This story was originally published in Charlottesville Tomorrow. For more reporting from central Virginia, subscribe to their free newsletter.
New sidewalks. A new evacuation siren. Body cams for police officers. Upgrades to the farmers’ market, the place to be on a Saturday morning.
These are some of the things that COVID-19 relief money made possible for Scottsville, Virginia, a small town of about 500 people at the intersection of rural Albemarle, Fluvanna and Buckingham counties. Things the town’s annual budget, which was around $644,000 before the pandemic, couldn’t accommodate.
Money from the American Rescue Plan Act (ARPA) and Coronavirus Aid, Relief, and Economic Security Act (CARES) nearly doubled the town’s revenue during the past two years. But now that federal money is gone and Scottsville, like many other places around the country, is back to pre-pandemic resources. And, because of skyrocketing inflation during that same time, it’s no longer enough.
Town Administrator Matthew Lawless estimates the total spend for the 2023-24 fiscal year, which begins in July, will be around $850,000 — $200,000 more than the revenue it now expects.
Scottsville’s town councilors vehemently disagree on what to do to address the shortfall — one even quit Council during a public meeting after his colleagues voted against a possible solution.
“I did not choose the problems that this town is going to inherit tonight from the decision that you all made. And you will need to find someone else who is willing to serve to solve those problems,” said Councilor Zachary Bullock.
To complicate matters further, many community members want all of the services they’re currently getting without any changes. That won’t be possible, said Lawless.
“I don’t see a good way to maintain our services without more revenue,” he said.
It didn’t have to be this way, according to Scottsville Mayor Ron Smith.
Smith hoped that a proposal to transform a blighted tire factory into 205 apartments near Scottsville’s downtown would raise enough local revenue to cover the deficit and then some. He saw it as a way to secure a bright future for the town.
In the short-term, the Scottsville Lofts proposal would have meant about $75,000 in general contractor licenses, plus a boost to the local economy in the form of materials sales, lunches for construction workers, and even construction jobs for area residents.
Additionally, Echelon Resources, the real estate development firm that made the proposal, would have given $100,000 to help the town maintain its levees, which protect Scottsville from flooding when the James River rises high. The company would have pitched in $200,000 for sidewalk construction and improvement — something town residents say they don’t just want, but need.
The apartments would also have added a few hundred more people to Scottsville, potentially doubling the town’s population and growing its tax base. Smith and many town residents envisioned an even busier Valley Street, with more people volunteering at community organizations.
There were community members who agreed. Some spoke excitedly about having a place to retire to after giving up their farms. Others said that the apartments would finally give them the chance to move into the town they’ve come to love from a few miles away.
But, in the end, the majority of councilors voted down the apartments.
Councilors and residents alike worried that Scottsville’s existing infrastructure — which is already suffering because the town doesn’t have the money to keep it in tip-top shape — would not support hundreds more people.
A staff impact report said that it wouldn’t be a problem. The additional revenue from the project would help mitigate any potential issues with roads, the school system and emergency services.
Councilor Bill Hyson questioned the validity of those town staff reports.
“Best practice advises that impact studies should be conducted by qualified, independent professionals,” Hyson said in an email to Charlottesville Tomorrow after the meeting. “This was confirmed by documentation at the federal level and by advice from comparable counties around Virginia. The fiscal plan presented to support this project did not meet that objective.”
Hyson didn’t support the apartments for a number of reasons. That type of development is “not who we are,” Hyson wrote. “We are a town. I think it’s just a remarkable place, and the people who are here are just typical working middle class people trying to live. And like them, the town has to live within its means. I don’t think this thing should be driven by money.”
He thought, instead, it should be driven by community, and he said that most of the community members he heard from didn’t want the apartments.
