A public hearing on Wednesday night for Clarke County’s proposed $38M spending budget saw a sizeable turnout, however, most of the people in attendance were school and law enforcement personnel rather than members of the public at large. Three citizens spoke in favor of the budget’s proposed two-cent property tax hike while Berryville resident George Archibald offered the lone dissenting voice on the increase.
Joint Administrative Services director Tom Judge, Clarke County’s budget chief, kick-off the meeting with a recap of the budget challenges that the County face along and offered a high-level explanation of specific financial hurdles that the budget addresses.
“We knew last year that it was going to a difficult budget year going in,” Judge explained.
Judge cited flat revenue growth, increased Virginia Retirement System rates, expiration of Federal stimulus funds, increased county employee health insurance rates as well as actions by the Virginia Assembly as the source of the local budget squeeze.
“The Commonwealth of Virginia continued in its devolution of support for services at the local level,” Judge said.
One bright spot in the otherwise dismal budget outlook, Judge said, was increased support for Clarke County from the Commonwealth’s composite index, the measure used to allocate state educational funding levels to localities.
“Changes in the composite index accrued to our benefit,” Judge said. “That $530K increase offset the loss of Federal stimulus for the school division.”
Judge said that a combined two-cent tax increase, transfer of $860K from the County’s fund balance along with elimination of four County government positions – a maintenance position, a real estate assessor position, a position in the Treasurer’s department and a planning department position – were necessary to bridge a $607K net pay-as-you-go budget deficit.
Several citizens said that they supported the tax increase.
Boyce resident Tony Parrott said that while “nobody cheers for a tax increase,” he was willing to accept what he estimated to be a $7 monthly tax increase expense in order to support a raise for the County’s law enforcement and teaching staff.
Planning Commissioner Richard Thuss (Buckmarsh) used his allotted speaking time to inquire about the size of the VRS funding shortfall that is ultimately expected to be shouldered by localities. After a knowledgeable audience member said the projected VRS shortfall amount was potentially a whooping $24B, Thuss said that he supported a measured tax increase provided that it pre-empts a larger unexpected tax increase later.
“I support the tax increase because I think that we need to hold money aside for this future liability,” Thuss said. “We need to hold money in abeyance against a future big financial surprise so that we don’t have to have a twenty-cent increase when we don’t’ expect it.”
Clarke County Education Association president Andy Kiser thanked the Supervisors for supporting a salary increase for teachers.
Offering the lone opposing view to the tax rate hike, Berryville resident George Archibald submitted a written statement challenging the financial logic behind the tax increase. Archibald asked how the Supervisors could suggest a tax increase given the County’s excessive funding reserves and its history of not tapping into the “rainy day” reserve.
“I am absolutely convinced that this proposed tax rate increase is not necessary and irresponsible,” Archibald told the Supervisors. “This County has $2.9M of liquidity – including $737K in stabilization funds that haven’t been used and $416K in undesignated funds. You’ve also have had carryovers of hundreds of thousands of dollars every year for many years.”
Archibald said that the amount liquidity funding in the County’s coffers far surpasses any funding increase that would be gained from a tax increase.
“I beg you to reconsider the tax increase,” Archibald concluded.
Whether any of the Supervisors will be swayed by Archibald’s plea to reconsider the tax increase will not be known until the Board meets again on April 18th at 6:30pm to finalize the FY13 budget.
Supervisors David Weiss (Buckmarsh) and Barbara Byrd (Russell) have expressed reservations in previous meetings about a tax increase.
At last night’s meeting Supervisor Bev McKay (White Post) offered his position on the issue.
“I’m having a very hard time believing that this is the right time for us to be raising taxes on people,” McKay said.