FY 2023 Budget
County leadership had 10 primary priorities for this budget:
General Fund Expenditures
Approximately 59% of the County's General Fund is allocated for two categories: justice and public safety (31%) and education (28%). The remaining categories are general government (14%), debt service (13%), human and health services (11%), and non-departmental (3%). With increases in education and public safety funding, this breakdown is mostly similar to the FY 2022 budget.
Under the proposed budget, Pittsylvania County's local contribution to Pittsylvania County Schools will be just under $21.1 million. That is a 6.9% increase from FY 2022.
The General Fund includes $9.8 million in obligated debt payments, which are primarily for the Middle and High School bonds from the mid-2000s. (Any financing payments related to solid waste, which are covered with revenue from contracts, would be included under the Solid Waste Enterprise fund.)
This budget also includes the allocation of a significant amount of federal funding from the American Rescue Plan Act (ARPA), from which Pittsylvania County received approximately $11.7 million. Some of the funds have been expended in FY 2022. Approximately $6.5 has been allocated for broadband internet expansion while another $1.83 million has been set aside for water system improvements and extensions.
Pittsylvania County is experiencing the impacts of inflation, as operational expenses are increasing significantly. The budget reflects a 20% increase in electricity rates, 27% jump in gas prices, and a 13.4% Rate Increase for the Virginia Retirement System (VRS).
This budget also proposes a 3.6% increase in wages for all County employees, a move that avoids salary compression issues when the new, $12/hour minimum wage goes into effect in January. In addition, the Board voted in December to provide a 10% increase to Sheriff’s deputies to compete with surrounding law enforcement agencies to recruit and retain qualified individuals for this vital public safety service.
Other Funds: Solid Waste and Capital
The County's Solid Waste/Landfill Fund includes a budget of $6.2 million. While the solid waste fee pays for the majority of the operating budget, revenue from outside contracts that total more than $1.785 million annually are paying the financing for the development of three new convenience centers and the recent development of a new cell at the landfill. With a contribution of $668,837, the Public Works Department will also have a landfill reserve fund for the first time in many years.
While there are a variety of upcoming capital projects, this budget only funds the most pressing, immediate needs. This includes $300,000 for the purchase of a new fire truck and brush truck for two volunteer agencies, $105,000 for a Public Safety ambulance, and $35,000 for upgrades to the County's server networks.
The County also allocated approximately $52,000 for a Community-Based Corrections Plan, a study that the Virginia Department of Corrections requires before providing 25% of construction funding for a new jail. Since the current jail is failing mechanically and vastly overcrowded, the County is taking steps to have a new jail operational by 2026.
General Fund Revenues
In terms of Revenues for the General Fund, approximately 39% of the County's revenue comes from real estate tax, 29% comes from State funds, another 16% comes from personal property taxes, and 13% comes from other local taxes and fees. The remaining 4% of the County's General Fund revenues come from Merchant's Capital/Machinery and Tools (3%) and Federal Funds (1%).
The Pittsylvania County Board of Supervisors voted during March's meeting to invalidate the results of the 2022 reassessment, which means that the values being utilized for real estate taxes are from the 2018 reassessment. Aside from an additional $769,339 in new revenue from new construction, real estate tax revenues will remain mostly flat due to the use of the values and tax rates from FY 22.
For personal property, this budget would provide more tax relief than any budget before it. As a result of trends playing out across the Country, the assessed value of all personal property in Pittsylvania County increased by 28% between FY 22 and 23. Pittsylvania County kept the tax rate the same, but is proposing more tax relief than the State recommendation. Pittsylvania County will provide approximately $6.7 million in personal property tax relief, which is $2.5 million more than the State recommendation.
The proposed FY 2023 budget does realize revenue growth of $4,805,557 due largely to inflation. Some of the major increases due to inflation occurred in Local Sales Tax ($684,678), Meals Tax (695,351) and Personal Property ($1,951,166). Even though Pittsylvania County had significant increases to these categories of revenue, it was also necessary to utilize $813,532 of ARPA funding to cover the shortfall. The use of these funds has allowed us to avoid using the County’s General Fund Balance for any portion of this budget.
As of June 30, 2021, the County's Unassigned Fund Balance stood at a healthy $28,642,621. Unassigned fund balance is a good indicator of overall health for a local government, and a government the size of Pittsylvania County should have a balance of approximately 20% of annual operating costs. The current unassigned balance is more than double that minimum recommendation.
The proposed budget also provides a $982,309 contingency budget for unknown expenses and grant matches. Potential use of this contingency budget could include an increase to fire and rescue volunteer contributions and EMS per call supplements, a position in the Circuit Court Clerk’s Office, potential reassessment costs and voting equipment.