Supervisors Decide to Keep Budget Options Open

Bid to Lock In Tax Rate Was Effort to Ward Off a Later Increase

The Loudoun County Board of Supervisors chose last week not to lock in an unchanged tax rate for 2007, despite an effort by three board members who had hoped to do just that before budget deliberations begin.

Supervisors voted 6 to 3 on Tuesday to authorize County Administrator Kirby M. Bowers to present several spending options in his 2007-08 spending plan, which he will release early next year. Those in the majority said they were unwilling to commit to keeping the tax rate at 89 cents per $100 of assessed value in a year when assessments are expected to dip while pressure to spend more on schools and other county services will be as great as ever.

"A desired tax rate is certainly a valid input in the process, and I think the board has indicated to the county administrator that they're looking at something around 89 cents," said Supervisor James G. Burton (I-Blue Ridge). "Once we look at the needs, I think we will wind up somewhere higher than that. I think it would be a mistake to cut off the option to go up or down."

At issue is a somewhat technical consideration: what tax rate to advertise in the legal notices the county is required to publish in advance of the budget process. Historically, Bowers has advertised a tax rate somewhat higher than the one settled on by supervisors. The practice not only allows supervisors to take credit for trimming Bowers's budget proposal but also safeguards against the need for a new public notice, which would be required if supervisors opted for a higher tax rate than the one originally advertised.

Supervisors Mick Staton Jr. (R-Sugarland Run), Lori L. Waters (R-Broad Run) and Eugene A. Delgaudio (R-Sterling) wanted to order Bowers to publish an 89-cent tax rate in the legal notice. The idea was to make it more difficult politically for the board to raise taxes later in the process.

Of particular concern to the three Republicans was the size of the spending proposal issued late last month by Schools Superintendent Edgar B. Hatrick III, who is seeking nearly $100 million in additional local tax funding to cover new operating expenses, as well as $27 million in local tax money to cover capital projects beyond those already scheduled.

Waters said she was uncomfortable advertising a tax rate that fully funds the schools proposal because it provides the public no incentive to participate in the difficult choices supervisors must make.

"I only hear good things about the school system," she said. "Parents love their teachers. They love their local schools. And we're going to continue to have a Class A system. But we can't afford to budget the superintendent's budget."

Bowers said he was likely to present a range of scenarios taking the tax rate as high as 96.5 cents, a rate that would increase the average tax bill by about 5 percent. Even that tax rate would yield only $115 million in additional tax revenue and would require cuts of more than $40 million to the school proposal, Bowers said.

Bowers noted that all estimates were preliminary and could change as revenue predictions for the coming year grow more certain.

In any event, budget season will look starkly different than it did this year, when average assessment increases of 28 percent allowed supervisors to approve a budget of $1.1 billion, 11 percent higher than the previous year. Even with that increase, the tax rate declined by 15 cents -- although the average tax bill climbed by about 10 percent because of rising home values.

Bowers told board members last week that keeping the rate at 89 cents would reduce the average tax bill by 3 percent; that setting it at 92 cents would keep most tax bills even; and that raising it to 96.5 cents would increase the average bill by 5 percent.

Several supervisors who voted against advertising the rate at 89 cents were nonetheless eager to trim the school proposal.

"It's one thing to run a first-class ship," said Vice Chairman Bruce E. Tulloch (R-Potomac), who was especially perplexed by Hatrick's request of $271 million for new capital projects at a time when home-building is slowing. "It's another thing to turn that ship into a mega-yacht."