IW tax hike for next year?

Published 1:34 pm Wednesday, January 11, 2017

By Diana McFarland

Managing editor

Smithfield Supervisor Dick Grice last week proposed a 5-6 cent real estate tax increase to cover Isle of Wight’s looming debt payments and other costs.

Under Grice’s proposal, a resident with a house valued at $250,000 could see his or her real estate tax bill go up about $125 to $150 a year.

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Grice qualified his proposal based on a looming debt service wave of about $11 million in 2019, plus the cost of the new radio system.

The debt payment for the radio system, estimated to cost from $6.9 to $8 million, is about $850,000 a year, Grice said. {mprestriction ids=”1,2,3,4,5,6″}

The choice is either to cut services or raise taxes, said Grice, who admitted his suggestion wasn’t typical of a politician.

The proposed tax rate hike was discussed during the organizational meeting and work session Thursday of the Isle of Wight County Board of Supervisors.

Grice also proposed a .3 percent pay raise for employees, which he said is the same as what seniors received as a cost of living increase through Social Security.

Isle of Wight County Administrator Randy Keaton said the Board might want to wait and see how the budget shakes out in the upcoming months.

The annual county ‘budget season’ usually begins in earnest in this month or next.

Board Chairman Rex Alphin said that the supervisors last year received some concrete options, such as the result of a one cent tax increase and so on.

There was a proposed 3-cent increase on the table last year, but in the end, the Board did not raise the real estate tax rate. It is currently $.85 per $100 in value.

Since one penny on the real estate tax rate generatess about $371,700, Grice’s proposal would bring in an additional $1.8 million to $2.2 million. Isle of Wight is also expected to save $1 million in tipping fees under the new SPSA agreement.

The county’s tax rate has gone up 33 cents since fiscal 2011 for a variety of reasons, including the loss of revenue from International Paper when it closed in 2010, the cost of the Norfolk water deal, other expenses and debt service. 

Keaton, who came on board last September, said it would be helpful if the supervisors could indicate what it considers “sacred cows” in terms of cuts, so “we don’t kill them.”

Keaton said it might also be helpful for the Board to get a list of state mandated and non-mandated services and the costs associated with each.

Windsor Supervisor Joel Acree requested that staff determine the cost of operating each volunteer fire and rescue agency in the county.

The volunteer system provides a good deal of savings and that needs to be recognized as volunteerism continues to erode, he said. 

That is a trend, agreed Keaton.  {/mprestriction}