Federal funding helped Roanoke County plug holes in an operating budget pockmarked by economic impacts of the coronavirus, but spending cuts are still affecting the local government.
When COVID-19 outbreaks began in March and an economic downturn became apparent, Roanoke County’s finance department determined it would receive less tax revenue than originally expected for the 2021 fiscal year beginning July 1, said Laurie Gearheart, county director of finance and management services.
“We presented a budget, and then less than a week after presenting that budget, COVID hit,” Gearheart said. “We had to cut, we stripped, we literally annihilated our capital accounts.”
Lack of tax revenue means lack of funding, which meant the county needed to lessen its operating expenses. In addition to slashing funds for planned improvements and maintenance to county assets, a 2.75% all-staff raise was eliminated, and department budgets were kept at the same amount as previous years.
“We were thinking we were going to have a pretty strong 2021 fiscal year budget before this COVID hit,” Gearheart said. “We did take a very conservative approach, we decided it would be easier for us to hit it hard and then lighten the reins a little bit as the year progressed.”
All said, coronavirus concerns caused Roanoke County’s fiscal year 2021 budget to drop more than 5%, from a proposed $201 million to $190 million.
Doling out federal funds
To the county’s fortune, Congress passed a Coronavirus Aid, Relief, and Economic Security Act in March, allocating $2 trillion for citizens, businesses and governments to spend on expenses related to COVID-19.
CARES Act money came to Roanoke County in the form of two $8.2 million installments: first in June, and again in August. But $16.4 million from the CARES Act hasn’t all gone to the county government.
“We didn’t keep it all for just the county,” Gearheart said. “We did take into consideration our citizens and our businesses, and tried to make a difference for them as well.”
Of the county’s CARES Act funding, $1.6 million was budgeted to create a small business assistance grant program that helped 302 local businesses, according to county records. A citizen assistance program was implemented, with almost $500,000 put toward helping residents pay their bills.
Some $1.9 million went to Roanoke County Public Schools, and $1.4 million was sent to the town of Vinton based on its population, for use on its own coronavirus expenditures.
“We have used some to help with the expenses that this has caused us,” Gearheart said. “But we did try to do some things to help the overall economy.”
As of November, CARES Act funding covered $880,000 worth of personal protective equipment and enhanced cleaning measures for Roanoke County. Additionally, county records as of early November show $1.2 million went to enhanced teleworking, distance learning and telemedicine capabilities.
More than $3.2 million from the CARES Act was spent on county facility improvements, including moving the Roanoke County voter registrar’s office from the county administrative center to a separate building in Vinton.
“We moved the registrar’s office, gave them much more space,” Gearheart said. “Some of the other offices aren’t very well spaced out, so we used some of that money to help with social distancing.”
Other buildings renovated to allow for better social distancing include Roanoke County Public Libraries, which have since reopened to the public.
“It’s helped us do several items like that,” Gearheart said.
More than $4 million has covered the costs of public safety payroll from the police, sheriff and fire & rescue departments, according to county documents.
Most recently, the county approved a second round of hazard pay from CARES Act funding for uniformed public safety employees, at a rate of $1,000 each for full-time staff and $500 each for part-time employees. All other full-time county employees received a gratitude bonus of $750, or $250 for part-time staff.
“Without the CARES Act reimbursement, it would probably be very difficult to award this kind of bonus,” County Administrator Daniel O’Donnell said to the Roanoke County Board of Supervisors.
The deadline to spend all the federal funding is Dec. 30, and there is still some left to be spent, totaling less than $2 million, Gearheart said.
“We are working hard to make that happen,” Gearheart said. “But we’re also trying to be responsible with it.”
A work session at the upcoming Dec. 15 board of supervisors meeting will help Roanoke County determine how to spend the last of its CARES Act allocations.
Budget gaps still felt
Despite positive impacts of CARES Act funding to various county services, Gearheart said the money has not helped fix programming that was initially cut in order to stay within budget.
“We’re still feeling the gaps, as far as how we cut the budget,” Gearheart said. “We haven’t given raises, and we haven’t really given back capital money yet.”
Tax revenue through the first quarter of the 2021 fiscal year does offer some hope for a revised budget, however.
Sales tax has come in better than anticipated, partially thanks to internet sales tax, which is new this year, Gearheart said. Meal tax revenue is not as bad as the expected 50% drop, thanks to an influx of takeout orders, and a recent real estate report showed a record year for the local housing market.
“We are somewhat pleased with how the first quarter has come in,” Gearheart said. “We’re hoping if that is an indicator of how the year will go, we’ll be able to increase the current budget with an amendment.”
The county’s first priority will be returning funds that were removed from department budgets, as well as for facility upkeep and fleet equipment, Gearheart said. Past that, Roanoke County will fill in the gaps with whatever revenues trickle through, federal or otherwise, with an eye always trained on tomorrow.
“We are keeping a very close eye on how our revenues are coming in,” Gearheart said. “At this point, we’re being optimistic and we will be increasing the budget we’re working on for fiscal year 2022.”