The Radford City Council voted Monday night to increase numerous taxes and fees, cut their own salaries by 10% and freeze vacant city positions in an effort to address a budget shortfall years in the making.
The city’s budget of $78.0 million was approved unanimously by the council, representing an increase of over $700,000 in tax and fee revenue, from the original proposed budget of $77.3 million.
City positions that are currently vacant will be frozen, as well as positions that become vacant, unless the city manager deems them necessary to fill. Interim City Manager Craig Meadows estimated savings near $1 million from this move.
Mayor David Horton said Monday evening that he had been unaware of the severity of the city’s budget challenges until this budget process. He said the situation is partially due to revenue being lower than expected in recent years.
During that time, Radford has struggled financially, a consequence of being a small city —population about 17,000 — with a declining industrial base. The state-owned Radford University owns 211 acres in the city.
“A lot has come to light throughout the process,” Horton said. “We thought we were in a different place 12 months ago. We reworked the way we look at our revenues, we’ve gone back and looked through our expenses again, and what we think we have now is far more reliable than what we had before.”
The council approved the following tax and fee increases:
- Real estate tax: increases from 79 cents to 82 cents.
- Personal property tax: increases from $2.44 to $2.55.
- Prepared meals tax: increases from 5.5% to 6.5%.
- Hotel occupancy tax: increases from 8% to 8.5%.
- Solid waste fee: increases from $22 to $25.
- Wastewater fee: increases from $32.48 to $36.48.
- Water fee increases from $20.32 to $24.32.
Meadows said these increases will generate an expected $721,000 in revenue for the city.
“The revenue, I can promise you, none of us had any joy in increasing those, but we want to be able to fund our schools, take care of our people, and at the end of the day … you have to start fighting and digging out of here. This is the first and hardest step and we have to keep working,” councilman Seth Gillespie said during the meeting.
Meadows’ presentation showed that council salaries will be reduced by 10%. The city budgeted a total of $27,600 for salaries for the four council members and mayor in the current year.
“This is not something that happened overnight, it’s been developing over several years and cannot be fixed 100% over one budget cycle,” Meadows said. He said expectations of revenues for the upcoming year are lower to be more realistic.
The city’s fiscal year 2025 budget was $79.0 million, making the upcoming year’s budget a 1.4% decrease from the current year.
If the annual revenues play out as the city is expecting, Meadows said, the city should see increases in its reserve funds, mostly in the general fund, of almost $3 million by the end of the next fiscal year.
On April 14, the city council did a first reading and vote on the proposed budget and ordinances. During the public hearing, no citizens spoke on the increased taxes and fees.
The city is expected this June to finish paying off a $4 million loan taken out to cover city expenses during anticipated revenue shortfalls.
After adopting the budget and tax increases on Monday, the council went into closed session to discuss the hiring process for a new city manager to replace David Ridpath, who retired at the end of last year after 15 years in the job.