The Town Board spent another session Tuesday night crafting a 2008-9 budget
that would help Davidson catch up on road and sidewalk improvements and hire its first full-time finance director. But with tax-revenue growth the slowest in four years, board members are also struggling over how to fund other priorities, including new planning, fire and police personnel; land for a new fire station; intersection repairs; and planning studies.
At the board’s direction, Town Manager Leamon Brice likely will present two options at the annual public hearing on the budget next month (May 13): one that holds taxes steady and one that calls for a two-cent increase in the rate. (Thursday update: The town spokeswoman said Mr. Brice will present a budget with the two-cent increase the public hearing. Mr. Brice said he will show town board members a spreedsheet with both versions.)
Mr. Brice delivered a 53-page draft budget, which included a summary of the economic picture for the year ahead. It was commissioners’ and department heads’ first chance to see what next year’s budget might look like, though Mr. Brice said it’s still likely to undergo substantial changes.
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WHAT A TAX INCREASE WOULD MEAN Town board members are considering two budget proposals, one that keeps property taxes flat and another that would raise the rate by 2 cents. A 2-cent increase would add:
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The document Mr. Brice presented Tuesday assumed a 3.5-cent increase in the tax rate, to 38 cents. (Each penny equates to a $50 a year increase in taxes on a $500,000 home, or $25 dollars a year on a $250,000 home.) But before the meeting was over, the board had ruled out that scenario.
Mr. Brice also showed the board a spreadsheet with a range of tax scenarios, from one that would keep taxes flat but fund very few new budget needs to one based on the full 3.5-cent increase that funds most of the town’s major priorities.
During Tuesday night’s discussion, some board members asked Mr. Brice to consider two scenarios: one that would keep taxes flat (call it Version A) and one that would raise the rate by 2 cents (Version B).
A final vote on the budget would come at the June board meeting. The new fiscal year begins July 1.
FUNDED AND UNFUNDED
Both proposals would include money to continue paying part-time firefighters to ensure fire coverage 24 hours a day. They also include the salary for a town finance director, a new position that would help Mr. Brice and town clerk Peggy Smith cope with the town’s increasingly complex finances as it grows.
Both also would allow the town to follow through on plans to borrow about $1.15 million for street repairs and sidewalks – projects residents listed as priorities in last fall’s townwide citizen survey. The budget includes money for payments on that new debt.
Version B, which would require a 2-cent tax increase, adds money for part-time staff in the planning, parks, and police departments, as well as funding to provide housing for two college student fire department volunteers – another way for the town to ensure adequate fire coverage.
Version B also would fund a new townwide comprehensive master plan – the first in about a decade – as well as a small area plan for the future train-station tax district. That plan would encompass the area around the proposed commuter rail station off Jackson Street, a new parking deck next to Town Hall, and an area stretching to Watson, Hobbs Hill, Armour and Magnolia streets.
And it would fund improvements for Goodrum Street intersections and the East Rocky River Road/Davidson-Concord Road intersection, which involves state-controlled roads. The town is under pressure from the state Department of Transportation to make a decision on the latter. The town wants to build a roundabout; DOT has obtained a road-safety grant for a stoplight. The stoplight would be added soon if the town decides not to fund the roundabout project, or if the town delays.
Mr. Brice’s spreadsheet also included a long list of projects on department heads’ wish lists that will not be funded this year, including proposals to add a new part-time fire captain and several other town staff; money to hire consultants for several planning projects and a Parks & Recreation master plan; budgets for new parks and improvements, a speed trailer, and computer/audio-visual equipment.
STRUGGLING TO FIND MONEY
In his budget message, Mr. Brice warned that Davidson’s tax revenues are projected to grow just 4 percent next year. That’s slower than 2007 (5 percent), 2006 (8 percent) and 2005, when it grew 13 percent.
