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Board Proposes Tax Relief

CUMBERLAND – The County's Board of Supervisors were presented with a budget presentation for the 2011-2012 fiscal year budget on Tuesday evening that included a proposed real estate tax rate decrease of two cents and a projected rollover balance from the current year.

After the Assistant County Administrator, Jill Matthews, gave the proposed budget presentation, the Board opened the required public hearing and several Supervisors addressed their concerns about paying too much for legal services.

The adoption of the County's budget and tax rates is set for Tuesday, April 12.

“We have seen very little recovery from significant reductions in state revenue over the past several years and have experienced a steady decrease in the availability of state and federal grant funds,” offered Ms. Matthews during her presentation.

“The economy has followed suit, as well, showing very little improvement and causing further delays in several anticipated revenue-generating projects. Despite these financial difficulties, staff has made every effort to maintain or improve the current level of services to citizens. As a result, this process has yielded a proposed budget that includes a continuation of staffing reductions implemented during the current fiscal year, no cost of living increases for employees for the third consecutive year and a continued delay of nonessential capital projects. Through this conservative approach, the proposed budget includes a reduction in the real estate tax rate,” she concluded.

Tax Levies

Ms. Matthews presented the proposed tax levies for the 2011-2012 fiscal year.

The biggest news out of this part of the presentation was that the Board of Supervisors is proposed a two-cent reduction in the real estate and manufactured homes tax levy and for public service corporations.

The actual tax rate for 2010 for real estate is 70 cents per $100 and the proposed rate would be 68 cents per $100.

The personal property levy is set to remain at $4.50, Ms. Matthews continued, and personal property for emergency services is set to remain at $4.50 and personal property for disabled veterans is set to remain at one penny.

The proposed tax levy for airplanes is set to remain at 50 cents per $100 and machinery and tools is set at $3.75 as well as heavy construction machinery.

According to Ms. Matthews, the per penny yield projected for real estate is $85,430 and for personal property it is $6,746.

“Both of these are at a slight increase from the current year,” she advised.

General Fund Revenue

The revenue from local sources includes $8,345,500 from general property taxes and $1,356,000 from other local taxes. The total of each line item in this category amounts to $12,270,558, Ms. Matthews stated. Revenue from the Commonwealth totals $1,939,943 and the grand total general fund revenue is projected to be $14,210,501.

According to Ms. Matthews, the slight increase in the revenue received from the state is due to 2010 Census data and Cumberland reaching the 10,000 people threshold in total population, which increases the salary for Constitutional Officers.

Property Taxes Revenue

Real estate revenue proposed in the budget is projected to be $5,720,000, which would be a 3.05 percent decrease due to the two-cent tax rate relief, Ms. Matthews explained. And based on the analysis of what is being collected and vehicle values, she continued, personal property tax revenue is set to be $1,775,000. Added together with the collection anticipated for the other line items in this category, the total revenue proposed from the general property taxes amount is $8,345,500.

Ms. Matthews noted during her presentation that 68 percent of the County's general revenue comes from real estate taxes followed by personal property taxes, which amounts to 21 percent.

General Fund Expenses

Next, Ms. Matthews took the Board through the line items in the General Fund Expenses.

General government administration expenditures total $1,372,897. She later clarified that items that fall under the general government administration include the county administration, legal services, independent auditing services, the Commissioner of Revenue's Office, DMV services, property assessment expenses, the Treasurer's Office, the accounting department and grant writing and administration, the information technology department and the Electoral Board and Registrar's Office.

Other proposed budgeted line item expenses include Judicial Administration, $380,579; public safety (which is an increase due to 12 Sheriff's Department employees being involved in a lengthy trial, said Ms. Matthews), $1,953,863; public works, $1,275,028; health, $136,662; education, community college and CSA, $40,207; parks, recreation and cultural (which includes the County administering the youth league) $195,669; community development (membership to the CRC and Farmville Area Chamber of Commerce), $384,297; non-departmental expenditures, $133,464.

The general fund expenditures outlined in the budget amount to $14,210,501.

An additional line item that has been fully funded this year that was not for the current fiscal year, according to Ms. Matthews, is that $40,000 was put in the economic development fund.

School Operating Fund

Ms. Matthews took the Board through the Cumberland County Public Schools operating revenue and expenditures.

The local appropriation proposed is $3,263,490, which is a 14.18 percent increase over last year due to an increase in VRS retirement and health insurance, according to Ms. Matthews. And also, the County decided to fund the school system's contract with its current grounds maintenance provider.

State funds identified total $8,455,161 and federal funding totals $2,514,276. The total school-operating fund is $14,232,927.

The County is also proposing $208,000 to the school capital projects fund and $15,928 to the school textbook fund, which is a 100 percent increase because no local funding was provided to this line item last year, Ms. Matthews said.

Textbook state funding amounts to $40,856. The total school textbook fund is proposed at $56,784.

Total Local Funding For School

At this point, Ms. Matthews took the Board through the total local funding that is projected for the school system. The grand total local support is projected at $3,487,418, which is a 12.33 percent increase.

The school system's total budget is $14,497,711.

Social Services

Local funding proposed for the Department of Social Services amounts to $290,205.

State funding would be $141,153 and federal funding is set at $842,128. The total social service budget is proposed in the County's budget at $1,255,486.

Debt Service

Debt service payments total $4,031,169, according to Ms. Matthews, some of which will soon be coming to an end in the next few budget cycles.

