Casey submits budget, holds line on tax rate
County Administrator Joe Casey said last week that he and his staff are working to position Chesterfield for a one-cent reduction in the property tax rate “at some point in the near future.”
“We are not there yet,” he added.
As Casey prepared to present the county’s proposed fiscal year 2018 budget to the Board of Supervisors on March 15, he and Budget Director Matt Harris outlined several of the document’s “big, thematic elements” last week during a briefing for local media outlets.
The $741.1 million proposal represents an increase of 3.7 percent from the current fiscal year, which ends June 30, and includes funding for public safety recruitment and retention initiatives, continued class size reductions in local schools and increased focus on the county’s transportation needs.
It was developed with the assumption that the county’s property tax rate would be set at 96 cents per $100 of assessed value for the fourth consecutive fiscal year.
Chesterfield’s property tax rate hasn’t changed since the Board of Supervisors voted to increase it from 95 to 96 cents in 2014.
Because the county’s average residential property assessment has risen in each of the past four years without a corresponding reduction in the tax rate, some citizens argue the Board of Supervisors has effectively raised taxes for many of its constituents.
As required by the Code of Virginia, the county has acknowledged it could maintain a “revenue neutral” position in fiscal year 2018 with a 94-cent property tax rate.
“I want to thank the community for letting us raise the tax rate [in 2014] so we had a continuum of service. I think that’s been on the minds of many people since then,” Casey said.
“If we can position the local economy and our budgets going forward, I would want to propose a budget at some point in the near future by which we return to the pre-recession tax rate. That would mean lowering it by one penny.”
Casey said last September that he considers the 96 cent tax rate Chesterfield’s “ceiling.”
Among metro Richmond’s four major localities, the county’s property tax rate is second only to the city of Richmond’s $1.20 per $100 of assessed value. Citizens in Henrico and Hanover counties pay 87 and 81 cents, respectively.
The Board of Supervisors appears committed to reducing the rate gradually over time to make the county more competitive with its regional peers.
According to sources with knowledge of the board’s discussions, who spoke to the Observer on condition of anonymity, there is support within the board for keeping the property tax rate at 96 cents when fiscal year 2018 starts July 1, then cutting it to 95 cents on Jan. 1, 2018.
Such a move, sources said, would still provide funding for the county government’s and school system’s top priorities, while allowing both staffs to begin preparing for the fiscal year 2019 budget season based on a 95-cent tax rate. The Board of Supervisors voted last month to advertise the rate at 96 cents. Under Virginia law, that gives supervisors the flexibility to reduce the rate, but not to increase it, when they approve the county budget in April.
Dorothy Jaeckle, the board’s chairwoman, confirmed via email last month that a tax cut is “on the table.”
“There is a belief within our board that the growth of local government should not be tied to the increasing assessments of existing real estate,” she wrote.
Asked last week about a possible tax rate cut, Casey said the county and school system are working to identify more than $3 million in future expenditure reductions in the Board of Supervisors’ and School Board’s joint five-year spending plan. That would create the capacity to reduce the rate by a penny.
“We’re applying our talents the best we can to structurally design the five-year plan to position us [to cut the tax rate] if, in fact, our assumptions and predictions come true,” he added. “For me to predict what the economy will be or something that’s going to happen in 2018 or 2019 is not appropriate at this moment.”
Following this week’s budget work session, members of the Board of Supervisors and School Board will host joint community meetings across the county from March 16 through March 27.
The Board of Supervisors will hold a public hearing on the fiscal year 2018 budget and property tax rate March 29 at 6 p.m.
The board is expected to adopt the budget April 26. ¦