Madison County Supervisors are advertising a five-cent tax increase for the upcoming fiscal year.
Due to the recent reassessment, the 2018 tax rate of $.68 per $100 of value will need to lower to $.654. Supervisors are looking to increase that rate by five-cents to $0.70.
According to Madison County Commissioner of Revenue Brian Daniel, the overall assessed value increased to $1.75 billion, a 5.6 percent increase in the real estate tax base. The assessed value excluding organic growth increased 3.9 percent. New growth contributed approximately $28 million to the tax base. Improvement value and land use value each recognized approximately a 20 percent increase while fair market land values decreased 20 percent thus the equalized rate of $.654.
Even with a five-cent real estate tax increase, revenues don’t cover proposed expenses. The proposed budget, at it currently stands, amounts to approximately $25 million, a $2.1 million increase over the current $22.9 million budget. It includes increased funding for school needs, a 30.8 percent health insurance rate increase, a new investigator for the sheriff’s office, funding to take EMS to a fully paid system which will be placed in contingency until needed, some salary increases due to increased certifications obtained by employees, additional part-time and over-time for some departments and vehicle replacements including three sheriff’s office cars and one school bus. The budget also currently includes numerous capital items including funds for the public safety radio system, consolidating Thrift Road and the administration complex, purchasing the Moore building, doing something with the Criglersville Elementary School and more. Plus, there is a 3 percent Cost of Living Adjustment (COLA) for employees, some of which is offset by compensation board funding for comp board funded employees and constitutional officers.
“Our two big problems are health insurance and EMS,” assistant county administrator and finance director Mary Jane Costello said. “My suggestion is to not hack up the budget to get it to balance. You won’t be able to.”
Instead, Costello suggested using $1.1 million in fund balance to cover the shortfall between revenues and expenses. Approximately $640,000 of the $1.1 million would be used to create an EMS reserve to have funds available if full staffing should be needed. Costello said that number could decrease. The remaining approximately $445,000 would be used to cover the health insurance increase for county employees. Funds to cover the increase on the school side have been included in the school board’s budget.
The deadline for insurance renewals isn’t until Oct. 1 so its possible insurance costs will change. The county is currently working with consultants to evaluate the insurance rate increase. Costello said by placing funds in contingency, it can then be pulled out and placed into the budgets of individual departments once the insurance rate is set.
Meanwhile, supervisors agreed that putting funds into contingency for EMS is likely the best approach.
“Hopefully everything the volunteers have conveyed will come to fruition and we don’t have to spend it,” board of supervisors chairman Clay Jackson said.
Costello said the amount needed for a fully paid EMS system is approximately $1.1 million, but has been split into three years to offer a phased approach.
“I like the contingency approach,” supervisor Jonathon Weakley said. “It kind of puts it on both [the volunteers and the paid staff].”
“Even putting it in contingency sends a message,” Jackson said. “It accelerates the availability if we need it.”
And what the board is likely to need in coming years is funding. The communications radio system will likely need to be funded via a loan since it’s currently estimated to be $3.2 million for the design and backbone phase. Consolidating Thrift Road and the administration complex has preliminarily been split in half with $640,000 in fiscal year 2020 and $607,000 in fiscal year 2021. Plus, the Madison Primary School renovation project is estimated to cost $12.4 million, also a project administrator Jack Hobbs said will require a loan.
“Seventy cents is not the end for the next few years,” Hobbs said.
He suggested that once the budget is approved, a five year projection be created to determine fiscal needs in the future.
“This is not the last tax increase this board is going to have to do in the next few years,” he said.
Weakley pointed out that projects like the Weiland property which offers development space near Food Lion and the potential rural resort near Uno are good for the county.
“There’s been five years with no tax increase and now that’s what it is,” Jackson said. He pointed out that both supervisors and planning commissioners are pro-business and new businesses increase the tax base, but the county doesn’t create business.
A public hearing on the tax rate has been scheduled for May 7 at 7 p.m.