Lynchburg council reviews budget scenarios tied to real‑estate tax equalization

City staff presented multiple budget scenarios to the Lynchburg City Council and discussed tradeoffs tied to different real‑estate tax rates, including an equalization rate of 76.7 cents.

Donna, a member of the budget team, summarized options and said, “I was asked to put together several scenarios,” and walked council through the city manager’s proposed 89¢ rate and lower scenarios intended to reduce proposed spending. The presentation described the city manager’s proposed FY budget at an 89¢ real‑estate tax rate and showed the effects of moving the rate to 86¢, 83¢ and the equalization figure 76.7¢.

The budget memo and staff presentation showed the fiscal effects of each scenario. Under the 86¢ scenario staff estimated roughly a $2.7 million reduction in real‑estate tax revenue and proposed a set of reductions and adjustments (including a $785,356 reconciliation with the assessor’s equalized rate, a $37,000 adjustment to a housing rehabilitation program and an assumed $300,000 increase in interest earnings). The 83¢ scenario was presented as producing roughly a $5.4 million reduction in real‑estate revenue and would require eliminating about 32.23 full‑time equivalent (FTE) positions (16.34 filled, 15.89 vacant, according to staff). Staff said equalizing the tax rate to 76.7¢ would reduce real estate revenue by roughly $9.4–$11.0 million depending on the adjustments applied and would require deeper cuts that could remove the proposed 3% cost‑of‑living adjustment (COLA), public‑safety pay progression and the school system’s proposed 3% increase.

Why it matters: council members noted the scenarios would affect services and people. Several members repeatedly emphasized protecting public safety pay progression and teacher funding, while others argued for keeping a citywide 3% COLA to retain and recruit staff. The budget choices discussed would affect staffing, senior programs and a proposed expansion of the elderly and disabled tax relief program that staff said would be cut in lower‑revenue scenarios.

Council debate and process questions dominated the first portion of the session. One council member moved to adopt the equalization rate of 76.7 cents and directed staff to prepare an ordinance; other members raised parliamentary questions about whether the prior night’s meeting had been adjourned and whether that affected the motion’s validity. Several council members said they supported some combination of restoring public safety and school funding while reducing other expenditures; others urged preserving the 3% COLA for all employees.

Staff repeatedly noted line‑item detail was available in a handout and encouraged council to review the department‑level lists that show which positions and services would be affected at each rate. Staff also warned that certain cuts could break contractual obligations or retiree promises in some scenarios.

No final vote on a real‑estate tax rate was recorded in the portion of the transcript provided. The meeting recessed with council members asking staff to provide a revised expenditure level tied to an agreed set of restorations; staff indicated an expenditure limit tied to roughly 84¢ would be needed to restore several items members named during debate.

Several members pressed staff about mechanics and timing: whether a COLA could be made effective January 1 instead of July 1 to reduce the FY impact (staff said that would reduce this year’s cost by about $800,000 but would create a larger next‑year budget requirement). Council also discussed one‑time options — for example, using fund balance or temporary fee waivers — as short‑term offsets.

Ending note: staff committed to return with numbers that reflect council’s stated restoration priorities so the council can consider an ordinance adopting a rate and the corresponding appropriations at a subsequent meeting.