Commissioners kicked off the 2019-20 fiscal year budget process with a three-and-a-half hour meeting last Thursday to discuss the accomplishments of the past year and to look ahead at future needs.
Looking at the last year, County Manager Derek Roland and County Finance Director Lori Hall had some good news to share with commissioners — sales tax revenue is up 5 percent over this time last year, property tax collections are up more than $750,000 over last year and general fund revenues are also up over last year.
“2018 was a great year — we saw a slight increase in our fund balance, which puts us in a better position for our capital improvement plan and space needs analysis,” Roland said.
The county is currently in the middle of completing a space needs analysis and capital improvement plan that will help the county set priorities for infrastructure projects for the next 15 years. Between the school system, community college and aging county buildings, the commissioners have a long list of needs in front of them.
In 2018, the county did complete an $800,000 renovation project to the R.C. Carpenter Community Building as well as a $350,000 renovation project at Highlands Civic Center and a roof replacement at the Macon County Detention Center. Though the budget was tight, commissioners also increased funding for the school system’s capital, operational and technology needs during the last budget year while holding its property tax rate steady at 34 percent.
Roland said he was also proud of the county’s “continued ability to provide efficient and high-level public services” to residents while dealing with the climbing costs of a county government. With more than 300 employees, 49 percent of the county’s general fund — about $22.8 million — goes to providing salaries and benefits.
Looking at the revenue side of the budget, 56 percent of the county’s revenue comes from property tax collections. The second most important revenue source is sales tax, which brought in more than $7.9 million for the county in 2018.
The 2018-19 budget of $51 million also included $400,000 toward efforts to expand broadband internet in Macon County and $400,000 to give county employees a 2 percent cost-of-living raise. The county moved more than $500,000 from its fund balance into its health care account to cover a 24 percent increase to its health insurance premiums.
“All these obligations were incurred in 2019 and we know we’ll have obligations in 2020,” Roland said. “We’ll need to discuss employee pay grade adjustments — not an overhaul, just tweaking — and will we give another COLA to employees. With health insurance, it doesn’t seem like it’s going to be as bad as last year but still not a good year.”
DSS needs more child welfare employees, the sheriff’s office is looking to hire four new positions, and grant funding for school resource officer positions will be ending.
On top of all these costs, the county is still at the mercy of the state budget as well, which usually isn’t approved when the new county budget is set to be adopted at the end of June.
One thing is certain — the latest revaluation showed that Macon County’s growth has been fairly stagnant over the last four years. While property values have stabilized since the last revaluation in 2015, it also means the commissioners could be looking at increasing the county’s property tax rate in order to have a revenue neutral budget. Macon County Tax Administrator Richard Lightner told commissioners in December that they might have to increase the rate from 34 cents per $100 of value to 37 cents, but it’s too early in the process to know for certain what the final percentage will be.
Improving security measures at Macon County’s Courthouse is one item commissioners say can’t be put off any longer.
Superior Court Judge Bill Coward approached commissioners two years ago about the need for security upgrades to the building, which currently has multiple entry points. In response, Sheriff Robbie Holland put together a committee with representation from every agency in the courthouse to come up with recommendations to the board.
“We feel like we’re getting somewhere — the North Carolina Sheriff’s Association came and did a review as did the Marshall’s Service and then we started doing our own reviews,” Holland told commissioners at the budget meeting.
Originally, the plan was to only have one secured entry into the courthouse, which would have created a lot of new expense for the county. Holland said the committee came up with a more affordable alternative that includes only having two entry points — one at the front of the building and one in the back. Each entry point will have metal detectors, X-ray machines and will be staffed with a sheriff’s deputy. The estimated cost of the equipment is $58,000 and Holland is asking for four additional positions in the coming 2019-20 budget. With more than 20,000 people accessing the court system in Macon County each year, he said these security measures are a necessity.
Standing before commissioners in the courthouse last week, Judge Coward said he was very much aware the back doors behind him were not locked or guarded.
“It makes my skin crawl. I deal with crazy people all the time in my job — they’re angry, they’re addicted to meth and they’re looking for someway to show how they feel,” he said.
Commissioner Karl Gillespie encouraged the sheriff to look into the possibility of leasing the equipment since security technology is changing so rapidly.
