Northampton Supervisors adopt budget amid curveball in General Assembly budget

The Northampton County Board of Supervisors approved the county’s Fiscal Year 2027 budget and tax rate resolution Tuesday night, but not before learning that unexpected changes in the state budget could require an additional $641,810 in local funding for county employees and public schools.

County Finance Director John Chandler told supervisors that Virginia’s state budget, approved just a day earlier, increased compensation funding beyond what had been anticipated when Northampton’s budget was developed. The timing left county and school staff scrambling to assess the financial impact before the county’s June 30 budget adoption deadline.

Chandler explained that the county’s advertised budget was built around a 2% cost-of-living adjustment (COLA) for county employees, with discussions earlier in the year suggesting the final state budget might support a 3% increase. Instead, the state approved a 3.5% average raise for state-supported local employees and a 4% average raise for teachers.

“We sat on the fence until Richmond was able to get their budget done,” Chandler said. “Who would have thought three or four months ago that we would learn something yesterday? It stressed me, to be honest.”

According to Chandler, increasing county employee raises from 2% to 3.5% would cost approximately $272,810 after accounting for Social Services reimbursements and employee benefits. The school division faces an estimated additional cost of $369,000.

School Superintendent Lisa Martin told supervisors that Northampton County Public Schools would need to act quickly because teacher contracts and salary scales must be approved before the division’s first July payroll.

“If we were to give a raise that’s less than what the state is funding, then we would be in jeopardy in the future of receiving additional state funds,” Martin said.

Martin noted that while school officials have identified health insurance savings that could offset approximately $180,000 of the increased costs, the division still faces a significant funding gap. She also cautioned that final state funding calculations are not yet available, meaning the estimates could change once Virginia releases its official funding tool.

The board discussed several possible options for covering the additional costs, including using the county’s $457,000 contingency fund, delaying planned expenditures, or drawing from fund balance. Chandler said staff would return in July with recommendations after further review.

Supervisor Jon Dempster said the county should support employees and teachers while allowing staff time to determine how to fund the increases.

“I think taking care of staff in any organization should be the priority,” Dempster said. “We’ve only had this information for 24 hours. Let the intelligent people behind the budget sharpen the pencils and figure out how we’re going to do this.”

The State’s budget is being reviewed by Governor Abigail Spanberger and the Virginia General Assembly will meet Monday to vote on any changes she makes before it is final.

The discussion also included concerns about the tax burden on residents. Supervisor Oliver Bennett questioned the long-term impact of rising property taxes, particularly on retirees, farmers and longtime residents.

“We’ve got to give these people some help,” he said. “If not, they’re not going to have anything to leave their grandchildren.”

County Administrator Matt Spuck and Chandler said that the board was not considering a tax increase beyond the rate already advertised and subjected to public hearing. The adopted tax rate remains at 69.95 cents per $100 of assessed value, the same rate included in the advertised budget, which is two cents more than the equalized rate the board adopted in May.

To allow the school division to meet payroll deadlines, the board amended the budget resolution to authorize Northampton County Public Schools to implement the state-required average 4% salary increase effective July 1 while county officials continue evaluating the broader budget impacts.

The budget resolution was approved on a split vote, with Supervisor Bennett voting against the measure,  saying he supports teacher raises but remained concerned about the overall tax burden on residents.