County bracing for $176 million budget shortfall
By Jason Jacks
A growing school system and a still slumping housing market will continue to have dramatic effects on Loudoun's fiscal situation, as county officials are predicting a budget shortfall next year of $176 million. "I wish I had better news," said County Administrator Kirby Bowers, who gave the gloomy fiscal forecast to members of the Board of Supervisors Sept. 17. "But we are experiencing something that is no different than what other jurisdictions are experiencing." Earlier this summer, officials in Fairfax County announced they are predicting a shortfall next year of around $430 million.
Bowers, during his preliminary glimpse at next year's budget, blamed shrinking revenues and increased spending on fuel, health care coverage and public schools for Loudoun's budget gap.
He said home values, a big source of county tax revenues, are trending about 8 percent lower this year, while commercial property values are down 2 percent.
He also expects school spending to go up $55 million to mostly pay for 3,500 new students the school system says it will have in the 2009-2010 school year.
To make up the difference without cuts to county departments, Bowers said the board would have to set the real estate tax rate at $1.35. The current rate is $1.14.
However, some supervisors were already expressing opposition to a significant tax hike next year and warned that severe cuts in government may be on the horizon.
"Some services may have to disappear at least temporarily," said Supervisor Jim Burton (I-Blue Ridge). "It's going to be painful all around."
Supervisor Lori Waters (R-Broad Run), who is known for being fiscally conservative, expressed frustration in Loudoun relying too much on residential real estate taxes and said "diversification" was needed in its revenues.
Like Burton, she also warned that "massive reductions in [government] programs" lay ahead.
"It's absolutely needed," she said.
Bowers will officially present his proposed county budget for fiscal year 2010 to the board in February. After a public hearing and numerous budget workshops, the board will adopt a spending plan and set a tax rate by early April.
Contact the reporter at jjacks@timespapers.com