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Richmond Mayor Proposes 2022 Budget With Little New Spending

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FILE: Richmond Mayor Levar Stoney speaking to City Council during last year's budgeting process. (Photo: Roberto Roldan/VPM News)

Mayor Levar Stoney presented a lean $770 million budget proposal to Richmond City Council Friday afternoon.

The budget was about $18 million lighter compared to last year, excluding one-time grant funding. City officials say the COVID-19 pandemic and resulting lockdowns drove down revenue from consumer-driven taxes like admissions, meals and lodging. Instead of funding new programs and priorities, the city’s budget staff were asked to find ways to maintain funding for core government services.

Like families have had to do during the pandemic, Stoney said the city likewise had to make tough decisions.

“With precious little help over the last year from the federal government, the ongoing pandemic has decimated the finances of cities and states alike, and the City of Richmond is no exception,” he said. “To be sure, this is a Pandemic-era Budget, and city tax revenue projections are still significantly short of what we projected at this time last year.”

Transportation-related funding would stay roughly the same under the proposal, thanks in part to new money from the Central Virginia Transportation Authority. The budget directs $33 million to road and sidewalk maintenance and $8 million to GRTC bus service.

Funding to alleviate the affordable housing crisis would also remain untouched. The proposal includes $2.9 million for the Affordable Housing Trust Fund and roughly $500,000 for the eviction diversion program created in 2019. The city will also look to act on some of the recommendations from the mayor’s Homelessness Advisory Council, including creating a Community Resource Center in City Hall, using existing funds.

Perhaps most important for residents, Stoney’s budget has no new tax increases, though it does include small increases in water and gas rates. Residential customers would see an average increase of $5.27 on their monthly bill.

Stoney said the utility rate increase will fund $3 million in stormwater remediation to alleviate flooding in Southside.

“Unlike the federal government, we can’t print money and we’re not allowed to run a deficit,” Stoney said. “We have to balance our budget every year. These rate increases are necessary to provide the top notch utility services our residents expect and deserve.”

Many departments and programs that will not see any cuts received support in the last  federal COVID-19 relief bill. The proposal for FY2022 Stoney outlined Friday could change depending on how much funding there is for local governments in the relief package currently being debated in the U.S. Senate.

The city will look to make up for the $18 million revenue loss by continuing the hiring freeze it put in place at the start of the pandemic. Officials estimate there are currently around 600 vacancies in City Hall that will go unfilled this year. There will be no employee layoffs or furloughs.

Despite hits to city tax revenue, the proposed budget does include a few new spending items.

Richmond Public Schools would receive the additional $6.4 million it requested. The district plans to combine that with state money to fund pay increases for teachers, increasing employee health care costs and pay for tuition for regional schools and other state programs.

Funding for a new mental health response system, known as the “Marcus Alert,” is included in the proposal. The new system would ensure that trained mental health professionals respond alongside police to emergency calls for a mental health crisis. The budget would put $1.1 million toward training for emergency communications staff, although it’s unclear if it would fully fund implementation.

Some city workers could also see a pay increase starting Oct. 1 as the city continues to implement the recommendations of a 2018 study on job classification and compensation. The goal is to reduce Richmond’s 16% turnover rate by offering more competitive salaries.

Sworn police officers and firefighters would also get two raises, known as step increases, to make up for planned raises that were cut last year because of the pandemic. The Office of Children and Families, which was also cut from the previous budget, would be established under the proposal. An Office of Equity and Inclusion will also be created, with funding for a community safety coordinator focused on homelessness and gun violence.