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2004-05-13 Budget Work Session NEW HANOVER COUNTY BOARD OF COMMISSIONERSBOOK 30 BUDGET WORK SESSION, MAY 13, 2004 PAGE 34 ASSEMBLY The New Hanover County Board of Commissioners held a Budget Work Session on Thursday, May 13, 2004, at 4:00 p.m. in the New Hanover County Administration Building, Room 501, Wilmington, North Carolina. Members present were: Chairman Robert G. Greer; Vice-Chairman Julia Boseman; Commissioner William A. Caster; Commissioner Ted Davis, Jr. Commissioner Nancy H. Pritchett; County Manager, Allen O’Neal; County Attorney, Wanda M. Copley; and Clerk to the Board, Sheila L. Schult. Others present were: Budget Director Cam Griffin; Senior Budget Analyst Norma Troutman; Budget Analyst Donna Seal; Finance Director Bruce Shell; Human Resources Director Andre’ Mallette; Assistant County Manager Patricia A. Melvin; Assistant County Manager Dave Weaver; and Public Information Officer Mark Boyer. Chairman Greer called the meeting to order and requested County Manager O’Neal to present the FY 2004- 2005 Recommended Budget. County Manager O’Neal began the presentation by informing the Board that the recommended budget before them was in accordance with the directive from the Commissioners to prepare a budget with no tax increase. County departments were instructed not to increase budgets over the previous year’s adopted amount. Keeping the operation portion of the budget at a constant level without a tax increase becomes more difficult each year. He continued with highlights from the recommended budget: REVENUE: Property Taxes: •The Recommended Budget is being proposed at a tax rate of 68 cents; that represents no increase from the tax rate for FY 03-04. •The increase in the ad valorem base is expected to be 3 percent; based on the current estimate a penny will be worth $1,750,280. •The tax rate in the Fire Services District remains at 6 cents. Based on the current estimates a penny in the Fire Service District will be worth $656,100. Sales Tax: • Increased revenue from the original one cent sales tax is estimated to be $1.4 million. •Revenue from the two existing one-half cent sales taxes is estimated to decrease slightly. •The estimated revenue from the new one-half cent sales tax, which became effective July 1, 2003, is $7.5 million. This revenue will offset the local government reimbursements that were eliminated by the state during FY 02-03. Other Revenue: • The budget is based on appropriating $3.9 million of fund balance. •No revenue is budgeted in the General Fund for Airlie. The revenue amount budgeted in the General Fund for FY 03-04 was $53,000. EXPENDITURES: Public Schools: •A transfer of $68.7 million from the General Fund is recommended for the Schools. Of this amount, $5.7 is funded by the portion of the sales tax designated for the Schools. •The Board of Education requested an increase of $2.1 million or 4 percent in operating expenses and $1.9 million in capital outlay. A tax increase of 3 cents would be necessary to fund the balance of the School’s request and debt service. It is recommended that the Board of Education appropriate their fund balance to meet the additional needs of the schools. The Board of Education fund balance is currently $7.6 million. School systems are not required to maintain a fund balance. •Funding of $4.7 million is recommended for Cape Fear Community College; this is an increase of $600,000. Employees : •Five new positions are recommended with the budget: •Two additional Grounds Maintenance Workers for the Parks Department due to the expansion that has taken place in the number of acres maintained by the department. •One Landscape Technician position at Airlie Gardens to assist with the continued development of the gardens. •One additional Custodian recommended for Property Management to help maintain the expanded County facilities. •One Administrative Support Specialist position to assist with the efficient operation of the Emergency Management Department. •Funding is included for a 2 percent market adjustment and 1 percent merit adjustment for deserving employees. •Funding is included for a 1 percent contribution of a 401(k) or 457 plan for those employees who do not currently receive a contribution. •Funds in the amount of $20,000 are included for an employee appreciation day. Human Services Departments: •County funding in the Department of Social Services is recommended to increase about $.9 million, which is approximately a five percent increase over FY 03-04. The increase is primarily due to increases in Medicaid. NEW HANOVER COUNTY BOARD OF COMMISSIONERSBOOK 30 BUDGET WORK SESSION, MAY 13, 2004 PAGE 35 Public Safety Departments: •The Sheriff’s Office budget is recommended to increase $1.2 million primarily due to the opening of the new Detention Facility and increases in overtime and temporary salaries. •Recommended County funding for the Juvenile Day Treatment Center is $174,000; this amount is an increase of $114,000. Other Expenditure Items: •Funding in the amount of $100,000 is included for a contribution to the Airlie Foundation. •Funding in the amount of $100,000 is included for improvements at Hugh MacRae Park. •Funding in the amount of $60,000 is included to contract with UNCW for water quality monitoring of tidal creeks; in the past this program was grant funded. •Funding at the FY 03-04 adopted amount is included for seven human service non-county agencies •Funding is included for the New Hanover Soil and Water Conservation District and the Wilmington-New Hanover Port, Waterway and Beach Commission at the FY 03-04 amount. •Funding is included for four agencies with multi-year contracts that provide economic and physical development services to the community. Commissioner Caster spoke in favor of reducing the property tax rate by one cent to provide relief to tax payers. County Manager O’Neal responded that if the Board was considering a tax reduction, he would need directive from the Board of which currently offered services the Board would recommend to be cut. Commissioner Pritchett agreed with County Manager O’Neal and stated that she could not support reducing the property tax rate when currently offered services would have to be reduced. County Manager O’Neal continued that as a means to allow department heads to express their budget concerns, they were given the option of submitting their requested budget increases separately from their FY 04-05 budget submission. These requests are not included in the recommended budget but are included for the Board’s consideration. An additional request was received from the Health Department for five additional Environmental Health Specialists positions. Vice-Chairman Boseman asked for clarification on the amount of funding recommended to Airlie Gardens. She advised she was in favor of additional funding to the Library in the amount of $16,000 for children’s books and the five additional positions requested by the Health Department for Environmental Health Specialists. Chairman Greer advised that he was in favor of funding the five additional Environmental Health Specialists positions requested by the Health Department but that he could not support the one percent contribution to a 401(k) or 457 plan for employees who do not currently receive a contribution and that he was not in support of a reduction of the tax rate. Commissioner Davis advised that he was in favor of providing additional funds to the schools and a reduction in the property tax rate. Commissioner Pritchett advised that she was not in favor of providing additional funds beyond the budget recommendation to the schools. Hearing no further comments, Chairman Greer asked County Manager O’Neal if he would like to comment. County Manager O’Neal advised that since there did not seem to be clear consensus from the Board concerning any recommended changes in the FY 04-05 Recommended Budget, he would proceed with the presentation to the Board at their May 17, 2004, meeting, and that a public hearing on the budget will be held at the June 7, 2004, meeting. Chairman Greer adjourned the meeting at 5:40 p.m. Respectfully submitted, Sheila L. Schult Clerk to the Board