“I’d hate for us to get technology that will be out of date in a year or two,” he said.
Commissioner Ronnie Beale suggested going ahead and buying the equipment before the new fiscal year begins since prices will only increase the longer the county waits.
Schools Superintendent Dr. Chris Baldwin thanked the commissioners for additional funds they allocated to the school system during last year’s budget process to prevent the school board from having to cut any essential staff or services.
Additional technology funds allowed the school system to purchase 400 new iPads to replace the outdated ones students have been using. More capital funds allowed the school system to make much needed school safety improvements on several of the campuses.
“We added security fencing at schools, provided access controls at several locations and swipe card entrances and new alarms systems and cameras,” Baldwin said.
However, more needs to be done. Baldwin’s budget request this year includes funds for classroom door locks at the high school, more swipe card entry systems at the elementary schools, perimeter fencing at Highlands School and more. Looking at other maintenance needs, Baldwin said the fine arts building at the high school needs renovations, several parking lots need patching and several windows need to be replaced at the high school and South Macon Elementary.
For technology, Baldwin said $618,000 is needed just to maintain what the school system already has in place, including replacing old desktop computers, a new air conditioning system for Iotla Valley, a new sound system at South Macon, fire alarm upgrades and an exterior speaker system at Nantahala School.
“As for the operations budget, we’re looking through a really murky glass right now,” he said, adding that the state budget will likely impact the local budget when it comes to class size requirements and mandated salary and benefit increases for teachers. He anticipates needing four more K-3 teachers, which should be funded from the state, but he’s concerned about whether the state will also fund the teacher assistants needed to go along with those teachers.
“Another concern is we’re seeing more and more trauma impacting students that have serious emotional issues. Many of them are living with grandparents and their parents are incarcerated or other things,” Baldwin said. “We need another social worker or guidance counselor and we’re looking at the possibility of adding school based health clinics.”
While the state has increased pay for teachers in the last few years and Macon provides a 2-percent supplement for them as well, Baldwin said the school system’s classified employees — maintenance workers, custodians, food service and receptionists — have not been included in those raises or supplements.
“They are the backbone of our community and they are some of the lowest paid in the community as well,” he said. “A 2-percent supplement for them would cost us $96,000.”
After hearing from staff and department heads, Commissioner Ronnie Beale said it seemed pretty clear what the commissioners’ goals should be for the upcoming budget.
“We’ve got some big decisions to make and things we need to go ahead with and stop kicking the can down the road,” he said, referring to the courthouse security measures and school safety improvements.
Commission Chairman Jim Tate agreed that school safety and courthouse security need to be at the top of the priority list.
“We need to get that moving. I don’t think I could live with myself knowing we could have made a difference if something ever happens,” he said.
Knowing the increased cost of health insurance is weighing heavy on Roland’s mind, Tate said he wouldn’t be opposed to allocating fund balance toward making the county health fund for solvent.
He said he’d also leave it to Roland’s discretion to figure out how the revaluation will impact the budget and the tax rate.
“I’m gonna have to trust your judgment. I had a great dream to hold it flat but after listening to what’s going on in the schools and with security, you’re going to have to make that recommendation on what it takes to run our county safely and efficiently and we have to have that hard discussion on whether we can make it happen,” Tate said.
Commissioner Gary Shields said he wanted to refocus on the needs of the Nantahala community where residents have been asking the county to address infrastructure needs.
Roland said those proposed projects would be included in space needs analysis, which should be released in the summer.
Lastly, Shields asked commissioners not to lose sight of what’s happening at Angel Medical Center. With the sale of Mission Health to HCA Healthcare, AMC is now a for-profit hospital under HCA. HCA has committed to constructing a replacement hospital along U.S. 441, leaving the old AMC building in Franklin without a use. The purchase also created the Dogwood Health Trust that will receive the proceeds from the sale to go toward continued community health initiatives in the region.
“We need to stay involved in trying to keep up with the new Dogwood Foundation and things like that,” he said. “A lot of people want to ask us questions but I don’t know the answers — I don’t know if we’re not staying involved or we’re not being included in it, but we’re expected to know whether were in the loop or not.”
Roland plans to make his recommended budget presentation May 14 before holding a public hearing. Then commissioners will have another month to discuss it before it has to be adopted by July 1.