Tarboro FY 2010-2011 Annual Budget (Full Document)
Comprehensive Annual Financial Report Part 1
Comprehensive Annual Financial Report Part 2
Highlights for Fiscal Year 2009/2010 budget are included in the following budget message from the Town Manager:
Budget Message
TO: Mayor and Town Council
FROM: Samuel W. Noble, Jr. Town Manager
DATE: 1 July 2010
SUBJECT: Budget for Fiscal Year 2010-2011
Submitted herein is the budget for Fiscal Year FY 2010-2011. The budget is balanced in its entirety, as required by the North Carolina Local Government Budget and Fiscal Control Act.
The Town’s overall budget for FY 2010-2011 totals $45,477,862. The budget excluding interfund transfers is $41,457,599.
GENERAL FUND
The proposed ad valorem tax rate for FY 2010-2011 is $0.36 per $100 valuation of $891,956,081 with a tax collection rate of 96.78%. This represents no property tax rate increase for FY 2010-2011. The Town of Tarboro has not increased property taxes in twenty (20) years. It is proposed that $500,000 be transferred from the Solid Waste Fund to the General Fund. The General Fund paid for the purchase of sanitation vehicles in 1998; therefore, the General Fund is being reimbursed for a portion of the expenses incurred to establish the Solid Waste Fund. This will leave the Solid Waste Fund with a fund balance of approximately $300,000. It should be noted that this is a one-time transfer. Should the economy not improve and the collection of revenues such as sales tax and interest on investments not increase, an additional three (3¢) to four (4¢) cents property tax rate increase may be necessary for FY 2011-2012. Due to the poor economy and high unemployment rates a property tax rate increase should be avoided in FY: 2010-2011.
In addition to the above mentioned fund transfers, two (2) Street Department Maintenance Workers have been eliminated representing a savings of $59,784, two (2) Groundskeeper positions will be eliminated no later than 1 July 2010, representing a savings of $60,706, and an office assistant IV, Computer Operator will be eliminated effective 1 June, 2010 representing a savings of $44,769.
The Town of Tarboro continues to have the lowest tax rate of any comparable or larger sized municipality in the area. The property tax rate for Rocky Mount for FY 2009-2010 is 55 cents, the property tax rate for Greenville for FY 2009-2010 is 52 cents and the property tax rate for Wilson for FY 2009-2010 is 51.5 cents. The Edgecombe County property tax rate for FY 2009-2010 is 86 cents. Furthermore, the General Fund continues to be debt free. These neighboring local government property tax rates illustrate the fact that Tarboro’s management team has and continues to be conservative. The Town of Tarboro strives to pay for capital outlay from reserves rather than issuing bonds and paying interest on debt; however, no capital outlay expenditures other than an E-911 equipment upgrade funded from grants and special 911 surcharge funds and roof repairs for the fire department have been budgeted for FY 2010-2011. In addition, the Town of Tarboro does not budget capital outlay expenditures unless they are needed and costs for such expenditures are kept to a reasonable level. It should be noted that at a 96.78% collection rate one (1¢) cent property tax generates $86,324.
The Town of Tarboro has been able to keep property taxes from increasing over the last twenty (20) years by reducing staff. Thirty-one (31) positions have been eliminated since 1987 resulting in a cumulative savings of $1,158,168 Staff positions will continue to be monitored and will be reduced if possible. As stated previously the proposed budget has included a fund balance appropriation for operating costs in the amount of $134,898. With the transfer from the Solid Waste Fund reimbursement to the General Fund in the amount of $500,000 the actual amount to balance the budget is $634,898. These funds are from the reimbursement of $500,000 from the Solid Waste Fund to the General Fund. This one time transfer is providing funds to keep property taxes from increasing three (3¢) to four (4¢) cents. The main driver for a shortage of revenue is a reduction in sales tax and investment revenues. The economy is improving and these revenues should increase over the next year. Tarboro continues to have adequate General Fund reserves to cover emergency expenses. With the proposed reduction in reserves, Tarboro still has a General Fund Balance of 17.03% of the General Fund or $1,605,699, excluding the Powell Bill Fund balance. The addition of the Powell Bill Fund balance, which is restricted, increases the overall General Fund balance to 26.36% of the General Fund or $2,583,536. Overtime has been reduced for all departments. Should the Town of Tarboro experience a severe emergency such as flood or hurricane overtime will be paid from reserves, which is why Council should retain adequate reserves.
