Loudoun taxpayers got some good news recently when the Virginia Department of Education (VDOE) released the new Composite Index (CI) report for the 2010-2012 biennium.  The report showed a large drop in the Loudoun County CI, which should translate into lower property taxes for Loudoun homeowners.

The CI is used by VDOE to determine the amount of funding the state provides to local school systems.  The lower the index, the more funding the state provides.  For instance, if the CI is .7000 then 70% of the cost of education (as determined by the state Standards of Quality) will be funded by the locality through local taxes and the state will fund 30%.  The CI is calculated using local real property values, adjusted gross income, taxable retail sales, population and school enrollment.  For details, visit www.doe.virginia.gov/VDOE/Finance/Budget/composite.html

Loudoun's CI dropped from .6708 for the 2008-2010 biennium to .5854 for the 2010-2012 biennium.  It was the largest drop of all 136 localities in Virginia!  Overall, the CI increased for 97 localities and decreased for 31 localities, while 8 localities remained at the cap of .8000.  This means Loudoun will get a significantly higher share of the roughly $7 billion the state spends on direct aid to public education every year.  Here is the history of Loudoun CIs:

• 2010-2012 biennium = .5854
• 2008-2010 biennium = .6708
• 2006-2008 biennium = .6895
• 2004-2006 biennium = .7220
• 2002-2004 biennium = .6851
• 2000-2002 biennium = .6571

Loudoun County politicians and officials have long expressed frustration over the relatively low amount of educational funding the state provides - citing it as a reason local property taxes are so high.  A drop in the CI will mean more state funding and a great opportunity for local property tax relief, provided the extra revenue will be applied to a lower tax rate and not to more spending!