Roanoke Rapids City Council could be faced with deciding on a tax rate increase for the upcoming fiscal year.
Discussing the first draft of her budget message Tuesday, City Manager Kelly Traynham told the panel, “We’ve been working through a very preliminary draft budget. We know that there’s going to be a gap in the end just like this year. In this current year, we have budgeted the use of fund balance, but we keep coming up short.”
The finance department projects a sum of $18,950,664 for general fund revenues in the 2026-27 fiscal year, while utilizing the current tax rate of 64 cents per $100 of assessed value. The initial revenue projection for the upcoming fiscal year represents a decrease of $129,000 from the current year’s budget, according to the budget message. “We need to look at ways to increase that, and we do anticipate recommending an increase in the tax rate,” she said. “We need council’s guidance on that.”
The budget message says that using the current tax rate for the upcoming fiscal year will generate an estimated $8,984,249, excluding motor vehicle taxes. This is based on projected values in the city limits of $1,422,943,103. One cent is expected to generate $140,160, and the Halifax County Tax Office expects a collection rate of 98.50 percent of the full levy.
Expenses
Traynham said the city will enter the new fiscal year carrying slightly more than $6 million in long-term debt, which she said “is pretty good compared to our peers across the state of North Carolina. There is a horizon in sight on that in 2032. By the end of that fiscal year, the two long-term debt instruments that we have in place will be paid off. It doesn’t mean we won’t have any between now and then, but that is great news for seeing that theater debt narrow down.”
The other long-term debt instrument is for the refinancing of Fire Station 2, she said, which is also expected to be paid off in 2032. “So annually, we have debt payments of just over a million dollars. You can see where decisions that were made over 20 years ago, we’re still paying for today.”
Absent the long-term debt payments, she said, “This budget would be much easier to put together.”
Personnel expenses, Traynham said, “are what they are — the cost of doing business. Like most employers, we are experiencing workforce challenges, especially in public safety, or in some more unique or specialized certification positions. Delivery of our services is an expectation of the public and an important resource.”
The upcoming budget is based on 152 full-time employees and 46 part-time employees based on the current planning efforts. “We are looking at options for cost of living and merit, as well as continuing the implementation of the study completed by the MAPS Group a year ago,” she said.
There are employee benefits that the city is mandated to pay. Retirement rates within the system continue to increase. Law enforcement has gone up from 16.8 percent to 17.10 percent, and the civilian rate has increased from 14.4 percent to 15.5 percent.
Also for law enforcement, Traynham said, “There’s a mandatory 5 percent salary contribution for 401(k).”
The budget message says that the city’s group health insurance premiums will increase slightly while maintaining 100 percent coverage to full-time employees.
Traynham said the city will need to identify a tax rate by the next meeting. “The reality is that expenses are outpacing revenues. The situation we’re in is not unique to Roanoke Rapids; it’s not unique to Halifax County."
Comments by the mayor and finance director
Mayor Emery Doughtie asked what the city’s fund balance is.
Finance Director Carmen Johnson responded it is around $15 million, with about $3.4 million available for use.
The mayor also wanted to know what percentage of the budget is used to pay for salaries and benefits. “I know ours has always been high — higher than the average.”
Traynham said she would have that information for the next budget presentation.
Doughtie said to Traynham, “You being the city manager and you’re making a comment about how things keep going up — and they do — it sounds like you want to go up on taxes. I don’t know if you want to use some of the fund balance.”
The mayor said the council talked last year about sales taxes going down, and now they are down another $145,000.
What that means to him, he said, “is people are still spending, but they’re not spending in Roanoke Rapids.”
Sales of cemetery plots are down $13,000, he said. “That’s a big percentage. What does that mean? People are moving and being buried somewhere else. That’s what we’ve been dealing with.”
He said that is the same with ABC and beer and wine tax revenues.
Johnson noted that burial rates were higher during COVID. “All of that is kind of evening out, I would have to say.”
Doughtie continued. “I’m just saying we can’t keep sitting here. I don’t have the answer, but we can’t keep sitting here and, as the city manager says, it’s all going to turn out all right. If this was a business, it would be out of business before too long. I don’t know how as a council we can sit down and end up in a bad situation. It’s difficult to make changes, but if you want to keep the community, you might have to do some of that, or either you might have somebody else down here telling us how to operate.”
Johnson said, “You’ve got to look at any gas pump in the whole city. I went and got gas at lunch today. It’s $4.20 or $4.29. How crazy is that? We have to fuel vehicles, to fuel our leaf trucks, fuel our dump trucks.”
“Yeah, but that’s trucks,” Doughtie responded, suggesting perhaps the city could run fewer trucks.
Doing that, Johnson replied, would mean picking up fewer leaves.
“Well,” Doughtie said, “you might have to. You’ve got to do what you’ve got to do.”
Johnson countered, “I want to point out that Roanoke Rapids has the lowest tax rate of any municipality in the general area. When I first came to work here, I was like, ‘Oh, we need to raise taxes.’ With a million-dollar theater debt a year, that’s a lot. And if you’re not raising your taxes and you’re not getting any new revenue, what are you supposed to do?”
