Budget cuts to impact schools

The tone was cordial, but the news was gloom and doom, and Prince William supervisors and School Board members agreed wholeheartedly on one core theme: Impending budget cuts aimed at offsetting a $190 million shortfall are going to hurt.

"I share the sentiment these are hard times," said Milt Johns, chairman of the county School Board, at the opening of Wednesday evening's joint session with supervisors to lay the groundwork for fiscal year 2010 budget planning.

While the county expects next year's budget to lead to a scramble for $82 million, the school's projected shortfall is even greater, at $108 million. How to make up the difference has been the topic of county government discussions for some time. To assist school officials with their fiscal planning, supervisors agreed to announce the real estate tax rate about a month early.

"On Tuesday," said Board of Supervisors Chairman Corey Stewart, R-at-large, "we're going to go with option two [on the tax rate scenario], and we're going to make that a formal decision. Hopefully, that will help you prepare."

Option Two is a rate of $1.13, up from 97 cents, that will reportedly leave the average homeowner with an 18.3 percent decrease in the annual tax bill. The minimum that residents' tax bills are expected to drop is 6.6 percent, according to figures presented by Craig Gerhart, county executive.

While the tax rate goes up, the tax bills go down thanks to plummeting home values. Commercial real estate bills, meanwhile, will on average rise by five percent.

Those numbers only hold true if county projections are accurate—that home values for the year really do drop by 30 percent.

"It is only November," said Gerhart, "and the most important quarter for setting the assessments is the fourth quarter. So we have to caveat everything … and [these percentages] are not necessarily correct."

If values were to instead drop by 35 percent, then the shortfall for the county government and schools grows. The difference is substantial: Each percentage point increase translates into an extra $4.4 million added to the shortfall, Gerhart said.

In response to this budget reality—the scenario also includes revenue cuts from the state, the amounts of which won't be known until December—county officials are looking at across-the-board cuts in various percentages in each department; at employee benefit packages for opportunities to trim; and at Capital Improvement Plan projects.

"It cuts CIP to projects that are already funded," Supervisor John Jenkins, D-Neabsco said. "There's no new growth at all."

School officials weren't happy.

"We continue to grow," said Superintendent Steven L. Walts, citing that 1,000 new students had entered the system this year and another 1,000 or so were expected for the next. "[Stopping construction is] going to be a little bit difficult for us, especially when you think about the needs we have for an eleventh high school. So we just hope you can keep those things in mind as we move forward."

School Board vice chair Grant Lattin, Occoquan District, suggested supervisors might consider a higher tax rate that would allow for some construction projects to go forth.

"There's no question putting a lid on the CIP puts a lid on the eleventh high school," Lattin said. "Sure [taxpayers] are going to love an 18.3 [percent] reduction in their tax. I'm just not sure they're going to love an 18.3 [percent] reduction in their schools … If you raise the commercial by 1 percent [from 5 percent to 6 percent under the $1.13 rate], what effect is on the residential?"

Jenkins, meanwhile, said the means of finding more money rested with the ability of local officials to successfully lobby state delegates.

"Until the House softens up on the revenue stream," he said, "we're going to continue to have these problems."

In terms of dollar amounts, the $1.13 tax rate that will be used as a starting point for fiscal year 2010 budget discussions translates into $713 million in revenues. Last year's revenues, by comparison, stood at $764 million, according to numbers from Gerhart.

Staff writer Cheryl Chumley can be reached at 703-670-1907.