Loudoun County Administrator Kirby M. Bowers has proposed a $732 million operating budget for the next fiscal year that raises the property tax rate by more than a nickel and increases school funding by 11 percent but falls $19.3 million short of what education officials requested.
The budget was presented to the Board of Supervisors Monday in a County Government Center packed with scores of school officials, county department heads and other budget-crunching observers.
It reflects spending guidelines provided by the supervisors last year. It holds the increase in local spending for schools to 1 percent per pupil and does not require a tax rate increase for additional general spending.
Bowers's proposal would increase the real estate property tax rate 5 1/2 cents to $1.105 per $100 of assessed value. Added to an 8 percent rise in residential property tax assessments, that would boost the average homeowner's tax bill 14 percent, or $390 a year.
The budget reflects economic and political realities in Loudoun, which has seen revenue growth slow as a result of the national and regional economic downturn and has entered an election season that some candidates hope will be dominated by issues of taxes and fiscal stewardship.
At the heart of the emerging budget debate and the supervisors' spending record for three years are sharply divergent views on costs and benefits of Loudoun's rapid population growth and on how to approach fiscal challenges in the country's second-fastest growing county.
Supervisors have argued that their efforts to slow home building are designed, in part, to rein in demand for public spending on new schools, teachers and other government facilities and workers. Opponents contend that wasteful spending and slow-growth efforts are largely to blame for the county's economic slowdown and increasing property taxes.
In a nod to that debate, Bowers's proposed $1.105 tax rate is a half-cent below the tax rate in effect when the current supervisors took office in January 2000. However, his budget proposal for fiscal 2004, which begins July 1, envisions increasing spending by 9 percent over the current fiscal year.
His proposed operating budget represents a 93 percent increase since the 2000 budget, which was in place when the current board came to office.
Bowers also announced that he would advertise a property tax rate of $1.16, a formality that would give county supervisors the option to raise the rate higher than the 5 1/2-cent proposal. The $1.16 rate would fund the school board's full request.
Schools Superintendent Edgar B. Hatrick III said Bowers's proposal for a $474.6 million school operating budget is simply the opening step in a complex dance involving school officials, citizens and local and state lawmakers. Hatrick said residents are willing to increase the tax rate to support schools, which will add about 2,900 students this year to the current enrollment of about 37,500.
"They are willing to pay for excellence," Hatrick said. "They understand it doesn't come on the cheap."
Bowers said his budget would leave many county needs unmet, including group homes for the mentally ill and substance abuse programs for the elderly and homeless.
Bowers also outlined a six-year, $975 million capital improvement plan, more than half of which would go toward school construction.
The $732 million operating budget includes the schools' operating budget, debt service payments and a separate cafeteria fund, as well as the general government operating budget, debt service payments and assorted funds. Bowers's full 2004 fiscal plan totals $802 million and includes spending on capital projects and asset replacement, among other items.
Supervisors plan a public hearing on the budget Feb. 20 and expect to finish budget deliberations by the end of March.