“The council gave me permission to proceed with property acquisition,” said Mayor Jack Reed. “I think this is an excellent first step.”
Reed presented a broad overview of the redevelopment project at a council work session last week. In Tuesday’s executive session, the council learned the specific area as part of the discussion on the property acquisition.
The council will have to approve any purchases as well as the larger redevelopment project. Reed said he expects to publicly announce the neighborhood within a month.
Council members voiced different levels of support for the mayor’s aims, but remained cautious about financing.
“I’m on board with making the city of Tupelo a better place to live,” said Willie Jennings, Ward 7 councilman. “We want to make sure we look at the budget.”
If the entire project is approved, the neighborhood redevelopment pilot project would pull $1.8 million from the unrestricted reserve fund as part of a $2.9 million project that Reed believes will uplift that neighborhood, stabilize adjacent neighborhoods and have positive economic effects.
The city has built up $18.3 million in unrestricted reserve funds. Municipal finance experts generally recommend cities keep reserves equal to the quarterly operations budget, Reed said. For Tupelo, that’s about $8.5 million. On Thursday, Reed presented the redevelopment project and an expanded road repair budget that would use about $3 million of the reserve fund in total.
Ward 3 Councilman Jim Newell believes the city should aim for nine months of reserves – which would be more than $25 million.
“There’s a small piece I can support,” of the project, Newell said. “I’m very conservative when it comes to taking money from the city’s rainy day fund.”
Ward 1 Councilman Markel Whittington said he considers reinvesting in neighborhoods a top priority because it will increase the numbers of homeowners in Tupelo, thereby strengthening city schools.
“I think there are more creative ways to fund Jack’s plan without affecting our reserves so much,” Whittington said. “We don’t want to be in a situation where we have to borrow money to cover city operations.”
Council President Fred Pitts, who is running for mayor, said he’s concerned the project is too ambitious to start during the last six months of the council’s term.
“Overall, the project is good,” Pitts said. “Is now the time to do it? Is this the way to pay for it?”