1. LAND USE AND REVENUE FY 2013 – 2014 REVENUES ANALYSIS

2. FISCAL SUSTAINABILITY Decisions we (Town Council, Planning Commission, and EDA) make have an effect on the long-term fiscal health of the Town. The Town is in a strong position financially due primarily to revenue diversification. Local governments who faced the greatest issues over the past five years relied too heavily on real estate and personal property taxes. The fiscal impact of land use decisions should be an important consideration for every case before local elected and appointed boards.

3. BACKGROUND Fiscal Year 2015 General Fund (GF) Budget of $8,274,514 Fiscal Year 2015 Capital Projects Fund (CPF) Budget of $4,086,480. Estimated General Fund Reserve of $3,686,164 or 44.60% of GF expenditures

4. BUDGET HISTORY

5. REVENUE MAKEUP Property Taxes - Real Estate, Personal Property, Machinery & Tools, Mobile Homes, Public Service Local Taxes – Sales Tax, Utility Taxes, Bank Franchise Taxes, BPOL, Meals, Lodging, Cigarette, Vehicle License Fee Other – Permit Fees, Police Fines, Pool Fees, Interest, Recovered Costs State Aid – VDOT Maintenance Funds, Auto Rental, 599 Funds, Grants Federal Grants – Bulletproof Vests, DMV Traffic Safety Funds Unreserved Fund Balance Transfer – If expenditures exceed revenues, we transfer the balance from our savings account.

7. LOCAL REVENUES Local revenues make up almost 66% of the budget Of local revenues, only 17.77% is from property taxes. 77.92% of local revenues are from other local taxes Revenue diversification is a good thing In 2013, the median real estate tax rate for towns was.16/100. Average individual RE bill in Town is about $158.60

8. Largest single revenue source is the meals tax at 42.23% of other local taxes and 21.87% of the Town’s total revenues. While individuals pay these taxes, all but the motor vehicle license and utility taxes are generated by businesses located within the Town limits. OTHER LOCAL TAXES

9. WHERE DOES THE MONEY COME FROM? Approximately 85% of the Town’s local revenues come from business activities (i.e. because a business is located within the Town limits) Only 15% are generated from citizens of the Town (understanding the caveat that citizens do go and pay these various taxes at the businesses where they are generated) These percentages are not inherently good or bad. There is no perfect model for this balance. In Ashland, the dynamic business community is what keeps the Town’s real estate taxes so low. Of the various areas and business clusters within Town, the area surrounding the highway produces the highest revenue return per acre.

10. ARE YOU SAYING RESIDENTS DON’T PAY THEIR FAIR SHARE OF TAXES? Of course not, but they do get an amazing deal Residents get amazing police protection, great parks, clean,well maintained streets, brush and leaf pickup, a visitors center, a comprehensive stormwater program, plus much, much more for about $50 per year.

15. SUMMARY AND THINGS TO CONSIDER… Businesses provide a majority of Town tax revenue. Should we consider zoning more land for business? Should commercial uses receive incentives? Should we discourage residential uses? What role should the Town play in improving or enhancing existing commercial areas? The I-95 area has the greatest potential for revenue growth. Should efforts be focused towards this area for development/redevelopment? Should a strategic plan for this area be developed to ensure appropriate land uses locate in the area? What is the economic loss if residential uses locate in this area? We love downtown, but it is not the economic engine of the Town. Should we invest in downtown? Should we invest in other areas and use the resulting proceeds to invest in downtown? What is downtown’s role in the Ashland economy?