The proposed 2012-2013 city budget contains good news for Mount Airy taxpayers, including less taxation and no increases in utility rates while also maintaining existing services.
City Manager Barbara Jones presented the spending plan for the upcoming fiscal year Thursday night during a meeting of the Mount Airy Board of Commissioners.
Although the property tax rate is projected to remain at 56 cents per $100 of assessed valuation, that’s misleading since a countywide revaluation has reduced Mount Airy’s tax base by 2.4 percent overall due to a decline in real estate values. The tax base now totals slightly more than $1 billion, reflecting a drop of millions of dollars.
This would translate into a $144,000 decrease in property tax revenue for city government, if this year’s 56-cent rate were applied. In order to achieve a “revenue-neutral” situation — or adjusting the level of taxation to incorporate the effects of revaluation — the rate would have to be raised by one penny.
But maintaining the 56-cent rate means less money will be expected from taxpayers, reflected in a total proposed budget ($17.4 million) that is 7.7 percent lower than this fiscal year’s. That total includes a general fund for city operations as well as a separate water and sewer fund.
“A lot of folks will be paying less tax than they are today, even with the rate remaining the same,” the city manager said. She added that this will be the case for commercial and industrial property owners, as well as residential in some cases.
“This is a tight budget,” Jones said of the resulting financial blueprint for the next fiscal year that begins on July 1. In order to keep a lid on taxation and meet a goal of maintaining services which was set during a city government planning retreat held last winter, the ax had to be wielded, she explained.
“We’ve worked extremely hard for months,” Jones said of herself and city department heads, “and made some reductions — pretty substantial reductions.”
This has been the case in recent years, which has included across-the-board cuts among the various municipal departments and not filling personnel vacancies in some cases.
The proposed budget, for example, calls for the elimination of one upper-level position, that of zoning administrator at an annual savings of $50,000.
Funding is contained for 175 full-time positions, eight fewer than the municipality had in the 2005-06 fiscal year before a round of annexation increased its territorial responsibilities.
However, those employees are recommended to receive a 2-percent cost-of-living pay raise in the new budget effective July 1. Their last increase came in January 2011, also 2 percent, and before that municipal workers had received no raise for the previous two fiscal years.
The 2011 hike also did not apply to the city manager, but Jones was awarded a 2-percent salary hike after completing extra training earlier this year which increased her professional credentials.
Jones said Mount Airy is facing some financial pressures she hopes will be addressed in the proposed budget.
“The upcoming fiscal year does come with challenges,” the city manager said, “such as the rising cost of fuel.” That is expected to be 8 percent higher in the next fiscal year compared to 2011-2012.
Other budget highlights include:
• Capital outlay expenditures of $427,500 in the city water and sewer unit. This includes money to begin what Jones termed a “much-needed rehabilitation program” to replace an aging infrastructure containing some lines that are a century old;
• Maintaining the same level of city government special appropriations to entities including the Mount Airy Public Library, which is part of a regional library system; Mount Airy Rescue Squad; Surry Arts Council; and Mount Airy Museum of Regional History. The total proposed funding involved is $204,150. However, an extra $53,907 is earmarked for building-related needs of the arts council and library, since the library structure and the Andy Griffith Playhouse are both owned by the municipality;
• Capital outlay spending of $137,377 in the general fund part of the budget, to cover replacement of police vehicles and equipment needed by various departments;
• An 8.2-percent increase in health insurance funding for municipal employees as part of their benefit package, which results from health-care costs increasing dramatically in recent years, Jones said. An average increase of 4.6 percent had been budgeted for that expense over the past three years.
The city commissioners each received bound copies of the proposed budget Thursday night, along with listening to an overview of the spending plan presented by Jones.
“I am excited about what I’ve heard,” Commissioner Jon Cawley said afterward.
Jones pointed out that the new budget is “a working plan” at this juncture.
The commissioners voted Thursday night to hold a public hearing on June 7 at 7 p.m., which will give citizens an opportunity to weigh in on the plan.
Also, the city board will have a budget workshop at 8:30 a.m. on June 11 in the downstairs conference room at the Municipal Building to discuss individual aspects of the budget.
Also at Thursday night’s commissioners’ meeting:
• No opposition was expressed during a public hearing on a rezoning request by longtime local industrialist Jim Crossingham. It involves plans for a condominium development in facilities of the former Spencer’s Inc. apparel company on Willow and Market streets, which Crossingham owns.
He is seeking to change the zoning classification of two parcels on those streets to accommodate the housing as well as possible retail shops and offices. Crossingham said if successful, the project eventually could lead to a convention center or hotel elsewhere in the Spencer’s complex that includes a cluster of buildings.
Action will be taken on the rezoning request at a future meeting of the commissioners.
• Reappointed Rondale Ratcliff to a three-year term on the Mount Airy Parks and Recreation Commission which will expire on May 30, 2015.
Reach Tom Joyce at 719-1924 or tjoyce@719-1924.