No tax, utility increases in Ayden budget proposal
By Amber Revels-Stocks
The Times Leader
Friday, April 26, 2019
AYDEN — Town residents likely will not pay higher property taxes or utility rates in the coming fiscal year, but may see an increase in water and sewer charges.
The Ayden Board of Commissioners got a look at the proposed 2019-20 fiscal year budget as it relates to core government services on Monday during a budget workshop.
The budget totals $21.61 million, which is a 7.91 percent increase from the current fiscal year. Ayden finance director Rob Taylor said the budget does not include any tax or utility fee increases.
The proposal includes $1.2 million to install advanced metering infrastructure on electric meters and $42,400 for street resurfacing. It also includes a 1.5 percent cost-of-living adjustment increase for town employees.
The budget also projects a 6.9 percent hike in health insurance costs for employees. The town receives its insurance through the League of Municipalities.
“We look at our insurance every year to make sure we have the best deal,” Ayden Manager Steve Harrell said. “Year before last, we changed our insurance to get a savings. Then last year, we changed our insurance to the League of Municipalities to get a savings. We shop around every year.”
The tax rate will stay at 54 cents per $100 valuation for the 2019-20 proposed budget. The collection rate is 97.94 percent. Taylor estimates the town will collect $1,275,916 in property tax revenue.
While Taylor is not recommending a utility fee increase for the proposed budget, he is considering a 4 percent increase in the water rate and a 4 percent increase in the sewer rate for fiscal year 2020-21.
Working capital in the water and sewer fund) is going in the wrong direction and will continue to drop, Taylor said.
“Right, now we’re projecting year end we’ll have $1,139,420 or roughly four-and-a half-months of working capital,” he said. “That is a challenge we’ve got. … We have one of the higher sewer rates in our comparisons. It’s something we’re looking at. We’ll be working with the School of Government to look at our water and sewer rates and see if there’s something we can tweak.”
Ayden Mayor Steve Tripp asked how much a normal household would see their bill increase if the proposed hikes are implemented. Taylor said it would be about $8 per month.
“Unfortunately, (working capital) is trending the wrong direction and eventually it will be a snowball,” Tripp said. “If you get into a situation where you run into some type of difficulty — well, that’s something that needs to be thought about.”
Commissioner Raymond Langley asked how much additional income the rate increase would bring. Taylor said it would be around $116,000.
“What if we split the (rate) increase over two years? What if we do 2 percent this year and 2 percent next year?” Langley asked.
Taylor agreed to look into the possibility.
The main reason for the decrease in working capital in the fund is due to an increase in treatment costs at the Contentnea Metropolitan Sewerage District wastewater plant. Treatment fees are budgeted at $934,000, which is an increase of $134,000. Ayden received around 80 inches of rainfall during 2018, resulting in the fee increase.
“(The treatment fees) will always depend on the rainfall,” Harrell said. “We have an $8 million (inflow and infiltration) problem that we’re addressing.”
An appropriation of $148,474 from the fund balance is recommended.
The proposed budget also includes a $479,001 appropriation from the general fund balance. Most of that is a $372,000 allocation from Powell Bill reserves for street resurfacing and does not affect unrestricted fund balance.
The board’s policy is to maintain an unassigned fund balance of no less than 10 percent — the current balance is 20 percent.
Commissioners will hold a second budget workshop on Monday inviting outside agencies, such as the Ayden Chamber of Commerce and Collard Festival, to make presentations for their budget requests.