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Sylva ponders tax increase BY HOLLY KAYS STAFF WRITER ales tax receipts are booming in Sylva and a newly completed property revaluation will bump real estate values by about 14.5 percent this year — if tax rates stay the same, the town would expect to receive $345,000 more in the coming fiscal year than in the current year’s budget. That increase equals 7.86 percent of the estimated general fund revenues for 2021-22, but three of the town’s five commissioners say they support an increase to the tax rate as well. Despite the marked increase in projected revenue under the current tax rate of 42.5 cents per $100 of value, Town Manager Paige Dowling told the board that the town will have to pull $52,000 from fund balance to cover some essential items in its budget, and that even that wouldn’t include the $81,000 needed to fill new positions requested by the police and sanitation departments. “Pretty much what I’m saying is this budget accomplishes what we’re currently doing,” she said during a March 25 work session.
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PAYING FOR PERSONNEL
Smoky Mountain News
April 14-20, 2021
The biggest drivers for anticipated increases in the estimated 2021-22 budget are salaries, insurance and retirement benefits for town employees. Of the $218,000 estimated increase for the police department, $126,000 is for salaries and benefits. The remaining $92,000 is for standard vehicle replacements that had previously been funded through the town’s capital reserve fund and so had not appeared in the budget as a police department expense. The $40,684 increase for the street department is primarily for salaries, as is the $28,685 for administration. Of the $62,396 increase in miscellaneous expenses, $25,000 is for separation allowances, a type of retirement benefit that police officers receive. The heightened salary expenses stem from the standard 1.4 percent cost-of-living increase the town gives its employees combined with a 2.5 percent merit increase that the town board voted on earlier this year. Retirement benefits and health insurance cost increases figure in as well. The $52,000 Dowling suggested that commissioners take from fund balance would include setting aside $20,000 to go toward sidewalks during the N.C. 107 project, $18,000 to cover increased fire department costs following the revaluation, $7,000 for a pay study of the town’s workforce and another $7,000 for a feasibility study on building a public restroom downtown — though a follow-up discussion April 8 indicated town staff would take on the bathroom feasibility research to avoid the $7,000 cost. None of that would fund the two police officers and one part-time sanitation employee that department heads begged commissioners for during an earlier budget work ses12 sion Jan. 29.
Police Chief Chris Hatton says his department needs more officers to respond to skyrocketing calls for service, but some say the graph is misleading and that police officers are not the best choice to respond to the types of situations making up most of that increase. Donated graph
Protestors hold signs opposing a plan to increase taxes to fund additional police officers during a public hearing on a different topic the board held at Bridge Park April 1. Holly Kays photo Police Chief Chris Hatton told commissioners that he needs two additional officer positions, which would cost $69,500 apiece for salary plus additional costs like equipment and training. Public Works Director Jake Scott asked for a part-time sanitation employee, which would cost $12,000. Because these positions would be ongoing costs, the money can’t come from fund balance, which is treated more like a savings account used to defray one-time expenses.
A QUESTION OF TIMING The conversation between board members March 25 for the most part was not about whether or not there is a justified need for more police and sanitation employees.
Rather, it was about whether 2021 — midpandemic, post-revaluation — was the time to pay for them. “What I’m hearing from people is, ‘I just had the worst financial year of my life this year, and yet my property value went up,” said Commissioner David Nestler. “I don’t think it’s a good year to say we’re going to also raise your tax rate on top of that.” After the last revaluation took place in 2016, property values went down drastically, as it was the first revaluation following the recession of 2008. The average home in Sylva was worth $162,000, while following the 2021 revaluation that average value rose to $171,500. That means a person with the average home value in 2016 would owe the town $688.50 in annual property taxes under the
current tax rate, but that bill would rise to $728.86 following the revaluation. In 2016, lower overall property values combined with perennial budget shortfalls prompted commissioners to increase the tax rate from 30 cents per $100 to 42.5 cents per $100. Some town residents may have expected that the reverse would be true following a revaluation yielding a substantial increase in value. Nestler made multiple comments to that effect, saying that he “didn’t want to stomach” a rate increase at this time. “So when do you want to stomach it?” asked Commissioner Ben Guiney. “Do you want to do it next year?” Providing quality services is one of the town board’s biggest roles, Guiney said, and without sufficient funding the town can’t provide quality services. “Chris (Hatton) and Jake (Scott) have made a compelling case, at least to me, that the staffing needs to increase now, not a year from now, and I think we should pay for it,” he said. During the Jan. 29 meeting, Hatton told commissioners that demand for police services was skyrocketing — officer actions and calls for service increased 64.7 percent from 2019 to 2020 — even as staffing had remained the same for 13 years. Officers are routinely called in to work extra shifts on their days off to cover for colleagues who are on vacation, off sick or away at training — it drains morale, impairs retention and strains services, Hatton said. Meanwhile Scott said his crews have been dealing with an explosion of solid waste, removing 22.5 percent more tons of trash in 2020 than in 2019. “My opinion is I think we need both of the additional personnel costs,” said Mayor Lynda Sossamon. “We may have to give something else up if nobody wants to raise taxes, but I definitely think those are needed for services.” “Where are you going to find $81,000 in savings without a tax increase?” asked Nestler. Commissioner Mary Gelbaugh agreed with Nestler’s view, pointing out that many businesses weren’t able to make their usual income this year and that their budgets may be worse off than the town’s is right now, without the tax increase. Meanwhile, Commissioner Barbara Hamilton said she would support a tax increase if it meant taking some of the burden off of the town’s existing police force. “We have lost so many officers within the last couple years because they can go to Waynesville, they can go to Asheville, they can go to other places and have some benefits and know they can have time off with their families,” she said. “I’m not for a tax increase but my goodness, if you were in their spot, how would you feel if you had to do that every single day?” It might not be popular, she said, but the town needs to fund at least one new officer position. During an initial straw poll of board members’ thoughts on the subject, Commissioner Greg McPherson swung the majority to the side of foregoing a tax increase this year, but his position changed when Hatton presented some new information about the state of his department.
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