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Sylva faces tough budget choices

Sylva town officials are staring down three unsightly options to balance the upcoming year’s budget: tax increases, budget cuts or both.


None of the choices have much appeal to board members, but it’s understood that something must be done to alleviate the town’s budget woes. Sylva’s government is carrying a $193,000 budget deficit going into the next fiscal year.


Town Manager Paige Roberson is recommending a combination of cuts to services, delayed spending and a tax increase of 5 cents to offset the difference in town revenue and town expenditures. A tax increase of that magnitude is expected to earn an extra $205,000 for the town in annual revenue.

“I’ve recommended some severe cuts that will be painful,” Roberson said. “And looking at how short we are, we are not going to balance this budget without a tax increase.”

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As an example of what more could come, the receptionist position with the Sylva Police Department has already been left unfilled, leaving the chief to cover some shifts at the front desk.

To balance the current year’s $3.1 million budget, Sylva officials had to draw more than $100,000 from the town’s savings account. A portion of that went toward necessary equipment purchases. Roberson said that type of fiscal policy is unwise and shortsighted and other action needs to be taken.

Most towns comparable in size to Sylva carry 68 percent of their annual budget in a fund balance. Roberson said Sylva’s has dipped down to 59 percent as it has been used to shore up shortfalls in revenue. 

But some of the revenue losses the town faced this year came as a surprise and caught officials off-guard, said Roberson. An estimated $25,000 was lost for video sweepstakes licensing fees; $50,000 from a joint liquor store venture with Bryson City that provided Harrah’s casino with alcohol; $10,000 from the town’s ABC store revenue; and another $20,000 or so in revenue losses from town fines and other fees.

Meanwhile, $13,000 in expenditure increases from utilities and employee and retiree health insurance exacerbated the situation.

But in light of the town’s budgetary outlook, at least one board member was not ready to take Roberson’s recommendations and make taxpayers stomach a rate increase. Board member Harold Hensley asked if the town shouldn’t take a more thorough look at cutting its own budget before raising taxes.

“We’ve got people out there struggling to pay taxes,” said Hensley. “They might want us to sacrifice a little bit first.”

Hensley also pointed out that if taxes are increased this upcoming year, it will most likely be only a prelude to another increase in coming years as Sylva tackles its town-wide property revaluations. To avoid another major revenue loss, the town may have to raise tax rates again as property values are adjusted to post-recession levels.

“Then we’ll have to say ‘Sorry, folks,’” Hensley said. “But we’ll have to hit you again because they’ve re-evaluated the property.”

But Mayor Maurice Moody said drastically cutting services to residents might not be the best solution either. As new budget year approaches in July, Moody said the board will have to consider all options on the table.

“The board has the responsibility to the town to perform services, and it also has an obligation to the taxpayers,” Moody said. “It’s kind of a balancing act.”

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