Two Culpeper Town Council members’ efforts to eliminate categories of personal property taxes did not make it into the upcoming fiscal year's proposed budget.
During a special March 24 meeting, the council voted to advertise a proposed budget with all personal property taxes intact. The budget does not include any tax increases, marking the 21st consecutive year the town will not raise personal property or real estate taxes. The proposed budget also includes a tax reduction in special tax districts.
The proposed budget received the go-ahead for advertisement with Councilman Keith Brown serving as the lone dissenter. Support for the elimination of some personal property taxes was voiced earlier this month by Brown and Councilman Jon Russell, who was absent from Wednesday’s meeting.
During a March 11 meeting, Russell suggested eliminating personal property taxes for heavy trucks, campers, tractor-trailers, boats, RVs and outside signs. This would eliminate about $47,500 of the $620,000-plus in annual personal property tax revenue.
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As the Culpeper Town Council was reviewing budgetary plans for the upcoming fiscal year duri…
After going through the budget line by line, Brown said items that could be cut to offset the elimination of personal property taxes include $31,500 budgeted for town council’s dues, books and education; $7,200 for the town manager’s education, training, lodging and meals; $5,000 for the clerk’s training, lodging and meals; or $28,000 for human resources education, dues and other miscellaneous items. He proposed other similar line items that could be cut, saying “this goes on and on.”
Councilman Pranas Rimeikis said he dislikes a “fortune cookie budget process” in which the council goes through the budget line by line.
“Breaking through fortune cookies looking for $47,000 seems like a waste of time,” he said.
Instead of reducing personal property taxes this year, Rimeikis said 21 years without tax increases is a good message to constituents.
Hoping to add some clarity to the questions posed, Town Manager Chris Hively explained that the town strives to be a “high performing organization.” To accomplish that goal, he said the town needs highly skilled and motivated employees. Having such workers, he said, allows the town to hire fewer employees and ultimately save money. Two ways to retain quality employees, he added, are providing training and good salaries.
Hively noted that although some conferences “can look like a boondoggle,” the networking aspect of training events often provides the town substantial savings. Regarding the line item for the clerk’s office that Brown suggested could be cut, Hively explained much of that is dues for organizations that provide benefits such as the chamber of commerce and Virginia Municipal League. Hively added that some of the line items Brown mentioned allow employees to obtain educational degrees and take on more responsibility.
Councilman Keith Price asked how much money Brown’s proposal would actually save individual taxpayers. On average, Treasurer Howard Kartel explained citizens pay $10 in personal property taxes on a trailer, $343 for a truck, $20 for outside signs and $19 for boats.
Councilwoman Jamie Clancey said Brown’s efforts of cutting frivolous spending are “honorable.”
“But based on what I heard, you want to cut training for our employees and education….so people don’t have to pay personal property taxes on their boats,” she said, adding that it is extremely important to have trained and educated employees.
Clancey said cutting certain personal property taxes would not be worth the loss of employee education.
Brown said he is open to cutting other items, but “those are areas that jumped out.” He noted that $47,500 is not a lot to cut in efforts to provide citizens savings.
He added that the proposed elimination of personal property taxes would not affect the town’s ability to fund its debt service.
“What’s amazing is that you’re talking about that it’s not that much money saved for the taxpayer but it’s a big deal to cut $47,000 out,” Brown said. “So it’s kind of an oxymoron. If it’s not that big of a deal to the taxpayer, then why is it a big deal to cut it out?”
Mayor Michael Olinger noted that an approved financial plan will result in the town being debt-free by 2026. He added that the community has been “extremely lucky” amid the coronavirus pandemic as the proposed budget has no tax increases. When the town is debt-free, Clancey noted that it may be possible to eliminate personal property taxes altogether rather than a few select categories.
The budget will be the subject of a May public hearing.