County Budget Slashes Funding, Jobs
The budget recommended by the county manager slashes spending for the 2010-2011 fiscal year by reducing education budgets, cutting jobs and deferring capital spending.
It retains the current 46.5-cent property tax rate and does not dip into the fund balance.
County Manager Cary McSwain presented the $84.9 million budget to the Moore County Board of Commissioners at a Monday meeting. The general fund budget reflects a decrease of almost 5 percent, or $4.4 million, from the current year. Some areas are down as much as 15.4 percent.
"It's not a fun process," said board Chairman Tim Lea of the sobering budget picture. "It's tough."
In sharply cutting the budget, McSwain said he took into consideration such factors as the sluggish economy and the dramatic drop expected in collections of property taxes and sales taxes and interest revenue. His budget exceeds the board's goal of cuts from 3 to 5 percent.
McSwain's budget is a recommendation. It will not become official until the board adopts the budget at its June 7 meeting. The board is expected to tweak the proposal at a series of work sessions, beginning with a special meeting scheduled for 5 p.m. Thursday.
"The recession has blanketed everyone with huge financial shortfalls," McSwain said in his budget message.
Tax Collections Down
McSwain cited estimates that property tax collections will drop by $1 million in the next year, while sales tax collections will drop by another $1 million and investment interest earnings will fall yet another $1 million.
Taking a hit are the Moore County public schools, where a 3 percent reduction leaves $25.5 million for current expenses and $711,932 for capital outlay.
The school board asked for $26.2 million for current expenses, up $1.3 million from the current year, and $1.13 for capital outlay.
McSwain said the schools can expect about $500,000 in average daily membership funding from the state for capital projects.
Sandhills Community College's reduced budget request was cut a further 3 percent, leaving $4 million.
McSwain acknowledged the difficulties faced by the public schools and college but said their leaders understand the scope of the financial situation and cooperated fully.
The budget recommendation eliminates funding for seven vacant positions in such areas as parks and recreation, elections, health, tax and public safety departments, a savings of $301,181.
It recommends four other positions "as part of a restructuring and/or reduction in force at a savings of $157,028." The budget message does not spell out the areas where such reductions might take place.
Not affected by the budget recommendation is progress toward construction of a public safety/detention center and a government office building. It calls for a $2.4 million payment but recommends delaying the principal payment until the 2011-2012 fiscal year, lopping more than $1.5 million from the new budget.
McSwain said this arrangement will not affect the payout for the life of the debt and remains within the county policy regarding debt.
The recommendation does not draw from the fund balance, and McSwain said this will keep the budget within the minimum 15 percent under county fiscal policy.
In the past, the budget has used appropriations from the fund balance to balance new budgets but retention of a reasonable balance is a significant factor in the county's bond rating, which can affect interest rates.
No Pay Raises
Although the property tax rate remains the same, early taxpayers will lose half of their pre-payment discount.
The recommendation alls for cutting the discount from 2 percent to 1 percent, representing a savings estimated at $285,000. McSwain said he does not expect this reduction o have an adverse impact on the overall collection rate.
The budget recommendation cuts spending in several areas affecting employees, who will receive no wage increases for the second consecutive year. McSwain said that appropriate wage adjustments will be essential in the near future.
The issue of longevity pay is not addressed in the budget because the commissioners had not made a decision about proposed changes in this policy.
The board has deferred action twice in recent weeks on alternative options. Later in the meeting, the board did vote on an alternative that incorporates performance with longevity. However, the board's action does not directly affect the budget until a decision is made to include that change.
In his budget message McSwain acknowledged improvements in economic conditions but said the unemployment rate remains high, at 9.9 percent at latest report. He predicts that recovery will be slow and will not be reflected at the local government level for quite some time.
The board approved a recommended budget schedule, which calls for the public hearing to be held during the Monday, May 17, regular meeting.
Contact Florence Gilkeson by e-mail at firstname.lastname@example.org.
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