Montgomery County will operate on a $156.5 million budget during fiscal year 2008-09, a $2.9 million dollar reduction from the budget first presented to the board of supervisors. The budget, approved in a 4-3 vote Monday night, is based on a 71 cent real estate tax rate and includes an additional 2 cents of capital improvement plan money previously set aside for school construction.

But three plans drafted by county staff to assist the board during budget-setting spurred heated debate among supervisors.

Two of the plans called for using an additional cent of capital improvement plan money to ultimately fund compensation increases for county employees, something Supervisor Gary Creed called "thievery."

"We cannot take $656,855 from money that we've got set aside for CIPs that can only be used for CIPs for school buildings and put it over in here for compensation for employees," he said. "Anything that stays within that dollar amount budget we can use, but anything above that is not doing anything but lying and cheating to the general public."

Supervisors Annette Perkins, Bill Brown and Mary Biggs disagreed with Creed, saying that a plan had not been passed dictating how the money had to be spent.

But Supervisor John Muffo agreed with Creed, saying that it was not good fiscal policy to convert debt money into money for employee compensation.

"I don't know if I'd call it lying or cheating, but I'd say it's maybe poor management," Muffo said. "As much as I'd like to see the employees get a raise, I think we need to worry about debt ... I think we may have some unexpected expenses ahead of us and I think we need to be very conservative about our finances."

In the end, supervisors approved using 2 cents of the capital improvement plan money in the 2008-09 budget, and what was labeled as "plan one" in handouts. According to plan one, the average pay raise for county employees will be 5.5 percent, much to the dismay of Perkins and Biggs.

Each disclosed before voting that they are employed by Montgomery County Public Schools, though Perkins is scheduled to retire June 30.

"I'm extremely unhappy," Perkins said. "I believe that we have made a commitment to our deputies, to our county employees and to our school employees to attempt to try to raise their salaries, especially when last year nothing much was given to the school employees."

Plan one also calls for spending approximately $2.6 million of windfall, or one-time, money in the following ways:

n Joinder study: $226,950

n Gypsy moth program: $50,365

n Waste containers: $31,000

n Mobile data terminals: $110,000

n Rainy day fund: $1 million

n Fuel reserve: $208,105

n Fire and rescue: additional $400,000 for a total of $1.1 million

n Roads: $500,000

n Brain Injury Services of Southwest Virginia: $1,000

n Parks and recreation: $100,000