A “no-change” City of Clinton budget for 2014-15 is expected to factor in cost of living adjustments, as well as slight utility rate and fire district tax increases in an effort to save more money for upcoming capital projects and equipment needs.
“This is a no-change budget,” finance officer Harry Staven said during the second of two planned budget workshops at which overviews of the Water and Sewer Fund and General Fund, respectively, were presented to the City Council. “We are looking at $227,000 less to do the same job as we did this year. We got it done so it should be no problem.”
The Council’s next regular meeting is not until May 20. The proposed final budget will be submitted at the end of May with city manager Shawn Purvis’ budget presentation and public hearing to be held June 3. The budget is tentatively scheduled for adoption two weeks later, on June 17.
The 2014-15 recommended General Fund totals approximately $8.7 million, down from this year’s amended budget, which was close to $1 million less than 2012-13’s plan.
“Basically we’re coming in with a very similar budget as last year, doing the same thing,” said Purvis. “There is some increase for employees, for paving roads, and we’re doing some capital projects.”
The budget includes three new police vehicles, $50,000 for sidewalk improvements, $35,000 for a ton-truck and $172,000 for paving improvements. Staven said that sales tax revenues continue to increase with the improving economy, and city officials expect a 4 percent increase for 2014-15.
“The general economy is certainly improving, the unemployment rate is going down and all indications are we will be having better (revenues)” Staven stated.
There will be no health insurance premium increases and a 1 percent COLA, totaling $19,000, is factored in the fiscal plan. Potential merit increases could also total $28,500.
“The merit (increases) might fluctuate down,” Staven noted.
Purvis requested as part of the budget that some fund balance be appropriated, but it remains to be seen how much will actually be used. The city plan called in this year’s budget for similar appropriations but they were not expended.
“We are asking for some money out of the fund balance,” Purvis pointed out.
In 2013-14, $187,000 was put into reserves and $130,000 appropriated for budgeting purposes, but next to nothing used from that total, Purvis noted. For 2014-15, Purvis requested that $150,000 be appropriated, which ultimately amounts to $100,000 because $50,000 netted from the sale of a fire truck is already sitting in reserves. Some of those funds will go toward consolidating the tanker and pumper at the Beaman Street Fire Station into a higher-capacity truck, a capital expense that has been looming for the last couple years.
“That $50,000 and $40,000 from the rural district reserves will help as a down payment ($90,000 total) for that pumper at Beaman Station,” said Purvis.
On the issue of fire department matters, Purvis also asked Council to give the OK for the city to increase its rural district tax rate — the request must be made to, and approved by, the Sampson County Board of Commissioners — from 9.5 cents to 10 cents, which would support the Beaman Street station.
“It would be an extra $21,000 for us,” he said. “There are already five districts at the 10 cent mark. We wouldn’t be the first and we’re not the highest. It’s just to help a little on the rural district. Twenty percent of our calls are to that rural district. If you factored the total outside the city limit calls, including mutual aid, a good one-third of our calls are outside the city.”
The Water and Sewer budget, totaling $4.8 million, was discussed in the first budget work session.
Purvis said he was recommending as part of the 2014-15 budget that water rate fees rise 1.5 percent, bringing the average bill to $45.71 for 5,000 gallons of water and sewer use.
“That is a nominal increase. It is going to be very small for homeowners,” Purvis noted. “It does keep us up with inflation and it does help us prepared for the upcoming projects, almost $5 million on the water plant, the Southwood tank and the (utilities) with N.C. 24 expanding and (costs associated) if Chemtex comes to fruition.”
All of those projects mean between $9-10 million.
Purvis showed how Clinton stacked up with others in terms of utility rates. Even with increases the city’s rates were still well under comparable municipalities.
“Every now and then there may be a question of why we’re raising water rates and what are we doing,” Purvis remarked, “but we’re still very low, and we’re operating efficiently and effectively. This is just a comparison tool. It doesn’t necessarily mean what is the tolerance of the community or the Council.”
Councilman Steve Stefanovich asked where a 2.5 percent hike would put Clinton on that scale with other towns.
“We have some tremendous expenses coming up,” Stefanovich pointed out. “We just have to have a way of paying for all these things that we need to do for the citizens of Clinton. I’m just thinking the more money we can set aside in advance is less we will need (later).”
Purvis agreed, but said that a great deal of debt service would be coming off the Water and Sewer books, which would just be replaced by the new debt in those capital projects. Relying on natural growth and making similar utility rate hikes in recent years to keep pace with inflation has helped offset the need for any large fee hikes.
There was $400,000 appropriated from fund balance in 2013-14 for the Water and Sewer Fund, but it will likely not be completely used.
In a previous meeting, the Council approved $57,000 from reserves to be budgeted for the columbaria at the city cemeteries, with a cost of $450 for the use of those niches. Grave sites are proposed to cost a flat rate of $600 for inside and outside residents. Nothing has been approved regarding a possible move to a contract gravedigging service, with discussion tabled on that matter.
Chris Berendt can be reached at 910-592-8137 ext. 121. Follow us on twitter @SampsonInd.