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Costs of pursuing reversion aired
Wednesday, July 25, 2012
By MICKEY POWELL - Bulletin Staff Writer
Becoming a town in Henry County could cost Martinsville $600,000 or more in legal expenses and other costs, according to City Attorney Eric Monday.
Addressing the Martinsville City Council on Tuesday, the attorney estimated that a “friendly reversion” — one which the county does not oppose — would cost $250,000 to $350,000. If the county goes to court to try and stop the effort, he said, the cost could be $500,000 to $600,000 or more.
South Boston and Clifton Forge are the only Virginia cities to have reverted. Monday said both efforts were “extensively litigated,” but eventually the localities were allowed to become towns.
Monday’s figures include an estimated $120,000 to do three studies which Monday said are crucial to the process of considering a reversion.
He described one as being a “where are we going study” showing financial constraints Martinsville expects in the future if it remains a city.
Another study would reveal how a reversion would affect both Martinsville and Henry County, Monday said. The third study would look at merging the two school systems, which he described as “the major component.”
The council studied reversion several times previously but never pursued it. In May, as the fiscal 2013 budget was being prepared, members brought up the idea again in response to concerns about expenses continuing to rise as city revenues remain stagnant.
Monday said the costs to study merger again might can be reduced if some previous studies can be updated.
Virginia cities are independent of the counties surrounding them so unlike towns, they do not receive any services from those counties.
Under a reversion, Henry County would take over certain city services such as courts and — probably — schools. The idea is that Martinsville would save money by not having to provide as many services as it does now, so it would not need to collect as much revenue.
In turn, residents may not have to pay as much in taxes to Martinsville, although they would have to start paying taxes to the county, too.
But “that does not mean your taxes will double,” Monday pointed out.
For example, Councilman Danny Turner noted that for real estate, per $100 of assessed value, Farmville residents pay a town tax rate of 12 cents plus a Prince Edward County tax rate of 42 cents. That equals 54 cents, which is much less than Martinsville’s real estate rate of almost $1.02 per $100.
Mayor Kim Adkins has said that another potential benefit of reversion is that as a town, Martinsville would be able to annex land in Henry County to grow its tax base. Virginia cities are prohibited from pursuing annexations.
Monday said, however, that years ago, Henry County asked for and received legal immunity from annexations. He did not know the background on that. Anyway, Martinsville would be unable to annex land in the county.
“To get the ball rolling” toward a reversion, Monday said, the council could adopt a reversion ordinance or 15 percent of Martinsville’s registered voters would have to sign a petition in support of the city becoming a town.
The state’s Commission on Local Government would have to hold hearings and issue findings of fact. If the findings are favorable, the city would file a reversion petition in its circuit court, according to Monday.
The Supreme Court of Virginia then would appoint a panel of three judges — each of whom would be from outside the area, to be fair — to hear the case, he said.
To be approved, a reversion of Martinsville would have to be found to be in the best interests of the city, Henry County and the state, Monday said.
He predicted that due to stresses on the local economy, a reversion likely would be approved.
The time frame for a reversion is indefinite, he indicated. He estimated that it could take about six months to do the necessary studies, but negotiations with Henry County would take “as long as necessary.”
The city of Bedford is seeking to become a town in Bedford County. Monday said negotiations between the city and county went on for about three years.
But issues have been involved in that reversion effort that would not come into play locally, such as Bedford being able to expand its boundaries and Bedford County establishing a Public Service Authority, Monday said.
Henry County already has such an authority, which oversees water/sewer matters.
Turner asked if there are options for Martinsville besides reversion, such as the city and Henry County merging into “one big city.”
Monday affirmed there are other options. One he mentioned is provisions in Virginia law for “shires.”
But “that’s never been tried,” he said, adding that he knows little about the process.
Adkins said the council will listen to public opinion before deciding whether to pursue a reversion as a way of ultimately reducing expenses in the future.
The council plans to hear public comments on the reversion idea during its next regular meeting Aug. 14. Still, council members took comments from a few people at Tuesday’s meeting.
“I don’t think you have any choice” but to pursue a reversion because city financial constraints are “not sustainable,” said resident Ural Harris.
Martinsville once was regarded as one of the wealthiest cities in both the state and nation, the Rev. Tyler Millner of Axton recalled. For that reason, he said it is “distressing psychologically and emotionally that the city is talking about regressing” to town status.
He said he hopes “some mermaid would come up out of the water” and rescue Martinsville’s economy “so we wouldn’t have to do this.”
Regina Harris of Fieldale, formerly of Martinsville, said she opposes the city reverting because being a town would not be as prestigious as being a city.
“We might not be able to attract any big industries” to provide new jobs in the future, she said.
Also Tuesday, the council decided that the city should pursue discussions with the Phoenix Community Development Corp. and The Harvest Foundation about the future redevelopment of the former Henry Hotel uptown.
More on that and other issues discussed during the council meeting will be reported in the Martinsville Bulletin on Thursday.