SUMMARY: Alamance County commissioners are looking to trim the proposed tax rate for the 2023-2024 budget year to 43 cents per $100 valuation, just above the 42.59 cents that the county’s tax administrator has determined to be the “revenue neutral” level for next year.
Still, the preliminary tax rate represents a reduction from the 45.43 cents recommended in May by county manager Heidi York. Each penny on the county’s tax rate equals about $2,514,301.
Thus, the 43 cents represents about $1 million above revenue neutral, but a reduction of about $6 million from York’s original proposal.
Commissioners seemed largely to reach a consensus although at least one commissioners, Craig Turner, held out the possibility of a revenue neutral number when the commissioners vote on a final number on Monday, June 19.
Meanwhile, the commissioners seemed also to have decided not to second-guess the proposed tax rates of the 12 rural fire districts.
While commissioner Bill Lashley said two of the fire districts’ recommended tax rates seemed abnormally higher than each of those district’s ‘revenue neutral’ levels, there seemed to be a consensus to leave the rates as recommended by each jurisdiction.
Commissioners will resume consideration on the budget on Monday night at 6:30 p.m.
Addendum: more detail on Tuesday discussion
After several weeks of cost-cutting and handwringing, Alamance County’s commissioners have reached a tentative consensus to structure the county’s next annual budget around a property tax rate of 43 cents for every $100 of property value.
A majority of the county’s governing board landed on this proposed figure during a work session on Tuesday afternoon – the third that the commissioners have, so far, convened as they grapple with the county’s finances for the fiscal year that begins on July 1.
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The board’s prospective new tax rate of 43 cents is a substantial drop-off from the county’s current levy on property of 65 cents for every $100 of value, which is the pre-revaluation rate.
The proposed figure is also 2.43 cents less than the county manager had suggested in her recommended budget to the commissioners, although it represents an increase of .41 cents over the “revenue neutral,” or status quo, rate that would effectively offset the windfall that the county would otherwise get from its latest state-mandated property revaluation.
During Tuesday’s work session, John Paisley, Jr., the chairman of Alamance County’s commissioners, touted the 43-cent levy as a workable solution to the board’s weeks-long struggle to provide adequate funds for the county’s programs and services without unduly increasing the tax burden on area property owners. Earlier this year, Paisley and his colleagues had unanimously endorsed a revenue neutral tax rate of 42.59 cents as the best way to achieve this precarious balance.
But on Monday, the board’s chairman argued in favor of the 43-cent tax rate as a more realistic alternative to the break-even levy.
“I think it’s a good compromise,” he told the rest of the board that afternoon, “and it does not leave us in a negative balance.”
In the end, commissioners Bill Lshley, Pam Thompson, and Steve Carter also threw their support behind the 43-cent rate, leaving commissioner Craig Turner as the lone board member still promoting the revenue neutral alternative. The commissioners nevertheless stopped short of formalizing their decision, which they plan to finalize on Monday when they vote on the county’s next annual budget.
In order to reach the 43 cent rate, the commissioners had to eliminate some $6.1 million from the proposed budget that county manager Heidi York had laid out for the county’s general fund in May. This sum ultimately proved much more attainable than the $7.1 million that the commissioners would’ve needed to attain a revenue neutral tax rate of 42.59 cents.
Yet, the board was greatly assisted in its push for that 43-cent target by a raft of spending reductions that commissioner Turner had previously suggested in his pursuit of a revenue neutral tax rate for the county’s next budget.
During another work session last week, Turner had floated roughly $6.8 million in budgetary changes that had brought the general fund’s outlays to within $300,000 of the figure that the commissioners needed to sustain a 42.59-cent property tax rate.
Among the items that went into Turner’s calculations were the reallocation of $2.5 million in the local school system’s capital reserves that the county had previously earmarked to pay off the debt on a bond package that the local electorate had approved for the schools. Turner also suggested some changes to the county’s own capital budget that freed up another almost $2.2 million, and he proposed an additional $732,033 in spending reductions by striking a single percentage point from a 5-percent cost-of-living adjustment that the county manager had recommended for the county’s entire full-time staff.
