The Henry County Board of Supervisors heard a presentation of the potential fiscal year 2023-24 budget at its April 4 meeting.
County Administrator Dale Wagoner said the proposed budget is $196,623,925, an increase of $6.7 million or 3.5 percent when compared to the fiscal year 2022-23 budget.
“This proposed budget includes no new taxes on our residents. In fact, I’m recommending that the board consider granting more tax relief by increasing the real estate tax relief threshold by at least 20 percent,” he said.
Wagoner said education is the largest investment in the upcoming fiscal year, with $102,684,412, including an increase of $1,466,615 from the previous year.
“The proposed budget continues the effort to recognize the work of our teachers. The school budget projects providing a five percent across-the-board increase and a one-step up for teachers,” he said.
It also suggests a seven percent increase for bus drivers and drivers’ aides and a five percent increase for administrators.
According to data provided by the Virginia Department of Education (VDOE), Wagoner said the starting and average pay of teachers in Henry County is higher than the surrounding localities and cities.
“This proposed budget will ensure our teachers’ pay is the most competitive in the region,” he said.
Wagoner said the public safety operations division continues to have an increase in call volume while revenue from the EMS has stagnated.
“To support our volunteer agencies, this year we’re recommending that the annual allocation of the Aid-to-Localities Fire Programs fund be designated to the Collinsville Fire Department,” he said.
Wagoner said $511,000 is included in the budget for fire department operations, with $61,750 included for radios and pagers for volunteer fire and rescue departments.
“Our volunteer departments have been impacted by inflation just like we all have. So, I am recommending in our budget that we include $120,000, a one-time disbursement, which will be given out to the volunteer fire and rescue departments in equal share based on the vehicle fuel expenditures,” he said.
The Sheriff’s Office will receive $21,568,985, which includes a 30 percent increase in fees paid to the Piedmont Regional Criminal Justice Academy for a total of $118,500.
“There is also a one-time increase in the sheriff’s budget to cover the expenses related to the re-accreditation of the department. We’ve also included software for the management of personnel for the sheriff’s office,” he said.
Wagoner said the Adult Detention Center (ADC) Cost Center is up about 6.6 percent. A majority of increases are associated with across-the-board pay raises for all employees.
“Perhaps the most significant change relating to the ADC is not on the expenditure side of the budget, but the revenue side. Operating the facility has been more difficult than anticipated by the sheriff’s office, and as a result, it will not meet its expectations to generate approximately $1 million annually by housing inmates from other localities,” he said.
Wagoner said the Department of Social Services (DSS) has a budget of $10,766,038. Henry County is responsible for $1,136,070 of the total DSS budget, which is an increase of $99,491 from last year and includes funds to hire three new employees.
Wagoner said the county continues to see higher-than-average numbers of children in foster care and an above-average number of families receiving services and benefits.
He estimates the county has an average of 90 children in foster care.
“The caseload has made it very difficult to respond appropriately to the needs in our community, and this has also resulted in high employee turnover,” he said.
Wagoner said the Children’s Services Act (CSA) is a state-mandated program that requires the county to provide support services to at-risk children.
“And we’re seeing a year-over-year increase of approximately 30 percent. We just can’t get a good graph of what are those escalated costs,” he said, adding the proposed budget 17.5 percent increase may not be enough.
The budget also includes $235,000 to update the county’s Comprehensive Plan, which was last updated in 1995. Changes in the state minimum wage laws have also increased the expenses for the more than 140 part-time county employees.
The county received $2,771,244 in requests from outside organizations and budgeted $2,102,006.
“The most significant increases are recommended for Piedmont Community Services (PCS) and Smith River Sports Complex (Monogram Foods).” PCS provides “behavioral and residential services, and in the current year they provided those services to approximately 2,500 county residents,” he said.
Another 4,000 residents participated in other services.
Wagoner recommends increasing the budget to $190,000 and noted that amount is still below the state-required local match which the county has not provided in many years.
“PCS will have to request a waiver from the Commonwealth since our funding is below the required match,” he said.
Wagoner said the proposed budget recommends $40,000 for the Smith River Sports Complex and for the county to procure and own capital equipment for ongoing maintenance.
“In 2022, there were events at the Smith River Sports Complex 50 of the 52 weekends. Unfortunately, the complex has reached a revenue plateau due to escalating inflation and salary, which does not allow it to be self-sustaining,” he said.
Wagoner said the proposed budget also recommends that over the next year, the county and the City of Martinsville explore increasing the Transient Occupancy Tax (TOT) from two to four percent, with proceeds to be used for tourism-specific activities at the complex.
While there are no funds for capital improvements in the budget, Wagoner suggested the board use the discretionary capital fund, carryover funds, and savings in the current budget to address the county’s urgent capital needs.
Suggested projects include $199,000 to replace the elevators at the Henry County Administration Building; $500,000 for patrol car replacements for the Henry County Sheriff’s Office; $86,000 to replace the roof over the Summerlin Room; $800,000 to relocate the generator from the old jail to the administration building and associated electrical upgrades, and other projects.
Wagoner said the primary driver of the increase in revenue is additional funding from the state for constitutional officers. Additional revenue also comes from interest income, sales tax, food and beverage tax, and the TOT.
“The most significant expenditures in the budget are state-mandated salary increases for sheriffs, deputies, constitutional officers, and teachers. Considerable other expenditures, primarily related to inflationary pressures specifically related to electricity and fuel,” he said.
There is no budget for new personnel except for the three positions in the DSS.
Wagoner said the most significant revenue comes from the state in the form of intergovernmental revenues for the operation of schools and constitutional officers. The county’s primary source of local revenue includes taxes from the real estate, personal property, and machinery & tools taxes.
“We don’t often talk about it, but grants are a source of revenue that is often overlooked when we talk about local government finances. Since Jan. 1, 2022, Henry County and the Public Service Authority (PSA) has applied for 75 grants asking for over $105 million, and we’ve been successful in receiving over $38 million,” he said.
The county’s interest income also contributed to the county’s revenue.
Other notable changes in the county’s revenue include real estate taxes being essentially flat and the revenue from Emergency Medical Services (EMS) trending slightly down.
“Our local sales tax is up approximately eight percent with a portion of that attributed specifically to inflation.” The TOT “is up 17 percent, and that gives us a good illustration of the renewed interest in our community from visitors staying in our hotels, motels, and campgrounds,” he said.
The board approved continuing the meeting until Thursday, April 6 at 5 p.m. A public hearing will be held on April 17 at 7 p.m. to accept the budget.
Garrett Dillard attended the meeting virtually.