Assessed values for property in the state of Virginia (Loudoun County included) are based on the market value of homes as of January 1st of each year. Questions have arisen recently regarding this extremely important practice especially here in Loudoun because so much of the county revenue comes from real estate property taxes.
The assessed value is just one part of a two part formula used to determine how much each homeowner will owe the county in the coming year. The other part is the tax rate. In 2007 the tax rate was .96. This means that a homeowner whose home is assessed at $500,000 will owe $4800 in taxes or $400 every month.
A recent post on our blog was met with some extremely criticism by the Loudoun County Assessor regarding our opinion on the current assessment and how much they will need to be reduced given the sad state of property values in the county. This post was not meant to be a criticism of the assessor so much as a warning to property owners to be vigilant regarding their assessments in 2008. And the reason for the warning was the incredible news that Loudoun County will have a budget shortfall of $250 Million in 2009 (the budget for 2009 is set by the county supervisors in April of the preceeding year).
The main reasons for the projected shortfall are two: Decrease in Revenues (housing prices stopped going up) and School Budget continues to grow. The school Superintendent has asked for a $117 Million increase for his budget. So in the face of declining revenues, slowing growth and a possible recession, there is a very high probability that our taxes will rise. How else will the Supervisors make up the shortfall?
The problem I have with this whole scenario is the fact that the Loudoun County homeowners have had their taxes increased an average of 13.5% per year since 2000. And that is all fine and good when the population was growning and the number of kids of school age continued to grow. But that kind of growth is gone and has been replaced by moderate growth. And it wouldn't suprise me if there is actually no growth to the overall population in Loudoun County in the coming year and only slight growth in the student population.
Which brings me to my point: We don't need to keep increasing the school budget. We don't need to increase spending 13.5% to keep up with 3% growth. We have already paid it forward. Our tax rate is higher than Fairfax County (89%) and Prince William County (83.8%). We have already increased our taxes significantly in the past 7 years and now it is time to be fiscally responsible. It is time to tell our government officials that they must cut spending, trim the fat that has accumulated over the years, come up with less expensive alternatives.
And we can do that by holding them accountable to the assessed values they place on our homes. It can be no more than 100% of market value. And we can do it by voicing our opinions to the new Board of Supervisors. Let them know that enough is enough. Our homes are not a blank check for them to cash.
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I respectfully disagree.
"Moderate growth" in home sales or even people moving into the county does NOT equal "moderate growth" in school needs. School needs can lag population and settlement growth by 3-5 years (kids don't go to school until they're 5). Thus, the School Board is projecting the budget increase and needs based on the kids that have been born over the past 5 years and the kids that continue to be born.
John Stevens (over at Our Loudoun Schools blog.loudounschools.org) does a fantastic job of comparing the Loudoun school budget with requirements, revenue and other jurisdictions. Before asserting "taxes are too high! cut the school budget!" it would behoove folks to read up on what's involved with the school budget and go from there.
We have an excellent quality of life here in Loudoun, that quality of life costs money. I do not want Loudoun to be forced into bad decisions by short-sighted tax and budget policies the way that Prince William has been. I say we let the BoS do their jobs and withhold judgement for a couple months.
Posted by: Paradox13VA | January 08, 2008 at 12:23 PM
Point noted, Paradox. But I have to question why there are all these justifications for increases and illustrations of stagnant salaries and nothing about reductions in areas that may need to be reduced or eliminated? Have all the allocations of money in the past been so perfect that there is no fat in a school budget that exceeds $800 Million?
My budget is far less than that, but if I know that in the next year I won't make as much as this year, then I take a look at what I need to do to spend less. But, if I have a source of unlimited funds that I can always just ask for more, will I really make an effort to do without? Will I really look hard for areas to cut back or eliminate? No. And to think I would or anyone else would is foolish.
Perhaps I am foolish to think that any government would ever cut back on expenses in anticipation of lower revenues. But I can still argue for the people who have to pay the increased taxes on lower and lower income with no hope of the cycle being stopped until it is too late for everyone, even the children.
Posted by: Tony Arko | January 08, 2008 at 01:34 PM
We always need to pay attention to spending and efficiencies. I believe there may be places our budgets are bloated, and I am glad there are watchdogs (Loudoun Stats, Bacon's Rebellion) who are making sure our officials stay honest.
Our School Board and Board of Supervisors are definitely coming into this years' budget process with a mind towards belt tightening. The current budget was a product of the Superintendent and Staff, not the School Board. Let's see what the Board does, and then our Supervisors. I'm sure they will be very diligent in seeking cost reductions.
Posted by: Paradox13VA | January 09, 2008 at 02:37 PM