DATE: Wednesday, April 30, 1997             TAG: 9704300512

SECTION: LOCAL                   PAGE: B7   EDITION: FINAL 
SOURCE: BY TONI GUAGENTI, STAFF WRITER 

DATELINE: VIRGINIA BEACH                    LENGTH:   73 lines

BEACH MULLS FAMILIAR DILEMMA: HELPING SCHOOLS WITHOUT TAX HIKE THE CITY SAW A 7TH PLAN TUESDAY; THE BUDGET IS DUE TO BE ADOPTED IN 2 WEEKS.

City Council members have been struggling to avoid a tax increase without harming the city's public schools.

Tuesday, they got a glimpse of what that compromise might look like.

The council reviewed a $411.1 million proposed budget for the schools Tuesday that would not require the city to raise taxes. But after studying the proposal twice, council members weren't sure if that was what they were looking for.

The council is scheduled to adopt the 1997-98 capital and operating budgets in two weeks.

City budget gurus put together the new proposal after council members asked for a no-tax-hike plan last week.

Tuesday's proposal is the seventh school spending plan considered by the council. Five plans still being looked at include tax increases ranging from 0 to 2.9 cents on the current $1.22 of $100 of assessed property value. The council has advertised that it might be willing to raise taxes by up to 3 cents.

Tuesday's option would add an additional $2 million to the $409 million the city has said it can afford next fiscal year, which begins July 1.

The proposal would also keep funds for programs intact. But it would decrease the amount of new positions requested by school officials, delay pay increases for school employees by one month and allocate an estimated $16.5 million school budget surplus for various one-time expenses.

``We've tried to be extra careful to do two things: to make sure we did not impact the programs'' and to avoid cutting costs that might re-occur in outlying budgets, said E. Dean Block, the city's Department of Management and Budget director.

The only problem is that there's still a gap in what the school system has requested from the city. The board had been asking for $422 million until last week, when school officials whittled the amount to $415.8 million. Block's pared-down budget was based on the original $422 million request.

``This is a doable budget, but it is a one-year budget,'' Block said.

Block told the City Council that Tuesday's proposal doesn't begin to address looming concerns over upgrading school technology, modernizing eight of the city's oldest schools and maintaining the other 80-plus city schools.

The technology and modernization issues could lead to referendums in the next two years asking for more money for the projects.

Block estimated that upgrading the school system's computers and wiring would cost an additional 7.8 cents on the city's real estate tax rate.

Modernization could require an additional 2.3 cents, for a total of 10.1 cents.

Councilwoman Barbara M. Henley wanted to know all the ramifications but was left with questions.

``We've got to know what the big picture is,'' she said. ``I don't know if we're going to get it in the next two weeks.''

School Board Chairman Robert F. Hagans said he had not seen the information presented to the council.

``I just hope whatever they do is fair and involves full funding,'' he said.

Block's proposals for an spending an estimated $16.5 million surplus in this year's budget included:

$5.4 million for one-time expenses such as computers and equipment.

$600,000 for the design of W.T. Cooke Elementary.

$200,000 for the second phase of a school modernization effort.

$4.6 million for renewal and replacement of items such as parking lots, windows, roofs, and heating and air conditioning units.

$1.2 million for new buses and other vehicles.

$1.5 million for textbooks.

A final public hearing on the budget is scheduled for 2 p.m. Tuesday in Council Chambers. MEMO: Staff writer Aleta Payne contributed to this story. KEYWORDS: VIRGINIA BEACH SCHOOLS BUDGET

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