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In anticipation of the next fiscal year, York County Administrator Neil Morgan rolled out his proposed budget Tuesday.
The $187.7 million budget consists of $135.4 million for county and York County School Division operations and comes without any tax increases for residents.
Morgan said a small amount of anticipated revenue growth and the county being in “a fairly good financial position based on a conservative past” allowed him to steer clear of any increases to taxes.
The county is anticipating about $2 million in revenue growth, primarily from real estate tax, which includes about $1 million from new developments and assessment growth.
“To the average person, it may sound like a lot, but based on a $135 million operating budget, it’s really not a lot,” Morgan said. “It’s about 1.5 percent of what we’re trying to do.”
About $600,000 in additional sales tax revenue is projected, but the county is expecting $300,000 less in commercial tax revenue as Dominion Power decommissions its two coal power plants next year, which will eventually account for nearly $2 million in successive years.
“Our single largest taxpayer will be no more,” Morgan said. “The fact that they’re going to close is pretty certain now.”
Morgan said he is using about $1 million of the anticipated revenue growth for salary increases for county employees, particularly those in the lower quarter of compensation, calling it his “first priority.”
As Baby Boomers – people born between roughly 1946 and 1964 – begin to retire in the coming years, the labor market is expected to become more and more compressed and competitive, Morgan said.
Morgan said he is also looking to restore a small number of positions that are “necessary to support county operations at a high level” in information technology, human resources and emergency communications among others.
The restored positions will be balanced in budget-wise by eliminating other positions.
The proposed budget also includes a $700,000 increase for debt service to help maximize the long-term capital improvement plan. The school division would receive $365,000 more than last year for a total transfer of $60.9 million. The schools are also projected to receive an estimated $2 million to $2.5 million in additional funds from the state.
Morgan said he is supporting using $900,000 from federal Impact Aid reserves to supplement the school division’s operations account as requested by the school division.
Morgan identified four unmet challenges from his budgeting process facing the county and Board of Supervisors in the future, including the continued growth of competition in the labor market, tax base reduction from the loss of the Dominion Power plants, sustaining the capital improvement plan and the anticipated need for additional personnel in public safety.
“I feel like part of my responsibility is to educate the citizens and the board on what I see on the horizon,” Morgan said.
County staff also proposed a new six-year capital improvement plan, which includes $11.2 million for schools and $8 million for the county on average, compared to a historical average of $6.7 million and $4.2 million, respectively.
While the county has made some strides in sustaining the capital improvement plan, Morgan said there is “a little bit of a hole” to dig out of from the Great Recession in the late 2000s with deferred projects.
The Board of Supervisors will discuss the budget March 22 during a work session, as well as April 5. A public hearing is scheduled for April 21, which will be followed by a vote to adopt the budget May 3.
The full text of the proposed budget and a video highlighting the budget are available on the county website.