City of Valley revenue holding up during pandemic
VALLEY — Despite many people being out of work across the U.S. and the most recent quarterly gross domestic product (GDP) showing an unprecedented 32% drop, the City of Valley has been holding up pretty well in terms of revenue.
“We are on track for this quarter to be a good one,” Mayor Leonard Riley told council members at a Thursday evening work session. “Our sales tax has been holding up well. In August 2019, we had our all-time best month in terms of sales tax. We collected over $780,000 in one month. We could top that this month. There’s no doubt our people are shopping at home, and we appreciate that.”
While total revenue is good, it’s not faring so well in other sectors. Revenue is way down in recreation, reflecting sparse activity due to COVID-19.
Riley is cautious about budget commitments heading into fiscal 2020/21.
“We are not out of this recession,” he said. “I am very, very, very cautious about where we are heading. We have a list of what our departments need and what we’ll be ready to purchase if our revenues hold up. We are going to have to be very careful.”
In her report to the council, City Clerk and Treasurer Cathy Snowden said the city was doing exceptionally well on revenue being generated by online sales.
“We have been blowing it out of the water on that,” she said.
The city is also doing well in terms of business license revenue and revenue relating to the work going on with the John Soules Foods project.
The numbers are down in terms of motor fuel taxes, franchise taxes, Community Center memberships and concessions.
“We could be down $200,000 in recreation this year,” Riley said.
Almost all of that is due to people staying away from crowds because of the coronavirus.
The increase in sales tax, possibly due to the increase of shopping at home, should more than balance out the loss in revenue due to the drop-in recreation, Riley said.
The city brought in more than $700,000 in sales tax in both June and July.
“All of our department heads are doing good jobs with their budgets,” Snowden said.
Purchases for the current year include three new police cars and a fingerprint machine for the Valley Police Department, new computers and software for the city hall staff, new equipment for public works and needed floor work and improvements for the racquetball courts at the Community Center.
The new police cars have yet to arrive, which has the police department in a bind. The VPD doesn’t need any vehicles they have in service to go down. The new Ford Interceptors should arrive soon, there are expected to be more purchases of police vehicles in the coming fiscal year. Those purchases will be made in October 2020.
The new budget is highlighted by a 3% employee raise, which is partly due to an increased expense in the retirement plan.
With tier 2 employees benefitting from the change, Council Member Jim Jones asked if the tier 1 employees could get a raise as well. Riley said he’d studied doing that but found that a 1% increase over a 10-year period would cost the city $190,000.
“I don’t feel comfortable in doing that,” he said.
“I still wish we could do something for our tier 1 employees,” Jones said.
“We still don’t have a clue about what this virus will do and where this recession goes,” Riley said. “If our revenue holds up, I think we will be in line for a 3% raise.”
Jones said a raise is well deserved.
“We should be extremely proud of our employees and the jobs they have done this year under very difficult circumstances,” he said.
“I agree with you on that,” Riley said “We have excellent employees and department heads. I am pleased with the work they do.”
The mayor reviewed this year’s paving projects in the city. Streets that have been paved include Valley Industrial Boulevard, 31st and 33rd streets in Shawmut, 15th Avenue and Combs Road.
Located on the city’s west side, Combs Road is a Rebuild Alabama project. An estimated 60 percent of the funding for the project will come from the new state gas tax. The city and county will each have 10 percent of the cost. Most of the project has been finished, but the wearing surface has yet to be applied.
Streets that have been bidded out to contractors and are ready for resurfacing include Cleveland Road, the portion of Columbus Road that runs from School Street to McGinty’s Crossroad, 65th Street East, the small portion of Hopewell Road that’s in the city limits, Boulevard and 48th Street. Streets to be bid on in September include Harmon Street, Whitesmill Road, 56th Street, Williams Street, Towel Avenue, 14th Place East and an unnamed street in Fairfax.
Riley said city and East Alabama officials knew something needed to be done about building water volume and water pressure in the industrial park when the new WestRock distribution center opened on Industrial Boulevard. That one new building created a water pressure problem.
That is being addressed with the construction of a new above-ground water tank and the installation of high-pressure water lines. The new water tank is a new city landmark off Fairfax Bypass. The City of Valley’s emblem will be painted on both sides.
Riley said he appreciated the work done by the men of the Public Works Department in clearing the land on the west side of town.
“1,140 acres of land was cleared by our men and equipment,” he said. “On the Combs property, we will have a subdivision on one side of the road and possibly a commercial district on the other side. There are still some piles on the property. Hopefully, we can have them burned in October and be finished with the land clearing in December.”
In the area where the subdivision is to be built, there is a bridge that needs to be removed. The Combs site is one of the largest places in the city that can be developed into a new subdivision.
Riley said that Aug. 21 is the bid date to remove contaminated material from the Fairfax Mill site. A total of 31 piles of debris needs to be taken to the landfill. Testing will have to be done after that. Following that, the city will be well on the way to turning the city-owned site into green space to be enjoyed by nearby residents.
At 1:30 p.m. on Wednesday, Aug. 12, a public meeting will take place at the new East Alabama fire station in Fairfax to discuss the mill project. There will be a walking tour of the site. Attendees are asked to be appropriately dressed.
“You need to wear some sturdy shoes and be careful where you step,” said Planning and Development Director Travis Carter.
Riley said he was pleased with the way the work was proceeding with the John Soules Foods project. A pretreatment station is being built behind the main building. The lift station that’s being built has been a massive project. A hole some 40 feet deep had to be dug.
“We have a lot going on right now,” Riley said. “Probably more than in a long, long time.”