Radford City Council approves budget, raises real-estate tax 2 cents and sets water at $3 per 1,000 gallons

Mayor Maya Horton and councilors voted Monday to adopt Radford City’s fiscal-year budget after a discussion focused on building reserves, reducing transfers from enterprise funds and addressing long-term infrastructure needs.

The council approved a 2-cent increase in the real-estate tax (raising the rate to 84¢) on a roll-call vote and set the water rate at $3 per 1,000 gallons. Council then adopted the budget as presented that evening.

Why it mattered: City leaders said the increases were meant to reduce dependence on transfers from enterprise funds (notably a roughly $4,000,000 transfer from the electric fund), restore reserve balances and fund capital work on water and other infrastructure. Todd, a city staff member, told the council that earlier proposals would have added about $256,000 to water reserves under a smaller increase but warned many upcoming projects will exceed current balances.

Council debate centered on how to balance rate increases with affordability. “I still stand at with the 2¢ tax increase,” Councilor Seth said, adding that moderate increases help the city become less reliant on transfers. Seth also cautioned that property tax increases often get passed through to renters, making affordability a concern for some households.

Councilor Jesse argued for a slightly higher approach to give the city more breathing room: “I’m landing at 3¢ on real estate and the $3 on water,” he said, explaining that larger reserves would reduce the likelihood of borrowing and better position the city to respond to storms or other emergencies.

Councilor Guy and Councilor Kelly signaled support for the compromise the majority settled on: Guy said he was comfortable with 2¢ and $3; Kelly said she would not want the water rate to be lower than $3 and emphasized the prior years’ increases and the need to avoid borrowing.

On the electric side, the mayor summarized staff and consultant advice that had recommended a 5% rate increase to reflect multiyear system needs and environmental considerations; she cautioned that lowering that proposal would require finding about $300,000 from other sources because of the large electric-to-general-fund transfer.

Council also agreed to pursue additional efficiency measures and stepped-up surplus sales of vehicles and equipment to bring in revenue and cut storage costs. Todd said the city has already approved several vehicles for surplus and is using the GovDeals website to sell them.

Votes at a glance: the motion to increase the real-estate tax by 2 cents passed on recorded roll call (four yes, one no); the motion setting the water rate at $3 per 1,000 gallons passed unanimously on recorded responses; the budget adoption passed on recorded roll call with all recorded members voting yes.

What’s next: The council confirmed its next regular meeting for Monday, April 27 at 7 p.m. and scheduled a special meeting for April 28 at 6 p.m. for the budget’s second reading. The rates and budget can still change between first and second reading, the mayor reminded the council.

The meeting adjourned after the votes.