State collected local revenues have been adjusted as recommended by the League of Municipalities and most revenues have decreased. Sales taxes received for FY 2009-2010 is approximately $300,733 less than budgeted. The amount budgeted for FY 2010-2011 is $291,000 less than was budgeted for FY 2009-2010. Interest on investments was budgeted at one (1%) percent for FY 2009-2010, Tarboro is current receiving less than .25 % on investments. The Governor unexpectedly retained $32,000 in beer and wine tax from Tarboro in FY 2009-2010. These funds have been budgeted for FY 2010-2011.
SOLID WASTE MANAGEMENT FUND
Edgecombe County landfill costs will increase from $45.00 per ton to $46.00. Due to a decrease in landfill tonnage, due to the economy and holding the line on operational costs, the solid waste collection fee will remain at $19.25 per month.
WATER AND SEWER FUND
Water and sewer rates will increase by twenty-five percent (25%) for FY 2010-2011. This increase is due to a reduction in consumption since the drought of FY 2007-2008 and an increase in chemical costs. The fact that the Town of Tarboro has no debt on its water and sewer system has allowed the Town to keep rates from increasing in previous years. Council held the line on water and sewer rates in FY 2009-2010 even though neighboring municipalities were increasing their water and sewer rates. Therefore, it is necessary to appropriate $183,222 from water and sewer reserves to balance the budget for FY 2009-2010. This amount would have been $100,000 greater if sewer line rehabilitation had been spent. It should be noted that $206,805 was needed from reserves to balance the FY 2008-2009 budget. The Town of Tarboro’s water and sewer rates with the proposed increase will continue to be lower than those of Greenville, Rocky Mount and Wilson. See Exhibit A: Proposed Water and Sewer Rates and the current rates in Wilson, Rocky Mount and Greenville.
STREET IMPROVEMENT FUND
The budget will support the Town’s street improvement plan with funding from Powell Bill funds.
ELECTRIC FUND
There is no anticipated increase in wholesale electric rates for FY 2010-2011. A wholesale increase in power costs will be necessary in future years should Congress pass legislation concerning climate change, renewable power requirements, or a carbon emission tax on coal fired generating plants.
The electric warehouse specialist position will be eliminated upon the 1 July 2010 retirement of the individual currently holding the position resulting in a savings to the Electric Fund of $49,631.
OPERATIONS
Line items such as department supplies and materials, auto supplies, uniforms and dues and subscriptions have been reviewed individually for each department and reduced if possible. Fuel costs and chemical costs continue to be high for all departments.
No funds have been budgeted for out of state travel. Funds have been budgeted for attendance by Council to the North Carolina League of Municipalities Conference.
The $10,000 expense for fireworks has been eliminated which will result in the private sector funding fireworks on July 4th 2011.
Operating funds have been appropriated for participation in the Carolinas Gateway Partnership, the Edgecombe County Memorial Library, and the Edgecombe County Arts Council.
The Town of Tarboro funds fifty percent (50%) of the Edgecombe Cultural Arts Council’s operating budget. The Town owns and provides maintenance and upkeep of the Blount-Bridgers House, Pender Museum, and the surrounding grounds.
The Town of Tarboro funds twenty-nine percent (29%) of the budget for the main library of the Edgecombe County Memorial Library. The County funds the remaining seventy-one percent (71%). The funding is based on a per capita basis.
As Council is aware, the Town of Tarboro adjusts the Town’s level of funding to outside agencies that are jointly funded by the County and Town in order to compensate for any increases or decreases the County makes to these agencies. This is done in order to keep funding levels for the outside agencies at the percentages agreed upon in previous years.
PERSONNEL
The FICA, retirement, and salary wage lines reflect a 2.5% one-time bonus. There was no pay increase in the FY 2009-2010 budget.
No merit raise has been budgeted for the Town’s above standard employees.
Worker’s compensation insurance costs are projected to increase by two percent (2%). General liability insurance costs are projected to increase five percent (5%). Health insurance costs are projected to increase by 1.1%. Our self-funded health insurance program, which is administered through Blue Cross and Blue Shield continues to be much less expensive than package plans from the League or elsewhere.
CAPITAL OUTLAY
The police department has a capital outlay request for an E-911 equipment upgrade which will be funded by grants and E-911 surcharge funds.
Water and Sewer capital outlay expenditures are for sewer line rehabilitation and a water plant pump rebuild. These expenditures have been funded from reserves.
Electric improvements are for overhead and underground distribution line capital outlay and are funded from operating revenues.
A new roof is needed for the central fire department and will be funded from General Fund reserves. In addition, a new gas pack and air conditioner are budgeted for the Blount Bridgers House.
