County mulls once 'unthinkable' cuts

The ailing economy has Albemarle County officials contemplating once “unthinkable” financial adjustments that could include a real-estate tax rate increase, employee reductions and delays or reductions in infrastructure projects.

County spokeswoman Lee Catlin said the very fact that officials are considering such moves shows they are “having to make very difficult, tough decisions.”

“There was a time when some of those things … were unthinkable,” Catlin said after a Board of Supervisors’ strategic planning retreat Friday.

In the past couple of years, sales tax revenue has plummeted, residential assessment values have declined and the county has gotten less money from the state government. The revenue declines mean the county could face a $2.4 million shortfall in fiscal 2011 if more budget cuts aren’t made and the real-estate tax rate remains unchanged, according to county officials.

The shortfall could climb to $5.8 million in fiscal 2015, officials project.

To overcome financial woes, county officials have suggested supervisors consider, among numerous options, raising the real-estate tax rate to 77 cents per $100 of assessed value for the next five years, up from the current 74.2-cent rate. At the 77-cent rate, the average homeowner would pay about the same amount of real-estate taxes for the next two years as this year, officials project, because real-estate assessments are down.

During the third through fifth years, the average resident likely would face rising tax bills at the 77-cent rate, as the housing market starts a slow recovery, local officials project.

Though supervisors are several months from having to decide which services to cut next fiscal year or to determine next year’s real-estate tax rate, the retreat may have provided a glance at supervisors’ strategies for creating budgets in coming years.

Supervisor Lindsay G. Dorrier Jr., a Democrat, and Republican Supervisor Kenneth C. Boyd, for example, insisted that residents couldn’t afford a tax-rate increase during the next two years, despite some officials emphasizing that the higher rate might only offset the drop in home values.

Boyd said the county should concentrate more on generating tax revenue from business development, a message echoed by some of the other supervisors.

“Our process is so long,” Boyd said, adding that the county’s red tape discourages businesses from locating in Albemarle.

Boyd also emphasized that county officials need to negotiate with Charlottesville leaders to have a significant portion of the money Albemarle gives Charlottesville — through a revenue-sharing agreement — used for services that benefit both localities.

County staff also suggested supervisors consider service cuts that include a reduction in the Affordable Housing Trust Fund and a delay of funding for long-term recycling efforts, both of which received majority support from supervisors.

Other options that county staff suggested supervisors consider include job cuts for county employees and cutting funds toward conservation easements.