The public hearing on the $542 million Greensboro 2018-2019 budget is Tuesday, June 5 at 5:30 p.m. in the Council Chambers at city hall.
The Greensboro City Council hasn’t shown much interest in the budget. The one budget work session since the budget was presented by interim City Manager David Parrish lasted less than 40 minutes.
The city had an effective tax increase in the 2017-2018 budget of 2.11 cents, but there is no tax increase planned for 2018-2019.
Of course, tax increases are a gift that keeps on giving. This year the city received about $5.5 million in additional revenue from the tax increase and the city will receive another $5.5 million next year.
The tax rate will remain 63.25 cents per $100 of property valuation, which is the highest in the state for any comparable city.
Both the city and the state are raising the minimum wage for full-time employees to $15 an hour, but a big difference between the City Council and the state legislature is that the legislature has learned that lowering taxes results in economic growth and more revenue, while the City Council still believes in high taxes.
The good news is that the City Council ignored a whole bunch of campaign promises as well as issues that it discussed at its two-day retreat in February.
One of those issues was raising the minimum wage for city employees to $24 an hour. Evidently, that fell by the wayside and the council is satisfied with raising the minimum wage for all full-time and benefitted employees to $15 an hour. That will leave only some part-time employees making less.
At that retreat, the City Council also discussed raising the salaries for all employees from the 50-percentile range when compared to other similar jobs in a 300-mile radius to the 75-percentile range. This would cost the city an estimated $15 million a year, or about a 5.5 cent tax increase.
The City Council has also discussed adding more bus routes. Councilmember Tammi Thurm talked about more bus routes a lot during her campaign last fall. However, no new bus routes are in the budget, which is good because bus routes are expensive. Fares pay less than half the cost of a ride, so more riders means the city spends more money.
The City Council had also discussed adding more money to the participatory budgeting program, but it is budgeted at $500,000 as it was two years ago.
So the good news is that the City Council forgot all about the expensive initiatives that councilmembers talked about when campaigning and decided to accept the budget the staff prepared with limited City Council input.
The budget does call for water and sewer rates to be increased by 3.5 percent for both those living inside the city and those living outside. When an equal rate increase was proposed last year, then City Councilmember Mike Barber convinced his fellow councilmembers that it made more sense for them to raise the outside rates more than the inside rates. But that was not brought up this year. People who receive city water but live outside the city don’t get to vote in City Council elections, so for an elected official it is practically free money.
Under the current city policy, no new customers outside the city can be added to the water and sewer system because they don’t get water and sewer service until after they are annexed.
The revenue from property tax is only projected to increase by 1.5 percent but the sales tax revenue, which has been increasing at about 5 percent a year, is projected to increase by 5.6 percent.
The debt service expenses, mainly to pay off bonds, will increase from $62.5 million to $68.4 million. This will cover the costs of selling the final 2008 and 2009 bonds plus some of the 2016 bonds.
Including employees added at midyear, the city will have an increase of 14 employees from 3,157 to 3,171. No positions in the Police or Fire departments are being added. Five new employees are to be added to the Coliseum staff for the Tanger Center for the Performing Arts and the Greensboro Aquatic Center.
The budget also includes a 3 percent merit raise for city employees and a 2 percent across the board raise.
One question about the upcoming budget vote is what will City Councilmember Michelle Kennedy be advised to do. Kennedy is the executive director of the Interactive Resource Center, which is primarily funded with an allocation from the city of about $150,000 a year.
When former City Councilmember Zack Matheny accepted the position as president of Downtown Greensboro Inc., which is primarily funded through the city, he was advised by City Attorney Tom Carruthers that he should resign before the vote on the budget because it would be a conflict of interest for him to vote on the budget due to his new position.
Matheny wanted to vote on the budget and then resign, but he followed the direction of Carrruthers and City Councilmember Justin Outling – who was selected by the City Council to take Matheny’s position at the same meeting as the budget vote – was sworn into office and then voted on the budget.
Barber is president of First Tee of the Triad, an organization that receives funding from the city and, while a councilmember, Barber was always allowed to vote on the budget but he was recused from voting on the portions of the budget that had to do with funding his organization.
Carruthers said that he saw Kennedy’s position as more akin to that of Barber than of Matheny and that his plan was to advise Kennedy to be recused from the portion of the budget that funds her agency, but vote on the rest of the budget.