News: Hemstreet Presents Proposed Fiscal Plan for FY2013

(Feb. 7, 2012) - Loudoun County Administrator Tim Hemstreet today presented to the Board of Supervisors a proposed fiscal plan for the Loudoun County government for Fiscal Year 2013 (FY 13). The fiscal plan totals about $1.8 billion in appropriations for the general county government and school system.


Hemstreet said the proposed fiscal plan focuses on preserving critical services for Loudoun County residents. This includes the maintenance of essential public safety and human service safety nets, as well as the Board’s focus on economic development. The fiscal plan also addresses internal services and infrastructure, provides staffing for new county facilities, and continues the county’s investment in the education of Loudoun County children and maintains a structurally balanced budget.

Board Direction

Early in the process of developing the FY 13 budget, the Board of Supervisors provided guidance to the county administrator to present a budget that reflected a zero percent change in the average homeowner’s tax bill and an option to decrease the average homeowner’s tax bill by five percent. The Board also directed that the budget maintain the 66-to-34 percent split in local tax funding between the public schools and the general government

Factors Shaping the Proposed Fiscal Plan

Hemstreet noted that the proposed fiscal plan was developed in an environment in which the county’s revenue outlook is positive overall. Revenues are forecast to increase a total of five-point-five percent from FY 12 to FY 13 with a total increase in local tax revenues of $50 million. From January 2011 to January 2012, the county’s real property values have increased more than three-point-five percent, and are projected to increase more than four percent in the next year.

Hemstreet noted that Loudoun County has responded well to the national recession through fiscal and organizational management. Hemstreet cited the improvement of several economic indicators, including job creation and employment. "Both the national and state economies appear to be gradually recovering from the recession and Loudoun continues to outpace the general rate of recovery,"€ said Hemstreet.

Loudoun employers added 4,000 jobs in 2011, which represents three percent growth while the U.S. growth was less than one percent. The December 2011 unemployment rate was four-point-two percent in Loudoun as compared to six-point-two percent in the Commonwealth and eight-point-five percent nationwide.

Enhancements

The proposed fiscal plan includes a limited number of enhancements. These enhancements focus on critical items such as opening new facilities and meeting core operating needs. Hemstreet also is proposing an average two percent, performance-based compensation increase for county employees, who have absorbed increased workloads with fewer resources over the past several years.

Options for Reducing Expenditures

At the Board’s direction, Hemstreet also presented options for reducing the use of local tax funding by five percent and developed recommendations based on a tiered reduction approach:

* Tier one would eliminate most budget enhancements and require departments to absorb increasing service demands within their current budget.
* Tier two would eliminate the proposed compensation increase.
* Tier three would reduce or eliminate existing programs, which would result in reduction-in-force.

Capital Improvement Program

The proposed FY 13 Capital Improvement Program calls for $101 million in general government projects. The largest expenditure category is transportation infrastructure at $61 million, which includes $40 million for Dulles Corridor Rapid Transit, $14 million for roads, and $7 million for transit buses and facilities. Other larger expenditures are related to public safety projects which include $12 million for the Emergency Communications/911 Center. The proposed Capital Budget for FY 13 also includes $230 million in schools’ projects for two high schools, a middle school and additions at Freedom High School and Mercer Middle School.

Tax Rates

Hemstreet's proposed budget recommends a $1.27 tax rate, which results in no increase in the average homeowner'€™s tax bill. But because the Loudoun County Public Schools have not yet adopted their budget and there are many aspects of the state’s budget process that may impact the county, Hemstreet will advertise a tax rate of $1.29 in order to provide the Board with additional flexibility and options during their deliberations. Hemstreet noted that 85 cents of every dollar of local tax funding goes toward the schools, debt service and public safety. The personal property tax rate of $4.20 would remain unchanged under the proposed fiscal plan.

Public Hearings

The Board of Supervisors will hold several public hearings on the proposed FY 13 fiscal plan. The first is Wednesday, February 22, 2012, beginning at 3:30 and 6:30 p.m., at the Loudoun County Government Center, 1 Harrison Street, S.E., in Leesburg. An additional hearing at the Government Center will be advertised for Thursday, February 23, at 6:30 p.m., if needed.

A hearing is also scheduled at the Loudoun County Public Schools Administration Building, located at 21000 Education Court in Ashburn, at 9:00 a.m. on Saturday, February 25, 2012.

Anyone who wishes to speak at the public hearings may sign up in advance for one speaking slot, beginning Wednesday, February 8, by calling 703-777-0200. Comments may also be provided to the Board of Supervisors by e-mail at loudounbudget@loudoun.gov, by calling the Citizen Comment Line, 703-777-0115; or by writing to the Board of Supervisors, P.O. Box 7000, Leesburg, VA 20177.

Website

More information, including the proposed fiscal plan for FY 13, the County Administrator’s FY 13 budget presentation, and the adopted FY 12 budget, is available on the Loudoun County website at www.loudoun.gov/budget.