As Prince William School Superintendent Steven L. Walts pitches his proposed $755 million budget for next year, one item rankles teachers and some members of the Board of County Supervisors: a $37 million administrative building, scheduled to open in fall 2008.
If many have been hesitant to embrace the building, especially as the school system faces a $38 million budget shortfall, Walts and other school officials have been equally frustrated in explaining why they simply cannot scrap the building's plans and boost more popular initiatives such as teacher compensation.
The new Edward L. Kelly Leadership Center, a 146,000-square-foot building equipped with a fitness room, is being built as Prince William teachers, already the lowest-paid among major Northern Virginia districts, are slated to get one of their most meager raises in years.
A regional decline in housing values has triggered unexpected shortfalls in property tax revenue in Northern Virginia counties for next year. Assessments are lower, so localities face raising taxes or cutting services. The Prince William Board of County Supervisors, which sets the tax rate and determines how much revenue the school system gets, has so far decided to leave the tax rate unchanged, which translates into lower revenue. The supervisors' goal is to give the public a break after so many years of rising home assessments. All supervisors are up for reelection in November.
Many community members, including some supervisors, are asking: Why build the administrative center now?
School officials say that the project was approved well before they knew about the revenue shortfall and that the building was authorized before school officials were informed of the supervisors' tax plans. The supervisors' actions -- against the suggestion of Walts, who proposed a rate that would have kept taxpayers' bills the same as this year -- will give the school system $38 million less than they expected for next year.
The other problem confronting school officials, they said, is a lack of public awareness of how the budget works and how such a building gets financed. Many teachers and community members might think the center requires a one-time payment that will remove a large amount of money from next year's budget, said Megan Link, president of the Prince William Education Association, which represents several thousand teachers.
"Unfortunately, teachers see one big chunk of money and the parallels are going to be drawn, rightly or wrongly so," Link said.
But, like a house with a mortgage, the building is being financed with annual debt payments for about 20 years, school officials said.
"People think that we're missing $37 million out of next year's budget," Walts said. "I can see how they logically would [think that's true], especially if they didn't have other information. We've been trying to help explain it."
David Cline, the school system's finance director, said that one incremental payment is in the process of being made during this fiscal year and that next year's payment is $2.8 million, hardly enough to give teachers the raises they are accustomed to.
Typically, teachers get a 3 percent cost-of-living raise and a 3 percent step increase, so they can more easily cope with the region's rising expenses and be rewarded for their increasing experience. But this year, under Walts's proposal, teachers are slated to receive only a 3 percent step increase. On top of that, first-year teacher salaries are being frozen at $40,788, the lowest in comparison with Fairfax, Arlington and Loudoun counties.
Cline said that even a 1 percent raise would cost the school system $5.8 million, much more than the annual debt payments on the Kelly Center.
Beyond that, plans for the Kelly building can't be nixed just because the school system received sudden bad news, he said. A contract was awarded in November to a construction company. Sewer pipes are being laid, and the property has been purchased.
School officials said that canceling the plans would destroy the county's credibility with the building community and that the school system could be held liable.
Link said it is hard to quibble with the center. The administration's current facilities are dilapidated and scattered among former military barracks and trailers.
In addition, the building was likely to be constructed someday and it might as well be now, when costs will be comparatively low, she said.
"To delay the building is only going to make it cost more, the way construction costs are going these days," Link said.
The School Board is reviewing Walts's budget plan and will make its decision in March before sending the budget to supervisors.