Local government budgets under budget scrutiny

Local government budgets under scrutiny

BY CORY VAILLANCOURT POLITICS EDITOR

Acountywide property reappraisal earlier this year generated substantial increases in property value for many homeowners, who will now have higher tax bills despite lower tax rates. Taxpayers and elected officials on two local governing boards aren’t happy about that.

“I was hoping that we could balance the budget and stay revenue neutral, which looks like it’s gonna be tough to do, but I guess I’m still holding out that we could give it a little more time and possibly do that,” said Brandon Rogers, a Haywood County commissioner who voted against the proposed budget on June 7.

For most local governments, property tax revenue is the single largest source of revenue each year. Property tax bills are generated by multiplying the tax rate, expressed in cents per $100 of assessed value, by the assessed value. Usually, tax bills rise and fall based on the rise and fall of the property tax rate, but when property values rise — and the rate stays the same — bills go up.

That’s why elected officials on all five local governing boards in Haywood County looked long and hard at needs and wants and ended up proposing lower property tax rates. Those rates, however, aren’t “revenue neutral,” meaning they’ll still generate more revenue than in previous years due to higher bills paid by property owners.

Haywood’s tax rate last year was 58.5 cents. A revenue neutral rate that would have kept tax bills the same for the next budget year is 50.7 cents. Haywood commissioners opted to go with 53.5 cents, largely to fund the recommendations of a forthcoming pay study that all agree will show county employees as underpaid based on their experience and performance.

“It is because of my commitment to a neutral rate that I cannot vote for the proposed budget today,” said Haywood Commissioner Jennifer Best, who joined Rogers in opposing the proposed budget. “The need to increase wages for employees is one of our major driving factors in this year’s budget and unfortunately counties and municipalities often balance their budgets on wages, salaries and benefits.”

While Republicans Rogers and Best expressed support for the pay increases despite voting against the budget that would fund them, fellow Republicans Tommy Long and Kevin Ensley voted for it. Lone Democrat Kirk Kirkpatrick was the swing vote, pushing the measure over the top.

Best said it was the most difficult decision she’s had to make since being filling the seat of former Commissioner Mark Pless, who left to become a member of the N.C. House, but the new tax rate does mean that only 15 out of 100 counties in North Carolina have a lower rate than Haywood does.

A day after the Haywood meeting, the Town of Waynesville found itself in a similar situation.

Waynesville’s proposed budget looked to be a shoo-in for easy passage during the June 8 budget hearing, but a number of public comments opposing the tax increase derailed the vote.

Currently, the town’s tax rate is 49.57 cents. The revenue neutral rate would be 41.27 cents, but the budget proposal lists 45.45 cents as its preferred rate.

That, said Pigeon community resident Phillip Gibbs, would be a severe blow to people on fixed incomes.

“I want to make an appeal to the board to be conscious of the fact that we are mostly seniors and we are on fixed incomes,” Gibbs said. “I will not get any more money — next month, next week, next year — than I am getting right now. We’re having a hard enough time paying our taxes as they are. Now, I know the town needs money to operate, but please be aware of the fact that a lot of senior citizens can’t afford this.”

Waynesville resident Joey Reece also opposed the increase, but for different reasons than Gibbs.

“Let’s take a look at this budget from a 50,000-foot view. Tax revenue’s up dramatically, 13 percent or about 750,000 this year,” Reece said. “We’ll be the recipients of roughly $3 million in federal stimulus money, the Plott Creek apartments will add another $60,000 next year. Looks to me like the tax base increase is substantial and this has come about even during a global pandemic.”

Reece went on to lament local job loss, businesses closed, the $300 federal unemployment supplement likely ending soon, along with the federal foreclosure moratorium as reasons why now is no time for a tax increase.

“Do the right thing,” he said. “Cut the rate to a revenue neutral rate.”

Aldermen Chuck Dickson and Jon Feichter then called for the budget vote with the 45.45 cent rate to be postponed and asked town administration to prepare a presentation on what a revenue neutral budget might look like.

They’ll entertain that proposal during a special called budget meeting that will take place on Wednesday, June 16 at 10 a.m. at town hall, 16 S. Main St., in Waynesville.

By law, local governments have until midnight on June 30 to pass their budgets for the upcoming fiscal year, which runs from July 1 through June 30.

Be heard

The Town of Waynesville will conduct a special budget workshop meeting to reconsider its tax rate before entertaining the passage of its next budget. The meeting is open to the public. • Time: 10 a.m. • Date: Wednesday, June 16 • Location: Town hall, 16 S. Main St.,

Waynesville.

Maggie Valley passes budget, lowers taxes

BY HANNAH MCLEOD STAFF WRITER

Maggie Valley Town Board of Alderman passed the proposed 2021-22 budget on June 8.

The board accepted the balanced budget Town Manager Nathan Clark had presented, with the general fund increasing by 14.51 percent from FY 20-21 for a total of $3,068,510.

The budget contains a tax rate decrease of $.03, to 40 cents per $100 of assessed value. This is the lowest tax rate since FY 16-17 and currently the lowest municipal tax rate within Haywood County. The town’s adjusted adjusted revenue neutral rate would be $.38. Property tax is the town’s largest revenue source and is estimated to bring in $1,847,210 worth of revenue based on a 96.97 percent collection rate.

Sales tax is the next biggest source of revenue for the town’s general fund. Sales tax revenue allocated from the county is estimated at 1.79 percent or $509,724. This is up 2.5 percent from FY 20-21. Sales tax allocation is based on population distribution within the county.

Expenditures in the budget include renovations for town hall, some of which were postponed last year due to the financial uncertainty of COVID-19. These include a side door replacement for $11,424 and new security cameras for $10,000. There is $25,000 within the Board of Alderman line item to promote economic development and placemaking.

The Maggie Valley Festival Grounds is getting $8,700 worth of upgrades to the Wi-Fi network, $4,600 to design a parking lot on the old Sweet Briar Motel property, and $3,000 to continue the Holiday Movie Night at the festival grounds.

There is $50,000 in the Parks and Recreation budget for the Veteran’s Memorial to be constructed near the town hall flagpole, which may take more than one fiscal year to complete. Parks and Recreation will also be relocating the basketball court, $10,776, at town hall to make way for the construction of a new public works storage shed costing $158,290.

The Soco Road improvement project will likely be started this year following a delay due to COVID-19. The total cost for the project is more than $2 million, though the town has only had to pay $360,000 over the course of three years.

The police department is allocating funds for two new vehicles and other equipment, $64,950 and $24,570 respectively. The budget also provides funds for the purchase of a new K-9 officer in order to ensure each patrol shift has an active K-9 on duty.

Street maintenance is increased from $46,00 to $70,324 for the Rocky Top Road resurfacing project and other unidentified private streets. The budget includes $35,100 in Powell Bill funds to repair Spring Lake Road at Twinbrook Lane, though it is likely that Powell Bill Savings fund and the general fund will also be used for repairs.

While the town is in its second year without debt to the general fund, the sewer fund still has $187,00 worth of debt to cover repairs to the wastewater treatment plant. Sewer rates will increase by 6.25 percent for residential and commercial users. The sewer fund is $1,231,086 for FY 21-22, an increase of 35.84 percent from FY 20-21.