Monday, June 17, 2024

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Graham, NC 27253
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County mgr. recommends 2¢, 4.6%, hike in property taxes to fund 2.8% spending increase

Alamance County’s manager has floated a new spending plan for the county that aims to “fortify” existing programs and services through measures that include a 2-cent increase in the county’s property tax rate.

This potential tax hike, which would lift the county’s levy on property from 43.2 to 45.2 cents for every $100 of value, is just one of several bitter pills that county manager Heidi York prescribed for the next fiscal year when she pitched her proposed budget to the county’s board of commissioners on Monday.

[Story continues below.]


See related budget stories:

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• Sheriff wants property tax increase to help his staffing shortages: https://alamancenews.com/sheriff-promotes-property-tax-hike-to-help-fill-staff-level-vacancies/

• School system doesn’t comply with state law; doesn’t submit its budget request in time for consideration: https://alamancenews.com/school-system-turns-in-budget-request-too-late/

• Commissioner scuttles capital funding for school system (twice) because she says the fix is a mere ‘band-aid’: https://alamancenews.com/thompson-no-more-band-aids-former-school-board-chairman-quashes-proposals-to-provide-more-capital-funds-for-school-system/


Among York’s other painful recommendations are a rather deep gouge into the county’s reserves as well as the omission of roughly $19.8 million in departmental spending requests. Her budget also deals a harsh blow to the Alamance-Burlington school system, whose plea for an extra $10.3 million from the county is effectively snub-bed due to the school system’s belated submission of this request.

All the same, York assured the commissioners that these difficult concessions will be necessary to keep the county on an even keel as it enters the next financial cycle on July 1.

“We’re grappling with significant revenue challenges,” the county manager acknowledged when she addressed the county’s governing board at the end of a four-hour meeting. “Honestly, we have found ourselves at a very critical juncture with this budget with our mission being compromised because we’re struggling to provide high quality services for our citizens and community members.”

York went on to confess that recent developments have forced her to set aside the ambitious goals of rebuilding the county’s infrastructure and workforce, which the commissioners had enunciated at their annual retreat. Instead, she said that her spending plan attempts to “fortify the foundation” of county governing in order to provide a solid base for the commissioners to build on in years to come.

York said that she has taken a rather conservative tack toward both revenues and expenditures in formulating her financial recommendations.

“We tackled some big challenges in this budget such as the end of Covid funding, fluctuations in your sales tax revenues, and contract escalations,” she added, “and we did a real drilling down into the details of the line item requests.”

Alamance County’s manager has floated a new spending plan for the county that aims to “fortify” existing programs and services through measures that include a 2-cent increase in the county’s property tax rate.

This potential tax hike, which would lift the county’s levy on property from 43.2 to 45.2 cents for every $100 of value, is just one of several bitter pills that county manager Heidi York prescribed for the next fiscal year when she pitched her proposed budget to the county’s board of commissioners on Monday.

Among York’s other painful recommendations are a rather deep gouge into the county’s reserves as well as the omission of roughly $19.8 million in departmental spending requests. Her budget also deals a harsh blow to the Alamance-Bur-lington school system, whose plea for an extra $10.3 million from the county is effectively snub-bed due to the school system’s belated submission of this request.

All the same, York assured the commissioners that these difficult concessions will be necessary to keep the county on an even keel as it enters the next financial cycle on July 1.

“We’re grappling with significant revenue challenges,” the county manager acknowledged when she addressed the county’s governing board at the end of a four-hour meeting. “Honestly, we have found ourselves at a very critical juncture with this budget with our mission being compromised because we’re struggling to provide high quality services for our citizens and community members.”

York went on to confess that recent developments have forced her to set aside the ambitious goals of rebuilding the county’s infrastructure and workforce, which the commissioners had enunciated at their annual retreat. Instead, she said that her spending plan attempts to “fortify the foundation” of county governing in order to provide a solid base for the commissioners to build on in years to come.

York said that she has taken a rather conservative tack toward both revenues and expenditures in formulating her financial recommendations.

“We tackled some big challenges in this budget such as the end of Covid funding, fluctuations in your sales tax revenues, and contract escalations,” she added, “and we did a real drilling down into the details of the line item requests.”

 

When the levy breaks…

In the end, York put together a budget that calls for $220.5 million in outlays from the county’s general fund – a repository for various taxes and fees which bankrolls most of the county’s operations. An increase of roughly $6 million, or 2.8 percent, over the general fund’s current expenditures, York insisted that this total still falls short of the rate of inflation, which she put at 3.3 percent based on the consumer price index.

