JCC Supervisors Approve 9 Percent Increase to Real Estate Tax Rate

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The James City County Board of Supervisors listens as a citizen discusses the county's budget proposal on Tuesday. The supervisors later voted 4-1 to approve the budget. (Gregory Connolly/WYDaily)
The James City County Board of Supervisors listens as a citizen discusses the county’s budget proposal Tuesday. The supervisors later voted 4-1 to approve the budget. (Gregory Connolly/WYDaily)

The James City County Board of Supervisors voted 4-1 Tuesday to raise the county’s real estate tax rate by 9 percent to generate more than $7 million in additional tax revenue to pay for several new projects and initiatives County Administrator Bryan Hill identified as critical.

With an $186.9 million budget adopted Tuesday night, the supervisors passed a slightly smaller budget than what Hill initially proposed in March. The original proposal sought to raise the real estate tax rate by 8.2 cents per $100 of assessed value for a tax rate of 85.2 cents per $100 of assessed value, good for an 11 percent increase.

The adopted tax rate sits at 84 cents per $100 of assessed value, which would add about $210 per year — instead of $240 under the original proposal — to the tax bill of the owner of a $300,000 home.

Conversations about the original 11 percent rate increase dominated board work sessions until a work session April 25, when Supervisor Jim Kennedy (Stonehouse) suggested Hill find a way to get the proposed tax rate increase under 10 percent.

On Monday, Hill came back with a new budget proposal that tweaked several items to get the increase down to 7 cents per $100 of assessed value, which was approved by the supervisors Tuesday. The budget covers the fiscal year that begins July 1 and runs through June 2016, with the higher tax rate set to take effect at the start of the fiscal year.

Sue Mellon, the county’s director of financial and management services, said the average homeowner will still be paying less when the new rate goes into effect on July 1 than he or she did in 2009. She attributed that to falling home assessments in the years since the recession began.

Supervisor Mary Jones (Berkeley) was the lone no vote, urging the supervisors to follow a budget plan created by the county last year that would have left the tax rate at its previous 77 cents per $100 of assessed value. She has opposed any tax increase since the first conversations about this year’s budget in February.

For the rest of the supervisors, the projects and initiatives identified by Hill — including stormwater projects, extra funding for school infrastructure, money to refill a dwindling debt reserve account and money to resume repairing county buildings — are necessary expenditures, prompting them to vote yes on the increase.

More information about Hill’s initial budget proposal is available here.

“We needed to raise taxes a year ago,” Kennedy said. “We needed some enhancements in revenue. I think if we stay the course with [the current rate], we’re just going to be putting ourselves deeper behind.”

Supervisor Kevin Onizuk (Jamestown) said the county cannot keep living off debt, referencing the money to refill the dwindling debt reserve account.

The adopted budget allocates an additional $1.5 million to start refilling that account, which is considered when the New York bond rating agencies go to evaluate the county. James City County currently has an AAA rating — the highest — from two of the three agencies, and any reduction of that could lead to higher interest rates when the county goes to borrow money for infrastructure projects.

Supervisor John McGlennon (Roberts) said the county continues to look for savings and it has cut spending and employees since the recession began. He said those cuts came at the expense of the county during tough financial times and this year’s budget and tax rate considerations are a question of whether the county wants to pay for what it needs.

The passage of the budget comes after several weeks of work sessions and community meetings to discuss the budget and the tax rate increase. A community meeting was held in each district over the past four weeks, attracting citizens ranging from those against any tax increase to those who wanted the supervisors to vote to fund the entire 11 percent Hill initially proposed.

A handful of people spoke in support Tuesday of an alternative budget proposed by Chris Henderson and Jay Everson, which presented what they identified as some cost savings to avoid a tax increase. A copy of the pair’s alternative budget proposal and Hill’s response to the cuts they recommend is available here.

The budget approved by the supervisors includes a $21 million allocation for a fourth middle school to be built at the James Blair Site. Hill said Thursday that figure remains a placeholder and it can change if the board asks him to alter the amount.

The schools will receive $82,417,697 for operations in the budget, a 2 percent increase over the current fiscal year. The budget passed by the school board requested about $610,000 more from the county.

Changes from Initial Budget Proposal

Hill came back Monday with a proposal to raise the rate to 84 cents per $100 of assessed value. He reached that figure by making some slight changes to his initial proposal, which include raising estimates of how much money the county will collect in taxes and fees, cutting an allocation for school buses for Williamsburg-James City County Schools and adjusting the funding source for a couple of initiatives.

The budget anticipates the county will collect $260,000 more in property taxes, $75,000 more in public service revenues and $250,000 in recordation taxes during the fiscal year. It also calls for the implementation of a $5 fee for traffic and criminal offenses that will be used to offset the cost of the electronic summons system.

The plan also calls for an increase in a variety of parks and recreation fees, which is estimated to generate an additional $100,000.

Hill’s revised plan seeks to cut a $1 million appropriation for 10 new school buses in half, instructing the schools to pick up the missing $500,000 with surplus money from the current fiscal year, which ends in June.

A $75,000 expenditure for increased mowing of road medians by the Virginia Department of Transportation would be paid for by a fund designated for promoting tourism, while studies into the county’s building and road needs would be paid for by using money from an estimated surplus of funds in the county budget for the current fiscal year.

Supervisors Add Fixed Charge for JCSA Water, Sewer Customers

The supervisors also voted to introduce a fixed quarterly service charge for water and sewer, which translates to an extra $7.22 for water and $5.66 for sewer for most residential customers.

A firm hired by JCSA to study its rate structure recommended the creation of such a charge, which adds fixed revenue to the utility’s coffers.

Previously, the utility was entirely dependent on usage to raise money.

To offset extra costs facing JCSA customers due to the fixed charge, the supervisors voted to lower the water rate for residential customers in the first tier of water usage.

That tier represents most of the customers who use the utility. Their rate will go from $2.85 per 1,000 gallons of water to $2.47. The sewer rate will decline by 29 cents to $2.93 per 1,000 gallons of wastewater.

The typical residential customer’s bill will raise by about 95 cents per month under the plan, which is set to go into effect on July 1.

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