During a Jan. 17 Council meeting, one of those community members said he didn’t like the idea of an entire apartment building making up half the town’s population and thus half of its voting block. That would give renters a lot of influence on town politics. Worst case scenario, apartment building residents could rally together and dissolve the town’s charter, only to have Scottsville absorbed fully by Albemarle County, he said. That particular comment stoked the fears of people in the audience who spoke about Scottsville being treated like the “ignored stepchild” or “the armpit” of Albemarle County.
A few others mentioned “the types of people” who might rent the affordable units.
“I like meeting new people, but I don’t want it to be a busload of immigrants,” one resident said. Nor does he want Scottsville to be built up like Crozet has been. “Crozet’s nice, but they’re not friendly there,” he said.
Others feared wealthy households moving in and driving up the overall cost of living in town. Some councilors said that people who rent are not involved or committed community members.
At least two people stood up before Council to say they couldn’t believe what they were hearing from some of their neighbors.
After the public comment period closed, Councilor Dan Gritsko suggested delaying the vote to give Council and community members more time to understand the project. Mayor Smith said that Council could indeed delay a vote, and started to say that he’d like to see a councilor make a motion to do so.
But before Smith finished his sentence, Councilor Edward Payne Jr. motioned to deny the rezoning application and special use permit, and Councilor Alex Bessette seconded it.
Council voted four to two against the project.
The vote was so upsetting to Councilor Zachary Bullock that he resigned from his seat then and there.
“We have missed an opportunity that will not soon return, if ever,” he said, clearly exasperated. “I am a volunteer. I have heard loud and clear from this community that I do not reflect its interests any longer, nor do I reflect the interests of the councilors on this dais, excluding Councilor Gritsko.”
Bullock’s declaration was met with stunned silence from the board.
Some of the naysaying community members and elected officials, including Councilor Meredith Hynes, believed that Echelon and Southern Development would come back with a different, possibly smaller project for the community to consider. But that’s not the case.
“At this point, the project is dead,” Randy Cosby of Echelon Resources told Charlottesville Tomorrow in an email. The owner of the property, Southern Development, said from the start that if town council denied the rezoning and special use permit, it would instead build an industrial park.
The industrial park will have some financial benefit to the town, but not as much as the apartments would have, said Lawless. It will likely bring some money in the way of contractor fees, particularly during the renovation phase. How much money comes later depends on the tenants the owner chooses to lease to.
Smith understands why so many folks were nervous about an apartment complex. Most Scottsville residents haven’t experienced development, or change, at that scale, he said.
“Unfortunately, in my opinion, there are a number of people here who do not sense the need to secure the future of Scottsville,” Smith said.
Now, the Council must find another way to deal with its $200,000 deficit.
Most of that deficit exists because Scottsville is paying more for staffing now that it did in 2019 — it’s the single largest expenditure.
In 2021, the town hired several people to open a DMV Select office. It also gave its existing staff raises. The town clerk’s salary, for instance, rose from $36,000 to $45,900. The town administrator (Lawless) went from $48,000 to $59,000. Police officers and other staff received raises, too, and altogether Scottsville is now spending $133,000 more on payroll than it was in 2019.
Life and health insurance for all employees is also costing thousands of dollars more. Other line items like computers, liability insurance, diesel fuel, and even postage, are going up a few hundred or a few thousand dollars here and there, and that starts to add up.
There are two options: Slash expenses or increase revenue.
The town’s government services committee has made some suggestions for slashing expenses, and most of them would affect town employees. Closing the town’s DMV Select — and terminating its two employees — would have the largest savings, reducing town spending by $110,000. Cutting the part-time police officer position (leaving three full-time officers) and reducing the town maintenance position from full-time to part time, would reduce spending by tens of thousands of dollars more.
Canceling a $6,000 public art grant, having fewer holiday decorations and eliminating riverfront landscaping improvement would save a few thousand dollars, too.
Canceling a sidewalk construction project, at least for now, could also save the town around $10,000.