In order to justify this increase in overall outlays, York harked back to a spiel that the commissioners had heard earlier that evening from Alamance County’s sheriff Terry Johnson.

In his remarks to the county’s governing board, Johnson had urged the commissioners to raise property taxes to order to address the turnover that he said has crippled his agency and other county departments. Although her rhetoric was a bit more subdued, York also encouraged the commissioners to accept a tax hike, which she assured them will prove far less burdensome on the average taxpayer than the naysayers would have them believe.

York predicted that her recommended 2-cent hike, which amounts to a 4.6 percent increase over the current tax rate, will ultimately cost an extra $52.80 a year for a typical homeowner with a house worth $263,997 according to the county’s tax department. She added that the revenue from these 2 pennies will be effectively wiped out by state-driven increases in retirement costs as well as the inflationary jumps in the county’s contracts, utilities, and sundry supplies. She also consoled the commissioners that, even with the proposed increase, Alamance County’s property tax rate will still be the envy of every neighboring county.

“We’re one of the fastest growing counties in the state,” she added, “and yet we also have one of the lowest tax rates…Even at the new tax rate of 45.2 [cents], Alamance County would still be the lowest of any of our surrounding regional counties.”

 

Digging deep to fund operations

York went on to emphasize that the additional revenue from her proposed levy on property will compensate for an anticipated drop off in sales tax receipts, which she is expecting to fall by $3.3 million from the current year’s estimate.

York told the commissioners that she has also penciled in $8.4 million from the general fund’s accumulated reserves, or fund balance, despite her reluctance to break into the piggy bank just to cover the county’s routine operations. The county manager warned that this proposed allocation would reduce the county’s usable savings to about 17.9 percent of the general fund’s annual budget – less than the 20 percent threshold that the commissioners had previously set as their goal.

“So this is not a revenue source we can continue to tap as we adjust this budget,” she went on to admonish the county’s governing board.

In any event, York said that these uncomfortable concessions on the left side of the ledger will allow the county to maintain many of current expenditures in the new fiscal year. Among other things, she noted that her budget recommends the same 3-percent cost of living adjustment and 2-percent merit based raise that the county’s workforce received in the current year. York has also endorsed a proposed stipend that the sheriff has sought for his investigators as well as the implementation of the next phase of an ongoing salary study.

At the same time, York said she has vetoed $19.8 million in new allocations that the heads of the county’s departments and agencies had sought in the budget. These omissions include more than 30 staff-level positions that would’ve been paid for from the county’s general fund as well many of the 26 new vehicles that various departments had requisitioned.

York added that her budget contains three new employees whose salaries won’t come out of the general fund. These prospective new hires include a foreign language interpreter for the health department’s self-funded dental clinic, and two posts in a proposed “recovery” court that the local court system intends to launch with the county’s share of a national legal settlement with opioid makers and distributors.

 

Extra for ACC, par for ABSS, which didn’t submit budget on time

As for the county’s contribution to public education, York has proposed an extra $848,140 for Alamance Community College – or about half of the $1.6 million that the college has sought on top of its current allowance.

York has nevertheless made no similar gesture to the Alamance-Burlington school system, which has reportedly asked the county to tack $10.3 million onto the $48.8 million a year that it already spends on the school system’s operations.

The county manager said that she has retained the school system’s current operational allotment as well as its existing capital outlay of $3.9 million due to its failure to provide her office with a timely budget request.

York pointed out that state law requires every school system to submit its “entire” budget to its home county by May 15. York added, however, that she and her colleagues received nothing from Alamance-Burlington’s administrators until they dispatched a cursory PowerPoint overview of the budget at 5:04 p.m. on Friday, May 17.

“I’m not sure that we’re meeting the requirements of the General Statutes with respect to the school budget submission,” she added. “Due to the fact that we didn’t receive a timely budget until well after the recommended budget was sent out for printing, I recommended level funding in this budget as anything else would’ve been presumptive. Any increase the board would like to make from current expense funding will increase additional revenue through a property tax increase.”

The commissioners will ultimately have an opportunity to tinker with any or all of York’s recommendations when they convene a series of “work sessions” in the coming weeks. These meetings are scheduled to take place at 10:00 a.m. on May 30, June 10, and June 12. In the meantime, members of the general public will be able to weigh in on the spending plan when it comes up for a public hearing on the evening of Monday, June 3.

