No notice needed

Published 6:35 pm Tuesday, July 2, 2019

Thrower says tax hike didn’t require public notice

By Diana McFarland

Managing editor

The Smithfield Town Council raised its real estate tax rate by 3 cents beginning this month, but did not publish a public notice to alert residents of the increase. 

If The Smithfield Times had not reported the increase as a news story, residents would likely not know it was going to occur, but it was Smithfield resident Dave Goodridge who raised the issue about the public notice discrepancy. 

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Smithfield Town Manager Brian Thrower said a locality such as Smithfield can raise its real estate tax by three cents without advertising that intention in a public notice.  Thrower said Smithfield’s tax increase was “properly advertised per state code”. {mprestriction ids=”1,2,3,4,5,6″}

Isle of Wight County, however, uses a different code section when it comes to informing the public about a possible tax increase.

By being properly advertised, Thrower was referring to a May 22 public notice in The Smithfield Times that stated the tax rate would remain at 16 cents per $100 in value. The Town Council held a public hearing on a budget with a real estate tax rate of 19 cents on June 4, and adopted a budget with that tax rate on June 24. 

“My proposed budget included the real estate tax increase; however, when the public notice was sent to the paper for advertisement, Council’s direction/intent was to start charging trash collection fees in its place,” said Thrower.

During a May 7 budget work session, the Town Council decided to advertise the budget without the tax increase, but include information concerning a charge for trash and recycling. The notice said the Council would adopt an ordinance to adopt a trash and recycling fee, but did not indicate what that would be. 

The Council eventually decided to forgo charging for trash pickup and instead to raise the real estate tax rate by 3 cents.

“Councils do not have to re-advertise the “final” budget, given the fact the final budget, tax rates, fees, etc. are subject to change at any time up to the time of final budget adoption,” said Thrower.

Thrower referred to code section 15.2-2506, which states that a brief synopsis of the budget, for planning purposes only, be published once in a newspaper of general circulation in the locality. 

The code section does not indicate that a locality must advertise the tax rate it intends to ultimately adopt, nor does it address the need for a public hearing. 

Isle of Wight County uses another code section, 15.2-107, when it comes to advertising a possible tax increase, according to Isle of Wight Assistant County Administrator Don Robertson.

That code section spells out what an advertisement of a tax increase should include, such as the actual dollar amount or percentage change, if any, of the proposed levy, fee or increase, as well as the time, date and place of the public hearing. 

The May 22 public notice also included a sentence concerning a tax levy increase due to a 2-percent hike in property values as a result of the recent reassessment. 

The information was based on a real estate tax rate of 16 cents, not the 19 cents that was eventually adopted. 

Smithfield town attorney William Riddick was on vacation this week and not available for comment.

Isle of Wight County and the Town of Windsor each published separate public notices concerning the tax levy increases in their respective localities due to the reassessment, including information about a separate public hearing. The notices were formatted according to the Code of Virginia that states localities may use the four-item format and includes how much, by percentage, the locality expects to receive due to the increased property assesssment. 

Smithfield’s notice did not. 

Isle of Wight and Windsor decided to retain its current tax rate for fiscal 2020 to obtain the additional revenues as a result of increased property values rather than going “revenue neutral,” which would have resulted in a decrease in the real estate tax rate. 

Isle of Wight County and Windsor also held separate public hearings concerning the tax levy change due to the reassessment. The Smithfield Town Council has not yet done so, according to its agendas.

The fiscal 2020 budgets for Isle of Wight and Windsor are easily found on their respective websites.  Smithfield’s fiscal 2020 budget is included in the June 4 Town Council agenda packet, but not as a separate document on its website.  The most recent budget available under financial reports is for fiscal 2016.  {/mprestriction}