructure, community health, quality housing, financial stability and quality of life amenities.
These areas were identified by a citizen advisory committee that produced an “Investing in Danville” report. The committee last fall held multiple town halls and conducted a community survey prior to developing a plan on how to invest possible new casino revenues in ways that would have the most significant long-term impact.
To do some things recommended in the “Investing In Danville” report now, Larking proposes the use of a combination of upfront casino revenue, general obligation bonds and bond anticipation notes.
For education, Larking is proposing $2 million for Danville Public Schools to pay for capital expenses such as roof and HVAC equipment replacements and other building repairs.
Also, the budget includes $2.4 million to pay for replacement of the track at George Washington High School. The new track will enable the school system to host track meets and provide student athletes with a quality facility for after-school sports.
The proposed budget presented by Larking provides flat funding for Danville school operations in the amount of $22.8 million, but it includes a provision to allow the school system to keep any unspent funds at the end of the current fiscal year to use toward expenses in the next school year.
Also, Larking said the school system is receiving federal stimulus funds, and while the state has not yet finalized its budget for the next school year, all signs are pointing toward increased funding for all school systems and additional funds for high-poverty districts.
Later this year, it is expected that Danville Public Schools will present a plan to renovate completely certain schools using funds generated from a one percent local option sales tax. Citizens of Danville will hear about the plans over the summer and fall and vote on the initiative in November.
For economic development, Larking proposes funding for continued River District redevelopment as well as funding for industrial site development, incentive programs, international business recruitment, and tourism development.
For public safety, the budget draft includes funds for the new police headquarters, additional closed circuit television cameras, new police equipment and fire apparatus upgrades.
For the other five investment areas identified by the “Investing in Danville” committee, the proposed budget includes funds for airport runway and terminal upgrades, street improvements, construction of the Riverfront Park, neighborhood revitalization and blight reduction, neighborhood park improvements, and construction of splash pad playgrounds in the northern and southern parts of the city.
The total proposed budget for the next fiscal year is nearly $280.3 million for operations, capital and debt service, which includes all funds minus inter-fund transfers. This total is almost $11.2 million or 3.83 percent less than the current fiscal year budget of $291.45 million.