Editorial – Town shouldn’t repeat county schools’ mistake
Published 5:04 pm Tuesday, August 15, 2023
Now that the Smithfield Town Council appears to be headed toward a “do-over” on adopting its real estate tax rate for the current fiscal year, it would be wise to learn from the budgetary disaster for Isle of Wight County Schools and consider the hazards of one-time COVID-19 relief money for ongoing operating expenses.
As our Stephen Faleski documents on the front page of this edition, the school division must go back to its funding agent, the county Board of Supervisors, after overspending its budget for the fiscal year that ended June 30. After sorting through the blame game currently happening between current and former central office administrations, it’s clear that relying on COVID money to fund an ongoing obligation — pay raises for bus drivers — is at least partly the reason for the half-million-plus budget gap supervisors are being asked to close.
Similarly, the Town Council last month adopted a tax rate that will require COVID money for the town to make operational ends meet during the fiscal year that started July 1.
Fortunately, it turns out that a mandatory public hearing on the tax rate was improperly noticed and conducted under state law, so the Town Council will get another shot to correct the misguided decision to use COVID money to suppress the real estate tax rate.
Councilman Mike Smith, who has emerged as the council’s voice of common sense and sound logic on matters ranging from fiscal policy to the controversial Grange at 10Main development, tried to mitigate the damage with his substitute motion for an extra penny on the tax rate during the council’s June meeting.
But his motion was incorrectly ruled out of order by the town attorney, clearing the way for Councilman Randy Pack’s motion for a 14-cent rate to be approved on a 4-3 vote.
Smith had wisely taken issue with the town’s plan to achieve the 14-cent rate by using $413,000 in COVID-19 relief funds from the federal American Rescue Plan Act to fill the resulting revenue gap. Such short-term thinking serves only to kick the can down the road and put the town right back in the position one year from now of either cutting spending or raising taxes.
Assuming the town left no stone unturned in reducing discretionary spending and needs an extra cent or two of tax rate to give employees a modest pay increase and balance the budget, then so be it. That’s what responsible elected officials have to do sometimes.
Smith, Councilman Wayne Hall and Vice Mayor Valerie Butler each cast “no” votes on the 14-cent rate. When the vote is taken again, we hope at least one colleague joins them in restoring fiscal sanity to town government.