Turner’s fellow commissioners ultimately accepted each of these suggested revisions to the manager’s budget. They nevertheless balked on some of his other proposals, including the elimination of $274,000 that the county manager had proposed for the victim advocacy groups Crossroads and Family Abuse Services as well as the county’s Juvenile Crime Prevention Council.
The restoration of these funds proved particularly crucial to commissioner Thompson, as she made it abundantly clear during Tuesday’s discussion.
“Revenue neutral has been made to sound like the answer to everything,” she told the rest of the board. “I support revenue neutral…But if the vote is to cut all of these services to attain revenue neutral, I cannot support it.”
Thompson was joined by other board members in her impassioned defense of these nonprofits, and even Turner backed away from his proposed cut for Family Abuse Services, which he said he had cause to reconsider after speaking with the group’s executive director.
Turner’s fellow commissioners also took issue with some of his other recommended reductions, including a 90-day hiring freeze that he had hoped to apply to a number of the county’s staff-level vacancies. By the time that the board convened its work session on Tuesday, the county manager had pared down the posts subject to the proposed hiring freeze to 15, and the commissioners agreed to restore another vacancy in the county’s veterans services office, which further reduced the financial impact of Turner’s suggestion.
In addition to these proposed restorations, the commissioners decided to allocate an additional $222,000 toward the implementation of a salary study that the county manager has in the works to suggest more competitive wages for some of the hardest-to-fill jobs on the county’s payroll.
In the meantime, commissioner Carter proposed some additional tweaks in order to free up nearly $200,000 for the local school system to use to nudge up the salary supplement that the school system offers its teachers on top of their state-subsidized salaries.
York reminded the commissioners that they have no line item control over the school system’s budget. She added, however, that the schools superintendent has previously said that one of his priorities for the new fiscal year is to add a percentage point to the existing supplement, which ranges from 10.5 to 12.5 percent of each teacher’s state-subsidized salary.
With these changes in place, Carter and Thompson declared their support for the 43-cent tax rate. Meanwhile, commissioner Bill Lashley also endorsed this same figure since it dovetailed with the $212 million in outlays that he proposed for the county’s general fund after factoring inflation into the general fund’s current budget of roughly $203 million. Although Lashley insisted that he may still “have a few tricks up my sleeve,” he nevertheless accepted the levy that Paisley had proffered to the rest of the board.
“I’m like you, John,” he went on to tell the board’s chairman that afternoon. “If you held a gun to my head, right now I’d go with the 43 number.”
In the final tally, Turner emerged as the only board member still holding out in favor of revenue neutrality.
“I was intent to work toward the revenue neutral number, and we’re not there yet,” he told his fellow commissioners.
In either case, the commissioners opted not to vote on the new budget during the work session after Turner observed that it would come as a bit of a surprise to the public. The board also held off on a decision regarding the requested tax rates that the county’s 12 rural fire districts have proposed in light of the county’s property tax revaluation in January.
Lashley, for his part, took issue with a couple of these requested rates, which officials from each of the 12 districts had presented to the commissioners at their previous work session. Yet, the commissioner couldn’t bring himself to oppose the requested rates, which would be tacked onto the county’s own levy on property to fund the fire department which serves each of the 12 districts.
“To be honest with you,” he added, “all the savings that I could find would be $300,000. I don’t know if that would be enough to upset the apple cart.”
The commissioners will have an opportunity to vote on these rates as well as the county’s next budget when they convene their next regularly-scheduled meeting at 6:30 p.m. on the evening of Monday, June 19.
Read our editorial views on the status of commissioner deliberations, getting to a ‘revenue neutral’ tax rate: https://alamancenews.com/why-cant-county-commissioners-get-to-revenue-neutral/