Supervisors in Chesterfield and Goochland counties signed off on fiscal year 2021 budgets this week that were scaled back from previous proposals due to coronavirus disruptions.
Chesterfield supervisors approved a $723.7 million general fund budget, a $50 million drop from the pre-coronavirus budget proposal. Goochland supervisors likewise approved a smaller general fund budget than county staff first proposed 一 $55.7 million, a $4.1 million decrease from the previous plan.
Both counties slashed new employee positions, capital projects and other expenditures to balance out their budgets amid lower revenue forecasts, particularly in lodging and sales taxes. The amended budgets come as localities look to help businesses weather the pandemic’s effects.
The county anticipates large declines in consumer-based tax revenue. Sales tax collections are projected to drop $14.2 million (26 percent decrease) compared to previous forecasts. Likewise, lodging taxes are expected to drop $4.4 million (59 percent decrease).
“As the revenue outlooks change, our priorities have not and I think this revised plan is reflective of that,” said Matt Harris, deputy county administrator for finance.
The county expects to get sales tax figures from March, the month when the pandemic and its effects were first fully felt, in May.
“That will give us a sense of how accurate our reforecast is and we’ll bring that information back to you,” Harris said, noting that staff will watch revenues carefully in the coming months and keep supervisors informed as they consider how to tweak the budget moving forward.
The county anticipates a decline in stock and financial market activity, and projected a $6.5 million drop in investment earnings as a result of lower interest rates.
Supervisors also approved a $311.7 million allocation to the county school system. That’s $9.7 million higher than the FY20 local allocation but lower than the original FY21 pitch by $2.9 million due to a forecasted decline in property tax revenue.
Though there aren’t any layoffs in the budget, it stripped a 2 percent merit raise for all employees and kept 40 full-time positions vacant. The county also furloughed 500 employees this month. Among other measures, the county delayed most additional funding requests made by departments, and reduced travel and training expenditures.
“All of those items added up in aggregate have a big impact,” Harris said.
The capital improvement budget was scaled back by $25.2 million to a final total of $38.4 million. The county decided to hold off on a $600 million bond referendum related to capital needs in the next decade. The supervisors voted April 8 to maintain the real estate rate level at 95 cents per $100 of assessed value.
Supervisors voted to kill a previously proposed increase to utility fees, a staff recommendation based on the pandemic’s effects.
Goochland County cut departmental operating budgets in its general fund by 5 percent across the board, except for public safety, in its bid to balance its budget when faced with a $4.1 million shortfall in revenues due to coronavirus disruptions.
It eliminated most proposed new positions, save for three new deputies and three firefighters. No employees have been laid off. Proposed increases for part-time hours at county convenience centers also were killed, said Barbara Horlacher, finance director.
“I took a hatchet to these things, not a scalpel. These are all things we’re going to have to look at next year,” Horlacher said.
The funding for schools operations was kept on par with FY20 levels at $23.3 million.
The FY21 capital improvement projects fund was cut from $5.8 million to $2.6 million. The largest projects that escaped the cutting block were a $1.4 million fire truck and about $860,000 for a parking project at Randolph Elementary School.
The contingency fund, a regular line item the county typically keeps around $200,000, has been doubled to about $400,000 in anticipation of future shortfalls the county could encounter because of the pandemic’s effects on the budget.
Supervisors voted to keep the real estate rate at 53 cents per $100 of assessed value. They also approved an ordinance to reduce the plat vacation fee to $150, and also increased utility permit application inspection fees from 3 to 4 percent of construction costs.