Radford interim city manager warns of $4 million structural gap; council approves $941,000 in current-year cuts and delays events

Interim City Manager Craig Meadows told Radford City Council members in a work session that the city faces “a fundamental challenge with the budget, especially [the] general fund,” and that his office identified about $941,000 in expenses that can be cut from the current fiscal year to help close what he described as “about $4,000,000 a year” in structural shortfalls.

Meadows said the reductions came after department-by-department reviews with staff and constitutional officers and include a 50% reduction in this year’s paving program (the paving program was budgeted at $650,000), deferral of two major information-technology upgrades into fiscal 2026 and smaller cuts across departments. “We were able to identify across all funds about 941,000 of funds of expenses that can be cut out of this current year budget,” Meadows said.

Why it matters: Meadows and councilors said the cuts are intended to show immediate fiscal restraint while the city continues work on a longer-term plan. Council members and staff described a mix of revenue and expense fixes ahead, including possible utility rate adjustments, a revenue-anticipation note in fiscal 2026 and a future capital-improvement planning session to address multimillion-dollar water, wastewater and electric needs.

Meadows emphasized the role of wholesale electricity costs in the city’s finances. He told the council that Radford’s purchase-power payments rose from about $8.3 million in a comparable six‑month period last fiscal year to nearly $10 million in the same six months this year — an increase he calculated at almost 21 percent. “That margin is pretty much gone,” Meadows said of the transfer from the electric utility to the general fund, historically an important revenue source.

Council action and near-term directions - Council voted to implement the budget reductions proposed by Meadows’ team and to continue searching for additional savings, directing staff to return with details if any proposed cut proves impractical. - Council voted to delay the city’s Easter egg hunt (costs under $5,000) and other April/July events; the city announced a $25,000 donor contribution for fireworks from Phoenix LLC but said overtime and other event costs remain significant. - Council approved a roughly 10% reduction in recreation-center hours (from 89.5 hours per week to about 81 hours) and asked staff to model labor savings from that change. - Council directed staff to explore adjustments to drop-center hours, downtown leases and parking arrangements and to return with options rather than immediate changes.

Meadows and other staff warned that some funds are already strained. He said the water and sewer fund had limited ability to absorb cuts this year because of recent breaks and repair costs. He also warned that deferring IT upgrades beyond fiscal 2025 would mean those projects “are gonna have to be addressed” in fiscal 2026, not eliminated.

Taxes, rates and comparisons Meadows reviewed Radford’s recent real-estate tax history and comparisons with neighboring localities. He said Radford’s current rate is 69 cents per $100 of assessed value; the revenue-neutral rate after reassessment was about 64 cents. He and staff showed multi‑jurisdiction comparisons—Pulaski County (74¢ for unincorporated areas), Montgomery County (84¢), and area towns where combined town-plus-county rates can exceed $1.00. Meadows noted that Radford’s large tax‑exempt base (the university and nonprofit properties) reduces the effective taxable base and multiplies the fiscal challenge.

Longer-term planning and capital needs Meadows urged the council to plan for multimillion‑dollar capital needs — water plant upgrades, wastewater work and electric‑system projects — and proposed a dedicated capital‑improvement session (suggested in April or May) after the current fiscal‑year actions are complete. He said some projects would require debt financing, which in turn requires a plan to repay principal and interest from recurring revenues or other sources.

Quotations from meeting participants - Craig Meadows, interim city manager: “There’s just a fundamental challenge with the budget, especially [the] general fund. Just a structural imbalance… It looked like about $4,000,000 a year.” - Meadows on wholesale power costs: “For the same 6 months, this current year… the city has paid almost $10,000,000 for power during that same time period. That’s an increase to the city for purchase power of almost 21%.” - Mayor (unnamed): “This is tough. I mean, we’re pretty lean as it is. If it was easy to cut a million dollars, I think we would have done that multiple times to to get us to a better place.”

What council asked staff to do next Staff were directed to continue meeting with department directors and constitutional officers, provide more detailed collections and receivables data (including past‑due utility accounts and tax collections), refine the utility‑rate options, model labor savings from rec‑center hour changes, evaluate lease and parking alternatives downtown and prepare a capital‑improvement session and timetable for fiscal 2026 planning.

Ending Councilors and staff repeatedly framed the immediate changes as painful but limited steps to stabilize reserves while completing a broader fiscal plan. Meadows said the council will receive a revised budget presentation at the regular council meeting scheduled for March 24 (the presentation date was moved to give staff additional time to refine utility proposals).