By DAVID BORAKS
There was little discussion on Tuesday night when Davidson commissioners held a public hearing on the $9.1 million 2013-14 budget. When Mayor John Woods called for comments from the audience, only one of the 15 or so residents spoke.
The plan will guide town spending in the fiscal year that begins July 1. It leaves property taxes unchanged, at 35 cents per $100 of assessed value, prepares for possible tax refunds as the county revises assessments from the 2011 property revaluation, and leaves some money for capital improvements, new equipment and maintenance of existing equipment, which has been a board priority.
Finance Director Cindy Jones formally presented the plan at the start of the public hearing, and it was mostly unchanged from what the Town Board saw in April. (See April 23, 2013, “Town staff could offer 2014 budget that keeps taxes flat”)
Most of Davidson’s budget also is little changed from this year’s. The town now has built into its budget a variety of line items for repairing and replacing equipment. The coming year will include new computers and police cars. In a message attached to the spending plan, Town Manager Leamon Brice said:
“Even with the property revaluation uncertainty we have been able to fund recurring maintenance and equipment replacement, some capital improvement plan items and personnel in critical areas. We look forward to a year where we will be able to advance the Board’s goals and make significant improvements throughout town.”
As the board briefly discussed the budget, Commissioner Brian Jenest observed that planning this year seemed easier than some recent years – perhaps because the economy has improved. “When I first began doing this six years ago, it was the beginning of the recession, and it was very hard. But this has been a very smooth process,” Jenest said.
Said Mayor Woods: “I think the staff particularly has worked very hard to use the funds we have to address the priorities we have.”
Revenues are part of the equation contributing to a smoother process – they’re up. Revenues in the next fiscal year are expected to be $9,117,102. That’s about 2.1 percent more than the current year and nearly 7 percent more than 2010. Property tax revenues are expected to decline slightly from this year (in part because of tax refunds and revised assessments). Sales tax revenues could rise 10 percent and prepared food and hotel occupancy tax revenues are expected to be 23 percent higher.
Expenses are expected to be down in many categories, with some increases in personnel, legal expenses, recreation and parks.
One area where expenses will decline is the solid waste fund, which pays for garbage and recycling pickups. The town expects to spend $705,000 in the coming year, down from $750,000 this year. Town officials added the fee in 2010, and set it up as a separate fund in the budget. The idea was to set the rate annually to equal the town’s costs. Critics called it a tax increase, and it came at a time when the town was struggling to pay for its annual subsidy to the MI-Connection cable system.
[Single-family households pay $201 annually for trash and recycling pickups. The fee varies at condos and apartments. See the town’s proposed new fee schedule for details.]
Resident Andy Beard asked during Tuesday’s hearing: “Any thought given to reducing the waste fee for citizens?” Town Manager Leamon Brice said that while the town expects to pay less next year, officials did not reduce the fee. He said the town needs to make up a shortfall in what was collected this year, to ensure that solid waste fund revenues equal fund expenses.
“That was very regressive tax and I’m sure there are people in town who would appreciate a reduction,” Beard said.
Brice and several commissioners told Beard the town plans to adjust fees to meet expenses in the future. So if fees decline, so will the fee, and vice versa.
The town also eliminated leaf pickups in the fall a could of years ago to cut expenses. Commissioner Jim Fuller suggested that the town look at reviving the service. “We pay an environmental penalty to bag them, and there are some people who are not in a position to bag their own,” he said.
Several commissioners nodded in agreement and said the town ought to look into the idea.
Jones’s presentation prompted some discussion among commissioners about MI-Connection Communications System, the Lake Norman-area communications network that Davidson owns jointly with the town of Mooresville.
Again this year, the system is the town’s single largest expense, at $1.3 million, or about 14 percent of the total budget. That includes a $1 million payment toward MI-Connection’s debt – and expense the two town’s share, and $300,000 for a sort of savings fund to cover future payments.
The system has been such a drag on Davidson’s relatively smaller budget that the two towns agreed a year ago to cap Davdson’s annual payments at $1 million and to fix Davidson’s ownership share at 30 percent. Mooresville agreed to cover the rest. Davidson would continue paying a fixed $1 million annually, even if its 30 percent share of the system’s debt goes below that figure, until it pays off its obligation to Mooresville.
Finance manager Jones said Davidson will owe Mooresville a total of $574,121 as of this June 30, and $1,278,268 as of June 30, 2014.
MI-Connection has seen some financial improvement over the past couple of years and officials are hoping it will begin paying off a larger share of the $7.2 million in annual payments on its $80 million-plus debt. In 2013-14, the system will be making its largest payment ever – about $1.6 million, officials said in April. But that still leaves about $5.7 million to be shared by the two towns.
The Town Board is expected to adopt the budget at its June 11 meeting.
See Jones’s presentation from Tuesday as well as the full proposed budget on the town website.
May 15, 2013, “Board approves $12M retirement residence in 4-1 vote.” – See a summary of other actions at the May 14 board meeting.