Supervisors, school board talk tax hike, cuts to services, or both

By Susan Gibbs

Greene County supervisors and school board members hold a joint public hearing Tuesday, January 16

Both the Greene County Board of Supervisors and the Greene County School Board painted a grim picture for the coming fiscal year at a joint public hearing held at the William Monroe High School Performing Arts Center Tuesday, January 16.

“Real estate assessments are down, which means that the amount of dollars we collect at the same tax rate will bring in fewer dollars,” said Chairman of the Greene County Board of Supervisors Jim Frydl when he opened the hearing.

“In addition, we have additional requirements from the state that add new costs; we have required debt payments for water and sewer infrastructure, and we’re still facing the ongoing impact of additional  state costs that we absorbed last year,” Frydl continued. “That’s what we’re facing. The only options that are available are to cut programs, services or people, or to increase the tax rates or use some kind of combination of all.”

Major county expenses include an approximate $30 million debt on the water treatment facility in Ruckersville. When the facility was approved the real estate market was booming, and the plan was to pay the debt with the $20,000 in hookup fees for each new residential dwelling and the approximate $200,000 hookup fee that each new commercial establishment – such as an Olive Garden or a Starbucks — would bring to the county.

But then the recession hit, housing starts slowed, and while commercial development has by no means come to a standstill, it has not been what was hoped prior to the recession.

“We now have to draw down from the general fund to pay the debt service,” Supervisor Buggs Peyton said late last year.

In order to attract that commercial development, supervisors committed early this year to a water impoundment facility that could cost about $40 million.

While there are certainly other agencies that require funding out of the county’s budget – which was $51.3 million for Fiscal Year 2012-2013 – the public school system, as the county’s largest employer, is the agency that by far requires the largest investment of local funds, at 60 percent.

At last year’s public hearing regarding the county budget all supervisors but Peyton voted to grant the school board’s request for an additional $2.1 million in local funding.

That additional amount included what was specified as a one-time pull from the county’s reported $16 million reserve fund.

At the time, according to county officials, the reserve fund consisted of two certificates of deposit totaling $2 million plus interest, the net worth of county-owned buildings, rolling fleets and any investments, accounts payable in the amount of approximately $4.5 million on average each month, and accounts receivable – which included $9.6 million in past due local taxes as of June 30, 2011.

In addition, Supervisor David Cox pointed out last year, “We are getting ready to make the first payment on the $5.3 million (renovations) to the athletic and performing arts facilities.”

The school board’s request had resulted from an expected health insurance increase of at least 10 percent; $500,000 for additional personnel; and new legislation that required county and school officials to contribute 5 percent of their pay to the Virginia Retirement System. The employee contribution to the VRS was to be covered by a corresponding 5 percent increase in pay by their employers.

At the public hearing last year Frydl pointed out that the school board’s request for an additional $2.1 million in local funding already included cuts that panel had made to positions and programs.

However, he told school supporters that the additional funding was “one-time money, and when you use one-time money, it’s gone. (But) this gives us a year to look at everything … to (maintain) the reputation of Greene County … without causing great harm and great suffering. We are all going to get together and work as hard as we can.

“No county – especially a small county – can survive under a continuous onslaught (of funding cuts),” Frydl concluded.

But the onslaughts continue.

At the joint public hearing January 16 School Board Chairwoman Michelle Flynn requested level funding from the county for the school’s $32.5 million budget, saying that even with that, the schools would fall $675,000 short, and cuts will have to be made.

She called attention to sequestration – automatic across-the-board cuts triggered by failure of the “super committee” – a 12-member Joint Select Committee on Deficit Reduction charged with reducing the deficit by $1.2-$1.5 trillion over 10 years — established under the Budget Control Act produced by the debt ceiling debate in the summer of 2011.

The super committee announced its inability to reach an agreement in November of that year, and sequestration was triggered – generating automatic cuts for each of nine years, FY 13-21, totaling $1.2 trillion.

Education funding is now subject to cuts – which apply to discretionary spending — ranging from 9.1 percent this year to 5.5 percent in 2021, according to the Center on Budget & Policy Priorities.

One of the programs that will be significantly impacted is the Individuals with Disabilities Education Act (IDEA), which accounts for 28 percent of the total reduction to education programs, and which will revert to its 2005 funding level, spelling a $1.1 billion reduction.

Even so, according to reports, federal funds for IDEA have never come close to the amount authorized, and this sharp decline will force school districts to either reduce services beyond what is mandated to students with disabilities or supplement the shortfall with local funds.

“For us, (sequestration) would mean about $125,000 less in federal revenue,” Flynn said January 16. “Even if sequestration does not occur, we are still likely to have federal budget cuts.”

She reminded those present that there are a significant number of unfunded mandates from the federal government, and that “there are a lot of things that we are required to do that are either underfunded or unfunded.”

In addition, Flynn continued, the school board expects reductions in state funding that include $400,000 due to a slower growth rate than projected, and holdbacks of about $232,000.

Flynn went on to cite insurance increases, fuel costs, and the 2 percent raise Virginia Governor Robert F. McDonnell has said teachers would receive in the coming fiscal year.

The raise, Flynn said, is a “match situation. Standards of Quality positions will be granted a 1 percent raise if the county matches that. But it does not include support staff, such as custodians, drivers, and all those folks we count on to make the schools run.

“We would prefer,” Flynn continued, “if we are going to give that raise, to give it across the board.”

The requested across-the-board raise is part of the $675,000 budget shortfall that Flynn says the school board is facing, even with level funding from the county.

Last year the schools gave an across-the-board 1 percent raise to offset an increased VRS employee contribution. County employees received the same, plus an additional 4 percent raise.

Four county residents spoke directly to the school situation at the public hearing January 16, while two spoke to the county’s budget as a whole. Four spoke about the needs of Jefferson Area Board for Aging, one about the needs of the Greene County Library, and one about the needs of the Shelter or Help in an Emergency.

Visit http://greenecounty.va.schoolwebpages.com/education/components/whatsnew/default.php?sectiondetailid=12953&viewType=detail&id=1513 to take a survey on what programs should be cut from the school district.

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