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Boosted by reassessments, F’ville budget may rise only 1%

By BEN NELMS
bnelms@TheCitizenNews.com

Fayetteville is reaching the final stages of approving the Fiscal Year 2006 budget beginning Aug. 1. Though an increase is expected it will barely top 1 percent.

The city’s proposed General Fund budget for FY 2006 totaled $8,953,501. In her June 20 report to the council, Finance Director Lynn Robinson said the proposed increase in the General Fund budget represents a 1.06 percent increase over FY 2005. The proposed revenues and expenditures for FY 2006 encompassing all funds and budget areas totaled $32,919,021.

“It’s an austere, tight budget, but an effective budget and it is what was called for,” said Mayor Kenneth Steele.

Robinson said the city’s tax digest is anticipated to increase by a projected 9 percent over the previous digest that totaled $702,243,669.

That number, she said, was factored into the FY 2006 budget, placing the value of a mill (one-thousandth of one dollar) at approximately $765,446, with the current millage rate of 3.003 used to project property tax figures.

The growth in the tax digest during the prior four years ranged from 7.04 percent in 2003 to 15.48 percent in 2001, with an average annual increase of 11.60 percent from 2001-2005.

Robinson said the Local Option Sales Tax (LOST) is by far the city’s largest source of revenue. A reduction in LOST for FY 2006 is due to both the post-9/11 local economy and re-negotiations of local distribution of sales tax dollars where the county receives a larger portion of revenues due to population increases.

Though experiencing decreases since 2001, Robinson said sales tax revenues are beginning to increase gradually.

Other General Fund revenue sources expected for FY 2006 include property taxes at 19.93 percent, business taxes at 16.76 percent, franchise taxes at 11.22 percent, fines and forfeitures at 10.33 percent and licenses and permits at 5.98 percent. The remaining 5.89 percent of General Fund revenues include intergovernmental sources, charges for services and other revenue sources.

General Fund expenditures fall under six categories, said Robinson. Those include Public Safety at 60.60 percent of expenditures, General Government at 11.37 percent, Public Works at 10.75 percent, Housing and Development at 8.73 percent, Judicial at 5.67 percent and Debt Services at 2.87 percent.

“There wasn’t much difference in this year’s budget compared to last year,” Robinson said, referencing the 1-percent increase. “We’re still trying hard to hold the line on expenditures, especially with the reduction in the Local Option Sales Tax. And we held the line on expenditures to balance the budget, and that includes no new capital equipment purchases.”

Five items affecting personnel and employee benefits were addressed in the FY 2006 budget. The most pronounced was the recommendation of a five-month hiring freeze on vacant positions.

Also proposed was the addition of one new storm-water maintenance worker, a 15 percent estimated increase for employee benefits and 3 percent increase to cover job performance raises and the retention plan.

Already enacted by the council was the voluntary early retirement incentive program that affected a maximum of six employees, including departing police Chief Johnny Roberts.

Of the city’s remaining budget areas, the proposed Water and Sewer budget totals, $17,565,937 and the Special Purpose Local Option Sales Tax (SPLOST) Fund, a new fund to account for capital projects such as transportation, is proposed at $2,983,400.

The Capital Projects Fund budget is proposed at $832,518 while the Impact Fee Fund totals $896,098, the Main Street Tourism Fund came in at $638,936 and the Solid Waste and Recycling budget is proposed at $556,950.

The Downtown Development Authority budget is proposed at $305,042. Smaller budget areas include the Hotel/Motel Tax Fund proposed at $83,136, the Confiscated Asset Fund at $47,538, the Vehicle Rental Excise Fund at $50,075 while the Cemetery budget is proposed at $5,850.

Proposed changes in various budget categories included a 49.43 percent increase in the Water and Sewer Fund due to capital outlay projects, a 49.89 percent increases in the Hotel/Motel Tax Fund due to anticipation of a new hotel and the city receiving franchise fees beginning in January 2006, a decrease of 49.81 percent in the Downtown Development Authority budget due to the completion of the 2001 bond projects.

The only project remaining from 2001 budgeted for the coming fiscal year is a $35,000 facade project, she said.

Other fund changes included a 49.43 percent decrease in the Capital Projects Fund due to recording all transportation projects in the SPLOST Fund and a 60.89 percent increase in the Main Street Tourism Fund due to recording and accounting for the Main Street function with the fund, she said.

The second reading of the FY 2006 budget will be held at the July 21 council meeting. The city’s FY 2006 budget year begins Aug. 1.