Graham city manager Megan Garner presented her recommended $17.8 million budget for the upcoming fiscal year that would keep the city’s property tax rate at its current level, 45½ cents per $100 of valuation.
Graham’s city council approved the water and sewer fund budget two weeks ago, with water and sewer rate increases taking effect May 1. Garner is also proposing a 24 percent increase in monthly garbage and recycling, which would rise from $8.50 per unit to $10.50 per unit, per month for the 2022-23 fiscal year (see separate story this edition).
On the revenue side of the ledger, one penny of Graham’s property tax rate is estimated to generate $133,967 in revenue during the upcoming fiscal year, Garner noted in her budget proposal. The city of Graham has also received a total of approximately $5 million in federal Covid-19 stimulus relief funding through the American Rescue Plan Act that Congress passed in March 2021, though those funds remain unspent, based on Garner’s budget presentation.
For 2022-23, the manager is proposing a 4 percent cost-of-living adjustment (COLA) for all city employees. “Although the consumer price index as of January 2022 was 7.5% due to extreme inflation the economy has experienced within the last year, the proposed cost of living adjustment is 4 percent and would begin in the first full pay period of the new fiscal year,” Garner elaborated in her budget message.
Garner is recommending hiring six new full-time patrol officers for the city’s new community policing initiative. Part of the costs for those positions will be offset by a grant through the Community Oriented Policing Services (COPS) division within the U.S. Department of Justice, Graham police chief Kristi Cole said in a recent interview with The Alamance News. The manager is also recommending hiring two captains for Graham’s fire department.
Expenses for public safety, estimated at $7.3 million, are projected to exceed property tax revenue ($6.1 million) by $1.1 million, Garner notes in her recommended budget. She has also called for restructuring the fire department, which entails reclassifying a single, existing fire captain to a “shift captain” and adding two others so each shift would have a dedicated supervisor.
Garner said in her budget message that the city is faced with some increases in expenditures that stem from changes at the state level , such as a 7.1 percent increase in employee health insurance premiums, which she estimates will cost the city an additional $86,000 during the upcoming fiscal year. Mandatory increases in employer contributions to the Local Government Employees’ Retirement System will cost the city an additional $185,000 in 2022-23, she said.
Garner presented her recommended budget to Graham city council members during their latest meeting Tuesday night. The manager’s budget for the general fund (which sustains most of the city’s day-to-day operations) totals $16.7 million. Her recommended budget for the garage fund (which is responsible for maintaining the city’s vehicle fleet and related equipment, in addition to maintaining vehicles for several outside agencies within the county) totals approximately $1.1 million.
The manager’s recommended budget for 2022-23 represents an overall increase of $1.9 million (or about 13.3 percent) in general fund spending. Graham’s general fund budget for the current fiscal year totals $14.7 million; the general fund budget would increase to $16.7 million in 2022-23, if adopted as proposed.
Proposed departmental budgets
Garner has recommended reductions in several departments’ annual operating budgets, including the fire department (by $132,400); traffic engineering ($62,700); property maintenance ($47,600); and streets and highways ($14,100).
At the same time, Garner emphasizes that the spending reductions won’t result in any reduction in city services to the city of Graham; rather, she said the city “will continuously review programs and services to ensure the appropriate level of service and most efficient use of taxpayer dollars.”
She has also recommended purchasing five new vehicles, including: three new police vehicles; one vehicle for the fire department; and one for the inspections department. Garner also recommends continuing the design phase for a second fire station and purchasing a brine-making system for the transportation department, as well as repaving the parking lot at the city’s public works department on East Parker Street. Her recommended budget for the upcoming fiscal year calls for spending approximately $1.1 million on capital expenses and maintenance projects (see accompanying chart).
The city is estimated to have $6.1 million in unrestricted revenue in 2022-23 from ABC profit distributions, local sales tax receipts, and various other fees and taxes, which represents an increase of about $812,300 from the current fiscal year.
The city began the current fiscal will approximately $12.2 million in unassigned fund balance (or rainy-day savings) on hand, which is estimated to increase by $1.6 million in the upcoming fiscal year to approximately $13.8 million – or well above the 8 percent of expenses that local governments are advised to keep in fund balance.
The council is scheduled to review Garner’s proposed budget at a work session next Tuesday and to hold a public hearing on Tuesday, June 14. The council typically votes to adopt a city budget at its June meeting.
