Supervisors begin work on budget

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Will consider raising tax rate to equalize revenue after reassessment

By John Barnhart

The Bedford County Board of Supervisors began work on the next fiscal year’s budget with a look at the county’s revenue picture during a 5 p.m. work session, Monday.

    County Administrator Kathleen Guzi told the supervisors that property values dropped 3.7 percent following the most recent reassessment. If the supervisors choose to equalize real estate tax revenue, something that they have done after each prior reassessment, the tax rate would have to go up by 3 cents per $100 of assessed valuation to 53 cents from the current 50 cents. She said that, in keeping with the supervisors’ past philosophy, revenue estimates developed by county staff are built around the assumption of an equalized tax rate.
    Guzi said that each cent in the real estate tax rate generates $711,000 in tax revenue.
    Personal property tax relief from the state will also impact Bedford County. Guzi said that the current car tax relief is 68 percent, but county staff expects this to drop to 60 percent.
    She reminded them that anything concerning what the state will do is still an estimate.
    The House of Delegates and the Senate have both passed their versions of the budget and a House/Senate conference committee began work this week to reconcile these versions.
    Guzi said the county won’t know   what    it   will  receive until the conference committee makes its report. However, the county has to get to work on budget, even without knowing what the General Assembly will do in order to get a budget, and a tax rate, in time for the commissioner of the revenue to send out tax bills.
    Guzi said that, based on the most recently available information, county staff anticipates getting $85.7 million in revenue. This represents a $1.8 million decrease in the actual amount the county received last year.
    There are some bright spots and, because of these, local revenue is expected to increase by 3.4 percent. New construction since the last reassessment has caused real estate revenues to increase. Sales tax and meals tax revenue is also rising. Guzi said that the increase in meals tax revenue is primarily due to new restaurants opening in the Forest area.
    Guzi said that revenue projections assume that money from the state will increase by 1.2 percent and money from the federal government will drop by 3.7 percent.
    According to Guzi, county staff anticipates an increase of $2.1 million in what she termed discretionary revenue, additional money due to revenue growth. She said that, in the past, the supervisors have split half of any increase in discretionary revenue with the school division. This would result in a transfer of $1.3 million to the school division.
    The budget picture will still be harsh.
    “It should be noted that the Governor’s proposed amendments to the budget result in a significant loss of state funding for Bedford County Schools,” she said.
    Guzi said that this loss could be anywhere between $3 million and $5 million.
    Furthermore, she expects the cost of mandated services to increase. Health insurance costs will also go up, with Guzi estimating an increase of anywhere between 4 percent to 12 percent.
    During the regular meeting, three speakers asked the supervisors to raise the real estate tax rate to provide more money for the schools while one urged them not to raise taxes.
    “I’m one of the ones who said in the paper that I won’t support a tax increase, “ commented District 5 Supervisor Steve Arrington at the end of the meeting. Arrington was responding to one speaker who referenced a Bedford Bulletin article on the supervisors views on raising taxes to provide more school money.
    Arrington noted that there are many cost centers in the county that need funding.
    “But I will not support a tax increase,” he said.
    In action items at the regular meeting, the supervisors looked at a request to raise the pay rate for the Equalization Board from $100 per day to $150. This board hears complaints from property owners concerning the latest reassessment.
    “I’d like to speak against that,” said District 2 Supervisor Chuck Neudorfer.
    Neudorfer commented that there are a number of county boards and commissions that are not getting an increase and the county shouldn’t pick one out.
    “I join Mr. Neudorfer on this,” commented District 3 Supervisor Roger Cheek.
    District 7 Supervisor Gary Lowry asked what surrounding localities pay and when county staff could not provide that information, made a motion to table the matter until the next meeting. This motion passed 4-3 on a voice vote with Board Chairman Annie Pollard joining Neudorfer and Cheek in voting against it.
    The supervisors have a budget work session scheduled for 5 p.m. on Tuesday, Feb. 22.