The VoTech buildings last debt service, she said, would be in the 2012-2013 fiscal year and that amounts to $72,327. The payment on the Elementary School is $622,529. The Middle and High School Complex debt service payment is $2,503,088 and the AMERESCO/school complex financing payment is $126,838. The Courthouse expansion payment is $293,543 and the public facilities note payment is $394,709.

Ms. Matthews concluded that the LeSueur Property payment would end in the 2013-2014 fiscal year and that total is $18,135.

Total Proposed Budget

The fiscal year's total proposed budget, including local, state, and federal funds, amounts to $29,339,410, according to Ms. Matthews.

Capital Improvement Program

Cumberland's locally funded capital improvements include computer system upgrades; funding the comprehensive plan update ($50,000 is being provided by a grant); back-up public water supply plan; sewer system capacity/expansion study; sewer jetter; sewer pump station replacement for number eight; sewer pump station rail replacements; Bear Creek Lake sewer pump station diesel pump; Cumberland Fire Department protective gear; Cartersville Fire Department vehicle purchase; a van for the HVAC technician; Sheriff's Office two cruisers; and a truck payment for the Randolph Fire Department.

The total local funding for capital improvements is proposed at $422,320.

According to Ms. Matthews, this amount does not include VoTech roof replacement needed at the school complex.

That replacement is estimated to cost $250,000 and she explained to the Board that if a grant were secured that project would then be added to the plan.

Public Hearing

After the presentation, the Board's Chairman, Van Petty, District Three, opened the public hearing and there was one speaker signed up to address the Board.

David Meinhard said, “I thought I'd come here and thank the Board of Supervisors as this is an election year and you see fit to purchase our vote with a two-cent tax cut. I'm sure you are thinking that, obviously, the voters and the taxpayers of this county have forgotten the 18-cent tax increase that you put on last year….”

Meinhard continued by requesting if the Board could have found a way to reduce the tax rate by more than two cents given the fact that the County had received its first payment from Henrico County for the Cobbs Creek Reservoir project.

“I looked at your advertised tax rates in the paper. I looked at those of your adjourning neighbor of Buckingham County and they are lower. They are advertising 44 cents on real estate and they are advertising everything across-the-board lower than what you are doing here in Cumberland County. I'm sure that the citizens of Buckingham County are not receiving any worse services than we are here in Cumberland…”

Because there were no other speakers signed up, the public hearing was closed.

Board Comments

Afterwards, Supervisor Bobby Oertel, District Five, voiced that he thought the “budget was sound” but addressed his concern related to the County's legal expenses.

“The one line item that I oppose, which I did a year ago, is the legal services. I opposed it and I didn't approve of this agreement a year ago and since that time my reasons have compounded. Even though the budget is sound-that one particular thing, I can't support the budget as it is presented unless we can do something about the cost of legal services. I suspect, of course this is an opinion, but I suspect that unnecessary spending there could have amounted to another two-cent decrease in our tax rate. That's just my opinion.”

Next, Supervisor Tim Kennell, District Two, also spoke up and addressed the legal service expense as well.

“One thing that was failed to mention is the Cobbs Creek Reservoir project where we have generated a revenue source…,” said Kennell, “to offset the biggest of our expenses going into this which was the new school complex. We've gotten half way there. That's a positive.”

Kennell continued by expressing his displeasure with the County Attorney's contract.

“I can't accept it,” he said. “I've expressed it and I've been overridden. I understand what costs are and what liability is. I am a businessman and I understand the costs of things but once again I think we've overstepped our bounds here. We should have addressed it last year and I'm sorry that I didn't more so although I did. I was using a lot of information that I had in the past that I was unaware of and with the information I have today I think it's a shame that we are spending that kind of money…I do have a problem with that one line item.”

The Herald spoke with Ms. Matthews after the meeting to gather the legal service total contract cost for the upcoming year.

According to information received, the County's legal services contract includes a five percent discount but that for the upcoming fiscal year Cumberland will have to catch up on one month's payment, which was deferred last year due to budget constraints.

The proposed total for legal services for the upcoming fiscal year in the budget is $293,312 and it is also a three-year contract with this being the second year.

“I'd like for the citizens to know and the record to show that the Board did have vigorous discussion with regard to the legal fees and that the majority of the Board has supported the legal fees. We've heard from the minority tonight,” said Supervisor Bill Osl, District One. “There has been vigorous debate and analysis and County staff helped us through the decision…”

Supervisor Elbert Womack, District Four, was not in attendance for the budget hearing.

Chairman Petty addressed the state of the economy and the County's tax rate.

“It still may be some fall out before things, we hope, get back to where they were a couple of years ago,” he said. “It may take a while but with regard to our budget, I know some people want to think that we play games with our budget you know in an election year to reduce taxes but since I've been on this Board we've always tried to cut taxes where we could and we've never tried to gouge anybody. Now, last year, we had to raise taxes to meet the debt service of the new school-there was no question about that. We had hoped that the new commercial landfill would operate and that tax increase would not have been necessary because when we originally set out that was the goal…but in life I can't predict the future…”

It's anticipated that the Board of Supervisors will adopt the 2011 tax rates; fiscal year 2011-2012 budget; and capital improvements program during its next meeting on Tuesday, April 12 at 7 p.m. in the Circuit Courtroom.