“Like all budgets, the fiscal year 2017-18 budget will present challenges in addition to opportunities — we’ll see unfunded mandates, we’ll see a rise in health care costs and an overall increase in the cost of doing business,” Roland told the board as he went over budget items. “But these challenges that we’re faced with are the same challenges that every private and public sector organization will face in the coming fiscal year.”
Whatever the challenges, Roland presented the board with a $50 million annual budget without an increase in property taxes and without dipping into the county’s fund balance like many local governments are doing this year. The county is looking to maintain its property tax rate of 34.9 cents per $100 of assessed value, which Roland boasted as the third lowest in the state.
Haywood County is raising its tax rate from 56 cents to 58 cents this year. Jackson County had to increase its rate from 28 cents in 2015-16 to 37 cents in 2016-17 to make up for a loss in property values. Swain County hasn’t touched its tax rate of 36 cents since 2013.
During the 2016-17 budget, the county was able to pay off the remaining $1.35 million loan for the Parker Meadows sports complex, completed a $620,000 renovation project at the Robert C. Carpenter Community Building, completed at $9.8 million landfill expansion project, upgraded the county’s phone system, increased funding for teacher supplements and capital outlay for the school system, spent $85,000 to renovate the Otto and Cullasaja community centers and spent $113,355 to improve Wesley’s Park.
Macon County’s upcoming budget focuses on implementing another phase of a pay scale study the county completed a few years ago to make employee salaries more competitive, public safety projects and creating a five-year capital improvement plan.
“The strong leadership and fiscal management combined with an additional $1.9 million increase in operating revenue will allow us to accomplish each of these things,” Roland said.
About 57 percent — or $23.8 million — of the county’s revenue comes from property taxes. Another 19 percent — $9.4 million — comes from state and federal revenues to cover the cost of programs like public transit, senior services and health services. Sales tax brings in 15 percent — or $7.3 million — and service fees make up 9 percent — $4.5 million — of the county budget.
While Roland only budgeted for a 1 percent increase in sales tax revenue last year, which would have brought in an extra $9,000, the county ended up seeing an additional $610,795 from sales tax during the current fiscal year. He anticipates that revenue will continue to increase, but says he will continue to budget conservatively.
The county also received an additional $331,599 in property taxes due to an increase in collections and new properties being levied. Motor vehicle tax revenue is up $140,216 and service fee revenue increased by $440,517. Roland said the service fee increase is attributed to the county’s emergency services increasing rates to 150 percent of the Medicare allowable charges for transport and also an increase in building permits being issued.
“Building permits in the past two years are up 21 percent, which is a good sign of an improving economy,” Roland said.
As the county continues to pay down its debt obligations, Roland said more funds would be freed up for other expenses. Since 2011, the county’s general fund debt has decreased by about $22.6 million and will decrease another $614,162 this year. The county’s remaining $40 million in debt includes loans for school technology and school renovations at Union Academy and Highlands School.
Public safety expenses
The largest expense items for Macon County include public safety (27 percent), followed by health and human services (26 percent) and education (19 percent).
This year’s proposed budget includes $13.5 million for public safety — a 7.6 percent increase over last year. But the additional funding will go toward upgrading the emergency communications system. Roland said $400,000 is budgeted for the first phase of the upgrade project and the county is also waiting to hear whether it will receive a $1 million FEMA Assistance to Firefighters grant to help fund the communications upgrade.
Due to increased emergency call volumes in Macon County over the last two years and the fact that a majority of transports are to Mission Hospital in Asheville, Roland said more funding is being budgeted for part-time and overtime for EMS.
Fire call volumes are up 17 percent but the number of volunteer firefighters has only increased by 1 percent. Roland said he is budgeting $229,000 for the creation and management of a fire task force to be overseen by Emergency Management Director Warren Cabe to assist all the fire departments. The task force will consist of four full-time employees with the tools and equipment needed to assist departments with responding to calls, data collection, inspections and public education.
“The Macon County Fire Task Force will be created to serve as a resource to all volunteer fire departments in Macon County in an effort to assist them with the rapidly increasing demand for service,” Roland said.
More calls also means the sheriff’s office is putting more wear and tear on its fleet of vehicles. According to Sheriff Robbie Holland, 50 percent of the vehicles have more than 100,000 miles on them, which leads to an increase in maintenance costs. The proposed budget includes $275,720 for six new all-wheel-drive SUVs for the sheriff’s office. Equipping the vehicles with cameras, insignia, spike strips and medical supplies is included in the cost.
The average population of the Macon County Detention Center has increased 18 percent from 2013 to 2016, which has led to increased expenses for inmate medical care, food, out-of-county housing and overtime for detention center employees. The detention center already added four full-time positions last year — bringing the staff up to 21 — and helped the department decrease its part-time and overtime line items in the budget. The detention center salaries and benefits will cost the county more than $1.2 million in the 2017-18 budget.
Macon County completed an overhaul to its health care insurance plan in 2015-16 in order to keep the county’s health fund solvent. On July 1, 2016, the county had about $530,00 available in its health reserve fund, but increased medical claims in the last year have put the reserve fund in the hole by just over $1 million.
“Increases in both sales tax and ad-valorem tax revenue during 2016-17 should prove sufficient to cover this $480,834 deficit in the reserve fund,” Roland said.
He said the county’s Health Insurance Committee, which helped recommend changes during the overhaul last year, also made more recommendations this year to keep health costs down. The county’s contribution will increase by $128,739 and $261,802 will be budgeted from the general fund to the health reserve fund to keep it in the black.
“We have to keep changing to keep pace with the volatility of this industry at the national level,” Roland said.
Capital improvement plan
The county’s proposed budget includes $30,000 to hire a consulting firm to assist the county in developing a multi-year capital improvement plan. The plan will identify and prioritize infrastructure projects and equipment purchases for the county and identity funding methods as well.
The county has $344,619 budgeted for capital items during the 2017-18 fiscal year, which is about a 20 percent increase over last year.
Macon County is still working through the budget request from Macon County Schools with a joint meeting scheduled for 6 p.m. Thursday, June 8, to continue discussions. The school system is requesting $7,338,330 in local funding for operating expenses. Pick up next week’s edition of The Smoky Mountain News for school funding coverage.