County faces $8.5 million shortfall
WOODSTOCK – Shenandoah County leaders need to cut spending or raise taxes to cover an $8.47 million shortfall for fiscal 2018.
County Administrator Mary T. Price presented her proposed fiscal 2018 budget to the Board of Supervisors on Tuesday. Price proposes a budget of $75.96 million – an increase of $15.54 million over the current budget of $60.42 million.
The county can expect to collect approximately $438,000 on each penny of the real estate tax rate of 60 cents per $100 of assessed value. The county would need to increase the rate by more than 19 cents to generate the revenue needed to cover the shortfall.
Price pointed out that the county lacks the power to diversify its revenue base by imposing other taxes such as meals. Towns and cities do have the power to impose some taxes by ordinance only.
Price’s proposal assumes $67.48 million in revenue – an increase of $7.08 million or 11.73 percent over the amount included in the current budget of $60.4 million. The bulk of the increase in revenue would come from the federal government for the new Sheriff’s Office headquarters. The revenue budgeted for the current fiscal period represents a drop from the actual amount collected in 2016 of $65 million.
The board plans to conduct work sessions in the coming weeks, with the first on Thursday afternoon, to discuss the proposed budget before the county holds the required public hearing scheduled for April 6. Supervisors expect to adopt a budget April 18. Price reminded the board to think of the county’s employees as members deliberate on the proposed budget.
Price’s budget includes a recommendation to provide a 3 percent, cost-of-living adjustment for county employees. The current budget included neither such adjustment nor a merit pay increase.
Department spending requests totaled $75.65 million – an increase of $15.23 million or $25.2 percent over the adopted, fiscal 2017 budget of $60.42 million. Departments requested a similar total during the crafting of the current budget last spring. The request for education spending, which covers the school system, increased from $26.05 million in the current budget to $31.27 million or 19.2 percent. The spending request for community development increased from $1.38 million to $1.52 million or 58 percent.
Capital projects, including a new headquarters for the Sheriff’s Office, make up more than half the increase at $8.52 million. The Sheriff’s Office intends to use asset forfeiture funds to cover the estimated $6.9 million cost of the facility.
Price’s proposed budget maintains spending requests submitted by schools Superintendent Mark Johnston and from most other departments. Price also has proposed allocating more in the budget for some of the departments than included in the requests.
Local funding to the school system has increased each year from $20.52 million in fiscal 2011 to $25.14 million in the current budget. If adopted, an increase in local funding to $27.34 million or more than $2 million would represent the sharpest increase since fiscal 2011. However, the county did not increase local funding for schools from fiscal 2016 to the current budget.
Price’s proposed budget includes $3.87 million as requested by the School Board to cover one-time capital projects.
Departments and constitutional offices requested $1.65 million in new personnel, including firefighters, sheriff’s deputies, deputy clerks for the circuit court, a business development manager and emergency communications officers. Price’s proposed budget includes funding only a few of the requested positions at a cost of $521,494 in local money. Price did not include seven firefighters and four communications officers in her budget.
The following counties included salary increases for their employees: 2.5 percent in Frederick County; 3 percent in Page County; and 2.5 percent in Warren County. Increases would take effect July 1.
Revenue from local sources, most of which comes from property taxes, makes up 76 percent of the total. The proposed budget includes $51.14 million in revenue from local sources – an increase of $1.28 million or 2.57 percent over the amount assumed in the current budget of $49.86 million.
The county also has dipped into its unassigned fund balance or savings to cover recurring, operational expenses. Price reminded the board that unassigned fund balance should cover one-time expenses and not recurring costs.
Contact staff writer Alex Bridges at 540-465-5137 ext. 125, or firstname.lastname@example.org