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Supervisors Seek To Fill $910,510 Gap In Budget

No capital improvement projects, no pay raises, and no tax rate increases can be expected this spring as the Halifax County Board of Supervisors attempts to balance its $89,971,290 budget for fiscal year 2011.

In order to balance the budget, supervisors are looking at using $910,510 of unrestricted fund balance and making budget cuts across departments and agencies.

Last year’s budget was balanced in part by using $943,000, and County Administrator George Nester warned that the surplus fund balance should be used to fund extraordinary one-time expenses such as capital outlay, and not used to fund recurring operating expenses.

On the second day of their annual retreat held at Riverstone, supervisors talked seriously about a proposed county budget that calls for a 43 cents real estate tax rate, $3.60 personal property tax rate and $1.26 machinery and tools tax rate.

The $89.97 million budget represents a 2 percent decrease from the current budget of $91,569,098, according to the county administrator.

The original budget requests from all the departments and agencies versus the expected revenue resulted in a deficit of approximately $1.25 million, he further explained.

If this deficit were to be eliminated solely by increasing the real estate tax, the rate would need to be increased by four cents to a new rate of 47 cents per one hundred dollars of assessed value, representing a 9 percent increase in the tax rate.

“This is an increase I do not believe would be supported by the board,” Nester added.

In addition to the three guidance objectives presented to staff when drafting the budget, the constitutional officers and other agencies receiving state funding reductions also were asked to absorb their entire reduction when submitting their budget proposal.

All outside agencies were budgeted at a 5 percent decrease from the current year including the Halifax County Industrial Development Authority (IDA), and all constitutional officers were able to absorb some, if not all, of their compensation board reductions, Nester added.

Most of the county departments’ operational budgets came in less than last year, and the Virginia Retirement Contribution rate and the group life insurance rates were increased from the current fiscal year, the county administrator explained, with all departments’ personnel line items reflecting these increases.

Finance Director Stephanie Jackson explained other highlights of the draft budget to supervisors during the retreat including the following:

• The county administration budget increased from the current budget of $240,372 to $254,727 due to the addition of a copier and telecommunications costs.

• The assessment budget reduced from $200,626 to $172,168 because 2011 will not be a reassessment year, so there is decreased printing costs and Board of Equalization expenses.

• Central accounting’s budget increased from $408,531 to $412,508 due to a software maintenance contract increase.

• The registrar’s budget increased from $92,153 to $114,422 due to redistricting.

• The circuit court judge’s budget rose from $33,922 to $38,803 due to a new full-time administrative assistant position that replaced previous part-time labor.

• Forestry services’ budget increased from $25,000 to $31,200 due to new regulations.

• Corrections’ budget increased from $2,081,430 to $2,126,292 due to projected usage of correctional facilities.

• Building Inspections’ budget increased from $241,028 to $246,664 due to new code being released and new reference materials and training that will be required.

• Emergency services’ budget increased from $86,197 to $95,523 due to the emergency services coordinator position being filled.

• Building and grounds’ budget increased from $1,059,330 to $1,102,250 due to additional properties the county purchased and the respective utilities and maintenance they will require.

• Planning and zoning saw an increase in its budget from $155,314 to $157,040 due to agricultural and forestal district implementation and the advertising and notification requirements.

• The county IDA has requested an additional $90,000 from the board to support prospect development/vistation, and professional services such as engineering and legal counsel that are expected to increase.

The IDA also wishes to relocate its offices to Riverstone that will increase operational costs, according to IDA Executive Director Mike Sexton.
However, the staff recommendation does not include any of these requests in its budget recommendation of $878,750 – down from the current budget of $1,025,000.

The county administrator and finance director agreed that the General Assembly has not finalized the state budget, so changes are expected to the proposed county budget.

When discussing the school budget, supervisors acknowledged that funding for the school system has the most significant impact on the budget representing approximately 66 percent of total expenses.

The county is required by the Department of Education to fund the school system a minimum of $9,748,707.

The school board has submitted their draft budget proposal that totals $59.6 million, a 1.7 percent decrease from the current budget.

Supervisors agreed “at this time” to provide level funding from the current school budget which totals $13,256,000.

This year, supervisors are not recommending any salary increases for county personnel or the agencies funded. However, they are recommending a flat monthly insurance contribution of $432 per month towards the employee Anthem coverage.

According to Finance Committee Chairman Doug Bowman, the county currently has a $7.5 million surplus fund.

“We’re lucky to have a surplus fund balance,” said ED-2 Supervisor Tom West.

“Seven and a half million seems like a lot but when you use a million a year, it doesn’t take long…” Bowman said.

ED-6 Supervisor Wayne Conner pointed out that county taxpayers have seen their taxes double since 2002 when the county took in $12,294,779 in taxes compared to $30,744,187 in 2008 and  $24,538,078 in 2009.

“It’s tough times. We need to cut this budget to meet our revenues, and we ought to be able to do it,” Conner continued. “We’re spending $12 million more than we did in 2002. Granted some of that spending was mandated, but I’m just saying we need to look at where that money is going and what we control.”