BEAUFORT -- Property tax rates could jump by 7 percent or more next year as Beaufort County government and schools struggle to find revenue to keep services at an acceptable level, officials said Monday.

County administrator Gary Kubic and Edna Crews, who takes over July 1 as school district superintendent, told County Council's Finance Committee they want to keep budgets as low as possible. They stressed their figures were very preliminary in nature, and no decisions on budgets or taxes will be made for several months.

"I'm going to be pushing not to raise taxes, but I'm not certain at this point that it's going to be possible," Kubic said.

Much of the expected increase would be caused by the state budget as approved last week by the state House. That budget, which now is in a Senate committee, would tweak the school funding formula to cut about $6.6 million from Beaufort County schools.

Local legislators have said they expect the money will be restored before the state budget is signed into law. But if it's not restored, that loss alone would result in about half of the increase.

This year, the county and schools both are operating under budgets that raised the tax rate only based on population growth and inflation. County government took $1.1 million out of its reserve fund just to balance the budget.

Now, that reserve fund is shrinking, down to $3.1 million, according to finance director Tom Henrikson. With that relatively small amount of cash in the bank, the county likely will be hit with higher interest rates whenever it borrows money in the future.

Under current tax rates, a $200,000 owner-occupied house pays $1,142.40 in property taxes to operations and debt for both the county and schools. If the "worst-case scenario" of a 7 percent increase is adopted, that would rise to $1,222.40 -- an $80 increase.

Property taxes for municipalities, fire districts and public service districts haven't been determined. County Council must approve the county and schools' tax rates for the budget year that starts July 1.

Kubic said county government faces rapidly increasing costs in several areas, including employee health insurance, workers' compensation, utilities, and aging facilities and equipment. The county also is in the process of vacating the dilapidated Bluffton Center, which houses a health clinic, magistrate's office and other services, and moving into a new office building on the Bluffton Parkway.

The budget debate comes as some County Council members have asked Kubic to create a system that gives county employees a way to work up in the system and some predictability to salary increases.

Complicating matters further is the countywide property reassessment that was conducted last year. Thousands of property owners faced increases, some as high as 800 percent.

About 10,000 property owners are appealing the value that was placed on their land. Of the appeals that have been decided, Henrikson said a majority are reducing the assessment, by an average of about 15 percent. If assessments are lower than originally estimated, it probably will mean an increase in the tax rate.

County buildings continue to age, and capital improvements must be made before buildings become decrepit and unusable, Kubic said, and council members will need to decide whether to invest in maintenance of old buildings.

"It won't be long before all of the chickens come home to roost," Councilman Skeet Von Harten said of the accumulating costs. "It's going to be painful, ... but we can't let the building fall down around our ears."

Crews, the superintendent-designate, said the schools had put off some maintenance for too long.

"We have deferred some things to the point where it's, 'Pay me now, or pay me later,' " she said.

Officials also have said they expect to ask voters to increase the sales tax next year.

Stu Rodman, chairman of the school board's Finance Committee, said he expected that the board would seek to put a sales tax question on the ballot to pay for new schools. A consultant recently reported that with aging facilities and thousands of new students, the district would need almost $200 million worth of new schools and $100 million to fix up the existing facilities.

Several County Council members have said they also expect to ask voters to approve a sales tax increase to pay for various projects, including transportation improvements and rural land purchases.