FRANKLIN—Despite delays with the budget and the state facing a $300 million deficit, City Manager Randy Martin said that Franklin would have to go ahead with its budget.

If things change once the commonwealth submits its budget, then the board would have to come back and make amendments.

Excluding schools and social services, Franklin receives $3.8 million in revenue from the state. Martin said that money goes toward streets, paving and to some degree, law enforcement. It’s about 1/6 of the general fund budget.

Martin said he didn’t expect Virginia’s contribution to drop much, if the state chooses to make up the deficit this year. Street money, which is the majority of it, comes from different pots, so he said the worst-case scenario would be that there is a delay in reimbursement. Martin said he was also conservative in setting up the budget.

Franklin is in good enough shape that cash flow won’t be an issue unless there is a prolonged delay. Martin said city reserves are strong enough to help cash continue to flow for the immediate future.

He didn’t expect there to be a long delay, though, as the consequences for the state would be big. Consequences include a potential bond rating decrease.

Martin said Virginia has never missed the July 1 deadline on a budget in recent memory, and he was hopeful that they would get something together in the 11th hour.

It could affect the Franklin schools budget more, as they rely on $8.7 million from the state for their budget. Martin said he hasn’t heard from the schools on exactly how they could be affected.

Information from the schools could not be obtained before deadline.

The Department of Social Services is another aspect that could be affected, but Director Alan Hogge said the benefit programs, which are primarily federally funded, should not be disrupted regardless of the outcome.

Hogge said state funds help pay for staffing that helps manage the programs, but he also said there should be enough money to cover a few months should the state not adopt a budget. The Virginia Department of Social Services operates on a reimbursement model of funding.

Of note is the Medicaid expansion, said Hogge. He said that 500 residents in Franklin could benefit from expanding Medicaid, and if the state adopts that, his office would serve those individuals. Additionally, Hogge said that if they chose to use a private insurance model like the Affordable Care Act, that private insurance companies would manage the additional residents.

“We are gearing up to be ready for either plan as we await a state budget being adopted,” he said.