Residents voiced concerns about sales tax revenue and real estate tax relief in the county’s proposed budget at a community meeting Monday.
The county’s proposed budget for fiscal year 2019 comes in at $253 million. It includes a $204.5 million general fund, which is the county’s main operating fund and an $8.2 million increase over fiscal year 2018. Of the general fund, the Williamsburg-James City County Public Schools would receive $108.2 million for operations costs and debt service.
Residents weighed in at the second and final community budget at the James City library. The Board of Supervisors is scheduled to tackle the proposed budget in work sessions scheduled for Tuesday and April 24. The board is expected to vote to adopt the budget May 8.
The proposed budget includes a 2-cent cut to the real estate tax, which would decrease the rate from 84 cents to 82 cents per $100 of assessed value.
The cut comes in response to Senate Bill 942, which would increase the sales tax by 1 percent to support tourism marketing in the Historic Triangle. Half the sales tax increase would go to the Greater Williamsburg Chamber and Tourism Alliance to market to overnight tourists. The other half would go to Williamsburg, James City or York based on were the sales tax was collected.
“We thought we could get the most people some money back,” Interim County Administrator Bill Porter said of the proposed real estate tax cut.
Resident Robert Lund pointed out such a tax cut wouldn’t benefit all county residents, namely people who rent rather than own their home.
“Is there anything we could be doing for the poorer folks in James City County?” resident Robert Lund said. He suggested some county funds could be set aside for skill-building, job preparation and vocational programs.
The county has requested expanded taxation powers in past legislative agendas, such as the ability to levy a cigarette tax, and if the county had more options it could have explored more ways to offset the sales tax increase, Board of Supervisors Chairwoman Ruth Larson said.
The legislative agenda is a list of priorities provided by the county to the General Assembly annually.
Some citizens voiced concerns about using the sales tax revenue on recurring expenses like first responders’ salaries, wondering how the county would provide for those expenses if the sales tax bill’s provisions were to end.
“The big cost is in the first year. So when we look at the revenue coming in future years, that’s built into the operation,” Porter said.
The county would receive an estimated $5.5 million from the sales tax bill revenue. Of that, $2.4 million would offset the real estate tax cut. The school district would receive $1.4 million for five school buses, operations costs and construction projects at some school entryways. Another $1.3 million would be allocated to public safety to hire six firefighters, three police officers and replace portable emergency radios.
That revenue figure refers to the version of the bill passed by the General Assembly in February. Gov. Ralph Northam issued amendments that would exempt groceries from the tax and retain the $2 transient occupancy tax last week.
The bill as passed by the General Assembly would have made groceries subject to the tax and would have eliminated the $2 transient occupancy tax. The House of Delegates and Senate will have to consider the amendments, and it’s unclear exactly how much money would ultimately be allocated to the county.
“We expect after that to know what the final thing is,” Porter said.
James City would lose an estimated $1 million should groceries be exempted. The county would earn about $400,000 should the $2 transient occupancy tax remain, said Suzanne Mellen, the county financial management services director.
Jacobs can be reached by phone at 757-298-6007.