County Supervisors adopt 71 cent tax rate; School request satisfied

The Albemarle County Board of Supervisors started their budget and tax rate discussion at 2PM today and by about 6:45 PM we had a tax rate.  The Board was split 3-3 for much of the day with half the board favoring a 70 cent tax rate (Boyd, Dorrier, Rooker) and the other half favoring 71 cents (Mallek, Slutzky, Thomas).  In the end, the Board adopted, by a 4-2 vote, a 71 cent real estate property tax rate with the stipulation that one cent of tax revenues (about $1.6 million) be set aside and only used if projected revenues are less than budgeted during the next fiscal year.  Any funds not utilized for revenue shortfalls will be returned to the Capital Improvements Program (CIP) budget at the end of the year.

The County's 2007 tax rate was 68 cents.  Thus a 71 cent tax rate represents a 3 cent increase. In their discussions, Supervisors said the resulting tax increase for the average household in the County would be about $30 a year. [Update 4/10/08: That $30 was the difference between the 70 and 71 cent rates.  Daily Progress reports overall increase is $74 for average household.  By my calculations, it is $93 a year if you hold the median sales price of an Albemarle home constant. See my comment on this post below.  Sorry for the confusion.  BW]

As a result of this action, I expect the Albemarle County School Board's $151.3 million budget request for 2008-09 to be fully funded. Speaking as one Board member and not on behalf of the School Board, I believe this is in no small part thanks to the support of our community at the numerous public hearings and in communications sent to the Board of Supervisors.  THANK YOU!  They got the message loud and clear and every Supervisor expressed their desire to support our schools at today's meeting.  Even those that voted against the final tax rate (Boyd/Dorrier) were willing to support 70 or 70.5 cents which also would have satisfied the school funding request when combined with a one penny transfer from the capital budget, as had been recommended by County Executive Bob Tucker.

In summary, the School Division will receive additional revenues based on the reallocation of one penny in capital funds towards operational expenses, plus the impact of the tax rate being increased (schools will have access to revenues generated from 2 cents of tax rate increase, with the third penny being held in the local government contingency fund).

The School Board will have a budget work session on Thursday, April 17, 2008 to finalize its budget.  The Board has said previously that it will continue with some cuts (e.g. central office expenditures) regardless of the revenues available as part of its implementation of recommendations in the Resource Utilization Study.  Other cuts (e.g. strings & world languages staffing subsidies) or additions (e.g. specialty centers) that were identified in various contingency plans and previously considered by the Board will be on the table for final review.

Brian Wheeler

Comments

[Brian Wheeler]

In my original post, I mentioned the Supervisors had described the impact of the tax increase on the average homeowner as being $30 a year. They did say that, but they were referring to the difference between a 70 and a 71 cent tax rate, the two rates that dominated their discussions yesterday.

By my calculations, at 71 cents, the average household will pay an additional $93 in taxes annually. I calculate this by using the 2007 Charlottesville Area Association of Realtors (CAAR) year-end median sales price for a home in Albemarle County ($310,000) and calculate the difference between a $0.68 tax rate and a $0.71 tax rate on that home. The value of the home is held constant.

My apologies for not being clearer about the impact.

Brian Wheeler

[Michael Coppola]

So, let's see... if the difference between $0.68 and $0.71 is $93 a year, then last year's reduction from $0.74 to $0.68 saved the average home owner about $180, or $15 a month. Sounds like David Slutzky's "beer and a pizza" analogy was pretty darned accurate.

This is not to ignore the fact that there are certainly some taxpayers on tight budgets for whom a couple hundred dollars can be a pretty big deal. But for most of us, there are worse things in life than paying taxes. Short-changing schools and closing bridges are among the things that I consider worse than paying an extra $200 in real estate tax.