HANOVER, VA (WWBT) - Home values in Hanover County continue to take a hit, falling more than five percent last year.
Hanover County homes are worth 711 million dollars less this year than they were last year.
That's causing a big headache for the county government and its upcoming budget.
More than half of the general fund for the county comes from real estate assessments and property taxes.
Hanover County estimates it's going to have $7.4 million less this year than it did last year.
Angela Kelly-Wiecek is one of four freshman board members elected this fall.
She's just starting her term on the board and she's already facing a tall task - trim $7.4 million from the county budget.
"Governments, local, state, federal, are all under a crunch right now," Kelly-Wiecek said. "None of us came into this not realizing it'd be hard work."
The county has already made a series of budget cuts in recent years.
"If there is any fat left, which I don't believe there is, we (need to) make sure we trim that," she said.
Compounding this problem is a lack of money coming from Washington and Richmond.
County leaders say federal stimulus money has dried up and the state is sending less money to local governments.
Sean Davis is another new board member elected this fall.
He says the board will have to make some tough decisions to stay out of the red.
"Is this item right here worth a fireman, a teacher or a deputy, is this item worth taking something away from our children?" Davis said. "And if it's not, that's how we prioritize."
Board members say it's too early to say exactly which county services are likely to see cuts.
"The fact of the matter is we're going to have some issues in this budget that we've never seen before," he said. "We're probably going to have to make some tough leadership decisions."
The value of Hanover County real estate has dropped by $1.4 billion in the last three years.
The Board of Supervisors will finalize its budget later this spring.