Letter to the Editor: Proposal Would Ease Property Tax Burden

Thursday, October 2, 2008

The Loudoun County School Board voted 8 to 1 to endorse a voter referendum on a meals tax as a way to broaden the revenue stream for school construction, renovation and debt service.

The ballot question says the revenue is “to be used exclusively for school construction projects and school construction debt service.” It is estimated that a 4 percent tax would result in $13 million in annual revenue. This could become an important way to finance some of the school system’s capital improvement needs — and reduce some of the county debt on bonds approved by voters in the past.

The key difference between this meals tax referendum and the two that voters rejected in the past is the specific purpose for which the revenue from a meals tax is to be spent.

I take the county supervisors at their word, since it is their language that will appear on the ballot. To my way of thinking, if the voters approve those words, the supervisors will follow them. I appreciate a tax option that would produce $13 million in revenue for the county’s budget, especially since it will result in a property tax rate savings equal to the meals tax revenue.

School Board Vice Chairman John Stevens did say the words attributed to him in the letter by Nicholas Graham (Loudoun Extra, Sept. 28). Stevens also voted to endorse the proposition. The impact of the new revenue will be on the overall county budget, not specifically the school system’s budget. The $13 million will help finance new bricks and help pay off bricks that are already laid.

Part of the county’s budget is interest payments on bonds approved by the voters. Another part is the cash from property taxes that the supervisors use to help finance school construction projects.

Supervisors will be able to replace property tax revenue for these two budget categories with revenue from the meals tax — and that will be an incentive to reduce the overall budget financed from property taxes.

In November, we are asking voters to approve a $21.8 million bond issue for a new elementary school and an $82.2 million bond issue for a new high school. Those amounts are less than our cost estimates because the supervisors are using some cash from property taxes to finance the projects. Our cost estimate is $26.7 million for the elementary school and $99.5 million for the high school — a difference of $22.2 million. Some of that difference could be offset by revenue from a meals tax.

Some may think that this is a bookkeeping exercise, but the proposed meals tax is a mechanism to help reduce the property tax burden.

J. Warren Geurin, Sterling District, Loudoun County School Board

Tagged: Letter to the Editor, opinions

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