At some point over the next six to eight weeks, a bunch of people you may — or may not — remember voting into office are going to sit down with some phone-book-sized documents and consider whether to make your monthly house payment or annual car tax bill go up.
As those city council members and county supervisors pore over those books, they'll be making decisions that may determine how often a police car swings down your block on patrol, whether that sidewalk is going to be patched this year and the chances you can sign the kids up for summer rec.
It's time, that is, for local government to begin writing budgets for the coming year.
The numbers involved are huge: more than $1.7 billion for the Peninsula, an additional $180 million when you add Isle of Wight and Gloucester counties.
They touch almost every aspect of daily life: from the age of the textbooks your kid uses, to the water that flows from your faucets to the traffic aggravations of your commute and errand-running.
They touch extraordinary events, too: the speed with which the fire department and EMTs come, the way streets are cleared after a heavy snow or hurricane.
They are all about choices officials need to make.
"I see the budget process as taking your community's values and needs and turning that into an action plan," said Chris Morrill, city manager of Roanoke who has just completed a term as president of the Government Finance Officers Association, the professional body of some 17,500 local, state and provincial government numbers crunchers.
"It's really all about prioritizing," he added.
Hampton City Manager Mary Bunting is already warning that a weak real estate market, increased employee costs and less state aid are going to hurt. Newport News Budget Director Lisa Cipriano expects revenue will remain depressed, but an unexpectedly large drop in spending on foster care and adoption services will leave the city with a larger financial cushion than it expected as she and her colleagues put the finishing touches on their budget proposal.
"We're still digging out of the great recession, and while we are anticipating revenues to be up a little bit, they still aren't very robust," said Williamsburg Mayor Clyde Haulman.
These days, city council members and county supervisors don't have a lot of wiggle room.
"There is some flexibility, but everything flows downhill, so to speak, from the federal and state governments," said John Camobreco, a political scientist at Christopher Newport University. "Local governments often have to make hard choices that the state and federal governments can put off or avoid altogether."
The feds can put things off because Congress doesn't have to balance the U.S. budget — it does not have to make sure the money projected to flow into federal coffers is enough to pay for all the spending it wants to do.
State governments, including Virginia's, can tap into more sources of money to pay their bills than local governments can.
In Virginia, meanwhile, the state legislature has extensive power over local government. It provides about a third of local governments' funding, and often dictates new tasks for local governments without always saying how they are to pay for it.
"Budgeting will be captive to what happens in Richmond," said Neal Menkes, director of fiscal policy for the Virginia Municipal League.
That may be particularly so this year.
Most of the heavy lifting on city and county budgets happens in April in May — after the General Assembly is supposed to agree on a budget for the state. This year, though, the battle lines between the House of Delegates and state Senate over the budget are particularly sharply drawn because of the politically charged issue of Medicaid expansion.
"If the House and Senate don't get together to find a way to agree on budget, it is going to be a difficult time," Menkes said.
The schools challenge
It's a challenge, too, for school boards — they write their budgets at about the same time cities and counties do. Williamsburg-James City County Superintendent Steven Constantino outlined his proposal 12 days ago, calling for a 4.8 percent increase in spending, most of which goes to cover a bigger bill from the Virginia Retirement System and the system's health insurer. About a quarter of the increase, or $1.2 million, is to hire 16 more teachers.
Still, it's not a done deal.
"We will continue to go through our approvals process — superintendent, school board, board of supervisors — and then make adjustments if state funding is not approved at the level of our projections," Constantino said.
On top of that, a major part of the school budget is what the city or county contributes; while the biggest piece of most city or county budgets is what they contribute to the schools. Constantino gets to do that twice, since both James City County and Williamsburg contribute. He's asking for a 1.8 percent boost from the county and 2.5 percent from Williamsburg.
In some places, that can make for some tense local politics. Whether it is talk of school budget funding gaps or hints about layoffs, trying to simultaneously balance school and local government budgets, while waiting on the General Assembly, does not make for placid times.
"Managers are saying that '14 will be a tougher budget year than last year," Menkes said.
Costs are not going down, and the state still hasn't made up cuts in payments to local governments that it made after the 2008 recession.
That leaves homeowners on the hook. About a third of the money local governments spend comes from real estate taxes.
That's why one of the first steps in the budget process, pretty much done by now, is for city and county officials to calculate the value of land and buildings within their locality's boundaries.
They'll tot up all the new construction, looking at building permits and comparable buildings. On the Peninsula, they'll also look every year or two at the value of existing land and buildings, comparing current assessments with recent sales prices to come up with a new value.
