AGENDA #1
MEMORANDUM
TO: Mayor and Town Council
FROM: W. Calvin Horton, Town Manager
SUBJECT: Recommended Budget Ordinance for 2002-2003 Fiscal Year
DATE: July 26, 2002
The attached budget ordinance would approve a final budget and set the tax rate for the 2002-2003 fiscal year.
INTRODUCTION
On June 26, the Council adopted interim appropriations for normal operating expenses of the Town for the month of July, 2002. Attached is the recommended final budget ordinance for the 2002-2003 fiscal year reflecting decisions made by the Council at previous budget work sessions and final decisions regarding the budget made on June 24.
Based on the final decisions regarding commercial garbage collection fees and parking fees, the proposed tax rate reflected in the ordinance would be 51.0 cents for the General Fund, an increase of 4.9 cents from the current General Fund rate of 46.1 cents. The Transportation tax rate would remain at 4.3 cents as in the current year, resulting in a final total tax rate of 55.3 cents.
At the time of this writing, the N. C. General Assembly has not passed pending legislation that we believe would protect the Utility Franchise tax and Beer and Wine tax revenue from potential withholdings by the Governor to address the projected State budget deficit. Therefore, we are not able to recommend including about $2.25 million in the budget from these sources that could be used to reduce the tax rate and provide for pay adjustments and additional capital projects as discussed by the Council at its budget work session on June 12.
This memo is current as of July 22, 2002. Change may be proposed based on any action taken by the General Assembly prior to the Council meeting on Friday, July 26th.
Although the tax rate for 2002-2003 must be established and may not be changed, the 2002-2003 budget may be amended by the Council at any time.
The following is a brief summary of the budget decisions made by the Council in budget work sessions and final decisions on June 24.
SUMMARY OF PROPOSED CHANGES
General Fund
A summary of changes made by the Council to the recommended budget presented to the Council on April 23 are as follows:
· A reduction of $60,000 in estimated revenue from Powell Bill revenue for street maintenance.
· A reduction of $4,000 in estimated revenue from a State Library grant.
· Using one time sale tax revenue of $235,000 resulting from a consultant’s study and reallocation of sales tax refunds.
· Transferring $200,000 in parking reserves to the General Fund.
· Using an additional $35,000 in Fund Balance.
· Using $215,000 in estimated revenue from the increase in Off-Street hourly parking fees and an increase in the rental fee for monthly parking spaces adopted by the Council on June 24.
· Using $12,000 in estimated revenue from initiation of monthly parking rental for selected underutilized on-street metered parking spaces.
· Reducing the allocation for street reconstruction by $65,000.
· Reducing the estimated allocation for Landfill tipping fees by $50,000 based on no increase in Orange County fees.
· Allocating $44,000 for traffic calming.
· Allocating $44,000 for the Northside Neighborhood safety issues.
· Adoption of fees for once per week collection of solid waste for businesses as noted below, estimated to generate $89,000 in revenue.
At the Council’s meeting on June 24, the Council adopted a fee for once per week collection of solid waste for commercial business only, resulting in estimated additional revenue of $89,000. At this meeting, the Council also eliminated the proposed hourly increase in On-Street parking fees previously considered by the Council, and decided not to extend enforcement of metered spaces in Town parking lots 3 and 5 from 6 pm. to 9 pm. as previously discussed. With these actions, the transfer of parking funds to the General Fund would be reduced by $73,000.
With the changes noted above and final decisions by the Council on June 24, the resulting General Fund budget would total $36,791,487 and require a tax rate increase of 4.9 cents in the General Fund, from 46.1 cents to 51 cents.
Parking Funds
The attached budget ordinance reflects all changes to the Off-Street and On-Street Parking Funds as noted above in the discussion of the General Fund changes. In addition to changes affecting the General Fund, the On-Street Parking Fund reflects a reduction of $10,000 in estimated parking enforcement revenue from the initiation of a five minute grace period for expired meters before parking tickets are issued.
Transportation Fund
For the Transportation Fund, the primary change from the original recommended budget would include the additional service requested by the University for a new 450-space park-ride lot under construction near the Friday Center. The cost of providing service to this lot effective October 1, 2002 would be about $338,000 which would be paid by the University in accord with the current agreement for fare free service.
