RICHMOND, Va. -- Mayor Levar M. Stoney will not certify the appropriation of $13 million in surplus funding to City Council, as requested. Council President Chris Hilbert officially requested the money on April 27, after $13 million increase was found from June 2016; it is referred to as the "Unassigned Balance."
Mayor Stoney contacted City of Richmond financial advisors about the surplus. He was advised that using the surplus in the proposed budget would have consequence, namely with rating agencies.
Advisors told Stoney that using the surplus "would only mask a true structural imbalance of a locality that would still in most cases remain in the following or subsequent fiscal years...the rating agencies are particularly sensitive to any local government that is not serious about providing a structurally balanced budget."
According to Stoney, the surplus represents 11.98-percent of the sum of the Fiscal Year 2017 general fund budget. He said that amount "is not much higher than the policy minimum and by comparison is proportionally less than our highly rated peer localities."
"I look forward to working with Council in updating the City's policies related to debt and Unassigned General Fund balance, and reviewing Council's amendments in their entirety, balancing revenues that are projected to be available with budgeted expenditures."
Councilmember Kim Gray, who represents the City's Second District, said that the council would like better collaboration between council and the administration, going forward.
Last week Hilbert also sent a formal request to Stoney and asked that almost $7 million of Richmond Public Schools surplus funding be made available for appropriation. According to the mayor’s office, Stoney has stated previously that he would like the funds to be used for education. However, he would like to see some additional clarification on how Council wants to use the money before taking any action.