An upgrade to the telephone system is included and funded equally by the General Fund, Electric Fund, Water/Sewer Fund and Solid Waste Fund.
Budget Message
TO: Mayor and Town Council
FROM: Samuel W. Noble, Jr. Town Manager
DATE: 1 July 2010
SUBJECT: Budget for Fiscal Year 2010-2011
Submitted herein is the budget for Fiscal Year FY 2010-2011. The budget is balanced in its entirety, as required by the North Carolina Local Government Budget and Fiscal Control Act.
The Town’s overall budget for FY 2010-2011 totals $45,477,862. The budget excluding interfund transfers is $41,457,599.
GENERAL FUND
The proposed ad valorem tax rate for FY 2010-2011 is $0.36 per $100 valuation of $891,956,081 with a tax collection rate of 96.78%. This represents no property tax rate increase for FY 2010-2011. The Town of Tarboro has not increased property taxes in twenty (20) years. It is proposed that $500,000 be transferred from the Solid Waste Fund to the General Fund. The General Fund paid for the purchase of sanitation vehicles in 1998; therefore, the General Fund is being reimbursed for a portion of the expenses incurred to establish the Solid Waste Fund. This will leave the Solid Waste Fund with a fund balance of approximately $300,000. It should be noted that this is a one-time transfer. Should the economy not improve and the collection of revenues such as sales tax and interest on investments not increase, an additional three (3¢) to four (4¢) cents property tax rate increase may be necessary for FY 2011-2012. Due to the poor economy and high unemployment rates a property tax rate increase should be avoided in FY: 2010-2011.
In addition to the above mentioned fund transfers, two (2) Street Department Maintenance Workers have been eliminated representing a savings of $59,784, two (2) Groundskeeper positions will be eliminated no later than 1 July 2010, representing a savings of $60,706, and an office assistant IV, Computer Operator will be eliminated effective 1 June, 2010 representing a savings of $44,769.
The Town of Tarboro continues to have the lowest tax rate of any comparable or larger sized municipality in the area. The property tax rate for Rocky Mount for FY 2009-2010 is 55 cents, the property tax rate for Greenville for FY 2009-2010 is 52 cents and the property tax rate for Wilson for FY 2009-2010 is 51.5 cents. The Edgecombe County property tax rate for FY 2009-2010 is 86 cents. Furthermore, the General Fund continues to be debt free. These neighboring local government property tax rates illustrate the fact that Tarboro’s management team has and continues to be conservative. The Town of Tarboro strives to pay for capital outlay from reserves rather than issuing bonds and paying interest on debt; however, no capital outlay expenditures other than an E-911 equipment upgrade funded from grants and special 911 surcharge funds and roof repairs for the fire department have been budgeted for FY 2010-2011. In addition, the Town of Tarboro does not budget capital outlay expenditures unless they are needed and costs for such expenditures are kept to a reasonable level. It should be noted that at a 96.78% collection rate one (1¢) cent property tax generates $86,324.
The Town of Tarboro has been able to keep property taxes from increasing over the last twenty (20) years by reducing staff. Thirty-one (31) positions have been eliminated since 1987 resulting in a cumulative savings of $1,158,168 Staff positions will continue to be monitored and will be reduced if possible. As stated previously the proposed budget has included a fund balance appropriation for operating costs in the amount of $134,898. With the transfer from the Solid Waste Fund reimbursement to the General Fund in the amount of $500,000 the actual amount to balance the budget is $634,898. These funds are from the reimbursement of $500,000 from the Solid Waste Fund to the General Fund. This one time transfer is providing funds to keep property taxes from increasing three (3¢) to four (4¢) cents. The main driver for a shortage of revenue is a reduction in sales tax and investment revenues. The economy is improving and these revenues should increase over the next year. Tarboro continues to have adequate General Fund reserves to cover emergency expenses. With the proposed reduction in reserves, Tarboro still has a General Fund Balance of 17.03% of the General Fund or $1,605,699, excluding the Powell Bill Fund balance. The addition of the Powell Bill Fund balance, which is restricted, increases the overall General Fund balance to 26.36% of the General Fund or $2,583,536. Overtime has been reduced for all departments. Should the Town of Tarboro experience a severe emergency such as flood or hurricane overtime will be paid from reserves, which is why Council should retain adequate reserves.
