DATE: Tuesday, May 6, 1997                  TAG: 9705060251

SECTION: LOCAL                   PAGE: B1   EDITION: FINAL 

SOURCE: BY MAC DANIEL, STAFF WRITER 

DATELINE: CHESAPEAKE                        LENGTH:   80 lines

COUNCIL UNLIKELY TO PASS TAX, FEE HIKES

A week before the City Council is to decide on a series of tax and fee increases to balance the upcoming operating budget, the votes don't seem to be there.

Only a proposed increase in the emergency medical service fee and an increase in the monthly 911 service charge will likely be approved.

The majority of the nine-member council supports little else in a long list of proposed fee hikes and user taxes that could cost the average Chesapeake resident another $70 a year.

Five of the members are up for election next year, which has compounded the problem for new City Manager John L. Pazour, who has said that the increases are necessary to cover a $19 million gap in revenue over the next two years.

Should no new funding sources be approved, Chesapeake officials will have little choice but to cut the operating budget or dip into the city's emergency reserve fund.

The city's much-valued double-A bond rating will not be put at risk if the city uses a portion of its reserves. However, city officials have warned that New York bond houses will be watching how the city handles its finances over the next three years.

Pazour has said that it will be impossible to deal with the revenue shortfall without some of the proposed tax and fee increases.

Some of the proposed increases include:

Increasing the local cigarette tax from 20 cents to 25 cents per pack.

Creating a cellular-telephone tax of 10 percent of the first $30 on a bill.

Increasing the building permit fee from a minimum of $15 to a minimum of $35.

Raising the emergency 911 fee from 50 cents per month to $1.95 per month.

Mayor William E. Ward has supported the full array of increases, as have fellow Democratic council members Elizabeth P. Thornton and Dwight M. Parker.

The mayor has been stumping for them, saying a vote against the hikes would be a vote against public safety.

Vice Mayor John W. Butt and Councilman Dalton S. Edge probably won't support the full increases. Both voted against the capital budget because it contained items they thought the city could not afford.

``Nothing as far as that has changed for me,'' said Edge on Monday.

Councilmen Peter P. Duda, Alan P. Krasnoff and John M. de Triquet have also expressed concern about the proposal and probably won't support it. Only Councilman W. Joe Newman appears undecided.

The city is currently under a moderate hiring freeze and a slowdown on new city projects as a result of the shortfall.

Cutting from within the budget is, ``for now, the future for Chesapeake,'' said Pazour on Monday. ``There is a large amount of catch-up necessary.''

The City Council has repeatedly put off raising taxes in the past 13 years. Since 1984, the council has approved a total of 27.1 cents in tax increases but adopted only a total of 9 cents.

Pazour said his staff is currently studying an option to review all capital projects not yet in motion, to help save money, something he called ``a reality check.''

The tax and fee increases have been discussed since last October to help with the projected shortfall, a product of the city's past rapid growth. The increases were also designed to provide a boost to economic development and pay for a new emergency radio system. The current system was blamed for contributing to the deaths of two Chesapeake firemen last year.

Many of the proposed increases would bring Chesapeake on par with the region's other cities. Some would pay for essential city services, including the radio system. The city's current system is severely underpowered.

At a budget workshop scheduled for 5:15 p.m. today in City Hall, the council will begin to hash out its choices. Later this week, a group of retailers will hold a meeting to seek support and lobby council members to vote against one of the main tax increases, a 5-cent rise in the local cigarette tax.

The council is scheduled to approve the operating budget on May 13. ILLUSTRATION: Graphic

Proposed Increases

Increasing the local cigarette tax from 20 cents to 25 cents per

pack. Creating a local cellular-telephone tax of 10 percent of the

first $30 on a bill. Increasing the minimum building permit fee from

$15 to $35. Raising the emergency 911 fee from 50 cents per month to

$1.95 per month. KEYWORDS: CHESAPEAKE CITY COUNCIL BUDGET

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