With this change, the Transportation Fund budget would total $9,676,444 and there would be no change in the current Transportation tax rate of 4.3 cents.
Capital Improvements Fund
Without action by the General Assembly that provides protection for the Utility Franchise and Beer and Wine tax revenue, no additional funding is proposed for the Capital Improvements Fund. Therefore, the Capital Improvements Fund total would remain at the limited level of $478,000 as presented in the original recommended budget.
Other Funds
For all other funds, there are no proposed changes from the recommended budget.
RECOMMENDATION
That the Council adopt the attached budget ordinance reflecting changes to the recommended budget approved by the Council during budget work sessions and at the meeting on June 24.
AN ORDINANCE CONCERNING APPROPRIATIONS AND THE RAISING OF REVENUE FOR THE FISCAL YEAR BEGINNING JULY 1, 2002 (2002-07-26/O-1)
BE IT ORDAINED by the Council of the Town of Chapel Hill, the following appropriations are hereby made:
ARTICLE I
GENERAL FUND
Department Department Total
Mayor/Council 229,439
Town Manager/Town Clerk 936,179
Human Resources 514,463
Finance 846,658
Information Technology 540,763
Legal 230,136
Planning 942,025
Inspections 705,134
Engineering 1,004,813
Public Works 9,628,067
Police 8,981,238
Fire 4,812,458
Parks and Recreation 2,069,595
Library 1,875,390
Non-Departmental 3,475,129
OTHER FUNDS
Transportation Fund 9,676,444
Transportation Capital Reserve Fund 478,782
Debt Service Fund 2,343,000
Vehicle Replacement Fund 2,027,500
Fleet Maintenance Fund 868,884
Computer Replacement Fund 304,370
Public Housing Fund 1,614,072
Housing Loan Trust Fund 175,000
On-Street Parking Fund 650,000
Off-Street Parking Facilities Fund 1,556,300
Cablevision Public Access Fund 90,000
Library Gift Fund 95,000
Capital Improvements Fund 478,000
Downtown Service District Fund 70,000
TOTAL ALL FUNDS 57,218,839
ARTICLE II
It is estimated that the following revenues will be available during the fiscal year beginning July 1, 2002 and ending June 30, 2003 to meet the foregoing appropriations. It is determined that where estimated revenues are higher than the previous year, the increases were warranted.
Property Taxes 20,707,000
Other Taxes & Licenses 1,053,000
State-Shared Revenues 8,523,000
Grants 452,000
Charges for Services 1,271,200
Licenses/Permits/Fines 1,569,000
Interest on Investments 252,500
Other Revenues 387,600
Transfers/Other Sources 1,506,187
Fund Balance Appropriated 1,070,000
Transportation Fund 9,676,444
Transportation Capital Reserve Fund 478,782
Debt Service Fund 2,343,000
Vehicle Replacement Fund 2,027,500
Vehicle Maintenance Fund 868,884
Computer Replacement Fund 304,370
Public Housing Fund 1,614,072
Housing Loan Trust Fund 175,000
On-Street Parking Fund 650,000
Off-Street Parking Facilities Fund 1,556,300
Cablevision Public Access Fund 90,000
Library Gift Fund 95,000
Capital Improvements Fund 478,000
Downtown Service District Fund 70,000
TOTAL ALL FUNDS 57,218,839
ARTICLE III
There is hereby levied the following tax on each one hundred dollars ($100) valuation of taxable property, located within the Town of Chapel Hill, as listed for taxes as of January 1, 2002 for the purpose of raising revenue from property tax as set forth in the foregoing estimates of revenues, and in order to finance the foregoing appropriations.
General Fund
(for the payment of expenses of
the Town of Chapel Hill) $0.51/$100
Transportation Fund
(for the payment of expenses related to
transportation approved by referendum) $0.043/$100
TOTAL $0.553/$100
ARTICLE IV
There is hereby levied the following tax on each one hundred dollars ($100) valuation of taxable property located in the Downtown Revitalization Municipal Service District established by the Town Council's resolution of June 12, 1989:
Downtown Service District Fund $0.062/$100
This the 26th day of July, 2002.