Wednesday, 30 May 2018 20:15

Proposed city budget in the air after salary increases suggested

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A request for City Manager Joseph Scherer to look into providing a 3 percent cost of living increase for employees could not only alter the city’s proposed budget for the upcoming fiscal year but has changed the date of the public hearing for the draft financial plan.

As presented this evening the proposed budget calls for a one-time $500 bonus for city employees, who received a 4 percent cost of living increase last year.

The $500 bonus would cost the city $82,000.

Giving a 3 percent cost of living increase would cost the city $125,000 per percent, Finance Director Leigh Etheridge told council.

Scherer said a cost of living increase would also end up affecting subsequent fiscal year budgets.

“I think raises would be more important than a one-time $500 bonus,” Smith said.

Mayor Emery Doughtie said, “Once we give that increase it comes around next year and then the next year.”

Smith countered there were several years the city “didn’t give them anything.”

Smith suggested to pave the way for a 3 percent cost of living increase that department heads could cut 1 percent off their proposed budgets.

Etheridge said providing the cost of living increase would increase FICA, unemployment, retirement and other costs associated with salaries.

“I like the idea of a 3 percent increase,” Councilman Ernest Bobbitt said, adding, however, “We also needs roads and equipment. I don’t disagree with 3 percent but what would it affect down the road?”

Scherer estimated the cost of living increase would cost the city around $400,000. “I can look at where we can cut. Basically it would be up to department heads.”

Scherer said he would sit down with department heads over the next couple of days.

Scherer said following the meeting he couldn’t speak with certainty what impact Smith’s suggestion would have on the level of services the city currently provides. In his budget message he noted the proposed financial plan, which calls for no tax increase or use of fund balance, keeps the city’s services at minimal acceptable levels. “That’s why I need to have discussions with department heads.”

 

Change in public hearing date

Following the debate on Smith’s proposal, council agreed to move the public hearing date on the budget and its regular meeting to June 12 at 5:15 p.m. at Lloyd Andrews City Meeting Hall on Jackson Street.

It had been scheduled for June 5 at the same location and set for the same time.



Highlights

In the budget message, Scherer noted Michael Walden of North Carolina State University reported the state’s aggregate growth in gross domestic product surpassed national growth for the third straight year yet lags slightly behind that growth in the Southeast. “He cites inflation, higher interest rates and a possible trade war as factors to watch in 2018. Although the outlook for the state economy looks positive overall, our local situation could vary widely from the statewide projections.”

Some of the factors the city manager based what he called the conservative $18,027,420 proposed budget on includes the city’s per capita income of $20,568 — the state figure is $26,779 — and its median household income of $33,844 — the state figure is $48,256. The city’s poverty level is 26.7 percent.

Said Scherer in the budget message, “This year’s budget attempts to address some of the more critical needs in law enforcement and public works resources including capital needs against flat revenue forecasts.”

The potential sale of the theater, he said, “will eliminate annual operational costs and has the potential for development revenue in out years.”

 

Fee increases

Scherer noted in his budget message he is recommending an increase in the solid waste user fees. The proposal would take the fee to $215.29. It has held steady at $204.50 for the past four years. “Increases are due to higher landfill and tipping fees.”

He is recommending the license plate fee be increased from $6 to $11. That proposed increase is expected to generate an additional $67,650 for the city. Additional revenue would be budgeted for street and alley repairs.

 

Other highlights

As far as personnel, Scherer is recommending two additional police investigators to concentrate on gang activity and drug enforcement.

In capital needs he is recommending five new police vehicles; a radar trailer and Taser package.

For public works he is recommending two dump trucks, a street sweeper and asphalt patch machine.

Other potential capital recommendations include a knuckle boom trailer, leaf machine and one to two pickups for public works and parks and recreation.

Total cost of capital needs is $900,000 and the city manager recommends installment financing which would cost the city $200,000 over five years.

Doughtie said following the meeting he still supports a sales tax increase as a way to raise extra funds for the city.

It is a matter that must be approved by legislators before a referendum can be held. “I would like to get more input from the community and make sure there is a referendum.”

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