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A Spending Perspective

November 2, 2010 by Blue Ridge Leader filed under Columns, View From the Ridge No Comments

In this day of enormous budget headlines, we tend to lose a small town perspective on what we are spending.

We see headlines about trillion dollar Federal deficits, and therefore when we read about Town expenditures – a million dollars for this project or ten million for that project – we don’t even bat an eye.

But when you consider that Purcellville’s spending burdens just 2,400 homes, the numbers begin to feel a little different.

  • The total town debt is the equivalent of seven years general fund revenue. If the five year plan is implemented, it will go up to about 11 years of general fund revenue.
  • The cost of the old Baptist Church (for the new Town Hall) without any improvements was approximately the total real estate tax collections for Purcellville for one year or approximately the amount Purcellville collects in personal property taxes (car tax) in six years. When the total cost of the expected repairs and the parking lot (across the street at Fireman’s Field) is considered, it equates to entire real estate tax revenue for 5-½ years or the car tax revenue for 30 years.
  • The cost of the proposed Main and Maple intersection improvements equals the entire real estate revenue for five years.
  • The new maintenance facility equals 2-½ years of the entire real estate revenue or 15 years of the car tax.
  • The repairs to the skating rink equal approximately the entire real estate revenue for one year.
  • The proposed purchase of new town vehicles for this year alone equals approximately the entire car tax for the next three years.
  • The General Fund debt service is equal to approximately two thirds of the total real estate tax revenue. The five year capital expenditure plan for the General Fund is equivalent to six years of the total real estate tax revenue. This means that the debt is growing since the debt service equals principal and interest. At this rate, an unanswered question is how long it will take before the debt service equals the total current real estate tax revenue.

Yup.

When you consider that all of this burden falls on just 2,400 households, you begin to understand that Purcellville is in fact right in line with the Federal model: spend and borrow, spend and borrow.

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