Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: FRIDAY, June 22, 1990 TAG: 9006220768
SECTION: EDITORIAL PAGE: A-13 EDITION: METRO
SOURCE: LEE B. EDDY
DATELINE: LENGTH: Long
An objective observer might compliment the county for having the foresight and political will to do what is necessary to assure an adequate water supply for the Roanoke Valley into the middle of the next century. Instead, we were accused of trying to fool the public, and we received a tirade on the spectre of overwhelming tax and fee increases for county homeowners. For a truly deserving target for editorial criticism, please consider the cities of Roanoke and Salem, who backed out of an earlier commitment to help finance a water project that is clearly needed for the future benefit of the valley.
To my knowledge, no one in the Roanoke County government has tried to conceal the future expense related to major capital-improvements. The water project, additions to the regional sewage system, the new landfill, and some pending school construction will result in a substantial need for bond money that will be repaid over the years from general taxes and user fees.
Over the next several months, the Board of Supervisors will be faced with determining the best mix of general obligation and revenue bonds, and the best means for paying debt service on those bonds. In regard to the landfill, a major factor will be the cooperation, or lack thereof, by the other area governments in working out a joint-use agreement.
With Roanoke County having the river and land needed for a water project, most of the land suitable for economic development, and the raw land needed for a landfill, you might think other local governments would be interested in some long-term assurances that these benefits will be available to them.
On the contrary, they often appear to be as obstructionist as possible, reminiscent of the old days of city-initiated annexation suits when the municipalities did everything possible to avoid cooperating with the county.
In regard to taxes and user fees to finance the proposed water project, the proper mix of funding sources has yet to be finalized. Increasing the county's utility consumer tax from 6 to 12 percent (making it equal to Roanoke's utility tax) has already been proposed as part of the financing changes for the consolidated government.
The current county water-connection and -user fees were set several years ago at a level calculated to provide major funding for the Spring Hollow project, and they have been producing a net income in the range of $1 to $2 million each year. Based on a real-estate tax rate of $1.15 per $100 valuation, the county staff has estimated that general tax revenues will exceed expenses in the 1989-1990 budget year by $1.8 million. The 2-cent tax reduction (to $1.13) starting in January 1991, will still leave an estimated annual budget excess of approximately $1.26 million.
Philosophically, those citizens who use a limited governmental service should be the ones to pay the cost. A significant number of rural county residents have their own wells or use a private water system, and these people understandably object to any general tax increase to pay for a water system from which they will receive no direct benefit. On the other hand, an assured water supply is essential for the long-term health and growth of the valley economy, and some financial participation by all residents may be in order.
The ultimate mix of debt-service payments will likely use general tax revenues for the previously authorized $15 million in general-obligation bonds, and water-connection and -use fees for the proposed $40 million in revenue bonds. It should be noted that the projected annual county "surplus" of $1.26 million is approximately the amount needed to pay debt service on the $15 million in general-obligation bonds, and that water fees have already been increased enough to pay a substantial portion of the debt service for the revenue bonds.
In respect to ability to pay, the total taxable real-estate values in Roanoke County are significantly greater than in Roanoke City. Although a higher percentage of commercial and industrial tax base would be nice, it is not necessary in order to maintain a financially sound county government.
One element of the proposed city-county consolidation agreement may deter early progress on some large capital projects. The plans says that debt service on any general-obligation or revenue bonds issued prior to the date of consolidation (July 1, 1993), will be paid, for the next 30 years, by the residents of the jurisdiction that issued the bonds.
Thus, if the consolidation referendum succeeds, any debt service for the Spring Hollow project (intended to benefit the entire valley) would be paid only by the taxpayers and water users in the "old county."
At this point, I doubt that the consolidation referendum will pass in Roanoke County, but if it is approved, we should look for ways to modify this element of the agreement. Otherwise, funding the Spring Hollow project might be deferred until late 1993, and the negative impact of having a limited water supply over the next few years could vastly outweigh any economic-development advantages resulting from a consolidated government.
I urge the newspaper's editorial policies to be a little more even-handed in dealing with Roanoke County, and to reflect some time spent on research before blasting the county government with undeserved invective.
by CNB