Alamance County’s interim manager has unveiled a proposed budget for the new fiscal year that calls for $241.3 million in outlays but no change in the county’s property tax rate of 66 cents for every $100 of value.
This plan, which interim manager Sherry Hook debuted to the board of commissioners on Monday, includes some $203,238,689 in expenditures from the county’s general fund – a repository for various taxes and fees that bankrolls most of the county’s programs and agencies. Hook assured the commissioners that her recommendation for this fund had been pared back substantially from the $212.5 million that the county’s departments and agencies had sought for the forthcoming financial cycle, which begins on July 1.
“This budget is a reduction of $9,308,823 from what was requested and what you saw at the budget retreat,” the interim manager stressed. “This budget is also based on no property tax increase so the property tax would remain at 66 cents.”
Even with these reductions, Hook told the commissioners that she managed to squeeze in higher allocations for the local school system and Alamance Community College, increased outlays for vehicles and equipment, and pay raises of $5,000 each for most of the county’s full-time employees.
Hook said that her financial projections take into account an anticipated increase of 4.39 percent in the county’s property tax base. She added that, based on the current tax rate of 66 cents, the county’s expanding tax base should bring in $106,711,051 in the new fiscal year – or roughly $1,602,686 for each cent on the tax rate.
Hook said that the county can also look forward to an increase of about 4.5 percent in its sales tax receipts based on current trends in this particular levy. If her predictions hold true, the $43,840,639 that the county is set to take in this year would rise to $45,813,469 in the next financial cycle.
The interim manager’s budget also includes a modest increase in the savings it uses as a stopgap to cover the shortfall between anticipated revenues and proposed expenses.
According to Hook, the spending plan earmarks $3,383,141 in “unassigned” dollars from the general fund’s “fund balance,” or accumulated reserves, as opposed to the $2,766,785 that has been set aside in the county’s current annual budget.
On the other side of the ledger, Hook has recommended a number of new expenses from the county’s general fund. These new outlays include several new staff-level positions, including a new assistant county manager, an emergency management planner, an EMS mechanic, three positions in IT, a paralegal in the legal department, a park technician in recreation and parks, a new social worker, a data systems specialist at the tax office, and a new veteran services officer.
Hook told the commissioners that she has also set aside some $3.9 million to cover pay increases of $5,000 for most of the county’s full-time. The interim manager said that this flat raise would exclude the department of social services, emergency medical services, and the sheriff’s detention division, which have previously received mid-year pay-increases courtesy of the county commissioners. Hook added that employees in detention and EMS would receive increases of $1,000 and $2,000 each in order to bring their earlier, mid-year adjustments up to the $5,000 mark.
In addition to these flat increases, Hook has earmarked another $709,006 for merit based raises that would average out to an additional 2 percent extra across the county’s entire workforce. Meanwhile, $246,116 has been set aside in her budget to cover the cost of $4,000 “stipends” that the sheriff has previously requested for deputies who actually pull patrol shifts out in the field.
Hook’s proposed budget also suggests an outlay of $50,912,319 for the Alamance-Burlington school system – an increase of roughly $3.6 million over the school system’s current appropriation. Hook has, likewise, suggested a hike for Alamance Community College, whose proposed allocation of $4,321,516 includes an extra $430,750 based ACC’s “share” of the county’s anticipated increase in property tax revenue.
Although Hook didn’t propose any increase in the county’s property tax rate, she acknowledged that the county has received a request for a tax hike from the North Eastern Alamance fire district. The district’s governing board has apparently asked the county to tack 2 cents onto the 10 cent levy that it charges the district’s property owners over and above the county’s own property tax rate.
Prior to Hook’s presentation, the commissioners have repeatedly hinted that they may want to cut the property tax rate by a penny or two when they sign off on the county’s next budget. A year ago, the commissioners knocked a cent off the rate based in part on the savings they realized when a favorable bond market allowed the county to secure unusually low interest rates when it issued the brunt of $189.6 million in education-related bonds that area voters approved in 2018.
During Hook’s presentation on Monday, commissioner Steve Carter asked the county’s administrators to estimate precisely how much the county had saved on its annual debt payments when it chose to forgo the issuance of a bond “premium” that it had been offered in light of the low interest rates. Neither Hook nor her any of subordinates had this figure at hand. Carter nevertheless received the answer he sought from fellow commissioner Bill Lashley. A commodities trader by day, Lashley said that he previously calculated the county’s bond-related savings at $2.89 million a year – or a little less than the equivalent of 2 cents on the property tax rate.
Lashley went on to predict that the county should brace itself for a higher interest rate, and a commensurate increase in debt payments, when it issues the last chunk of its education-related bonds later this year. Lashley also warned his colleagues to expect a reduction in the county’s sales tax receipts as the economy feels the combined pinch of inflation and increasingly high interest rates.
Hook’s budget also received a somewhat cautious welcome from Jeremy Teetor, the finance director for the Alamance Burlington school system. In an interview with The Alamance News, Teetor acknowledged that the interim manager’s proposed increase for the schools is roughly $1.3 million less than the school system’s requested hike of just under $4.9 million.
“But when you look at the previous years,” he said, perusing the county’s past five allocations, with their average annual increase of less than $1 million, “we’ll take it.”
Other commissioner coverage from May 16 meeting: https://alamancenews.com/interim-mgr-persuades-commissioners-to-ok-last-minute-spending-before-budget/