The Henry County Board of Supervisors scheduled a public hearing for Tuesday, June 25 at 6 p.m. to receive input on a proposed tax increase that, if approved, will provide additional funding for education.
The county is considering increasing the real estate tax rate from 55.5-cents to 62-cents per $100 assessed value to comply with the funding level required by the state.
In April, the board adopted a budget that increased school funding by $4.3 million and brought the total school budget to $107,018,865, including $72.6 million in state funds and $21.6 million in local funds. Subsequently, the state finalized a budget that increased its portion to $80.1 million.
Virginia uses a formula called the local composite index (LCI) to determine the amount of funds localities are required to pay for education. Counties and cities with lower LCI scores are determined to have less of an ability to pay for education. Henry County has the 12th lowest LCI score in the state.
Using the state’s formula, the county would be required to provide $20.1 million to match the increase in state funding. This would be an increase of $3,816,789, or 23.42 percent, to its previous amount.
On June 6, the Henry County School Board amended its budget to also request $3.8 million in discretionary funds from the locality, bringing the total local funding amount to $23.9 million if approved.
The new advertised tax rate the board is considering would provide for the required amount by the state and some additional discretionary funds for the school division.
The school board also requested the locality increase its facilities budget by $1.12 million from the original adopted budget. Taxpayers support school facilities through the annual budget and a separate fund generated through an additional one percent sales tax. That fund currently has a balance of $10.2 million and accrues approximately $5.5 million per year.
The county last approved a property tax increase in 2017.
“In 2017 we increased the real estate tax, the personal property tax, eliminated the decal fee and implemented the motor vehicle license fee all at once. It took effect in fiscal year 2018,” County Administrator Dale Wagoner said.
At a Tuesday, June 11 board work session, Wagoner presented four potential funding options to fund the school system.
If “we decide to only give the absolute minimum that we have to give, we have to come up with $975,845 new dollars, which would still give an increase to the total school budget of $12,949,052,” he said.
Wagoner said that amount would only be enough to pay the school’s debt service. The division would have no funds for its facilities line item.
If the board gives everything the school division requested, Wagoner said the discretionary money would increase to $3,875,545, with an overall increase in the budget of $14,325,241.
“This would require us, the board, to come up with an additional $2,352,034 beyond what we’ve already appropriated and approved in the previous budget in April,” he said.
Two additional options Wagoner presented were giving the level funding of discretionary funding, which is $3,053,903. This would be an overall increase to the budget of $13,505,599 and the board will have to come up with an additional $1,532,392.
Another option is to give the March meeting funding of discretionary funding, or $3,359,293, for an overall increase to the budget of $13,810,989. With this option, the board would have to come up with an additional $1,837,782.
Wagoner said the funding amount the board chooses could be used from a tax increase, the county’s saving account, a reallocation from other departments, or a combination of those options.
Of the options, Pam Cobler, of the Reed Creek District, said she preferred the March funding of discretionary.
“Definitely not take from the department’s we’ve already funded and the great budget you’ve already presented to us. I think we need to look at raising taxes. It seems the one percent voted on unanimously,” she said.
Cobler said she’s talked to a lot of her constituents and educators about the issue, and noted they have questions about why the school budget has gotten so high and what the money’s going to be used for.
“They want other details, like how the schools are spending the money. I think they had some legitimate questions about why all this is happening, and they want answers from the school system, which I believe the school can provide. When it comes to it though, I don’t see another option right now other than taking some of the savings, leave the budget as it is, and then talk about raising taxes as we need to do that at whatever rate that is,” she said.
Travis Pruitt, of the Ridgeway District, said he favored the level funding of discretionary funds option or the March funding of discretionary funds.
“I think it’s inevitable that real estate’s going to have to be raised at some point, whether it’s now or whether it’s the next budget cycle. The budget’s not going to get smaller, it’s going to continue to increase, so we’ve got to be able to have funds to do that,” he said.
Pruitt said he doesn’t want to get into a situation where the board raises the real estate tax rate now, but when the budget rolls around next year, must raise it again “simply because we didn’t raise it enough to get to where we needed to be.”
Vice-chairman Joe Bryant, of the Collinsville District, said he would pick the March discretionary funding option.
“The reason being is because in our budget, we have allocated our local discretionary funds $3,359,293, we’ve allocated that. To go in and just pull that away, and decrease what the state gives them, I don’t think that’s the best thing to do,” he said.
Bryant added he also doesn’t feel comfortable taking the funds from other departments.
Garrett Dillard, of the Iriswood District, said he preferred that option, and giving the school division the full amount it requested.
“We also have to think when we look at salaries, we’re looking at bus drivers, cafeteria workers, we’re looking at teacher aides, so it’s more than just teachers. Retaining substitutes has been very difficult, so this money won’t just be about the teachers and the administrators, I mean there’s a whole lot of other folks that’re also in the school system,” he said.
Debra Buchanan, of the Horsepasture District, said she wasn’t sold on raising real estate taxes.
“It still concerns me that we have reassessments coming up two years from now. I don’t want the taxpayers to” have “two tax increases. I think they would probably expect for the real estate, the way it is, to see a” higher reassessment that would result in more taxes, she said.
At the same time, Buchanan said she doesn’t think the board should take the funds from the other county departments.
“The next two largest budgets that we would probably look at are law enforcement and public safety. We’ve added additional manpower in public safety to cover calls, the sheriff’s department’s working on drug abatement and all that now, so there’s plans there. So, if we start cutting the departments, we’re going to have to look at the sheriff’s department and public safety, and I don’t think that’s a good idea,” she said.
At a starting point, Jim Adams, chairman and of the Blackberry District, said no one wants to cut from other departments.
“We’ve worked hard to get where we are with that. We all agree in fairness. We’ve made promises and it may not have been a promise where you raise your hands so to speak, but when you vote you do make that promise somewhat,” he said.
Considering reoccurring needs, Adams said he finds it hard to dip into the county’s savings.
“We’re going to have that need next year, and likely the toughest thing that we’re going to be facing is a real estate increase. But we need to probably determine which side of this we’re going to fund. Are we going all the way through, or not,” he said.
The board also approved a resolution honoring Joey Craig, of the Bassett Volunteer Rescue Squad, for his over 60 years of volunteer service.
Pruitt attended the meeting electronically. Since the board did not adopt an electronic voting policy, he was unable to vote on the motion to schedule a public hearing to potentially have a tax increase.
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County Administrator Dale Wagoner detailed the requested increase to the school division’s budget and the budget approved by the General Assembly at a meeting Tuesday.
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The Henry County Board of Supervisors set a public hearing for 6 p.m. on Tuesday, June 25, to gain input on a proposed real estate tax hike. The hearing will be held in the Summerlin Meeting Room of the Henry County Administration Building.
