Chesterfield County’s draft spending plan for fiscal year 2023 would trim 3 cents off the real estate tax rate and funnel millions of dollars toward making employee salaries more competitive in the region.
The budget proposal, presented to the Board of Supervisors Wednesday afternoon, would set the real estate tax rate at 92 cents per $100 of assessed value, which would be a 3 cent decrease from the current rate. Even with that decrease, the county anticipates real estate tax revenue to grow by $55.9 million to $473.3 million in FY23, due primarily to increased property assessments.
The proposed cut to the real estate tax rate would put the rate a cent lower than what County Administrator Joe Casey proposed as a starting point for the rate’s reduction late last year.
Other tax-rate changes would include utility rate increases (new rates would be $2.36 per 100 cubic feet for water and $2.43 per 100 cubic feet for sewer) and a 50 percent rollback of the vehicle registration fee to $20.
The overall proposed budget comes to $1.8 billion, which is $185.3 million more than the current FY22 budget.
The FY23 general fund, which is the main operating fund of the budget, would grow by $98 million (12 percent) to a total of $905.1 million under Casey’s proposal, which he chalked up primarily to inflation but also to a bid to increase the pay of county employees.
In a Wednesday morning news conference, county officials said a high priority for the FY23 budget is workforce compensation to better retain and attract employees in an economy shifting due to inflation and the economic disruptions of the COVID-19 pandemic.
More than a third of the general fund increase, $35.6 million, is earmarked for workforce investment efforts, though the finer details of those efforts are still a work in progress.
“We want to make sure that we remain competitive. Aside from tax relief, taking care of our workforce is the No. 1 initiative in this budget,” said Matt Harris, deputy county administrator for finance and administration. “Those are the things we’re trying to be mindful of: starting salaries, particularly for public safety, and this concept of compression and market adjustment for the balance of the workforce. The dollars won’t change, but the details we’re still working through.”
The county would allocate $12.5 million to cover increases to starting salaries for public safety workers and avoid salary compression among public safety employees. “Compression” refers to the situation in which the gap closes between the salaries of lower-level and higher-level employees.
Chesterfield would also earmark $15 million in FY23 for wage increases for county employees who don’t work in public safety or the school system. Chesterfield would aim to increase its minimum wage to $16 for county government positions over the next couple fiscal years.
More than 300 county employees currently earn less than $15 an hour, according to proposed FY23 budget materials.
Chesterfield would also provide salary adjustments to employees with below-median wages who don’t work in public safety or the school system, and give a 5 percent raise to employees already above that threshold. The county would continue its existing annual merit raise and career development programs.
The proposed budget also includes $60 million for salary increases for teachers and other school division employees.
County officials said the salary moves were continuations of studies and raises last year, and that further salary efforts would follow in the FY24 budget.
“We had a great initiative last year with our schools on the teacher side of the scales and our public safety sworn officers,” Casey said. “We are, in this balanced budget, again reinvesting and continuing the methodologies to best recruit, retain and reward those professions with a decompressed step system.”
Exactly where things will land in regard to the workforce investment efforts is still a work in progress. County officials said they expected further tweaks, and a firm sense of compensation rates are to come as the budget works its way through the approval process.
“Trying to get your arms around the labor market and where you need to land to be competitive changes on a day-to-day basis, so we’re still studying that particular topic to put the finishing touches on it,” Harris said.
The current FY22 budget has about 3,900 county positions (not including public safety and the school system). Of those, about 380 full-time positions are unfilled, though the county isn’t necessarily actively seeking applications for all those positions, a county spokesman said.
The FY23 budget would add 77 new positions.
Chesterfield’s proposed five-year capital improvement plan tees up $612.9 million in county government projects and $451.3 million in school division projects.
Among the county government projects would be renovation and replacement of county government facilities, River City Sportsplex improvements, expansion and maintenance, and new sidewalks and trails.
The county plans to hold a bond referendum in November in which voters will weigh in on $540 million in general obligation bonds to fund capital improvements for the county’s schools and government facilities. The referendum was originally scheduled last November but was postponed due to the pandemic.
Adoption of the budget is expected to take place April 6. A public hearing is scheduled March 23.