In 2019, Scottsville received a grant from the Virginia Department of Transportation to construct sidewalks on Bird Street, near the Scottsville branch of the Jefferson-Madison Regional Library. VDOT would put up $320,000 for the project and the town would pay any overages.
But then COVID-19 hit and the town delayed construction due to budget uncertainties. Since then, construction costs have skyrocketed, so that VDOT money won’t go as far, and as the budget stands now, the town can’t afford the overages.
The only way to avoid such serious cutbacks is to bring in more money. That means raising taxes.
Most of the town’s revenue comes from a meals tax. It also gets money from things like business licenses, renting out town property and a few other small taxes.
That income has mostly remained stagnant since 2019. Council could increase those tax rates, though. For instance, increasing the rate on the meals tax, the biggest source of revenue for the town, from 4.5% to 6%, could add another $60,000. They could also bump up the lodgings tax for hotels and short-term stays like Airbnb.
But there’s another, bigger tool in the toolbox, said Lawless, and Council is not using it: A real estate tax, something the town hasn’t had since the mid-1990s.
Scottsville residents do not pay real estate taxes to the town, but they do pay them to Albemarle or Fluvanna County, depending on which part of the town they live in. A Scottsville town real estate tax could be added on top of the county tax rates, which are currently 88.4 cents per $100 of value in Fluvanna, and 85.4 cents per $100 of value in Albemarle County.
A real estate tax of ten cents per $100 of value for town property owners could add at least $65,000 in revenue for Scottsville, Lawless said.
A real estate tax came up multiple times during Town Council public meetings about the proposed apartments. Some residents asked the Council not to impose a real estate tax, or increase any taxes, because it would affect their personal finances. Others encouraged the town to reinstate the tax, saying they’d be willing to pay for better services. A few pointed out something that was in Lawless’ fiscal impact report, that a property tax would be a boon for the town’s finances in large part because of the value of the factory property, no matter what’s on it.
“If the Town adopted a 10 cent real estate tax, the owner of a house valued at $300,000 would pay $300 per year to the Town. But the factory owner would pay $50,000 to the town,” Lawless wrote in the report.
Most likely, Town Council will balance the budget using some combination of spending cuts and tax increases. They’ll be difficult decisions, said Gritsko.
Also difficult, said the mayor, is thinking of all the things the town won’t be able to do. It’s extra painful perhaps because COVID-19 relief funds gave the town a taste of what it could be like to operate with more revenue. With the relief money, the town made some long-needed sidewalk repairs and bought an updated evacuation siren for the town’s flood pumps — a potentially life-saving investment if the James River breaches the levee built in the 1980s.
The town’s police department should have had body cameras, as well as a server to store the footage, years ago, but the town couldn’t afford it in a typical budget cycle, said Lawless. The town farmer’s market, which is an important social and economic center for the entire area, needed better paving. The air ventilation system in Victory Hall, where Town Council and other meetings are held, also needed updating to make it safer.
Smith wants the town to be able to invest in its own future — something he’s concerned about.
The town is shrinking not just in revenue but in population, he said. Since 1990, the town’s population has declined by about one-sixth, from 620 people in 1990 to 526 in 2020, according to U.S. Census data.
The town’s population will likely increase in the coming years, with the construction of 36 new single-family homes on Bird Street, the town’s first new neighborhood in 70 years. Smith cast the tie-breaking vote last year on that development, and he said he was happy to be able to do that.
Still, he worries that the way Council handled the apartment building application will damage Scottsville’s reputation and hinder the financial and population growth the town needs to survive.
He worries that without more new places for people to live, whether they’re new or long-time residents looking to downsize from a farm to an apartment in retirement, the town’s population will stagnate, or decline further. And if population falls, so does revenue, so do services.
“We’re not going to go out of business as a town,” Smith said. “But we’re not going to be able to do the things we want to do.”
This story was originally published in Charlottesville Tomorrow. For more reporting from central Virginia, subscribe to their free newsletter.