County director outlines revenue scenarios
But a bad economy could change that scenario, leading to less money for county schools.
Each year the county turns over to the schools 56.75 percent of the money it receives from taxes due to a revenue sharing agreement. But the amount the county receives fluctuates according to real estate assessments.
Real estate is the county’:s main source of revenues.
Although assessments were up dramatically in 2003, there is no guarantee that will continue, he said.
Returns depend on growing, or at least stable, real estate assessments.
“The thing that concerns us most are the years of low or negative assessment growth that have followed periods of spikes, like the one we just had,” Gerhart said.
Assessments were up an average 17.5 percent in 2003, but the county is only projecting an 8 percent hike in 2004.
If assessments drop, less will be available for school funding and more will be needed to bolster the tax rate, Gerhart said. So far, the county has been steadily reducing the tax rate, which now stands at $1.23 per $100 of assessed value.
In fiscal 2003, the current budget year, the county provided roughly $258 million of the schools’: $648 million budget. It was able to turn over $9 million more than anticipated at yearend because its coffers were flush from housing appreciations.
The semi-annual meeting with the Prince William School Board is designed to keep it abreast of the county’:s financial outlook, so school officials will know what to expect in terms of revenues. The county is about halfway through this fiscal year and is formulating its fiscal 2004 budget.
The schools use the money for capital improvements — including an ever-increasing need for new schools — and for operating expenses such as teacher salaries.
The revenue-sharing arrangement has been hailed as a way to build certainty into the school’:s budget and ensure less wrangling at budget time.
The schools can use all the money they can get because of the need for new schools and repairs to old ones, said Robert Ferrebee, associate superintendent for management with the school system.
“In addition, there are a lot of older buildings that need repairs,” he said. “About 64 percent are more than 21 years old.”
The division has a policy of putting 2 to 4 percent of what it would cost to replace an old school back into repairs and renewals. In fiscal 2004, that will cost the school division $10.6 million.