Raise taxes, or ‘scramble’ for funds?: Rappahannock supervisors weigh options

One thing was clear last Monday night when the Rappahannock County Board of Supervisors convened to hear residents’ thoughts on the proposed budget: the supervisors are reluctant to raise property taxes, leaving them to “scramble” for other funding sources to meet the county’s stated needs.

The likely alternative is what Hampton Supervisor Keir Whitson termed “a mad scramble” for funds, where the county finds a mix of revenue increases and spending cuts to fill the budget gap that surfaced when, for the second year running, the state of Virginia dropped about $1 million in support that the schools had expected. 

As they edge toward adopting a budget, county supervisors are managing two juggling acts:

The advertised budget of $30.1 million must balance financially, with a dollar of revenue for every dollar spent. 

In the county administrator’s advertised budget, there would be a shortfall of $691,845, requiring a slew of adjustments, including an increase in property taxes to 56 cents for every $100 of assessed value, up from 55 cents today. 

The second balancing process is the required sifting of competing demands across all county functions. 

Citizens at the meeting expressed appreciation for the office of the county administrator, which prepared the initial budget proposal, and fielded multiple questions on various provisions, placing the explanations on the county website. And most who spoke, underscored their support for the schools.

“Our county is aging at a rapid rate,” Fran Krebser of Flint Hill said. “We should be trying to attract and retain younger households.” But she also expressed the worry that the added tax revenue would support the relatively high administrative functions at the schools, rather than teachers and counselors. “Without a guarantee that administration won’t swallow up too much, I would suggest no increase in the tax rate for our citizens.” 

Tommy Atkins, a Planning Commission member representing the Jackson District, called attention to elderly residents living off their Social Security checks. “I truly believe our children, our grandchildren and our great grandchildren are a special group,” he said. “But we have another special group in this county. It’s our aged and elderly.” 

Whitson and Piedmont Supervisor Christine Smith earlier this month voted against advertising the proposed tax hike, arguing that other budgeting tactics should be used instead. At Monday’s discussion, Smith asserted that stubborn inflation pressures in the economy will delay the Federal Reserve Board’s interest-rate reductions, meaning that the county will be able to bring in more interest revenue. She also suggested tapping interest income from funds earmarked for the multi-county broadband project – a proposition other supervisors viewed as a non-starter.

Stonewall-Hawthorne Supervisor Van Carney, who voted for including the property tax increase for the budget plan for fiscal year 2025, explained, “I have been a strong supporter of the schools,” while pointing out that tax rates were cut in past years. 

Meanwhile board chair Debbie Donehey, Wakefield District, signaled her reluctance to adopt a tax increase — which she voted for in the advertised budget — if other budget tactics might close the gap. 

“I know that having a conversation about taxes is awful and everyone here stresses about it,” she said. 

Similarly, Jackson Supervisor Donna Comer, the board’s newest supervisor, expressed her aversion to new taxes, although she voted to include the proposed increase in the advertised budget. “None of us came to the table this year, and said, ‘We’re going to raise taxes.’” 

Under all scenarios currently under consideration, the schools would bring in an increased budget contribution from the county, as they did the last two years. The budget now on the table calls for $9.9 million to go to the schools, up from $9.4 million in the current fiscal year, and $8.9 million a year earlier. However the tax hike is needed to support the $9.9 million plan. The supervisors are expected to consider a $9.7 million transfer to the schools; this more modest increase wouldn’t come with a jump in property taxes. 

RCPS Superintendent Shannon Grimsley noted that “it’s a very challenging budget situation in which we find ourselves. It really is a very complex, sausage-making business we’re in.” She added that when tight budgets force staff to take on multiple jobs, “it takes its toll on retention,” with teachers and teaching assistants seeking less stressed, and often higher-paying positions elsewhere.  

Whitson stands on the other side of the balancing act. “The tension between us and the schools is productive and necessary,” he said. “I think we’re close and I hope we can meet halfway and keep the pressure off our taxpayers.” 

Whitson is willing to go along with a change in tax rates in personal property taxes, but he insisted that this should be calibrated to keep tax payment level with those paid this year. 

Enter General Assembly 

The unseen actor in Rappahannock’s budget drama is the Virginia General Assembly, whose fluctuating support for upping Rappahannock’s share of state educational infusions has contributed to the turmoil in the county. 

Said Donehey: “We write Richmond and we lobby Richmond, and we basically got looked down on because we’re agriculture and tourism and we haven’t raised our taxes.”

During the public discussion, Stephanie Ridder, member of the Board of Zoning Appeals and the Planning Commission, argued that some legislators consider that Rappahannock undertaxes its wealthy residents and then looks to the state to keep the schools funded.

“Their income figures are skewed by some very wealthy individuals,” she said, adding that lawmakers in the General Assembly have little appreciation of Rappahannock’s system of land-use tax breaks, which are central to preserving an open, agricultural landscape.

She said she “strongly” supported the proposed tax hike, terming it “a minimal increase” that would help “provide quality education to all its children.”

Courthouse project looms

Both Whitson and Carney urged their fellow supervisors to keep in mind the looming courthouse renovation. The county will work down its outstanding debt service obligations in the next fiscal year, but will be issuing bonds to finance a costly courthouse renovation along with other changes in Washington’s historic judicial complex. The debt service associated with the bonds will almost certainly require additional tax revenue from Rappahannock residents. 

Whitson warned of a “very, very large amount of money in debt service for the courthouse. We’re not going to pay for it in cash, and I would like to show restraint in the lead-up to that point in time.”