No one can be sure when the spread of the COVID-19 coronavirus will subside, but Grove City officials are certain the pandemic will impact the city's receipts of income taxes and other revenue.

That could mean some of the $8 million in capital-improvement projects the city slated for 2020 might have to be deferred, Mayor Richard "Ike" Stage said.

The financial impact of the coronavirus hasn't hit city coffers just yet, finance director Mike Turner said.

The income-tax revenue for March "came in just as expected, and we've had a good start so far in April," he said.

It likely will be May when income-tax revenue drops due to temporary business closures and staff reductions or furloughs, Turner said.

The 2020 budget council approved in December projected that $27.34 million of the city's general-fund operating revenue would come from income taxes.

That amount represents a sliver more than 80% of the estimated $33.71 million in total general-fund revenue projected for 2020, Stage said.

The city has developed two models, one in which total city general-fund revenue, including funds coming from property taxes, the hotel tax and franchise and building fees, would be reduced by 15.6% and a less optimistic reduction of 20% over the next 12 months, Stage said.

"The 15.6% is probably the minimum reduction we would expect to see," he said.

The 12-month period would carry over through the end of this year and into the first few months of 2021, Stage said.

Grove City has established a benchmark calling for the city to maintain a general-fund balance equal to at least three months of operating expenditures, he said.

"That's more conservative than what financial associations generally recommend," Stage said.

The Government Finance Officers Association recommends maintaining a balance of at least two months, he said.

The 2020 budget document approved in December projected the city's general-fund balance would be about $7.8 million, or 27% of projected operating expenditures.

"We are going to have to dip into that reserve," Stage said.

Over the next few weeks, city officials will try to determine how large a dip they should anticipate and how much of a reserve should remain in place, he said.

That will determine the number and scope of the capital projects that could be deferred, city administrator Chuck Boso said.

"This will be a process the administration will be working on closely with city council," he said.

The first priority will be to delay projects that would not affect the city's ability to provide services to residents, Boso said.

Those projects could include plans to upgrade the service department facilities, an estimated $800,000 project; improvements to the safety complex, $60,000; Evans Senior Center renovations, $220,000; and the 2020 sidewalk program, $200,000, he said.

Planned improvements for Southwest Boulevard, projected at $2 million, likely would not be deferred because the city has been awarded a Ohio Public Works Commission grant for it and would stand to lose that funding if the work was delayed, Boso said.

The slate of projects that would be deferred has not been determined yet, he said, and would be finalized in consultation with City Council.

"I would say the projects we decide on would be deferred, not canceled, and we would still plan to do them at a later date," Boso said.

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