County budget

Currently Fluvanna’s real property tax rate stands at 88 cents per $100 valuation.  Nichols’ $66.81 million FY16 budget proposal requires a tax rate of 89.5 cents in today’s reckoning.

But Fluvanna homes underwent a reassessment this year and appreciated about 2 percent in value.  State code requires counties to equalize the tax rate after reassessments – that is, to adjust the rate up or down as needed to collect the same amount of revenue. The equalized rate for 2015 is 86 cents, therefore Nichols’ proposed 89.5-cent tax rate would mean a  4 percent tax increase for the typical homeowner.

He suggested the personal property tax rate hold steady at $4.15 per $100 valuation.

Because some tax bills go unpaid, the county would be stuck if it counted on 100 percent collection of taxes owed.  For this reason, Nichols’ budget assumes a real property tax collection rate of 96.5 percent and a personal property tax collection rate of 92.5 percent.

At these rates, each penny on the real property tax rate yields about $275,000 in revenue for the county.  Each nickel of personal property tax yields about $88,000.

Most county departments will see an approximate 10 percent “salami slice” cut in funding for routine operations, Nichols said.  This constitutes a reduction of about $400,000 from the departments’ operating budget requests.  If those department requests had been fully funded, Nichols said, the equalized tax rate would have needed to be $1.03.

The increase in expenditures for FY16 is largely due to an approximate $330,000 increase in local funding for the schools, an additional $155,000 for full-year funding of the second EMS contract crew, an increase of $300,000 in operating costs for the Central Virginia Regional Jail, a $300,000 increase in costs for CSA services to at-risk youth, and a $400,000 increase in debt service for middle school renovation projects and a new fire engine.

“It is a very difficult year for capital projects,” Nichols said, explaining why many proposed capital improvements plan (CIP) projects have been delayed.  Nichols lowered but retained funding for reserves for county government and school emergent maintenance needs and replacement of school buses, sheriff’s office vehicles, and student transport and other school system vehicles.

County needs delayed from this year’s budget include a public utilities department consisting of permanent or contract staff to manage potential water and sewer infrastructure, and an assistant/deputy county administrator.

Nichols also delivered to supervisors a five-year financial forecast, extrapolating out the budget with any known adjustments through FY20.

“This is the start of an ongoing, very important dialogue, with you, with staff, with citizens, and with organizations, so that we can eventually have you adopt a budget for FY16,” Nichols told the Board.

Supervisors will dig deep into the budget throughout this month and next.  They are scheduled to adopt a budget on April 15.

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