Mount Airy Mayor Deborah Cochran and Commissioner Jon Cawley go over figures during a workshop Monday which culminated with the adoption of the 2013-2014 city budget.

slideshow

Mount Airy officials unanimously adopted a 2013-2014 budget Monday which slashes property taxes by 4 cents, while providing a 2 percent raise for city employees over the objections of one commissioner.

The spending plan for the next fiscal year, which begins on July 1, already included a 2-cent tax cut. But during a workshop Monday morning, the board of commissioners supported a 4-cent reduction instead.

“I think if there is a time that people need more money in their pockets, it is now,” Mayor Deborah Cochran said.

Balancing the municipality’s budget for next year and covering the raises and other provisions will require using an estimated $2.03 million from its general fund balance, or savings. Dipping into that fund, which hasn’t been tapped for several years, did occur with some reluctance.

“I am concerned about the fund balance,” Commissioner Steve Yokeley said, with Monday’s debate including a reminder about a situation in 2008 when it fell to a dangerously low level and drew scrutiny from the state treasurer.

But, countered fellow board member Jon Cawley in arguing for the 4-cent tax reduction, “I think it’s important for us to understand that this is not our money. I think we should have a fund balance (savings) similar to what the citizens have.”

While Cawley said many people live “hand to mouth,” the city is prospering in comparison — with a fund balance that at last report represents 87.3 percent of total municipal expenditures and will drop to 71.5 percent with the budget action. The state average is 51 percent.

“We’re here for the citizens of Mount Airy — that’s what I think we should be working toward,” Commissioner Dean Brown said of cutting taxpayers versus building up a fund.

Dollarwise, the city’s fund balance stood at $11.8 million as of the close of 2012.

Cawley said if tax cuts continue and officials are forced to make a habit of raiding the fund balance, which hasn’t occurred in recent years, “then you know where the bottom is.”

Commissioner Scott Graham said he was “very comfortable” trimming taxes by 4 cents for the next fiscal year. But this might be hard to maintain in the future due to changes in Raleigh that could eliminate various revenue sources, based on information presented at the workshop.

Monday’s vote means the property tax rate for 2013-2014 will be 52 cents per $100 of assessed valuation. Each penny of the tax rate represents about $100,000, according to City Manager Barbara Jones.

The city’s general fund budget, which does not include water-sewer operations, totals $12.9 million, which is about 5 percent higher than the present fiscal year. The water-sewer portion of $5.7 million is 5.1 percent less, with no rise in utility rates included.

Pay Raise Debated

Providing the 2 percent cost-of-living raise for 173 full-time employees covered by the budget will run about $231,342, the city manager said.

The increase will not be across the board, but for those who achieved satisfactory performance during their most recent evaluation. New-hire probationary employees, those serving disciplinary actions or workers receiving marginal reviews will not qualify.

Qualifying workers will get a minimum $1,000 hike, which assures those at the lower end of the pay scale receive a greater percentage increase.

But Commissioner Shirley Brinkley expressed concern Monday about the level of extra compensation, while acknowledging she was raising a “sore subject.”

“I don’t know many cities that’s giving two percent,” Brinkley said of budget discussions elsewhere.

The board member added that she admires the job municipal employees do. “I love all of you, and I don’t want to kick anybody in the teeth,” Brinkley said.

Yet it could be argued that they are doing well already, she said. “We need to consider the fact that everybody is eating pretty well with the city.”

Brinkley, whose son is an officer in the military, said the benefits received by city personnel are better than those of service members. “I wish I had a job that had the insurance that this city has.”

She argued Monday for reducing the proposed raise to 1.5 percent. “I feel like two percent is a lot of money to give, and guarantee $1,000.”

Other commissioners disagreed.

“I would defend the two percent pay increase as much as anything in this budget,” Cawley said. He pointed out that the city payroll has declined in recent years, due to such measures as not filling vacancies when employees leave. This means those remaining have done more work, not only in maintaining services to citizens but improving them.

Concerning the question of paying people more while also reducing taxes, Cawley said, “Why would you fuss with that?”

“I think it’s very reasonable,” Yokeley said of the 2 percent increase. “I’d rather pay a few good employees what they’re worth.” Doing less could “damage morale,” Yokeley said.

For his part, Commissioner Brown said he would give municipal employees a 5 percent raise if possible, citing their fast response in helping citizens with various problems.

Other Budget Highlights

The 2013-2014 city budget also includes:

• $793,831 for capital outlay needs, reflecting major expenditures or projects costing $10,000 or more. This will allow the city to stay on target with its replacement of police vehicles, along with various equipment needs for all departments. It also includes some HVAC upgrades, which has been viewed as a necessity; storm-drainage replacement; and street paving.

Money additionally is contained in the capital outlay portion of the utility budget for continued water and sewer line rehabilitation.

• The maintaining of special appropriations to outside agencies including the Surry Arts Council, Mount Airy Rescue Squad, Mount Airy Public Library and Mount Airy Museum of Regional History. This totals $205,150, with only the library getting an increase, of $1,000, for new books.

Reach Tom Joyce at 719-1924 or tjoyce@civitasmedia.com.