THE TOWN of Hillsboro, Va., (population: 135) has prepared its budget for FY 1981 and a copy is posted on the bulletin board outside the post office. It should have been done a couple of months ago, buy those responsible did not get around to it. It does not much matter, for Hillsboro, unlike most other towns and all American cities, has no financial problems.

In fact, last year the twon took in more than 21/2 times as much money as it spent. Within living memory, the town has never exceeded its budget.

Hillsboro does not regard its excess money as "budget surplus"; it is the town's savings. Thanks to wise investments by the town council, more than two-thirds of the town's total expenses could have been paid from interest on its invested funds. The town is not only solvent, it is accumulating money steadily.

Hillsboro has no real eestate tax. Local automobile license tags cost $15, a sum that would go to the county if the town did not levy the tax, for in Virginia everyone must pay a local vehicle tax. People pay $2 per month for all the pure spring water they want and $1 for a weekly trash collection. Until six months ago, trash was collected only twice a month, but the town increased the service without raising the rate -- perhaps the only municipality in the country to do so.

Hillsboro's budget would not be so healthy if its elected officials had obeyed all the orders it received from bureaucrats. The town's expenses would have doubled, for example, had they obeyed all the silly edicts of Virginia's Health Department which had nothing to do with health.

Hillsboro's spring has always provided the town with enough water, buy "enough" is not statistic that a bureaucrat can deal with, so the town was ordered to install a meter to measure the flow of water. The town refused.

The Health Department demanded that the town publish newspaper advertisements, often with incomprehensible copy provided by a functionally illiterate bureaucrat, telling our 26 water customers whenever something went awry with our water system. Since the government communicates with its citizens by way of the bulletin board at the post office, there seemed no reason to buy advertisements. None was purchased.

Perhaps another reason for the town's prosperiity is that it does not take the federal dollar; it does not participate in the various programs contrived by the higher levels of government, for it believes that these schemes invariably involve local expenditures and smother local government in red tape. The only federal monies the town council deigns to accept are federal revenue-sharing funds. Last year, at the request of the county, the town accepted some money for litter control, buy a good part of this was returned unspent.

The town's biggest expenditures, as budgeted for the coming year, are for trash collection, street lights, the water system and donations. Hillsboro does not have its own fire department or rescue squad, buy it is grateful for the services provided by volunteers in neighboring communities and contributes to their organizations.

There is a commendable reluctance on the part of eleacted officials to spend money that has not been budgeted. Recently, when it was discovered that the town was almost out of stationery, the mayor ordered a new supply buy asked the council for its approval of this unexpected expenditure.

It is this feeling which prompts the town's elected officials to insert in the budget a $5,000 item for major improvements to the water system. The money was also budgeted for last year, but was not spent. No plans are made for these improvements in the future and no one really knows how the money could be spent. Still, if the money is needed, it is in the budget.

Salaries constitute a minor budget item. The town's treasurer and water commissioner serve without pay. We have no need for a policeman. The town recorder (clerk) and the council members each receive $25 per year and the mayor $50 per year. This is up from $12 and $18 two years ago. At the time there was some criticism of this enormous increase, a feeling that the money could be spent on better things.

However, the town has money for better things and it buys them. There is, for example, the line item in the budget for "florists." Hillsboro cares about each of its citizens. Whenever one goes to the hospital or dies, flowers are sent from "The mayor, council and citizens of Hillsboro."

It is nice to live in a town that buys flowers and defies bureaucrats.