Fairfax County Town Hall Budget Meeting (Sully)
-- Charles McAndrew, March 10, 2020
On 5 March 2020, Fairfax County Taxpayers Alliance (FCTA) board members Rob Whitfield, Ron Quasebarth, and I attended a two hour Sully District Town Hall Budget meeting at the Sully Government Center. Kathy Smith, Sully Board Supervisor, Stella Pekarsky, Sully School Board Member, Joe Mondoro, Chief Financial Officer of the Fairfax County Government, and Marty Smith FCPS Chief Operating Officer gave this presentation. Mr. Mondoro gave the bulk of the presentation.
Real Estate & Other Proposed Taxes: The rate will increase three cents from $1.15 to $1.18 per $100 of assessed value. The 3 cents increase consists of 2 cents utilized to fund priorities in the General Fund and 1 cent will be dedicated to affordable housing. Each penny increases the amount by $26.5 million, which results in an increase of approximately $346 for the average real estate tax bill. (Some of our FCTA board members have reported that their assessments have increased from 1.4% to 17%, so some of you will see your real estate tax increase way over $346.)
The county is also proposing a 4% Admissions Tax to be implemented in October 2020 on the sale of movie, theater, and concert tickets. This particular tax will be deposited into the Contributory Fund and used for arts, cultural, and tourism activities.
Note that the County receives only about 23 cents back from Richmond for every $1 of state taxes generated in the County.
General Fund Budget: FY2021 General Fund Revenues are projected to be $4.616 billion, an increase of $159.5M (3.58%), over the FY2020 Adopted Budget Plan. The General Fund Disbursements are $4.625 billion, an increase of $175.9M (3.95%), over the FY2020 Adopted Budget Plan. As usual, the county budget is increasing double the current inflation rate (Consumer Price Index). This increase includes $13.37M for transfers to the Revenue Stabilization and Economic Opportunity Reserves. The remaining $162.5M reflects adjustments for the Fairfax County Public Schools (FCPS), compensation, and other programmatic requirements as outlined in the General Funds Summary. The overall total Fairfax County budget is approximately $9 BILLION.
Employee Compensation Including Fringe Benefits : Funds compensation for County employees, including performance/merit/longevity increases and a 2.06% Market Rate Adjustment. Pay increases would average 4.06% for non-uniformed merit employees and 4.31% for uniformed merit employees. These costs are offset by reductions in retiree health benefits and health insurance premiums for employees, which amounts to $0.60 million. The 2.06% Market Rate Adjustment amounts to $28.73 million for FY2021 effective July 2020. The county's budget would allot $41.9M for compensation increases. That figure reflects $11.63M in savings from lower health insurance costs, offset by an extra $28.73M to pay for a nearly 2.1% cost-of-living increase and $23.28M to cover performance, longevity and merit increases. All of this includes a living wage of $15.14 to $15.45 per hour. For FY2021, the County proposes 177 new positions.
FCPS Budget: FY2021 Operating Fund budget will increase to $3.2 billion which represents a substantial $172.2M (5.8%) increase over last year's budget -- almost three times the rate of inflation! Most of this increase is for what they call "Premier Workforce" of $94.8M. This increase breaks down to what they call "Market Competitive Compensation" of $44.1M. $50.7M is for what they call "Exceptional Employees" which includes step increases, Virginia Retirement System Rate Increase, Workers Compensation, Elementary Principal Pay Parity, Comprehensive Professional Development, Masters Program, and other small items.
Approximately 90% of the total budget is for salaries and benefits. 71% of the FCPS budget comes from a transfer from the County budget and approximately 25% of funding comes from the state. 86% of the budget is spent on instruction. The larger portions of the $3.2 billion budget includes: $1 billion (31.8%) for Elementary Schools, $665.7M (21.1%) for High Schools, $601.6M (19.0%) for Special Education or, $295.9M (9.4%) for Middle Schools, $134.3M (4.3%) for General Support and Administration, $172.3M (5.5%) for Student Transportation, $123.7M (3.9%) for Facilities Management and other smaller items. This includes an overall increase for FCPS from the county of $85.52M (3.65%) over FY2020. There are approximately 24,221 positions in the FCPS. The average per pupil cost is $16,043 -- average for all school districts in the Metropolitan area.
I have not yet obtained the ESOL costs, but I estimate over $80M for FY2021 based on last year's estimated $76M. Soon I hope to have the per pupil cost of Special Education and ESOL. We have no idea what the cost are to provide FCPS education to students of illegal alien parents.
FCPS General Information: FCPS data shows the county on-time graduation rate of 91.3%. The average SAT score is 1218 for Fairfax County versus 1119 for the state and 1059 for the nation. Other statistics: 89% of graduates attended post-secondary programs, 86% earned at least one industry certification, and there were 237 Merit Semifinalists in the class of 2020.
Residential and Non-Residential Real Estate: The average price of homes sold in 2019 was up 3.9%. There are more than 344,000 residential properties in Fairfax County, and 79% saw an increase in assessed value and 7.3% saw a decrease in assessed value. Residential properties comprise approximately 73% of the total tax base. As to nonresidential real estate, the amount of empty office space declined to 17.1M square feet out of 118.7M square feet. Office vacancy rates for 2019 were 13.9 direct, down from 14.9 in 2018. Currently, 2.7M square feet of office space is under construction. Office real estate assessed values were up for the third consecutive year.
Transportation Including METRO: The county's FY2021 contribution of $160.5 million is a 2.9% increase over the FY2020 Adopted Budget Plan for METRO expenditures. For FY2021, the County has a $38M capital requirement to METRO in General Obligation Transportation Bonds. The debt service for bonds that WMATA issued for the County's share of the capital costs in FY2021 is included at $5.6M and is funded by General Funds monies. There is an increase of $1.92M in General Fund support for Fairfax Connector requirements operating 90 routes to provide intra-county service and access to METRO stations serving county residents.
Public Safety: Public safety services would increase $9.77M more, including 51 new positions. This amount includes $5.08M for police body cameras and 13 related positions; nearly $2.5M to pay for staffing positions at the future Scott Run Fire Station in Tysons, slated to open in January 2021; and nearly $1.5 million for eight positions at the police department's South County District Station, slated to open in December 2022.
County Reserves: As part of the FY2021 budget, reserves are projected to reach 10% of General Fund Disbursements as established in 2015. General Fund reserves contributions total $13.49M, a $3.36M reduction from FY2020. Projected interest income also contributes to reserve levels. Here are the numbers for the Unfunded Pension Liabilities:
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In conclusion, as you can see, the budget and taxes usually increase TWO to THREE times the inflation rate, year after year, and decade after decade!