Va. leaders fear dangerous precedent over Petersburg financial assistance

Posted at 6:42 PM, Sep 19, 2016
and last updated 2016-09-19 18:46:32-04

RICHMOND, Va. -- On Monday, state leaders learned more about the financial crisis facing Petersburg.

Secretary of Finance Richard Brown was in Richmond to deliver a detailed briefing for the House Appropriations Committee. He then fielded questions from concerned delegates.

Delegates said they fear that with the amount of help given to Petersburg so far that they are setting a precedent.

The Commonwealth cannot provide financial assistance but it has been providing technical assistance in helping Petersburg sort out the money crunch and prioritizing payments.

The City needs to pay the state $1.4 million by Oct. 1. To default on this payment, Brown said, would have dire consequences, essentially forcing the state to cut out other funding to the city.

"The consequences for the Commonwealth of not being involved at this state in the game, given this critical October first sort of time frame, on debt, is probably much worse than being involved," explained Secretary Brown.

When asked if the city can make the deadline, Brown said, "We're working on it".

One question Brown was asked, was how to get the city back on track and follow specific recommendations of consultants.

"If they don't have the talent on the ground to carry out those recommendations, it's not going to work, so they need to get a hold of that," said Brown.

Brown did explain to the committee that external funding from a private entity would be one way to help Petersburg.

"I think it's going to be difficult, but we're hopeful that yes, in the final analysis, that avenue is open to them, " Brown said. "Because essentially that is probably the first step in trying to right this ship over a three to five-year period."

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