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Shenandoah County faces budget shortfall

By Alex Bridges

WOODSTOCK - Shenandoah County leaders need to raise tax rates or pare down spending requests to fill a $1.8 million gap in next year's budget.

County Administrator Mary T. Price presented a proposed fiscal 2015 budget to the Board of Supervisors on Tuesday that calls for a 2 percent cost-of-living allowance increase for government staff. Price's budget also includes a merit pay increase for staff -- the first since 2008.

Price told the board her proposed budget reflects $1.7 million cut from department requests made earlier in the process. The county still faces a $1.8 million deficit, Price said. That does not include the $3.9 million in additional, local funding requested by schools Superintendent Jeremy Raley.

Price did not recommend the board set a tax rate needed to cover the possible deficit. Data show that the county would need to raise the levy on real estate by 4 cents to 58 cents per $100 to generate the $1.8 million needed to bridge just the gap in the general government budget.

Price explained after the work session that she chose not to propose a tax rate to the board. Rather, she presented the spending needs and revenue projections and is leaving it up to the board to look at the proposed budget.

County data show that each cent of the current real estate tax rate of 54 cents per $100 of assessed value amounts to $444,934 in revenue. A homeowner with property valued at $200,000 pays $1,080 per year at the current rate, Price explained. A 55 cents per $100 of assessed value would increase the homeowner's bill to $1,100 for the year.

At the current rate the county collects $24.02 million in revenue from real estate taxes. Residential real estate taxes make up 77 percent of the total county revenue.

The board last spring raised the levy from 51 cents to the current rate. Shenandoah County still has the second lowest real estate tax rate of all localities in the region.

Price advised the board that the county can advertise tax rates and approve levies at or below those amounts. The board cannot approve any rates that exceed the advertised levies, Price said.

Price's proposed budget assumes a decrease in state funding of $801,326, from $7.54 million to $6.74 million, or 10.6 percent.

Price mentioned that the county budget will feel the impact of the Affordable Care Act. The law requires the county to provide insurance to any employees who work 30 hours a week or more. The county instead chose to reduce the hours of those employees in that category. The action still required some departments to hire additional, part-time staff to make up for the reduced hours.

Price explained that, under the law, the county must also pay a $63 "reinsurance" fee for each employee. The county would need to pay more than $42,000 for its 667 employees.

Following Price's presentation, the board discussed the proposed calendar of meetings, work sessions and public hearings required for the budget and tax rates.

Budget Manager Garland Miller, Treasurer Cindy George, Accountant Matt Green, Fire and Rescue Chief Gary Yew and Price comprised the administrative budget team that worked on the spending plan.

Contact staff writer Alex Bridges at 540-465-5137 ext. 125, or abridges@nvdaily.com

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