State collected local revenues have been adjusted as recommended by the League of Municipalities and most revenues have decreased. Sales taxes received for FY 2009-2010 is approximately $300,733 less than budgeted. The amount budgeted for FY 2010-2011 is $291,000 less than was budgeted for FY 2009-2010. Interest on investments was budgeted at one (1%) percent for FY 2009-2010, Tarboro is current receiving less than .25 % on investments. The Governor unexpectedly retained $32,000 in beer and wine tax from Tarboro in FY 2009-2010. These funds have been budgeted for FY 2010-2011.
SOLID WASTE MANAGEMENT FUND
Edgecombe County landfill costs will increase from $45.00 per ton to $46.00. Due to a decrease in landfill tonnage, due to the economy and holding the line on operational costs, the solid waste collection fee will remain at $19.25 per month.
WATER AND SEWER FUND
Water and sewer rates will increase by twenty-five percent (25%) for FY 2010-2011. This increase is due to a reduction in consumption since the drought of FY 2007-2008 and an increase in chemical costs. The fact that the Town of Tarboro has no debt on its water and sewer system has allowed the Town to keep rates from increasing in previous years. Council held the line on water and sewer rates in FY 2009-2010 even though neighboring municipalities were increasing their water and sewer rates. Therefore, it is necessary to appropriate $183,222 from water and sewer reserves to balance the budget for FY 2009-2010. This amount would have been $100,000 greater if sewer line rehabilitation had been spent. It should be noted that $206,805 was needed from reserves to balance the FY 2008-2009 budget. The Town of Tarboro’s water and sewer rates with the proposed increase will continue to be lower than those of Greenville, Rocky Mount and Wilson. See Exhibit A: Proposed Water and Sewer Rates and the current rates in Wilson, Rocky Mount and Greenville.
STREET IMPROVEMENT FUND
The budget will support the Town’s street improvement plan with funding from Powell Bill funds.
ELECTRIC FUND
There is no anticipated increase in wholesale electric rates for FY 2010-2011. A wholesale increase in power costs will be necessary in future years should Congress pass legislation concerning climate change, renewable power requirements, or a carbon emission tax on coal fired generating plants.
The electric warehouse specialist position will be eliminated upon the 1 July 2010 retirement of the individual currently holding the position resulting in a savings to the Electric Fund of $49,631.
OPERATIONS
Line items such as department supplies and materials, auto supplies, uniforms and dues and subscriptions have been reviewed individually for each department and reduced if possible. Fuel costs and chemical costs continue to be high for all departments.
No funds have been budgeted for out of state travel. Funds have been budgeted for attendance by Council to the North Carolina League of Municipalities Conference.
The $10,000 expense for fireworks has been eliminated which will result in the private sector funding fireworks on July 4th 2011.
Operating funds have been appropriated for participation in the Carolinas Gateway Partnership, the Edgecombe County Memorial Library, and the Edgecombe County Arts Council.
The Town of Tarboro funds fifty percent (50%) of the Edgecombe Cultural Arts Council’s operating budget. The Town owns and provides maintenance and upkeep of the Blount-Bridgers House, Pender Museum, and the surrounding grounds.
The Town of Tarboro funds twenty-nine percent (29%) of the budget for the main library of the Edgecombe County Memorial Library. The County funds the remaining seventy-one percent (71%). The funding is based on a per capita basis.
As Council is aware, the Town of Tarboro adjusts the Town’s level of funding to outside agencies that are jointly funded by the County and Town in order to compensate for any increases or decreases the County makes to these agencies. This is done in order to keep funding levels for the outside agencies at the percentages agreed upon in previous years.
PERSONNEL
The FICA, retirement, and salary wage lines reflect a 2.5% one-time bonus. There was no pay increase in the FY 2009-2010 budget.
No merit raise has been budgeted for the Town’s above standard employees.
Worker’s compensation insurance costs are projected to increase by two percent (2%). General liability insurance costs are projected to increase five percent (5%). Health insurance costs are projected to increase by 1.1%. Our self-funded health insurance program, which is administered through Blue Cross and Blue Shield continues to be much less expensive than package plans from the League or elsewhere.
CAPITAL OUTLAY
The police department has a capital outlay request for an E-911 equipment upgrade which will be funded by grants and E-911 surcharge funds.
Water and Sewer capital outlay expenditures are for sewer line rehabilitation and a water plant pump rebuild. These expenditures have been funded from reserves.
Electric improvements are for overhead and underground distribution line capital outlay and are funded from operating revenues.
A new roof is needed for the central fire department and will be funded from General Fund reserves. In addition, a new gas pack and air conditioner are budgeted for the Blount Bridgers House.
An upgrade to the telephone system is included and funded equally by the General Fund, Electric Fund, Water/Sewer Fund and Solid Waste Fund.
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