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The Rockbridge County Board of Supervisors is looking at dropping the real estate tax rate by 13 cents – from 74 to 61 cents per $100 value – to offset reassessments that are pushing up property values by 21 percent.
A proposed budget presented to the supervisors Monday by County Administrator Spencer Suter and Director of Fiscal Services Ashton Harrison accounts for revenues that would be generated by an “equalized” real estate tax rate of 61 cents.
The draft budget has a nearly $2.4 million gap between contemplated expenditures and anticipated revenues based on the equalized tax rate. The precise gap between expenditures and revenues in the draft budget stands at $2,389,989.
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Expenditures would be up by $3,833,529, or 7.2 percent, and revenues would be up by $1,443,540, or 2.71 percent.
Built into the draft budget are 7 percent pay raises for county employees. This amount is based on pay raises the state is planning to give constitutional officers, state employees and teachers. The cost of health insurance premiums is projected to increase by 12.5 percent – a figure that was used in the preparation of the budget document.
Local costs for the county schools are slated to go up by $1,253,784, or 7.85 percent, according to the contemplated transfer included in the budget document. This amount may change, of course, when the School Board actually approves its request for local funding.
Costs for fire and rescue would rise by $505,042, or 11.98 percent, according to the figures in the budget document. This amount would cover three new positions that were recently approved as well as a second training officer, plus 7 percent pay raises for everyone.
Costs to the county associated with the operation of the Rockbridge Regional Jail were to go up by $493,750, or 19.19 percent, according to the budget document. However, newer figures have since been provided to the county that will lead to this amount being adjusted downward.
Costs of solid waste would go up by $246,954, or 10.9 percent, based on a new contract recently approved with the company that transports the waste.
The supervisors are undecided about whether to make any adjustments to the county’s personal property tax rate, which was lowered last year from $4.50 to $3.80 because of then-skyrocketing values of used cars. Those values are now dropping precipitously so the supervisors could consider raising that rate.
Suter and Harrison emphasized the preliminary nature of the budget document they presented Monday. Even though the General Assembly has adjourned, lawmakers left their budget work unfinished, leaving localities not knowing what state funding to anticipate.
In order to stick with its original schedule to approve a budget and set a tax rate by late April, Suter would need to know by next Thursday, March 16, if the supervisors are going to increase the real estate tax rate above the equalized rate of 61 cents. That’s because state code requires a 30-day notice to increase the tax rate in a reassessment year.
Suter alluded to what he referred to as “option two,” which would be to move everything back a month, including the due date for when taxes are to be paid.
Supervisor Dan Lyons suggested it might make sense to go with option two. “That would give us more time to get the information that we need. … We’re hampered by the state not finishing its budget work.”
With revenues increasing significantly, this would ordinarily be reason to feel good about the county’s finances, Supervisor David McDaniel said, but not when expenditures are going up by more than double this amount. “I think we should equalize the real estate rate and leave it alone,” he declared. “This is not the year to be in citizens’ pockets. … It’s a tough year for our citizens.” He expressed doubts about the county being able to afford giving 7 percent pay raises this year.
Supervisor Leslie Ayers said she wants to see what it would cost to equalize the personal property tax rate and recapture the revenues lost from eliminating vehicle decal fees. She suggested that one-time expenditures in the budget not come out of the general fee. She noted that property value increases from reassessments aren’t being felt equally by everyone. Hit the hardest, she said, are those who own homes in the $200,000 to $400,000 range. Values of milliondollar homes haven’t risen as much, she said.
Supervisor Jay Lewis said he and Lyons, who comprise the finance committee, would be taking a look at all of the budgetary information this week and come up with recommendations for the supervisors at their next meeting on Monday, March 13. “I would like to equalize the tax rate, understanding that we have needs,” he said. “We’re still waiting on state information.”
