Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, March 31, 1994 TAG: 9403310289
SECTION: CURRENT PAGE: NRV1 EDITION: NEW RIVER VALLEY
SOURCE: BRIAN KELLEY STAFF WRITER
DATELINE: CHRISTIANSBURG LENGTH: Medium
At Tuesday's board meeting, not only did the numbers drop, Linkous got few takers.
That's because the figures represented Montgomery's first major tax increase in three years.
The board advertised an 8-cent jump in the real estate tax rate and a 25-cent boost to the personal property rate to balance the $71.6 million spending plan for the fiscal year that begins July 1.
At Tuesday's three-hour budget work session - the eighth in seven weeks - only three of the board's seven members could agree on even a 4-cent boost. And one of those three "yes" votes was conditional on eliminating the personal property tax increase.
The Board of Supervisors must adopt the budget and set the new tax rate next week to avoid a delay in billing for the June 5 tax payment deadline. With the budget still out of balance and no apparent majority for a major tax increase, board members are mulling over three major cuts, all potentially controversial.
They include:
Making up for this year's school budget shortfall by using $300,000 left over from last fall's bond sale for the new Blacksburg-area elementary school. The $300,000 would pay off some of the principal on the bonds. By paying off that principal, over time the county will save almost $800,000 in interest. That's the same amount Montgomery will pay to make up for a shortfall in this year's school budget caused by a disputed budgeting error. School officials had hoped to use the $300,000 for improving other school buildings.
This option will only work if the new school comes in under budget. Linkous said school Superintendent Herman Bartlett promised publicly last fall that the school would cost $5.7 million instead of the budgeted $6 million. Bartlett disputes that. County staff were checking tape recordings of earlier meetings on Wednesday to find the disputed remarks.
Delaying the bond sale for the Blacksburg library and Christiansburg health and human services building projects. Though overwhelmingly endorsed by voters last fall, a delay until October could save $389,000. The risk for the board is being penny-wise and pound foolish for two reasons: if interest rates soar, the long-term cost would be greater; if construction costs climb above the estimate because of changes in the market, the county would have to cover the difference. Moreover, the county will have to dip into cash reserves to pay for architectural work on the projects until the bond sale. This could hurt the reserves.
Hold all salary increases for school and other county employees to 2.5 percent. The School Board wanted to give its employees 3 percent raises. The county planned 4.5 percent increases, to be paid for by savings found by its employees. County officials say their employees start from a lower base, in general, than do teachers.
The supervisors also are considering two new user fees that will make slight revenue contributions: a new tax on cellular phone customers that could raise an estimated $5,600; and raising the application fee for land-use taxation from $5 to $50, thus generating $1,500.
They talked over shelving the county's capital improvements plan for a third straight year, but decided against it. Instead, improvements to the courthouse's heating and ventilation system will be paid for from leftover economic development money being held in reserve, and the cost of a recreation building project will be split over two years. Those savings amount to $129,000. The remaining capital improvements budget is about $450,000 for expenditures such as a new pumper for the Blacksburg Volunteer Fire Department.
The Board of Supervisors will resume work on the budget, and possibly set the new tax rates, at 7 p.m. Tuesday on the third floor of the Montgomery County Courthouse.
\ chart - Montgomery County's 1994-95 Budget Crunch.
Memo: ***CORRECTION***