Chickens come home to roost

Walking the razor’s edge at budget time

The November supervisors’ meeting saw the first skirmishes in the budget battle for the 2011 fiscal year, which begins July 1, 2010.

County administrator Rebecca T. Dickson, during the evening portion of the meeting, presented and explained the county’s current and expected fiscal position. She was careful to point out that the numbers are preliminary, but they did give everyone a good idea of the magnitude of the financial shortfall the county faces due to declining real estate values.

Dickson said that she expects revenues for 2010 to fall about 12 percent, drop another five percent in 2011 and remain flat the following year.

Goochland, like most jurisdictions, is trying to find its way through the minefield of challenges caused by the economic meltdown. Unfortunately, in past years, our board has used a whistling past the graveyard method to deal with problems, so we may be caught more flatfooted than most.

The failure of the county to attract meaningful economic development puts the burden of the shortfall squarely on the backs of land owners with property tax still the significant source of county revenue.

Predictably, the board room was filled to standing-room- only capacity mostly with parents and teachers passionately concerned about the prospect of significant reduction in teacher ranks. The school budget consumes about 55 percent of the county budget.

Teachers are a vital resource to a school system. Think about the teachers that changed your life. They helped you tap your own resources to find the path to success in life. How would your life have been different if they had not been there?

The county school system has about 400 employees, 200 of them teachers. It’s hard to understand why the teacher corps is not at the very bottom of the list of proposed cuts. One reason is that a threat to fire teachers strikes a powerful emotional cord in parents that motivates them to action.

Unfortunately, this tactic has been used, successfully, so often in the past that it’s lost its authenticity.

Goochland schools have morphed in the past seven or so years from an embarrassment to one of the best districts in the region. This is accomplishment is the result of hard work by the school system, teachers, parents and students.

Good schools are an expensive proposition.

Several speakers cited the curious factoid that Goochland has one of the highest per capita incomes in the country. Everyone wants to hit up all those rich people, all 30 or so, to fund whatever they’re passionate about.

Those figures are based on an average. Teachers should know that when you have a relatively small population —Goochland’s is around 21,000 including the 2,000 or so inmates at our prisons — and you divide that number into the total annual income of all residents, it doesn’t take very many households with seven figure incomes to skew the result to a number that does not paint a true picture of conditions on the ground.

For the past few years the school system has aggressively pursued its funding with the board of supervisors. Using carefully choreographed demonstrations at the annual budget hearing school proponents passionately protest proposed budget cuts when the supervisors attempt to slow the rate of increase of the school budget.

The schools usually get most of what they request.

Excellence in local education is a very fine goal, but it’s never been quite clear if the supervisors and citizens agree that funding excellence in education should take a top fiscal priority.

This year, things are different. The expected shortfalls are the worst in recent memory.

The supervisors will have to make difficult and delicate choices about use of public dollars.

They can keep the 53 cent tax rate in place, which will result in lower property tax bills for some landowners. They can use part of the county’s fund balance, which Dickson estimated at approximately, $14.2 million. They can raise the tax rate on the reduced assessed valuations or they can slash spending to meet the expected county income.

None of those choices are happy ones. No matter what the board does, some citizens will be angry.

Although several speakers at the board meeting urged the supervisors to raise property taxes to prevent budget cuts, many people in the county are hurting financially.

Businesses are closing. Homes are in foreclosure. People are losing their jobs or not getting raises. For many people, money is very tight.

To give a modicum of relief to some business owners, the board voted 4-1 with Jim Eads District 5 dissenting:

“ to extend its deadline for payment of business personal property taxes for ninety (90) days without incurring the 10% late penalty. However, interest will accrue beginning January 1, 2010. The new deadline for paying business personal property taxes will be Friday, March 5, 2010. After this date, penalty is 10% of the uncollected balance. Interest begins January 1, 2010 and is not included in the extension.”

Although the picture is grim Dickson and the supervisors are right to publicly discuss the impact of the expected shortfalls now. This action represents a significant change in the county budget process. Dickson’s predecessor rarely, if ever, presented the county’s financial picture at open meetings. The budget was always an inside baseball behind closed doors activity with only carefully orchestrated glimpses permitted before the public hearing.

The 53 cent tax rate, which has been in effect for several years, is the result of a projection based on steady growth in population and property values. Indeed, it seemed like the budget was crafted by multiplying the total assessed valuation of all of the land in Goochland by 53 cents to determine the total budget. Then, working backwards to allocate that amount of money to various departments regardless of their budget requests.

During the fiscal year if a department ran out of money, supplemental appropriations were made. In all it was a very magical process with probably little basis in generally accepted accounting principles.

All that has changed. Everyone says they want transparency. Well, here it is, warts and all.

No one wants to pay higher taxes. However, if there is such a thing, local taxes may be the best kind. Those dollars stay close to home and fund things that make our community work.

It’s time for some citizen input. How would you instruct the supervisors to deal with the budget shortfall? Which items should receive funding priorities?