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Originally published: 2013-05-30 21:15:50
Last modified: 2013-05-31 09:35:52

Tax hike in proposed Boone budget

by Anna Oakes

Boone Town Manager Greg Young recommends a 5 cent property tax increase and a number of General Fund reductions in his proposed budget for fiscal year 2013-14.

Young said the recommendations are part of efforts to balance the budget despite an estimated $2 million revenue shortfall, a result of the county's decision to change local sales tax distribution.

"The General Fund will be impacted tremendously this year due to Watauga County's decision to change the method of sales tax distribution," Young said in his budget message.

Last year, the Boone Town Council approved a 2012-13 fiscal year budget of $22.2 million.

Young said his proposed budget continues basic services and maintains existing personnel, but that departmental recommendations reflect a 5 percent reduction and $1.3 million was cut from the General Fund. Proposed cuts include the elimination of additional funding for sidewalks and all outside agency funding, as well as changes to town operating procedures.

"Additional details for these recommendations will be provided at the upcoming budget workshops," Young said.

The proposed tax increase would raise the town property tax rate to 42 cents per $100 valuation.

Because the municipal service district (downtown) is slated to see an increase in revenue because of the sales tax change, Young proposes that the town's downtown coordinator position be fully funded from MSD revenues.

Currently, the MSD funds half of the position and the town's General Fund pays the other half, an arrangement that was negotiated as part of the MSD Task Force process in 2010 and 2011.

No salary increases for employees are recommended.

Under General Fund special programs and projects, funding is eliminated for lobbyists, an $118,000 expense, but Young said that line item has been shifted to the Water and Sewer Fund.

"Due to the loss of sales tax revenue, and potential additional loss pending General Assembly actions, I recommend that we proceed cautiously and conservatively," Young said.

The council will discuss budget matters and council priorities at a retreat from 8:30 a.m. to  5 p.m. at the Council Chambers Friday.


CLARIFICATION: A previous version of this story indicated that funding for lobbyists had been eliminated under General Fund special programs and projects, but Boone Town Manager Greg Young said Friday that the lobbyists line item has been shifted to the Water and Sewer Fund.