Guilford County Manager Marty Lawing’s $606.8 million proposed budget had a little something for everyone – but not as much of that something as some, including school board members, wanted to see.
Lawing presented his budget proposal at the Thursday, May 18 Board of Commissioners meeting in the commissioners meeting room on the second floor of the Old Guilford County Court House.
Lawing’s budget proposal is about $6 million larger than the current budget adopted last June. Although it technically lowers the tax rate 2.45 cents – from 75.5 cents per $100 of assessed property value to 73.05 cents – it’s not a real tax decrease because it keeps revenues from property taxes at current levels, thanks to a recent countywide property revaluation that bumped up most property values.
At least once every eight years, Guilford County conducts a revaluation of every house, building and tract of land on the books, and the 2017-2018 budget takes those new values into account. If the tax rate had stayed the same after the revaluation, Guilford County would have been pulling in about $13 million more from county property owners than before under the old tax rate – so, while the shift downward in the tax rate looks good on paper, Lawing’s budget offering really keeps the county “revenue neutral.” State law requires that the county publish the revenue-neutral rate each year, in part to keep county citizens from the misconception that they are getting a tax decrease when tax revenue is being held steady. This year that rate is the 73.05 cents per $100, the rate Lawing recommends.
The biggest expense Guilford County government has each year is funding Guilford County Schools. In the current fiscal year, for instance, the amount of money the county is spending for school needs, and covering school bond debt, totals 44 percent of the county budget.
Lawing’s budget offers the school system more funding, but not as much as schools officials wanted. Rather than the $10.2 million in additional funds that school officials requested for school operations – such as paying power bills and salaries – Lawing’s budget calls for the county to pay $5.5 million more than last year, which would increase the total county funding for school operations from $188.4 million to $193.9 million. In his budget message, Lawing pointed out that this additional money would move the county’s per pupil funding from $2,419 per student to $2,439.
If Lawing’s budget is adopted, about $18 million of the total funds the county gives the schools for operations would “pass through” the school system to charter schools. That amount is based on the number of charter school students in Guilford County, which has been growing in recent years.
The budget Lawing proposed also includes $6.5 million for school maintenance and repair, which is $500,000 more than the county gave the schools for that purpose last year, but is $3.5 million less than the school system’s request for its capital needs.
Lawing, in his message to the commissioners, pointed out that his budget would make Guilford County the 12th highest of all counties in the state in terms of per pupil funding and the fourth highest of North Carolina’s 10 most populous counties.
In addition to the funding for operations and capital, the county manager’s recommended budget for 2016-2017 includes plenty of money to pay off school debt that the county took on after a $457 million 2008 school bond referendum county voters approved. Guilford County just issued the final $130 million of those school bonds last month. The proposed 2017-2018 budget includes roughly $75 million to pay off debt acquired to fund Guilford County Schools.
The county manager’s budget also includes $300,000 to help fund an extensive school facility study that will examine building needs, district lines and cost saving measures. The Board of Commissioners has approved plans to participate jointly with Guilford County Schools in that study.
The other large educational system the county helps fund each year is Guilford Technical Community College (GTCC). Lawing’s budget calls for the community college to get just over $15 million in county dollars for its operating budget – an increase of $500,000 over fiscal 2016-2017. As for GTCC’s capital needs, Lawing proposes the county fund those at the same level as last year – $1.5 million. In the coming fiscal year, the proposed county budget pays about $11 million to pay down debt acquired for GTCC.
In addition to increasing county expenditures on education, the manager’s budget also calls for more spending in areas of county government. For instance, for the county’s public safety sector – which includes the Sheriff’s Department, Emergency Services and Animal Services – Lawing is proposing an increase of $2.8 million. That bump includes money for new security guards for social services operations and includes $242,000 for the medical and mental health needs of inmates. The increase also includes $80,000 in supplies for a new DNA crime lab run by the Sheriff’s Department.
One thing the budget doesn’t include is money for a new Family Justice Center in High Point. The Justice Center in Greensboro – which addresses domestic abuse and elder abuse cases as well as other problems – is considered a big success by the commissioners and they are considering creating a similar service in High Point. The High Point City Council just set aside $500,000 for the project and the county has been scouting potential locations. However, the county commissioners have decided nothing yet, which is why there’s no money in the new budget for that purpose. Lawing stated that a county committee “continues to evaluate the feasibility of establishing a Family Justice Center in High Point.”
Human services would see a 9.7 percent drop in funding in 2017-2018 if Lawing’s proposal is adopted. It would fall by $12.8 million, from $132.3 million to $119.5 million – but that’s not due to any drastic cut in county services, just an accounting change in the way some vendors are paid. In 2017-2018, the state will pay day care vendors directly rather than have those funds pass through the county. The State of North Carolina is also now directly paying vendors who provide transportation for Medicaid patients. The county will still be responsible for verifying eligibility for clients who use those services. However, the county’s human services budget will shrink due to the changes.