In Virginia, property owners are taxed on the basis of the fair market value of their property — a figure it is impossible to know for sure until real estate changes hands. So city and county assessors do some complex mathematics to produce what they hope are accurate estimates.
That sets the stage for one of the biggest single political decisions of the process: at what rate — cents per $100 of assessed value — will property owners be taxed? If the assessment shows the current rate would boost collections by 1 percent or more, local governments must calculate and publish what the rate would be to hold revenue unchanged. If they want to set a rate above that calculated one, they have to have a public hearing and vote before enacting a budget.
The next biggest source of local funds , accounting for bit less than one-sixteenth of most local government budgets, is the personal property tax, generally levied on motor vehicles. Commissioners of the revenue use vehicle registrations and standardized compilations of used-car values to figure out the tax base. Then it is up to council members and supervisors to figure out if they want to change the rate at which vehicles are taxed. State-funded car-tax relief — the last vestige of former Gov. Jim Gilmore's campaign to end the car tax — has been diminishing for years. The General Assembly capped the amount the state will spend on car-tax relief, so while the cost of cars continues to rise, the percentage of the tax bill that the state will pick up decreases.
The third-biggest source of money for local governments is the 1 percentage point of the sales tax they receive. That's a sum local officials can't do much to change, though similar taxes on hotel stays, meals, cigarettes and entertainment sometimes offer them a way to boost funds.
It's rare for local officials to look at cutting revenue. That's because, in the real world, when local department and agency heads start planning, there's only one way their estimates of what they think they need will go.
The price of most goods tends to rise over time — think about the fuel localities must buy for police cars, trash trucks and school furnaces; or the premiums they must pay on employee health insurance; or the electricity that keeps computers humming. And when department and agency heads begin thinking about their budgets, a process that usually starts in the late fall, they tend to think about additional tasks they would like to take on or that their bosses tell them they have to do.
On the other hand, CNU's Camobreco notes, "local government officials are averse to raising tax rates when the economy is bad, due to the hardship this might cause their constituents, so they usually try to cut spending instead."
That can set off a competition as departments jockey for limited funds.
Roanoke's Morrill tries to avoid that with a system in which the city council sets broad goals and city staff outlines programs to address them. A team representing several departments is assigned to each goal and ranks how well each proposed program meets the goal. In the last go-around, Police Chief Chris Perkins led the infrastructure group — the team looking at programs to maintain and repair streets, storm drains and bridges — and told Morrill afterward that those needs were bigger than his department's wish for newer cars.
Whether budget writers slice spending up by departments or by function, they have a lot of bases to cover.
The biggest is schools. Between what local governments contribute, what the state and federal governments transfer, and the small amounts of fees or rent schools themselves collect, schools account for half of total local government spending in cities and about 60 percent in counties.
Spending on health and social services, on average, accounts for about 10 percent of Virginia local government budgets.
Parks and recreation, courts and the group of departments that handle permits, inspections and zoning each account for less than 5 percent of local government budgets on average.
Paying for all that isn't the only thing local budget writers have to worry about.
In addition, they've got debt — bonds used to finance big projects like new schools or city facilities. On the Peninsula, the running cost for debt service ranged from just under $4 million in York County to $21 million in Newport News, according to the state Auditor of Public Accounts.
And that's another key area of strain coming up.
"We've been pushing back a lot of capital maintenance projects in recent years and we can't keep doing that," said John McGlennon, a College of William and Mary political scientist who also serves on the James City County Board of Supervisors.
It's one more element of the financial squeeze that has persisted for local governments, as for so many Peninsula residents, even this many years after the recession. Or, as McGlennon put it: "Things have been so constrained, a lot of the time decisions are made for you."
Ress can be reached by telephone at 757-247-4535. Virginia Gazette staff writers Cortney Langley and Christine Sampson contributed to this report.
About the series
Today the Daily Press is launching in-depth coverage of local government and school budgeting, beginning with a primer — how local budget works, what it means and why it's important. Coming stories will explore:
•A first look at officials' thoughts on how your money should be spent.
•This year's revenue picture — how home values, the economy and other factors will come into play.
•Detailed reports as officials get solid revenue numbers and set spending priorities.
•The public hearings — how taxpayers respond.
•Debates and decisions.
•In June, with the new fiscal year about to start, a look at the bottom line regionally: Who's paying how much, and what are they gettingCopyright © 2015, The Baltimore Sun