Public hearing Thursday on $30M Fayetteville budget

Proposed hold on millage rate would increase taxes due to reevaluations, new homes

By JOHN MUNFORD
jmunford@TheCitizenNews.com

The Fayetteville City Council will have its first hearing on the city’s proposed $30.04 million budget for 2004-2005 at Thursday night’s council meeting.

The figure includes all city expenditures, including $8.85 million for general fund expenditures, $11.75 million for water and sewer expenditures and $6.51 million for capital projects in addition to other separate smaller funds operated by the city.

The general fund portion of the city’s budget would increase of 1.49 percent from the current fiscal year according to the current recommendation to council. This increase was due to increases in employee benefit costs, finance director Lynn Robinson and City Manager Joe Morton noted in a memo to council.

The budget includes no additional personnel but several significant capital expenditures for the city’s new police department and municipal court building and improvements to the city’s water and sewer system.

City staff is recommending that the millage rate remain at 3.033 mills, which would result in a net tax increase due to an increase in the tax digest through increased property values on existing homes and new home construction.

Public safety, including police and fire services, takes up 60 percent of the city’s general fund budget with a projected expense of $5.39 million. Public works ($892,000) and general government ($967,000) taking up roughly 10 percent each of the general fund, according to city staff projections.

The city’s capital projects fund, totaling $6.5 million, includes $3.2 million for the police station and municipal court building which will be financed, increasing the city’s annual debt service. The capital projects fund also includes $1.63 million for pedestrian improvements on Lanier Avenue —Êbut $1.3 million of that will be paid for with grant proceeds from the Atlanta Regional Commission’s Livable Centers Initiative program.

In their memo, Morton and Robinson noted that the proposed budget “is one of the most austere budgets developed in recent years.”

While revenues such as property taxes, franchise fees and building fees have slowed, the city’s operating expenses have continued to increase, mainly due to providing competitive salaries and increasing health insurance benefits, the memo stated.

Revenues for sales taxes have increased, largely due to the renegotiation of the percentage the city receives, Morton and Robinson noted.

In fact, sales and use taxes accounted for 32 percent of the city’s projected general fund revenues for the coming fiscal year. Property taxes come in second at 18.5 percent, with business taxes at just under 16 percent, fines and forfeitures at 9.95 percent and franchise taxes at 9.78 percent.