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Double whammy
Double whammyLate last week, Gov. Tim Kaine put the brakes on state spending, with his chief of staff telling department heads that a "troubling trend" in state revenue means they must curtail hiring, traveling, and buying.
The state's travails mean that lawmakers may withhold money promised to local governments and nonprofit organizations.
Ouch.
Here in Fauquier, the commissioner of revenue had a look at recent sales of "typical" single-f homes — not condos, not mansions — and discovered that their value has declined almost 13 percent in the last six months, that being the average difference between what they fetched on the market and the assessed value on which they are taxed.
What that means for next year's budget is anyone's guess, the current budget having kicked in a mere three weeks ago.
But Commissioner of Revenue Ross D'Urso's analysis calls into question the supervisors' ability to hold the line on taxes after this year's 12-cent real estate tax hike .
His data is sufficient to make some forecasts, dire as they may be, but the supervisors are well-advised to err on the conservative side when next they sit down to craft a spending plan.
As much as sellers and real estate professionals and local government officials hope we are nearing the bottom of the real estate plunge, simple math and complex macroeconomics say we probably aren't.
Don't bother darkening a bank's door if you don't have at least five percent to plunk down as a down payment. Then be prepared for a pretty low ceiling when it comes to how much you can borrow. Lending institutions, it seems, have gone back to a business model that links loan amounts to repayment capability.
And in terms of the larger picture, gasoline prices and Richmond's inability to address Northern Virginia's commuting nightmare is increasingly dictating an end to the population shift from that mess to our beautiful retreat. Inflow drives demand for homes, which drives prices.
Taken together, these factors are going to continue to push prices down. And if home values are falling, so, too, is the revenue the county collects from them. And now the state might renege on some of its obligations to us.
In difficult economic times, nonprofits often suffer a double whammy — the governments and individuals they depend on for funding have less to give, while the demand for services grows, as those teetering on the edge of economic survival grapple with higher food and energy prices.
According to the Fauquier County Department of Social Services, even in this largely affluent area, requests for food stamps are up 14 percent over last year, and General Relief emergency assistance requests are up a whopping 67 percent.
At the same time, the county's food banks and nonprofits are at their lowest resource levels in years.
We save money in the long run by keeping nonprofits going. Governments at all levels must strive to maintain funding for government-run social services programs, as well as supporting their nonprofit partners.
For fiscal year 2009, Fauquier County will fund $726,404 of the $926,861 in requests from local nonprofits. Meeting all the requests is out of the question, especially in tight economic times like these, and county officials should be commended for granting about 78 percent of the overall nonprofit requests. But the county should make sure it is giving all the support it can to these organizations that provide relief to its residents.
Individuals should also strive to do what they can. If you have money to give, consider giving locally instead of to a large national charity, which may be better able to weather this economic storm.
If you are not able to donate money or goods, consider giving your time, especially if you have skills that could allow a nonprofit to redirect funding from operations to clients.
If you are willing, nonprofits will surely be able to find a way to use your help.
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