Loading...
HomeMy WebLinkAbout2002-06-13 Budget Work Session NEW HANOVER COUNTY BOARD OF COMMISSIONERSBOOK 29 BUDGET WORK SESSION, JUNE 13, 2002 PAGE 235 ASSEMBLY The New Hanover County Board of Commissioners held a Budget Work Session on Thursday, June 13, 2002, at 5:00 p.m. in Room 501 of the New Hanover County Administration Building, 320 Chestnut Street, Wilmington, North Carolina. Members present were: Chairman Ted Davis, Jr.; Vice-Chairman Robert G. Greer; Commissioner Julia Boseman; Commissioner William A. Caster; Commissioner Nancy H. Pritchett; County Manager, Allen O’Neal; County Attorney, Wanda M. Copley; and Clerk to the Board, Lucie F. Harrell. Chairman Davis called the meeting to order and stated that the purpose of the meeting is to discuss the recommended FY 2002-2003 Budget. County Manager O’Neal referenced the information packet presented to the Board and advised that the major concern was not knowing if the State will withhold $4.5 million in local reimbursements for intangible and inventory taxes. The other concern is the lack of funding for non-county agencies that have been funded in the past. If State reimbursements are not received, the Schools Fund Balance can be used to replace this shortfall. Use of this fund will not reduce the amount of funding from New Hanover County to the schools. The Board can also consider a combination of using the Schools Fund Balance and other revenue to replace State reimbursements or consider increasing the property tax rate. Further discussion was held on the composition of the Schools Fund Balance. Budget Director Griffin explained that money budgeted for school capital projects that was not spent has been set aside in an account for a number of years. The current balance of this fund is approximately $5.9 million. This account is considered a savings account reserved for the schools. She stressed the importance of the County Commissioners and public understanding that using this fund will not reduce the amount of money appropriated to the schools in the recommended FY 2002-2003 Budget. Commissioner Boseman asked if any money from this fund had ever been disbursed to the schools. County Manager O’Neal responded that two years ago, $700,000 to $1,000,000 was used to purchase computers for the schools during the middle of the year and to bring schools into compliance with the Fire Safety Code. Discussion followed on implementing a ½ cent sales tax and the amount of revenue that would be generated within a year. Budget Director Griffin reported that if the Board decides to implement a point-of-origin ½ cent local sales tax, the estimated revenue generated would be $8 million. If the County implements a ½ cent sales tax as proposed by the State, it would be a point-of-origin tax based on population. The estimated revenue received by the County will be $5.8 million with the other half shared with the municipalities. A lengthy discussion followed on the issue of no funding recommended for non-county agencies. County Manager O’Neal advised that the proposed FY 2002-2003 budget has been prepared in an unusually conservative manner; however, only $1 million has been budgeted for Medicaid which will probably not be sufficient for the next fiscal year. With the budget shortfall and the possibility of not receiving $4.5 million in State reimbursements or State matches for entitlement programs, there is no revenue left to provide funding to non-county agencies. This has been an agonizing budget process for Staff. With elimination of 100 or more positions and money cut from every single department in County government, the only course left is to consider exercising the following options, increasing the property tax rate or implementing a local option ½ cent sales tax effective July 1, 2003: 1.Eliminate County participation and funding for the Cooperative Extension 2.Eliminate televising Board meetings 3.Eliminate proposed increases to Cape Fear Community College and the Southeastern Center 4.Reduce the contingency from $350,000 to $300,000 5.Eliminate contributions to DARE and other programs 6.Eliminate funding to the Airlie Foundation 7.Cut the following non-mandated departments: Airlie Gardens Aging except for Nutrition and Administration Parks Library Human Relations Museum Veterans Services If these actions are taken, a total of $7,129,599 would be saved and there would be sufficient revenue to cover the $4.5 million that probably will be withheld by the State. Further discussion was held on the need to preserve the fund balance to protect the County’s bond ratings. County Manager O’Neal advised that no money from the fund balance has been used in preparing the FY 2002-2003 budget. He stressed the importance of keeping a strong fund balance to maintain the current bond ratings and stated that a decrease will result in higher interest rates when the County borrows money. Chairman Davis stated that he could not vote to increase the property tax and noted that complaints are received daily from elderly citizens who are afraid of losing their homes if the property tax and values of their homes continue to increase. Commissioner Caster agreed with Chairman Davis. NEW HANOVER COUNTY BOARD OF COMMISSIONERSBOOK 29 BUDGET WORK SESSION, JUNE 13, 2002 PAGE 236 After a lengthy discussion of increasing the property tax rate by 1.7 cents to pay for school obligation bonds and using the School Fund Balance to replace State reimbursements if the money is not received, the Board directed Staff to present a budget with no increase in the property tax rate and no funding for non-county agencies. After further discussion of the additional ½ cent sales tax authorized by the General Assembly to become effective July 1, 2003, the Board directed the County Manager to place this item on the June 17, 2002, agenda for further discussion and consideration. ADJOURNMENT Chairman Davis called for a motion to adjourn the Work Session. Motion: Commissioner Caster MOVED, SECONDED by Commissioner Boseman, to adjourn. Upon vote, the MOTION CARRIED UNANIMOUSLY. Chairman Davis adjourned the Work Session at 6:35 p.m. Respectfully submitted, Lucie F. Harrell Clerk to the Board