The Henry County Board of Supervisors held its annual budget planning session Feb. 9 at the Henry County Department of Public Safety Training Center, launching discussions on the Fiscal Year 2027 budget and hearing funding needs from county departments.
The session opened with a review of priorities funded in FY26, including new positions for Building and Grounds maintenance, the Sheriff’s Office Animal Services Division, and Public Safety. Additional investments included Circuit Court records preservation, district impact funds to address blight, new vehicles for the Sheriff’s Office, overtime for deputies supporting Parks and Recreation events, and replacement of aging emergency radio system equipment.
Board members then reviewed long-term investments in education, public safety, and economic development. Since FY14, total school funding has increased from just over $70 million to nearly $120 million in FY26, with local contributions rising from $16 million to nearly $24 million. Sheriff’s Office funding grew from approximately $10 million to nearly $25 million, largely due to the construction and operation of the Adult Detention Center. Support for Public Safety increased from about $2 million to approximately $5.5 million, while Economic Development funding rose from $5 million to roughly $8 million, fluctuating year to year based on grant-funded projects.
“The Board of Supervisors has made a deliberate and consistent investment in our schools and in public safety, and residents are seeing the results of those decisions,” said County Administrator Dale Wagoner. “In particular, the Sheriff’s Office has significantly increased enforcement efforts targeting drug trafficking and violent offenders, actions that have been strongly supported by the community. Those efforts don’t happen by chance. They are the result of stable funding, staffing, and long-term planning. Continued progress on these challenges requires continued public investment, and the Board has demonstrated a strong commitment to using taxpayer dollars responsibly to improve quality of life across Henry County.”
Much of the session focused on the county’s financial health, debt service, and reserve policies. In FY25, Henry County’s unassigned fund balance stood at about $40 million. County financial policies require maintaining reserves equal to 18 percent of the annual budget, leaving roughly $13 million available for potential spending priorities.
David Rose of Davenport Public Finance, the county’s financial adviser, stressed the importance of strong reserves to maintain favorable credit ratings from Moody’s, Fitch, and S&P. Strong credit ratings allow the county to borrow at lower interest rates, reducing costs for major capital projects and helping stabilize services. Rose also noted disciplined financial planning helps local governments weather economic downturns without sudden tax increases or service reductions.
Davenport representatives also discussed the need to address structural budget challenges. In FY25 and FY26, unassigned fund balance was used to balance operating budgets, a practice described as unsustainable. County staff identified an annual operating shortfall of approximately $5.5 million, which would require setting the real estate tax rate at about $0.48 to restore balance and avoid future reliance on reserves. Even at that rate, Henry County would remain below the median tax rate of comparable jurisdictions.
The board also discussed financing options for future school construction, including use of low-interest debt to manage costs and offset construction inflation.
Uncertainty with the state budget was another key topic. Because the Commonwealth has not yet adopted a budget, the county faces potential mandates including salary increases for state-supported employees, increased local school funding responsibilities due to changes in the Local Composite Index, higher required contributions to the local health department and Department of Social Services, and a projected 18 to 25 percent increase in Children’s Services Act costs.
Department heads then outlined funding requests and operational needs, including staffing and pay adjustments for Parks and Recreation; capital maintenance and staffing for Building and Grounds; additional cybersecurity staffing in Information Technology; support staff increases in Finance; a new position to administer the Erosion and Sediment Control program in Planning, Zoning and Inspections; expanded staffing and volunteer support for Public Safety; and administrative, enforcement and equipment needs within the Sheriff’s Office. Across all departments, nearly $9.5 million in capital improvements were requested, along with increased funding for outside agencies.
The session concluded with a discussion of revenues, rising property assessments, and tax rate options. Without using reserves, the county projects a $4.79 million increase in costs next fiscal year, not including possible state mandates or departmental requests.
A $0.48 tax rate would generate enough revenue to maintain current service levels and meet debt obligations, while a revenue-neutral rate of $0.37 would require significant service reductions. Supervisors also discussed potential changes to the personal property tax and elimination of the motor vehicle license fee.
The FY27 budget process will continue in the coming months, with additional public discussions and opportunities for community input before adoption later this year.
For more, visit https://www.henrycountyva.gov/DocumentCenter/View/1627/2026-Planning-Session-PresentationPDF?bidId=.