Posted September 9, 2009 | comments Leave a comment

Board OKs bids for courthouse, human services building

Shenandoah property taxes may rise as result

By Sally Voth -- svoth@nvdaily.com

WOODSTOCK -- Shenandoah County budget manager Garland Miller says property taxes may have to be raised to foot the bill for a new courthouse.

Despite that, the Board of Supervisors unanimously approved Nielsen Builders Inc.'s $11.6 million bid Tuesday to build a new district courthouse behind the County Government Center, and convert the former Safeway building into what is being called a human services building, housing social services, the health department and Northwestern Community Services.

"I was very pleasantly surprised when the bids come back," District 2 Supervisor Steve Baker said.

Original estimates for the projects were $14.2 million for just the courthouse, and up to $7.9 million for the former Safeway building, Miller said.

The best financing deal is a 20-year loan through the Virginia Resource Authority with a 3.8 percent interest rate, County Administrator Vince Poling said. Loan repayments will come to $1.1 million annually, he said.

"I can't say it doesn't place a strain on our cash flow ... but it is a lesser impact," Poling said.

Supervisors Chairman David Ferguson asked Miller if, given the county's current debt service schedule, he thought the county could go through the current real estate reassessment and pay for the courthouse and human services building without adjusting the tax rate.

Gary Eames, of Wampler Eames, said earlier in the meeting that his company was finding that many properties were selling for higher than their assessed values.

"At this point, you never quite know what the future will hold, but it's certainly going to be very difficult, I think, at this point, to not have something alter or change," Miller responded to Ferguson.

Miller added that the governor is looking at another $1.5 billion in cuts, and he did not know how that would affect the county budget.

Ferguson pressed on, asking whether -- if other factors remain unchanged and extra taxes come in from new businesses -- it would be possible for the county to carry the additional debt service without increasing the tax base in this reassessment.

"It could be possible," Miller said. "I have some reservations the budget, as it is today, can take it."

Combined, the two building projects make up about 3 cents on the tax rate, Poling said.

District 6 Supervisor Conrad Helsley pointed out 13 bids came in for the project, when the norm is six or seven bids. The county has owned the former Safeway for the past 10 years, he said, reading from a statement. The supervisors actually ratified a contract on the building in June 2002.

"And, frankly, [we] haven't been a very good neighbor to the rest of the shopping center with its appearance," Helsley said. "The federal government has pumped trillions of dollars into the economy this year, and we all know ... somewhere down the road we're going to see future inflation come roaring back. So spending a little now will probably save you a lot in the future. I do not think we will see bids and interest this low in the foreseeable future. I believe now is the time to move forward with these projects."

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