Wytheville residents might want to brace themselves for tax increases. The town’s proposed budget contains tax increases across the board – from real estate and personal property taxes to machine/tools and tobacco taxes. Water rates, which increased in January, are expected to be bumped up again July 1, the beginning of the budget’s fiscal year.
But there is a glimmer of hope in the form of some federal funds that are expected to be handed out at the end of May, along with guidelines on how the money can be spent. Town Manager Steve Moore’s proposed budget does not take those funds into consideration.
“It remains to be seen,” Moore said. “If the money is allowed to supplement revenue shortfalls from previous years, Council will take a hard look at doing that.”
During Monday’s Town Council meeting, Council member Mark Bloomfield said the Budget and Finance Committee has been evaluating and fine-tuning the budget for the next fiscal year, but income projections are not significantly better than last year.
“The American Rescue Plan is purported to have funding for state and local governments to replace tax revenues lost due to the Covid-19 pandemic,” he said. “While there have been some unofficial releases of dollar amounts of allocations to local governments in Virginia, there have also been rumors that these amounts may not be correct.”
Bloomfield said the committee hopes to have the budget ready for a first reading on May 10.
According to town documents, the proposed revenues are projected to be $22,515,925 with $24,347,759 in appropriations, for a difference of $1,831,834. The difference includes the proposed tax hikes. Without the tax increases, the deficit would be about $2.6 million, Moore said.
The town manager said there are several reasons for the increases, including a decrease in meals and lodging taxes collected over the past year because of the pandemic. In past years, the meals and lodging tax revenues were enough to keep other taxes from being raised, Moore said, adding that real estate and personal property taxes have not been raised in years.
Included in the proposed budget is a 2 percent raise for employees, $35,000 in matching funds for a possible dog park, $140,000 for a 20 percent match for Heritage Walk Phase III, and $53,000 for health insurance premiums increase.
The proposed budget also includes $44,000 for the operation of McWane Pool on a reduced schedule. The pool will be open from 1 to 7 p.m. on Thursdays, Fridays and Saturdays, starting Thursday, May 27, and running through Saturday, Aug. 14. There is a free day at the pool on May 29 with food and games. Daily admission $3 for ages 4 and up; children under the age of 3 are admitted free. Ten-punch pass is $25. A season pass is $80. Family pass is $275. Passes are non-transferable. Admission is also free if you have a Gold Pass from the Wytheville Wellness Center.
Here’s a quick look at the proposed tax increases:
● Real estate tax: increase 5.5 cents from 15.5 cents to 21 cents per $100 in valuation, for $456,621.35 in new revenue. According to town documents, the increased rate is lower than the real estate tax was in 1981 (28 cents). Since then, the rate has decreased steadily until 2005, when it increased from approximately 11 cents to 16 cents. The last adjustment was in 2017 when it fell to the current 15.5 cents.
● Personal property: increase 10 cents from 28 cents to 38 cents per $100 in valuation, for $61,597.86 in new revenue. Moore said the personal property tax has not been raised in 30 years, “and with inflation, it just needs to be done.”
● Machine and Tools: increase 5 cents from 28 cents to 33 cents per $100 in valuation, for $230,000 in new revenue.
● Tobacco: increase 25 cents per pack from 9 cents to 34 cents for $230,000 in new revenue.
● Water: increase begins at $2.27 per month for up to 2,500 gallons. The fee goes up from there depending on usage. Moore said the water department needs to operation on the money it receives and “it’s just barely doing that.”
To reach reporter Millie Rothrock, call 276-228-6611, ext. 35, or email firstname.lastname@example.org.