Prince William County’s budget process is moving forward, but the economic impacts of the ongoing coronavirus pandemic mean the county could have about $30 million less to spend next year, County Executive Chris Martino told supervisors Tuesday.
Addressing the board during its March 31 meeting, Martino said projected revenues for fiscal year 2021 have dropped $29.7 million compared to what was originally presented Feb. 18 because of the COVID-19 economic impacts and changes to the library shared services agreements with the cities of Manassas and Manassas Park.
If the amount is split between the county and the school division according to the revenue sharing agreement, the school division would receive $15.5 million less from the county next school year. The remaining $14.2 million would impact the county government’s proposed budget, Martino said.
As a result, the county budget is now projected fall about $30 million short of the amount school board members requested in the budget they approved March 18.
The total reflects the $15.5 million projected drop in local tax revenues related to coronavirus impacts and the $15.3 million gap that already existed between Martino’s proposed budget and that of the school board.
“My proposed budget was $15.3 million less than what the school division was asking,” Martino said Tuesday. “This $15.5 million is an additional reduction from that. So, the school transfer would decrease from $645 million in the proposed budget to $630 million with the modified numbers that I’m looking at now.”
The school division would still receive $23 million more in county funding than it during this school year. Likewise, the county will have an increase of $22 million under Martino’s proposed budget, even with the dip in projected revenues.
Martino said the county has taken additional measures to reduce spending, including implementing a hiring freeze for the remainder of the year. The county is also evaluatingall general fund capital projects to determine which projects can be stopped or deferred.
Under the Martino’s proposed budget, the real estate property tax rates would rise from $1.125 to $1.145 per $100 in assessed valuation, resulting in a $242 annual increase in the average annual residential real-estate tax bill. The average tax bill would rise from $4,190 to $4,432 under Martino’s budget, or by about $20 more a month.
In February, the board decided to advertise a tax rate of $1.17 per $100 in assessed valuation, an increase that would fully fund the school division’s budget in concert with other proposed tax and fee hikes.
Under the advertised rate, the average residential real-estate tax bill would rise from $4,190 to $4,529, for an annual increase of $339 or about $28.25 more a month.
Both amounts exclude the county’s fire and mosquito levies, which add about $310 to average annual residential real estate tax bills.
The supervisors did not discuss real estate property tax rates during Tuesday’s meeting.
Martino recommends cutting new public safety positions
Martino recommended the board slash the 40 full-time positions that were planned in the proposed 2021 budget, including 15 police positions, 14 fire and rescue positions, five courts positions and two sheriff’s office positions.
Martino also proposed cutting $7.1 million slated to fund 3% raises for county employees. Martino said the county’s second phase of its classification and compensation study, which will result in pay raises for about 1,600 county employees, will move forward as planned, however.
All told, the proposed cuts make up $18 million, which more than is needed to cover the county’s $14.2 million budget shortfall. Martino said some of the excess cash, about $400,000, could be used to supplement the salaries of county nurses whose pay is not competitive in the region. Martino said the Prince William Health District has 19 nurse positions, but only seven are currently filled.
“The turnover on nurses is a problem,” Martino said. “Certainly, in this crisis that has come to light.”
Martino recommended directing the remaining $3.4 million to be put into reserve funds to prepare for additional unforeseen impacts of the COVID-19 crisis.
Martino’s update to the board included a list of unfunded community services and social services programs, like homelessness prevention services and services for those with intellectual disabilities, that may be necessary to fund to blunt the impact of the coronavirus crisis locally. The unfunded services total about $4 million.
The county, he said, could fund several of these programs by increasing the computer and peripherals tax, or data center tax, from $1.30 per $100 of assessed value to $1.35 per $100 of assessed value, which would add $800,000 to the general fund.
The board could create an additional $3.4 million in general revenue funds by increasing the county’s motor vehicle license tax from $24 to $33 for cars and trucks, and from $12 to $20 for motorcycles.
“As we saw in 2008, whenever there’s a recession, the demand on human services goes up,” Martino said.
Several supervisors were skeptical of the recommended changes to the budget. Supervisor Pete Candland, R-Gainesville, said he was disappointed that Martino had not offered additional options to consider.
“I’m pretty disappointed with this presentation as far as giving this board additional options to consider. We’re looking at a budget proposal from the county executive that would raise new spending for the county and schools by over $40 million, and will increase taxes to do it,” Candland said.
Candland said small businesses across the county have been impacted by the ongoing crisis, and that some may not survive. Candland and his wife own two ice cream shop called Cookies ‘n’ Cream in Haymarket and Bristow.
“We’ve had to lay off all of our employees. We are now restricted on our hours of operation and how many customers we can have,” Candland said.
“The fact that we’re still considering a budget that raises taxes on people is not the direction we should be taking right now,” Candland added.
Supervisor Jeanine Lawson, R-Brentsville, expressed similar concerns about the budget’s potential impact on individual taxpayers.
“I have strong concerns about where this budget is going,” Lawson said. “There’s a lot of concern about unemployment. We don’t know what this pandemic is going to bring.”
On March 18, Lawson, Candland and Supervisor Yesli Vega, R-Coles, the three Republican supervisors on the board, asked county staff to include a “flat-tax-bill” budget option that would have kept real estate tax bills for county residents and businesses identical to their 2020 tax bills. The average county homeowner paid $4,177 in real estate taxes in 2020.
A similar “flat-tax” budget was unanimously approved by the Fauquier Board of County Supervisors on March 27.
At-large Chair Ann Wheeler (D) said the county’s proposed budget, with Martino’s new recommendations, is a step in the right direction.
“I see the schools and the social programs, especially the ones that we are going to need over the course of the next six months, as the backbone of our community,” Wheeler said.
Wheeler said the board of supervisors should not approve a budget that cuts county services or further scales back school funding. “We did that in 2008 and we never recovered,” Wheeler said.
The supervisors will resume their budget discussions on Tuesday, April 14, and on Thursday, April 16. Both dates are slated for budget public hearings.
On Tuesday, the board directed Martino to devise a way for residents to participate in the meetings electronically in real time. More detailed plans about how the meetings will be conducted are expected before the meetings take place.
Reach Daniel Berti at email@example.com