The federal government should be so lucky. In Hillsboro, population 120, the Town Council has passed one of its largest annual budgets ever: a whopping $10,500. But town officials expect no trouble meeting the budget: the municipal bank account holds almost three times that amount.

"We've never had too many expenses," said Mayor Alexander F. Muir. The budget approved last week is $2,000 higher than last year's and includes funds to chlorinate the town's water supply, Muir said.

Hillsboro, about 10 miles north of Leesburg, has not been plagued by water shortages affecting some of its neighbors, but its gravity-flow system from a Short Hill Mountain spring has become tainted with coliform bacteria, according to state health officials.

The Town Council has asked a Fairfax City engineering firm to draft specifications for the system, which would cost roughly $4,000 and could be installed as early as next spring.

Hillsboro has no property tax and gets most of its income from sales taxes, local fees and federal revenue-sharing funds. Next year, Muir said, the town expects about $9,000 from those sources, which means the town may have to dip into its $30,000 reserve to complete the chlorination project.

Muir said the town will continue to subsidize water and trash removal costs for residents, however, many of whom are retired government workers.

"Trash removal costs $40 per family; we charge them $12 for it," Muir said. "And unlimited water costs $80. We charge $24 for that."