Loudoun County government will use $99.6 million in leftover funding of fiscal year 2018 money to catch up on skyrocketing construction costs on some projects and avoid financing costs on some others.
The money comes from the previous fiscal year’s fund balance, from the county collecting more in tax revenues than it spends. This year that number is higher than usual due largely to higher-than-expected revenues from taxes on data centers. Much of it will go into contingency funding for projects that are expected to exceed their budgets.”
“We have had a lot of difficulty with project bids coming in higher than expected,” said Management and Budget Director Erin McLellan at the Board of Supervisors meeting Wednesday, Jan. 2. “We have a very competitive construction market, a very tight construction market, and as such we need to keep our existing projects moving.”
The largest portion of that money, about $21.1 million, will go simply to contingency funding for projects that run over budget. Several projects are already expected to draw from that fund, immediately requiring $15 million of that money.
A project’s costs go up each year it is delayed, and Loudoun’s finance officers have recently revised their estimates for how much that costs upward.
A relatively small portion of that fund balance, almost $4 million, will go to specific projects directed by county supervisors including a safety study on Evergreen Mills Road, startup costs for an Adult Drug Court, a plan to make county bus stops compliant with the Americans with Disabilities Act, and funding for a program to help pay to set up conservation easements.
Another $12.3 million will go to eight relatively small projects, paying for them with cash rather than debt financing to avoid an estimated $2.2 million in costs such as bond payments. Those include projects like public safety radio replacements, an Ashburn volunteer fire department truck, and broadband connections and bus replacements for the school system.
And a total $52 million will carry over to the fiscal year 2020 budget—the budget county staff members and supervisors will be preparing for the next three months, and which begins in July—to go toward other major projects and possibly making up the difference of a potential tax cut.
Supervisor Geary M. Higgins (R-Catoctin) pushed to have a Lovettsville park specifically named in the contingency fund. While the park is funded and expected to go out for construction contract bids in the winter, Department of Transportation and Capital Infrastructure Director Joe Kroboth said it may need to be split up into two phases if those bids are to expensive. Kroboth said currently the project is budgeted for $14.4 million, but could need as much as another $4.7 million in funding.
Higgins said the project has been delayed or left unfunded time and again.
“All I want is a commitment that if we need funding, we will fund it…” Higgins said. “I hope that you all would see fit to fund the project and fulfill a commitment we have to the community that has been dragging on forever.”
But other supervisors said that is redundant—”the contingency fund will fund the park if needed,” the purpose of a contingency fund, said Chairwoman Phyllis J. Randall (D-At Large). And Supervisor Matthew F. Letourneau (R-Dulles) said it’s not the county’s practice to spend money on a budget overrun before a project is actually over budget.
“I sympathize a ton with what Supervisor Higgins is saying, because watching projects get delayed is probably the biggest frustration I’ve had on this board,” said Supervisor Ron A. Meyer Jr. (R-Broad Run). But, he said, every supervisor’s district includes projects like that, including in his own district sidewalks that are not expected to be ready by the time Metrorail trains start running in 2020.
Supervisors voted 5-3-1 against Higgins’ proposal, with Higgins, Randall and Supervisor Tony R. Buffington (R-Blue Ridge) in support and Supervisor Koran T. Saines (D-Sterling) absent.