Council likely to hold taxes steady next fiscal year

FRONT ROYAL – Town Council shouldn’t need to raise taxes to meet its goals for the next fiscal year, officials say.

Front Royal’s fiscal 2016 budget should cover initiatives such as pay raises for town workers without an increase in property tax rates, Town Manager Steve Burke explained to council’s finance committee on Monday. The full council heard the same report after the committee meeting.

Goals set by council for fiscal 2016 include salary increases, the design of a redundant water source for the U.S. 340-522 Corridor, a joint marketing and community development position with the Northern Shenandoah Valley Regional Commission and continued business development.

Finance Director Kim Gilkey-Breeden said officials are looking to see if a 3 percent salary increase can work within the next budget. Gilkey-Breeden said she might need to reduce that amount if 3 percent doesn’t work.

The town has seen a small increase in revenue it collects from meals and lodging taxes that will help cover some of the expenses in the next budget, Burke said. The town had seen increases in meals and lodging tax revenue as a result of workers on the Dominion power plant project staying at Front Royal hotels and buying food in the area. Gilkey-Breeden said even without this source the town saw revenue gains.

“The economy’s turning around and people [are] spending money and you even see that in our sales tax [revenue],” Gilkey-Breeden said.

The town charges the following rates for property taxes: 13 cents per $100 of assessed value for real estate; 64 cents per $100 for personal property such as vehicles; 64 cents per $100 for machinery and tools. The town budget for the fiscal year ending June 30 includes an estimated $970,000 in revenue from real estate taxes and $287,000 in personal property tax transferred from the state.

Real estate values for town properties increased by 3 percent on average, the reassessment found. Some property values increased by more than 3 percent, though others decreased since the last reassessment. Even with the 3 percent increase in values, the town can expect to collect less than $30,000 in additional revenue and, as such, would not need to adjust and equalize the tax rate.

“Unless a department comes in and really has a major project, I think that we will be able to maintain [operating] on the revenues that we have,” Gilkey-Breeden said.

The town can expect savings in the Information Technology Department’s budget because it purchased new equipment this fiscal period, the director said. That savings frees up funds for other needs.

However, if council decides the town needs to hire more employees or spend additional money, then expected revenue would not suffice, Gilkey-Breeden said.

At council’s work session, Councilman Eugene Tewalt warned that they can’t increase the tax rates once they are set if they realize the town needs to spend more money next fiscal year. Mayor Timothy Darr concurred, noting that council could reduce the rate at a later time. The town will need to hold a public hearing on the rates even if the levies remain unchanged, Burke said.

Contact staff writer Alex Bridges at 540-465-5137 ext. 125, or

Comment Policy

Print This Article

Front Royal

Local News