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Higher composite index will cost schools $300,000

The Middlesex County School Board learned Monday night that the county’s composite index, which determines the county’s ability to fund its own school expenses and other aspects of local government, will increase from .6786 to .7431.

This means county taxpayers will have to come up with an additional $300,000 in local funds next year to cover lost state revenues, said school superintendent Rusty Fairheart.

The composite index of a county is based, in part, on real estate values in that county. The higher the real estate values, the higher the composite index.

At Monday’s meeting, school board member Jim Goforth said the discussion should continue on how land use taxation affects Middlesex. Land use taxation is intended to discourage development and keep land in farming, forestry and open space uses. Land use taxation allows such land to be taxed at a lower rate than its potential “highest and best use.”

Middlesex has had a land use taxation ordinance since the mid-1970s.

Goforth noted that all supervisor candidates in the recent election said they were in favor of continuing with land use taxation because it encouraged open space, noting that farm and forest land do not cost the county nearly as much in services as developed land.

However, Goforth pointed out that when figuring the composite index, land use taxation values are not used. Rather, the property’s assessed value, which is based on the highest and best use of the land, is used. 

Goforth said he talked with Delegate Harvey Morgan about having land use values plugged into the state composite index formula rather than using the “highest and best use” figures. This would lower Middlesex’s composite index.

Goforth said Morgan indicated he was going to look into the matter when he returns to the General Assembly.

Middlesex, Northumberland and Lancaster counties all have extremely high composite indexes, yet Goforth said all three counties have high percentages of families receiving free and reduced lunches in the schools.

“We have high land values along the water, which pushes our composite index up, yetmany of the people in the county live on low incomes,” he said.

Waterfront property in Middlesex has been purchased mainly by people either retiring to the county or as second homes. Most of these people have higher incomes than local people, and many purchased waterfront property well above what local incomes can afford—driving land values up.

In some ways, these high waterfront values have had a positive impact on the local economy. However, they also have produced a false image of what most average county taxpayers who work and live in Middlesex can afford, said Goforth.

Goforth was defeated in the November 3 school board election by Garland Harrow of Deltaville and will leave office at the end of 2009. Goforth encouraged the school board to continue working with Delegate Morgan to have the composite index/land use policy changed. “I don’t know how much it will help, but it can’t hurt us,” he said.

Fairheart agreed and indicated he will contact Morgan to make sure the matter continues to be studied. 

posted 11.11.2009

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