One human service that has been putting a lot of upward financial pressure on Guilford County lately is the foster care program, which has at times has been in a near crisis situation in recent years. Lawing’s budget calls for an increase of $2.6 million for foster care services. According to the manager, that cost has climbed “as more children with more complex issues continue to come into the county’s care.” Lawing isn’t big on adding new county positions but his budget does call for a new “Foster Care Recruiter” who would among other things find people willing to be foster parents for the county’s growing number of foster kids.
Over the last two years – at budget time and in the months in between – Guilford County has been adding eligibility caseworkers for the Division of Social Services, and this budget continues that trend. Part of that is because the county has been, at the state’s behest, moving from a model that outsources many services to one where those duties are taken over by in-house county workers. Some of the cost of hiring these new workers has been offset by spending less on contracts with outside service providers.
The county’s budget for general government services – such as the clerk to the board’s office, the county manager’s office and other administrative departments – would get a $426,000 increase in funding under Lawing’s budget.
The recommended 2017-2018 budget includes $263,000 to fund four new school nurse positions. Those nurses are supposed to be assigned to the schools where the need for enhanced student medical care is the greatest.
There are other added positions as well. Lawing is requesting a new part-time register of deeds position that would allow the deeds office to be the only “walk-in” passport office in the county. Currently, the register of deeds office is one of the three in the state that offers passport services. (Brunswick County, on the state’s southern coast, and Johnston County, just south of Raleigh, are the other two, and Rockingham County will soon start providing the service.) According to Guilford County Register of Deeds Jeff Thigpen, this change would bring in more money than it costs to fund the position. Thigpen said this week that he believes providing a walk-in passport service to citizens would be a big benefit.
For years Lawing has emphasized the need for Guilford County to have a public information officer – a public relations person who would deal with media requests, get the word out on county initiatives and present a professional and positive story for Guilford County government actions. This year his budget includes funding for the position again – though in past years the Board of Commissioners has cut that proposed position out before a final budget has been adopted.
When it comes to projected revenues, Guilford County has been edging its way out of the dark days of 2009 when revenue from sales taxes took a big hit and many residents were unable to pay property taxes. Lawing told the board during his May 18 presentation that the county’s economy was continuing to recover. He said the unemployment rate in Guilford County through February of the current fiscal year was 5.1 percent – down from 5.7 a year earlier. He said that number is about average for the state but is higher than the current national average. The decreasing unemployment rate translates into more sales tax revenue for Guilford County, since a working population buys more things than a largely unemployed ones does.
Another positive is that, in the first nine months of fiscal 2016-2017, the value of taxable sales in Guilford County was $4.77 billion, compared with $4.37 billion for that same period a year earlier.
In Lawing’s budget proposal, sales tax revenue projections are at $84.6 million, which is $4.6 million higher than in 2016-2017. Lawing stressed to the commissioners that the current sales tax revenue numbers are estimates and he also noted that the amount the county receives could change if state legislators alter the distribution formula – something that has happened in the past.
Lawing’s recommended budget for fiscal 2017-2018 will be revised before a final budget is adopted by the board in June; however, each year the budget presented by the county manager forms the basis of that final budget and it therefore provides a great deal of insight into what the county’s adopted budget will look like.
As is their usual practice, the commissioners didn’t ask any questions or make any significant comments on the budget proposal at the time it was introduced. However, there will be plenty of time for that in budget-related work sessions, meetings and private discussions in the coming weeks.
Chairman of the Guilford County Board of Commissioners Jeff Phillips has stated publically that there will not be a property tax increase this year and that desire is also reflected in Lawing’s budget. The Republican-majority board would like to offer citizens another tax cut to follow on the heels of tax cuts in recent years, and in the coming weeks the board will attempt to find places to cut in order to do so. In this budget each penny on the tax rate equals $4.9 million in revenue, so if the board wishes to offer, say, a 1-cent tax cut, it will need to find nearly $5 million in savings.
According to Guilford County Budget Director Mike Halford, who has been burning the midnight oil for weeks helping to put the budget together, a decade ago the 2007-2008 county budget totaled $549.3 million. Halford added that that is “the equivalent of about $668 million in today’s dollars.”
The Board of Commissioners has scheduled a budget work session for Tuesday, May 30 at noon in the Blue Room on the first floor of the Old Guilford County Court House and has scheduled a public hearing on the budget at the board’s Thursday, June 1 meeting at 5:30 p.m. in the commissioners meeting room on the second floor.