The City of Petersburg looks like it has finally dug out of its fiscal hole. City Manager Aretha Ferrell-Benavides presented a $73 million budget to City Council last week that restores funding to schools and public safety even while building up the cash reserve by $950,000.
Last year the city lurched from crisis to crisis after the discovery in 2016 that it was running a $20 million deficit. After bringing in consultants with the Robert Bobb Group, the city slashed funding across the board, cut salaries, and laid off administrative employees.
The proposed fiscal 2019 budget is $1.1 million smaller even than last year’s, yet it manages to increase public safety by $3 million and schools by $0.3 million. The city bond rating has been upgraded from junk to bond status, reports the Richmond Times-Dispatch.
The budget is spartan, no doubt, and many Virginia localities would find it unacceptably austere. One could argue that the budget fails to invest enough into K-12, one of the worst-performing school systems in the state. One could further argue that the budget is still fragile, thus vulnerable to a slowdown in the economy and tax revenues. But there is no nay-saying that Petersburg has survived one of the worst fiscal disasters experienced by a Virginia locality since the Great Depression. Government administration is far more disciplined as as a result, and the city is fiscally stronger than it has been in years.
Most remarkable of all, Petersburg pulled off this fiscal feat without benefit of government bail-outs or reneging on its debt. Kudos to Fredericksburg, to the Robert Bobb Group, to the citizen activists who kept the pressure on, and to the city officials who did what they had to do.
Bacon’s bottom line: There are two lessons to be learned here. First, Virginia’s system of government worked. The McAuliffe administration didn’t panic. The Secretary of Finance provided some professional assistance but didn’t turn the city’s fiscal plight into a broader political crisis. The Commonwealth made it clear from the beginning that Petersburg’s problem was Petersburg’s to solve. And rather than expend its political capital on blaming others and seeking bail-outs, Petersburg’s political leadership submitted to the discipline imposed by the Robert Bobb group.
Second, Petersburg’s resurrection serves as an example for other governments to emulate. Illinois, Chicago, and Hartford, Conn., are one recession away from fiscal collapse, and a dozen other states and localities are not far behind. Here in Virginia, we forced poor, economically struggling Petersburg to face the music — and it did. When the inevitable occurs, our congressional delegation must steel itself to the inevitable crocodile tears and special pleading from other jurisdictions and say, “If Petersburg did it, so can you.”There are currently no comments highlighted.