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News County manager recommends status quo budget for 2011/2012

Horton ‘guardedly optimistic’ that state won’t pass its own budget crisis on to counties

County manager Jack Horton has proposed a balanced budget of $42.4 million for Macon County for Fiscal Year 2011/2012. In a presentation to the board of commissioners on Tuesday, Horton presented a budget proposal which he said was essentially a “flat, no-growth budget.” The proposed budget is one percent (0.98%) higher than the original budget for the current fiscal year, however it is 1.37 percent lower than the current year’s revised budget (which is now just above $43 million). No property tax increase is requested or recommended in the proposal.

Though the state budget is still uncertain, Horton told the commissioners that he is “guardedly optimistic” that counties won't be forced to bear the brunt of the state's own financial crisis. “We have been assured by our legislators that the state will not balance their budget on the backs of the counties this year,” Horton said. He cautioned, however, that “with the General Assembly still in session, we remain concerned that the state will shift additional responsibilities and/or reduce county funding to correct its budget crisis. We hope that is not the case, but we can only wait and see.”

Horton noted that although sales taxes have somewhat stabilized, they continue to fall short of pre-recession levels, meaning growth in the county’s tax base has been minimal. “We continue to hope for a rebound in the economy next year, but realistically at this point, we don’t anticipate a drastic change,” he said.

While challenges do exist for the coming fiscal year, compared to many counties in North Carolina, Macon finds itself in an enviable position, Horton told commissioners. “The county is in sound financial condition and continues to have one of the lowest property tax rates in North Carolina,” he said. With a 27.9 cent per $100 millage rate, the county actually has the second lowest tax rate in the state. (Carteret County maintains the lowest millage rate in the state at 0.23 percent.)

A stable fund balance provides the county a strong degree of confidence in terms of being prepared for unexpected emergencies or shortfalls in revenues, Horton said. He added that the county's favorable bond rating, which has led to savings in recent capital projects, is due in part to a healthy fund balance and consistent tax collection rates (96.85 percent).

“Our goal over the past three years has been to maintain the current level of service without additional staff,” Horton said, noting that the county has also reduced capital outlay for departments and trimmed other expenses.

While adding no new positions, Horton’s proposal does include a three percent cost of living adjustment for full-time county employees. For the past three years, county employees have received no cost of living adjustments although, according to the consumer price index, the cost of living has risen as much as nine percent.

Horton highlighted several major projects that the county undertook or made progress on over the past year, including several school projects for improvements and new facility construction. Besides upgrades and improvements at Nantahala School and Franklin High School, the county also embarked on construction of the new Iotla Valley K-4 School, an $11.3 million project funded through a low-interest bonded loan (0.48 percent) and scheduled for completion in August of 2012.

Other county projects funded through various sources during the current fiscal year:

• Little Tennessee/Cartoogechaye Creek sewer interceptor line
• Riverbend Road water line
• Macon County Airport runway extension
• Hudson Library renovations
• New Macon County Detention Center security system
• New county computer servers which now host current digital maps for the county
• New EMS facility with garage

Horton told commissioners that the county should be proud that it has been able to make these positive accomplishments while at the same time being vigilant and realistic in its approach to budgeting and financial planning.

The county manager’s budget proposal will be reviewed by the board of commissioners over the coming weeks as they prepare the final budget which by law must be approved by June 30. The first of several scheduled budget discussions will take place on Friday, May 13, at 5:30 p.m. in the boardroom of the Macon County Courthouse. A subsequent budget meeting is scheduled for June 2.


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