In addition, despite a large amount of commercial development approved or under construction, the town’s tax base remains a lopsided 80 percent residential, Mr. Brice told the board. (Clarification: the town spokeswoman said Thursday the actual figure is 87 percent residential.) Residential tax revenues are not enough to cover all the town services needed to support residential development, he said. And even though some new revenues will come in from new commercial development, it is not enough.
“Revenue that comes from growth lags way behind demand for the services that come with the growth,” Mr. Brice told the board. He repeated what he has said often: that the town needs more commercial development to balance the sources of tax revenue. “As far as I’m concerned, if we didn’t build another house next year (in town), it would be all right,” he said.
In the budget message, he said the town needs to increase revenues. “The net result is that we cannot continue to provide the facilities, programs or staffing required to meet the new service demands with current revenues,” he wrote. So he is asking the board to consider a tax increase.
FLAT OR INCREASE
Much of Tuesday’s discussion focused on whether the priorities envisioned for next year – including street and sidewalk work – are significant enough to justify a slight tax increase.
Commissioner Laurie Venzon argued the board should look hard at keeping taxes flat, especially as the economy slows.
“We have been doing a lot in the last five years. So to say we have to have one year where we need to tighten our belt and just take a breather, may not necessarily be a bad thing, given the economy, given that people are already getting hit with water increases, they’re already getting hit with gas price increases. I’m not so sure I feel good about tax increases on top of that.”
Commissioner Brian Jenest suggested at one point that he would feel more comfortable holding taxes flat. But in a sign of just how difficult this year’s budgeting process has been, both he and Ms. Venzon joined the board in wrestling with limited revenue and a desire to find ways to fund as many priorities as possible.
DOCUMENTS
Draft of 2008-2009 Town of Davidson budget, on the town website.
Thanks so much, David, for providing us with close coverage of town board considerations during such an important period. This site has done more to improve public awareness — and democratize — town proceedings than anything I’ve seen in 17 years living here.
Ken Menkhaus
Time and time again citizens have stated that they would be willing to pay more taxes if our government would put that money to good use. In that context, I don’t understand the reluctance of the board to increase the property tax rate.
As stated, a 2 cent increase in the property tax rate would add $100 annually to the tax burden of a $500,000 home, which is about the cost of an “average” Davidson home these days (and keep in mind the property tax valuation upon which taxes are based is typically much, much lower than market value). That is about 30 cents a day. The median family income in Davidson is in excess of $100,000 per year. Does 30 cents a day really sound like that much? Have one less latte at Summit every ten days and you’ve got that covered.
Laurie Venzon’s concern about increasing taxes in a slow economy has some merit, but I think it is incorrect to assume that keeping taxes flat will save citizens money. One benefit of a slow economy is that costs for many construction items are lower than they have been in years. If we put off capital projects until the economy improves, it may well cost us more in the long run to do those projects at prices that are higher than they are right now.
I am not a proponent of raising taxes just to raise taxes, but as I looked through the budget and saw what requests could not be funded, it struck me as ridiculous that a town as wealthy as Davidson is continually crying poverty (NOTE: we should find a way to hold flat, or reduce, property taxes on those who actually are living in poverty in Davidson).
Taxation is how our community collectively makes investments. It should not be viewed as a negative, but rather an opportunity to make investments that will make Davidson an even better place to live.
I hope that this board shows more courage and imagination during this crucial budgeting process. I for one am tired of having to wait for everything to get done. I would like a meaningful greenway system, but there is no money in the budget for greenways this next fiscal year. Nothing for open space preservation. If the board was able to find tens of millions of dollars to bring us the Playboy Channel, surely they can come up with a way to get us something important.
Upgrading my sixteen dollar cable plan will not be an option and that’s probably a good thing. I will spend my money on higher taxes. Wasn’t the additional commercial development in West Davidson suppose to lower our taxes? Perhaps Davidson should only be a town for high income residents. I will accept that and move to another county, as long as I live close enough to drive to the Davidson College basketball games! Go Wildcats!
