By Brandon Martin
A former teacher raised concerns during an April 27 Henry County Board of Supervisors meeting over the use of funds in the fiscal year 2021-2022 school budget.
The funds in question will be from the recent ballot referendum to finance capital improvement items through a one percent increase to the local sales tax.
Dorothy Carter, of the Reed Creek district, said taxpayers were misled about the tax increase, and she questioned the legality of the county’s intent to use some of the funds to cover debt service rather than renovations or new construction.
To illustrate her position, Carter referenced the text of House Bill 486, which allowed the referendum on the proposed tax increase on the November 2020 ballot.
In the bill introduced by Del. Danny Marshall, R-Danville, and amended by Gov. Ralph Northam, revenues raised from the tax increase “shall be used solely for capital projects for new construction or major renovation of schools in the qualifying locality, including bond and loan financing costs related to such construction or renovation.”
Carter noted the clause which states “new construction or major renovations of school” to make the point that the tax could not legally be used to pay for construction that took place before the referendum passed.
Quoting County Administrator Tim Hall from October 2020, Carter emphasized his statement that the money would be used for “improved or new facilities.”
“We did not vote for a one percent increase to pay off former debt,” Carter said. “We voted for improved or new facilities. Meadow View is now longer new. This board agreed to build Meadow View in 2016. The referendum for higher taxes passed in 2020. This is 2021.”
Dr. J. David Martin, of the Iriswood District, said one locality has sought the opinion of the Attorney General regarding the ability to use the funds for debt service.
“I don’t see any reason to change our budget until we find out what that opinion might be,” Martin said.
Hall said county staff also researched the matter before proposing it.
“That gives us some comfort that other localities are attempting to do what we suggested to do,” Hall said. “Our county attorney has provided us with an opinion that what we are doing is completely legal. We wouldn’t attempt to do it if it were illegal.”
According to the budget presented, the county proposes to include approximately $19.4 million in local money for the school system. Every year, the transfer of funds from the county to the school system consists of three components: operations, debt service and state recordation tax pass-through.
Staff recommended transferring almost $16.8 million of the $19.4 million for operations, which is an increase of $516,485, from the current budget. However, the school board only requested $507,345.
The other two components are given “dollar-for-dollar each year based on actual school debt service and the amount of state recordation tax the County receives from the Commonwealth.”
Page 12 of the county budget includes an estimated projection that $5.2 million will be generated by the one percent tax increase.
“Staff recommends that $2.6 million be used to pay towards existing school construction debt, and the remaining $2.6 million be set aside for the school system’s use on current and future construction/renovation needs,” the budget states.
“I call on you Mr. Hall to do what the citizens of Henry County voted for,” Carter said. “Let that entire $5 million go towards what you promised ━ improved or new facilities.”
Hall said the decision to split the amount was to address the $2.6 million gap after the state stopped distributing the state recordation tax to the county.
Feeling it was inappropriate to take funds from other agencies, like law enforcement and public safety to address the gap for schools, Hall said it was the best option available.
“It’s not something we want to do but knowing that a gap of that size” could only be made up with increased taxes or spending cuts in other areas, “we didn’t want to burden law enforcement or public safety,” Hall said.
The decision was made easier by the school requesting fewer funds for capital items this year, Hall said.
Based on the “FY 2022 Superintendent’s Estimate of Needs,” the tax revenue was to be targeted towards athletic fieldhouses at Bassett and Magna Vista high schools, for a budgeted amount of $750,000, which is still less than half of what the county is transferring to the schools from the tax increase.
Carter said Hall “fails to mention that the county will receive a great deal of CARES Act money again this summer,” but this was a calculation in the school’s proposed budget.
The capital improvement plan for schools is included on page 154 of the county budget. Three items are proposed to be funded with CARES Act funds – replacing the HVAC system at Bassett High School and Laurel Park Middle School, and air-cooled chiller replacements at Fieldale-Collinsville Middle School as well as Rich Acres and Sanville elementary schools.
Additionally, the school system expects to get an additional $20 million over the next three years in American Rescue Plan Act funds.
As future capital improvement items arise, the schools will be able to access the one percent tax increase revenue.
The increase expires on July 28, 2040. During the interim, Henry County would collect an additional estimated $100 million over the course of 20 years.
The board will hold a meeting on May 10 at 5 p.m. to adopt the proposed school and total county budgets.
In other matters, the board:
*Approved a rezoning application for approximately 24-acres in the Ridgeway District from Industrial District I-1 to Agricultural District A-1. The applicant wants to use the property for residential and agricultural purposes.
*Approved a rezoning application for approximately 9.92-acres in the Iriswood District from Agricultural District A-1 to Limited Industrial District I-2. The applicant wishes to construct a building on the property to be used for the manufacturing and sale of metal roofing.
*Approved the move of the Irisburg (#303) voting precinct from Freedom Baptist Church on Irisburg Road to the Galilean House of Worship on A.L. Philpott Highway.
*Approved a resolution in support of the Community Development Block Grant application to provide restaurant meals and fresh produce to low-to-moderate income senior citizens in the region.
*Heard a request from Public Defender Sandra Haley about salary supplements to address pay parity between public defenders and the Commonwealth attorney’s office.