Despite the board of commissioners' rejection of the proposed "draft" budget, the financial projections offered for the upcoming fiscal year included a rise in property taxes and a residential water and sewer customer rate increase.
In a press release that accompanied the "draft" budget offered to the Ripple after a formal request was made to Yadkinville's Town Attorney Ben Harding, the mayor and the board of commissioners said "due to an increase in the cost of goods that are needed to maintain our current level of service, the reduction of the tax base, and the overall economic crisis that has affected municipalities, state and federal governments an increase in the tax and water rate is anticipated."
There will be a budget hearing that is open to the public at 11:30 a.m. Monday, May 17, in the Yadkinville town chambers. Members of the public will only be allowed to watch, not offer comments during the hearing. The formal adoption of the budget will occur after a public hearing at 6:50 p.m. Monday, June 7, also in the town's chambers. According to the draft budget presented to the mayor and commissioners, ad valorum taxes would increase .3 cents to .40 cents per $100 of property valuation. That increase would net the town approximately $62,000 in revenue if the tax collection rate remains at the expected 97 percent.
Each penny of the town's ad valorum taxes represents approximately $22,545.
The ad valorum tax increase, according to the draft, would offset a 7 percent decrease in the overall tax base to $214,269,899, which reflects the loss of depreciated equipment at Unifi, the town's largest taxpayer, according to the administrative staff's proposal.
There were three primary justifications for the increase in property taxes, according to the draft.
The first draft budget cited "increased personnel costs." Specifically, "The Local Government State Retirement System has mandated an increased percentage all local governments must pay to help fund retirement benefits for its employees. There has not been an increase since the 1980s and it was determined that an increase was needed to keep the system sound," read the town's budget proposal.
A downturn in the economy was the second of three justifications for the tax increase. "The recent recession is also affecting other revenue sources. Sales tax and utility franchise fees are both projected to be down this year with no immediate signs of recovery. In addition, the historically low interest rate are affecting how much the Town receives from interest on its investments," read the budget proposal.
The third primary justification for the proposed tax increase was the "reduced" tax base, which is expected to be off by 7 percent.
As for the potential of a 3 percent increase in residential water rates, when Sloop was asked if he could offer specifics on the potential rate hikes, such as minimum bills, costs per thousand gallons used, he said the budget was only a draft and referred all other questions to Yadkinville Town Attorney Ben Harding
In the draft budget, it reads "this increase is needed to keep up with the growing cost to provide quality water distribution and wastewater collection services to the residents and businesses in Yadkinville."
There are several potential major "purchases" for the upcoming year proposed in the draft budget.
Topping the list was the potential addition of an officer and vehicle to the Yadkinville Police Department force at a cost of approximately $75,000.
Also listed as "major" purchases were funds to "pay for a management consultant to help with the transition to a new Town Manager;" "continued resurfacing of town streets per a priority list;" and "replacement equipment for the lab, funding for sewer line rehabilitation, (and) replacement equipment for the water plant."
The draft budget, dated May 3, 2010, was signed by Ken Larking, former Yadkinville Town Manager, who according to the newly-installed Town Manager Joseph Sloop, no longer works for the town.
When pressed for details about Larking's employment status, Sloop referred all questions to Yadkinville Town Attorney Benjamin Harding.
Attempts to contact Harding were unsuccessful.