Critical school needs and a dismal real estate climate have Prince William County supervisors considering a real estate tax rate increase next year of as much as 25 percent.

Prince William County School Board members contended at an annual budget session Wednesday there is no choice but to bump up teacher salaries, reduce class sizes and build an $80 million high school to improve the community’s public schools.

County leaders agreed on the need to boost school funding as well as extra funds for illegal immigration enforcement, jail overcrowding and new police communication systems, but have yet to settle on an amount of increase or outline all the things extra money will buy.

To pay for everything the county needs, a property tax rate hike from about 79 cents per $100 of value to 99 cents would be necessary, top county officials said Wednesday. A slightly less painful option for homeowners would be to raise the tax to about 92 cents per $100, but that wouldn’t cover all the school needs, officials said.

This story continues below
Advertisement

Extra funding to cover school priorities would require the 20-cent tax rate increase and add $257 to the average tax bill, county officials estimate.

Because house values have fallen dramatically in the area, raising the real estate tax wouldn’t be as burensome to homeowners, officials said. The credit bubble bursting has sent property values plummeting 14 percent in a year, creating a $52 million deficit for the county.

Several school board members said the new budget must include more money to make up a $32 million schools’ deficit for salary increases, class size reductions and other programs.

“At some point, ‘lean and efficient,’ becomes failing to meet standards,” school board member Grant Lattin said.

The county board and school board created a new joint panel to continue working on the budget plans.

The challenges include meeting the strict financial guidelines needed to maintain the county’s AAA bond rating, the top mark, including a rainy day fund with 7.5 percent of the county’s operating budget.

While the county would free up more money by ditching those guidelines, County Executive Craig Gerhart warned the fallout would include a devastating blow to its fiscal reputation that would take many years to recover.

“We won’t get it back in our lifetimes,” Gerhart said.

dgenz@dcexaminer.com