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Hanover Supervisors approve $615.5 million budget; no tax increases but added help for tax relief

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Hanover County Administrator John Budesky said the cost of creating a $15 across-the-board minimum wage for school employees could reach “tens of millions” of dollars because there are more school employees than county employees.

Hanover County’s Board of Supervisors unanimously approved a $615.5 million fiscal plan Wednesday afternoon for 2022-23 that holds tax rates steady while including, among other things, 5% salary increases for all employees, longevity increases for veteran public safety employees, 27.5 new positions and increased tax relief for the county’s most vulnerable residents.

The FY23 budget is nearly 20% higher than the current year’s budget, thanks largely to a healthy capital project and debt services portion needed to pay for new schools, a new fire station and road projects throughout the county.

County Administrator John Budesky introduced the plan in February, noting then that it attempts to address employee recruitment and retention and reverse the rising turnover rate among county staff.

The budget approved Wednesday includes a 5% salary increases for all, plus additional increases for veteran public safety employees with at least 25 years of service. The budget also increases minimum salaries to $15 per hour, though it was noted prior to the vote by Ashland District’s Faye Prichard, who was serving as board vice chair, that while the county was raising its minimum wages for its employees, she was hoping the school division could do the same.

The school board approved its budget earlier this year and while $15-per-hour minimum wages were approved for some school positions, but that’s not the minimum wage across the board.

Prichard made a motion to approve the budget with the caveat that county and school officials get together at the county’s joint education committee in May to figure out how to reach that goal. She even wondered aloud if it were possible to do that within the FY23 budget.

Mechanicsville District’s W. Canova Peterson echoed Prichard’s concerns, saying that the board has always treated both county and school employees the same, but that “it sounds to me like we’re not doing that right now.”

Budesky, however, cautioned the board about making a commitment to fix that issue within the FY23 budget without first knowing the financial impact. Without offering specifics, Budesky said the cost of creating a $15 across-the-board minimum wage for school employees could reach “tens of millions” of dollars because there are more school employees than county employees.

Additionally, when the minimum wages are raised, “it compresses others,” he said, “so you’ve created a separate compression problem” in other salary areas.

Prichard made the motion, saying she hoped the board could “solve that dilemma as soon as we possibly can — it is simply the right thing to do.”


Wednesday’s approved budget was built on higher revenues from real estate tax, personal property tax and sales tax, though Budesky warned in February that these higher revenues likely won’t continue beyond 2023.

Hanover’s 81 cents per $100 of assessed real value will not change, and remains the lowest among Richmond and Chesterfield and Henrico counties.

Real estate taxes are up nearly 10%, including 7.1% from higher assessments, plus 2.5% from new or natural real estate growth. Hanover’s median home sales prices are up 9.8% and homes sales — compared to this time last year — are up 8.2%. The majority — 70% — of homes sold in Hanover are valued at more than $300,000.

But as assessments go up, so does the burden on those who can least afford the higher fees, board members have said, and it’s why they pushed for more tax relief for elderly and disabled residents.

The approved budget includes an enhanced tax relief program aimed at residents 65 and older and/or are permanently disabled, and it applies to the taxes on their home and up to 10 acres of land.

It’s a tiered system based on an individual’s net worth — minus their home’s value — and their annual income. The adopted FY23 budget provides that anyone making $55,000 or less — and has a net worth of up to $300,000 that does not include their home — is eligible for tax relief on their real estate taxes of between 30% and 100%.

The smaller the individual’s income and net worth, the higher the relief.

Those metrics are up from the current year — the income threshold is $52,000, overall net worth is currently capped at $200,000 and relief starts at 25%.

Board Chair Angela Kelly-Wiecek said she’s pleased that the staff — at the board’s request — was able to find additional funding for tax relief beyond what Budesky proposed in February. As an added measure, staff increased each of the four income tiers by $2,500, so the top reaches $55,000.

“Inflation is hitting a number of our residents very hard at the moment with gas and groceries,” she said, adding that she was pleased to “find a solution to even further enhance the initial recommendations.”

The approved budget provides for 27.5 new positions, including 16.7 in public safety, including four sheriff’s deputies, seven firefighters, a deputy emergency manager and an auto technician to work on response vehicles. New nonpublic safety positions include a human resources analyst, a safety and risk management coordinator to focus on school-based training efforts and a public information specialist.

Elsewhere, within the capital improvements plan, $112.8 million is earmarked for road improvements, including projects such as the Atlee Station Road widening, paving and roundabouts countywide and improvements to the U.S.360/Lee Davis Road corridor.

The school division is also seeing a large capital investment, with $108 million allocated over the next five years for three new schools and renovations to another. It’s the largest five-year financial investment in school infrastructure in recent times, Budesky noted in February. That funds three new elementary schools — the new John M. Gandy going up in Ashland — as well as replacement schools for Battlefield Park Elementary and Washington-Henry Elementary, and substantial renovations at Beaverdam Elementary, through 2027.

A new $11 million fire station is also part of that plan, though a site has not yet been identified.


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