Tax hikes proposed, real estate tax rate would increase from 50 to 55 cents

Published 5:49 pm Friday, March 25, 2016

County supervisors in Buckingham are proposing a 5-cent increase in the county’s real estate tax rate for fiscal year 2016-17.

The proposed $46.5 million budget, if approved, would bring the county’s tax rate to 55 cents per $100 of assessed value from the current 50 cents. The budget also proposes increasing the public service corporation tax on real estate by the same amount, from 50 cents to 55 cents per $100 of assessed value. The budget also assumes implementing the public service corporation tax on personal property, such as vehicles, at $4.05 per $100 of assessed value — the same as the personal property tax rate.

According to County Administrator Rebecca S. Carter, who presented budget numbers to supervisors this week, the increases would bring in about $710,000 more in revenue in real estate tax collections and about $300,000 more in real and tangible personal property of public service corporations.

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According to the proposed budget, all other taxes would remain the same.

Though District Three Supervisor Don Matthews and District Four Supervisor Morgan Dunnavant voted against inclusion of the tax increase in the proposed budget, the board unanimously voted to advertise the proposed budget for a public hearing on April 18 at 7:30 p.m.

“The proposed tax increase is not only to provide the additional $275,520 to the schools for the buses, Ident-A-Kid, special (education) vehicles and additional maintenance funding, but to build a reserve for expenses that we know are coming for the next several years,” Carter said. “For example, we already know the school’s VRS (Virginia Retirement System costs will increase by) an additional $240,000 in the 2018 fiscal year.”

She said without a tax increase, “there is no money for school general capital repairs to building or to any county properties, (solid) waste site or for any emergencies that may occur, without dipping into the general fund reserve of $4.2 million.”  

The proposed school budget totals $26.8 million, including debt service.

According to Carter, auditors said the county is “in a good place financially” with the budget’s reserve “and it would not be good management to let that balance drop further (spending more than we have coming in). For example, a catastrophe like what happened in Appomattox with the tornado could very well leave our county in a financial bind,” Carter said. “A shortfall in tax collections could cause a depletion of our balance. The budget without a tax increase leaves only $21,000 for any shortfall or emergency.”

According to Carter, the proposed budget includes $180,000 for two new school buses, an additional $45,187 for school operations and maintenance, $34,000 for two special education vehicles and $16,333 for Ident-A-Kid software, totaling $275,520.

Carter said the school division’s request for $617,079 is additional local money.

“Included in the … local money is funds to provide the 2 percent raise to all school employees (the state only provides the 2 percent to the state-covered school employees) with the raise commencing July 1 instead of December (and) to give all of the hourly school employees a 50-cent-per-hour raise, to increase office aide positions hours by 1.5 hours per day and to move an office aide preschool employee from hourly to contract ($6,000).”

Overall reductions in general government operations in the budget total $92,589, Carter said. “The reduction in the committed reserves is $238,410. These reductions had to be made to have enough money to make up for the increased school debt payment of $392,514. Based on the current 50-cent (real estate tax) rate and our values, we were only seeing an increase in all county revenues of about $167,000.”

The budget includes the $250,000 in the reserve for the proposed library debt payment.

“There is a 2-percent salary increase for county employees, but is offset by other reductions (total general fund reductions was $166,669.00, increased $74,080, leaving total reductions $92,589),” Carter said.

“Increasing taxes is never a favorable position. However, the public expects the services and continues to want to better our community,” Carter said in her budget memorandum to supervisors.

In her original presented balanced budget, she said that, under the current 50-cent tax rate, including funding for new buses, county and school building maintenance and repairs and improvements to solid waste sites, the spending would have dropped the county’s ending year balance, “thus spending more than you are bringing in.”

According to Carter, one penny of the real estate tax rate brings in about $142,000 in revenue, while one penny on the public service corporation tax brings in about $50,000.