In the end, York put together a budget that calls for $220.5 million in outlays from the county’s general fund – a repository for various taxes and fees which bankrolls most of the county’s operations. An increase of roughly $6 million, or 2.8 percent, over the general fund’s current expenditures, York insisted that this total still falls short of the rate of inflation, which she put at 3.3 percent based on the consumer price index.

In order to justify this increase in overall outlays, York harked back to a spiel that the commissioners had heard earlier that evening from Alamance County’s sheriff Terry Johnson.

In his remarks to the county’s governing board, Johnson had urged the commissioners to raise property taxes to order to address the turnover that he said has crippled his agency and other county departments. Although her rhetoric was a bit more subdued, York also encouraged the commissioners to accept a tax hike, which she assured them will prove far less burdensome on the average taxpayer than the naysayers would have them believe.

York predicted that her recommended 2-cent hike, which amounts to a 4.6 percent increase over the current tax rate, will ultimately cost an extra $52.80 a year for a typical homeowner with a house worth $263,997 according to the county’s tax department. She added that the revenue from these 2 pennies will be effectively wiped out by state-driven increases in retirement costs as well as the inflationary jumps in the county’s contracts, utilities, and sundry supplies. She also consoled the commissioners that, even with the proposed increase, Alamance County’s property tax rate will still be the envy of every neighboring county.

“We’re one of the fastest growing counties in the state,” she added, “and yet we also have one of the lowest tax rates…Even at the new tax rate of 45.2 [cents], Alamance County would still be the lowest of any of our surrounding regional counties.”

 

Digging deep to fund operations

York went on to emphasize that the additional revenue from her proposed levy on property will compensate for an anticipated drop off in sales tax receipts, which she is expecting to fall by $3.3 million from the current year’s estimate.

York told the commissioners that she has also penciled in $8.4 million from the general fund’s accumulated reserves, or fund balance, despite her reluctance to break into the piggy bank just to cover the county’s routine operations. The county manager warned that this proposed allocation would reduce the county’s usable savings to about 17.9 percent of the general fund’s annual budget – less than the 20 percent threshold that the commissioners had previously set as their goal.

“So this is not a revenue source we can continue to tap as we adjust this budget,” she went on to admonish the county’s governing board.

In any event, York said that these uncomfortable concessions on the left side of the ledger will allow the county to maintain many of current expenditures in the new fiscal year. Among other things, she noted that her budget recommends the same 3-percent cost of living adjustment and 2-percent merit based raise that the county’s workforce received in the current year. York has also endorsed a proposed stipend that the sheriff has sought for his investigators as well as the implementation of the next phase of an ongoing salary study.

At the same time, York said she has vetoed $19.8 million in new allocations that the heads of the county’s departments and agencies had sought in the budget. These omissions include more than 30 staff-level positions that would’ve been paid for from the county’s general fund as well many of the 26 new vehicles that various departments had requisitioned.

York added that her budget contains three new employees whose salaries won’t come out of the general fund. These prospective new hires include a foreign language interpreter for the health department’s self-funded dental clinic, and two posts in a proposed “recovery” court that the local court system intends to launch with the county’s share of a national legal settlement with opioid makers and distributors.

 

Extra for ACC, par for ABSS, which didn’t submit budget on time

As for the county’s contribution to public education, York has proposed an extra $848,140 for Alamance Community College – or about half of the $1.6 million that the college has sought on top of its current allowance.

York has nevertheless made no similar gesture to the Alamance-Burlington school system, which has reportedly asked the county to tack $10.3 million onto the $48.8 million a year that it already spends on the school system’s operations.

The county manager said that she has retained the school system’s current operational allotment as well as its existing capital outlay of $3.9 million due to its failure to provide her office with a timely budget request.

York pointed out that state law requires every school system to submit its “entire” budget to its home county by May 15. York added, however, that she and her colleagues received nothing from Alamance-Burlington’s administrators until they dispatched a cursory PowerPoint overview of the budget at 5:04 p.m. on Friday, May 17.

“I’m not sure that we’re meeting the requirements of the General Statutes with respect to the school budget submission,” she added. “Due to the fact that we didn’t receive a timely budget until well after the recommended budget was sent out for printing, I recommended level funding in this budget as anything else would’ve been presumptive. Any increase the board would like to make from current expense funding will increase additional revenue through a property tax increase.”

The commissioners will ultimately have an opportunity to tinker with any or all of York’s recommendations when they convene a series of “work sessions” in the coming weeks. These meetings are scheduled to take place at 10:00 a.m. on May 30, June 10, and June 12. In the meantime, members of the general public will be able to weigh in on the spending plan when it comes up for a public hearing on the evening of Monday, June 3.

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