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Swain fund balance once again teetering on the brink

Swain County might have to raise taxes or make budget cuts to keep its cash reserves from falling into unhealthy territory.

Swain County’s cash reserves are hovering around $1.6 million, barely above the state-recommended minimum. Independent auditor Eric Bowman recently warned the county that one capital project or one hiccup could quickly drop Swain County’s fund balance too low.

Sylva budget passes on split vote

Funding for the Downtown Sylva Association has caused a rift in the Sylva town board for the fifth year running.

Town leaders last week approved a $2.3 million budget for the coming fiscal year by a vote of 3 to 2. Board members Ray Lewis and Danny Allen cast their votes against the budget in protest.

Lewis said two appropriations particularly irked him: a $12,000 allocation to the Downtown Sylva Association and a $2,500 contribution to the Jackson County Economic Development Commission.

“Ever since I’ve been on the board I’ve voted for a budget, but I just decided this time I wouldn’t do it,” Lewis said.

Allen would not comment on his vote, but he has previously been a critic of the town’s funding for the Downtown Sylva Association.

Town Commissioner Sarah Graham is stepping down from the board in a couple of weeks because she is moving outside the town limits, making her ineligible to serve as an elected town leader. An ardent supporter of DSA, Graham said she wanted to see the budget process through before stepping down.

Sylva Mayor Maurice Moody would have voted in the case of a tie, however, and he has always supported town funding for DSA, a point he drove home following a video presentation shown during last week’s meeting extolling the virtues of the North Carolina Main Street Program.

“That just highlights some of the benefits we do get from the Main Street program,” Moody said, pointing out the town was currently eligible for a $250,000 matching grant through the state and acknowledging Waynesville’s receipt of $300,000 through the Main Street Solutions program.

The funding for the two business development groups was a small portion of the overall budget this year. Sylva will spend nearly $1 million on its police department, $300,000 on streets and another $250,000 on administration.

Overall, the budget reflects a $40,000 decrease from last year, stemming from a decline in local sales tax.

Macon budget avoids tax increase, layoffs

If you’re a county commissioner in Western North Carolina, it’s hard not to feel envious of Macon County’s budget. While surrounding counties are grappling with layoffs and — in Haywood’s case — a tax increase, Macon County commissioners have managed to largely dodge the economic downturn that has stricken other places.

“On the local level, we’re not doing too bad compared to other places,” County Manager Jack Horton told a crowd of local residents who gathered to hear him speak about the budget last Thursday (June 11).

It’s not that Macon County hasn’t felt any impact from the economy. The county’s $42 million budget is the lowest it’s been in five years. Building and septic permits, a major county source of revenue, are down significantly. In April of this year, just $3.1 million in building permits were issued, compared to $11 million in April 2008. The county predicts sales tax revenues will plummet 10 percent next year.

Commissioners have implemented several decreases to balance the budget, said Horton, but it “hasn’t dealt with any mass layoffs or severe budget cuts. We’re basically trying to hold our own and keep our services in place so when the economy picks back up we’ll keep on going.”

The commissioners already decided in the middle of the current fiscal year that they wouldn’t be asking for more money from taxpayers.

“We live with what we have,” was the thinking, said Horton.

So to save money, the county is not including a cost of living increase for employees in this year’s budget and likely won’t fill positions that become vacant. Schools won’t get any extra money over last year, and capital funding to schools will be reduced from $700,000 to $500,000. The fact that Macon schools are getting capital outlay at all is a big contrast to many other counties, who have had to slash capital projects altogether for the school system. While other counties have put a halt on new school projects, a new early college campus is being finished in Macon County, and a new field is being put in at the Highlands School. In total, Macon County Schools are getting about the same amount of funding as they received last year — a total of $6.9 million.

It’s the state — not Macon County — that might end up impacting the school budget the most.

“The thing that’s making me really concerned is how much they’re looking at cutting education,” said Horton.

Under the proposed state budget, $800,000 in teacher salaries would be cut in Macon County. That’s equivalent to about 26 positions — and it’s unclear whether the county would be able to supplement the cutback.

“If the state cuts positions in the school system, can the county pick them up?” said Horton. “Our own county commissioners are pressing the state to step up and support the education budget.”

Reality, outcomes and education spending

This deserves emphasis, given the central role that public education plays in North Carolina political debate: our schools have vastly more resources to work with than they did a generation ago.

Changing budget laws would save taxpayer money

The words still ring in my ears, coming as they did from a teacher who had spent years playing by the book: “I’ve got to spend the money by the end of the school year or it’s gone, so I’m gonna spend it on something.”

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