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County property values drop
Revenues would fall $653,053 as expenses rise
Wednesday, February 6, 2013
By PAUL COLLINS - Bulletin Staff Writer
Unless it raises taxes, Henry County could face a loss of revenue and increased expenses of about $729,000 or more in fiscal year 2013-14, according to County Administrator Tim Hall.
Hall spoke at the Henry County Board of Supervisors’ annual planning session Tuesday.
The county’s recent property reassessment showed market values down 4.72 percent, which represents a revenue loss to the county of roughly $653,053, Hall said. That figure is based on raw data before appeals by property owners.
To make up that amount, the county would have to increase the current real estate tax rate from 46 cents per $100 of assessed value to 49 cents per $100.
Real estate taxes on a house assessed at $125,000 would increase from $575 under the current rate to $612.50.
Hall called the $653,053 “a big chunk of money” and “a precipitous drop.”
Hall said in addition to the loss of roughly $653,053 in revenue (assuming the board of supervisors does not change the current real estate tax rate), the county faces:
• Spending about $172,000 because of a 10 percent increase in health insurance costs;
• Spending about $65,000 for the second year of a phased-in raise for employees to offset employee contributions to the Virginia Retirement System.
• Spending a “very conservative” $125,000 as the local match for proposed state raises for constitutional officers. If the county was to give those same raises to local employees, the cost would be even higher, but not giving local employees the same raises as constitutional officers could hurt morale, according to Hall.
Helping offset part of those $1,015,000 in total revenue losses and increased expenses, the county may not have to return $286,000 of the “so-called state aid to localities” as in years past, according to Hall and information he presented.
That means the county would face about $729,000 because of loss of revenue and increased expenses — or even more if the county gives local employees the same raises as constitutional officers.
If the county does raise the real estate tax rate to make up for the roughly $653,053 in loss of revenue because of the reassessment, the county still would face a shortfall of nearly $76,000.
Hall said that under state law, the county would have to advertise any increase in the tax rate as a tax increase, but “practically speaking,” he doesn’t consider it a tax increase. He considers it being “revenue neutral,” or adjusting the tax rate to keep the revenue equal.
Jim Adams, Blackberry District supervisor and chairman of the board, pointed out that the real estate tax rate was lowered four years ago. Hall said the rate was lowered from 54 cents to 46 cents per $100 of assessed value. According to an October 2008 Bulletin article, real estate values in Henry County rose an average of almost 18 percent over the previous four years.
Among other points made during his “fiscal preview”:
• Hall mentioned a joint meeting of the board of supervisors and the county school board Jan. 28 in which the two boards reached a consensus for Hall and county schools Superintendent Jared Cotton to explore how John Redd Smith Elementary and Collinsville Primary could be replaced with a combined K-5 school. Hall said he and Cotton plan to meet Feb. 15 with officials of Roanoke County about the capital improvement project fund that the county government and the county school division share.
• Hall said county, sheriff’s office and county schools officials plan to meet to discuss adding more resource officers to schools, including how many, how to replace sheriff’s officers who would be assigned to schools, and who would pay for what. Hall said Cotton doesn’t think a school resource officer is needed at every school.
• Hall said the heavy volume of calls to the Martinsville-Henry County E911 Communications Center “boggles his mind,” and he anticipates proposing additional staff for the center.
• Hall said the Harvest Foundation will be asked for funding for a retail recruitment effort. Iff that request is denied, he asked how much new county money the supervisors would be willing to commit and for how long. “It can’t just be one year; it will take time to play out,” he said.ˆ
In other business, Hall pointed out that the county’s total general fund balance increased from $28,197,856 for the fiscal year ending June 30, 2011, to $28,393,368 for the fiscal year ending June 30, 2012. That amounts to an increase of $195,512.
He noted the county’s unassigned general fund balance increased from $15,792,166 to $17,599,659 for that same period. That amounts to $1,807,493. He said the county has been judicious, or exercised good judgment, in spending.