PILOT MOUNTAIN — In a special meeting held by the Pilot Mountain Board of Commissioners Friday to discuss paving bids, the discussion was more focused on finding cuts in personnel funding to overcome a budget shortfall.
Town Manager Homer Dearmin outlined alternatives to eliminating employee positions in order to save costs and work within the town’s budgetary limits. At the Nov. 29 monthly board meeting, Dearmin recommended eliminating up to three positions, however, the board directed Dearmin to revisit the idea and propose alternatives in order to try to save jobs.
At the Nov. 29 meeting, Dearmin said the town needs to overcome a $60,000 budget shortfall by eliminating one water and sewer employee, one police officer and one public works employee. Even with this measure, the town would still recover just 75 percent of the budget shortfall. Dearmin said by eliminating those three employees effective Dec. 31, halfway through the fiscal year, the town will save $15,000 to $18,000 for each position. There are eight full-time employees in the police department, four in public works and three in the water and sewer department.
Dearmin said when the original 2011-12 budget was approved, those departments were not adequately funded.
On Friday, Dearmin presented the board with a list of financial obligations that the town has for the fiscal year which are not covered in the budget under which the town is operating. These obligations amount to just more than $70,000, and include personnel expenses, costs of the recent municipal election, legal costs, garbage collection costs and the town’s portion of a building reuse grant awarded by the North Carolina Rural Development Center.
“Aside from the Rural Center grant and legal costs, these are expenses that should have been planned for in our current budget,” said Dearmin. “I’m not sure why they were omitted or overlooked, but we have to adjust our budget to accommodate them. That will be pretty difficult to do when we are nearly halfway through the year.”
To adjust for the additional expenses without eliminating positions, Dearmin proposed cutting 401k contributions for non-law enforcement personnel, as well as salary reductions of around five percent for all town employees, including himself.
“Salary and benefit reductions will not be popular,” said Dearmin, “but I don’t know any other way to cut costs if we are committed to saving positions.” Dearmin noted that the proposed cuts would be the equivalent of about six and a half furlough days for employees, and hoped that if this was the ultimate outcome, the board would look at ways to repay or reward employees in next year’s budget.
“I know these cuts will not be easy or popular, but it is the only way to continue services to our citizens uninterrupted,” said Dearmin.
In addition to salary and benefit reductions for employees, Dearmin’s proposal included reducing funding for the town’s library, fire department and rescue squad, as well as reducing funding for economic development initiatives such as façade grants. Dearmin also proposed using contingency funding, and asking department heads to eliminate another $1,000 in spending for each of their departments for the remainder of the fiscal year.
“Departments are already squeezed pretty tight for funding,” said Dearmin. “Each department has cut its budget significantly to help address the town’s low fund balance in keeping with the plan adopted by the board in October to rebuild our cash reserves. It sounds like a small amount to cut, but it will be tough.”
Commissioners were reluctant to reduce salaries and benefits and to cut funding to the town’s partners, but appreciated the efforts made to avoid eliminating positions. Dearmin has eliminated two positions from the town’s roster already, and it was noted that some departments already are understaffed. The two positions eliminated were the town’s finance director Don Keeley and a water and sewer line maintenance employee. Keeley was fired shortly after Dearmin became the town manager in October. Dearmin and the board were informed by the state that the town’s budget was not in order.
The board withheld action on the plan proposed, and decided to talk to interested stakeholders prior to its meeting on Dec. 19, when it will consider taking further action to address budget shortfalls.
Dearmin also informed the board that he was working on getting paving bids for the board in a uniform format. The town received two bids to fix several potholes around town, but commissioners were not satisfied that either bid was specific enough about what the bids included and asked Dearmin to report back to them on Friday.
“This may be something we have to put off until the spring during warmer weather,” said Dearmin, noting that with the winter approaching, the successful bidder would have limited time to get the work done.
In other business, the board went into closed session to discuss personnel matters and matters relating to attorney client privilege. The board came out of closed session with no action taken.
Reach Mondee Tilley at firstname.lastname@example.org or at 719-1930.