I’d love my extra 30 cents per day to go to keeping the gravel and construction scree out of the bicycle lanes on Concord Road and elsewhere and to filling potholes–that is, to have my tax money pay for the most basic services that towns offer, and which in Davidson right now seem to be less than top priority.
Do we have a street sweeper? Does it ever sweep the streets? When I’m riding to work on my bicycle I’m tired of dodging gravel in the bike lanes. And when I’m in my car I’m tired of the Griffith Street slalom course between the Harris Teeter and the railroad–nothing but holes, cones, patches, and gravel. Davidson could do better.
Cover that and I’d love to pay for more open space and greenways. (Really!) But if the basics like streets are mismanaged (or at the least unkempt), we should be skeptical about complicated things.
I agree with Rodney that most citizens of Davidson love the lifestyle we enjoy here and are willing to pay for it. Each of us has our own pet projects – mine are more sidewalks, open space and greeways – and we realize they cost money. No board wants to raise taxes, so maybe we all need to tell our commissioners that with the cost of oil affecting everything the Town does, we understand the need for more revenue.
Don’t worry about a tax increase not being enacted. After working 10 years in Meck county government, I know that most “budget meetings” are dog and pony shows for the public to show that elected representatives and staff really do care about controlling costs and guarding the public purse from potential empire builders who constantly need more staff, more facilities and more master plans.
Government agencies and departments ask for the moon, then cry crocodile tears because so many of their worthwhile plans need to be axed in the name of fiscal responsibility. Meanwhile pet projects “limp through” under the cover of “reasonable, if unfortunately insufficient funding,” and new initiatives without a special handler get sheared like the sacrificial lamb they always were.
The money is there, and it will flow, but maybe not to sweep the bike lanes or finish the greenways– or build bus stop shelters (my unfunded pet project).
As one of the people working on the comprehensive plan proposal, let me add a small but very significant correction. While there have been several previous town plans, there are no prior comprehensive plans. The Town of Davidson has no comprehensive plan.
How will Davidson look when we are built out in town and in the ETJ? Will there be additional commercial nodes? If so, will they compete with or complement downtown? Do we need multiple police and fire stations? Where and when? What additional staffing requirements will occur, and how will we phase them? The questions continue, when one considers all of the implications of a completely built Davidson, which will have a population several times larger than our current size. A comprehensive plan is simply a long-term plan, to be revised as needed.
The proposal is to take a total of two years, with maximum public involvement, guided and shaped by an outside professional. Its benefits can be seen as one looks at this year’s struggles to accommodate many short-term requests with limited funds.
The main point, though, is the original: the Town of Davidson has no comprehensive plan. For a community with aggressive planning policies, this is an anomaly.
I think it is great that we are doing a comprehensive plan with citizen input. However, I hope this planning process is not used as an excuse to defer obvious needs. Too often committees and commissions are used (both intentionally and inadvertently) as ways to pass the buck and delay action. Two years is a long time. In two years we’ll lose several more acres to development because we’re not aggressively preserving open space, spew thousands of extra tons of pollutants into the air than we would if we developed a town energy efficiency plan, and the opportunity gap between areas of our town may well widen while we develop “the plan.” Planning is great, but some action is needed now.
As the town balances the wants and needs of its citizens, we should keep in mind that one of our goals is to be “‘affordable.” While Rodney is correct that a tax increase is small and would fund desired improvements, it is one more “straw” that could break the camel’s back. Keep in mind that government is raising the cost of water by 16 percent, gas is expected to go up to over $4.00 per gallon and food and services are also increasing. In addition, many of our bankers and builders are bringing home less money.
Davidson is a wonderful and wealthy community. However, in a slow economy, it is wise to trim the sail and look for ways to cut costs. Our roads have been neglected and need attention. The town should find a way to fund these by cutting or delaying other expenses.