Commissioners (several of them) spoke in response to the crowd at last Monday night's meeting, saying that the pandemic and the resulting downturn in the economy is likely going to leave the County with significantly less money--and that means the budget must address that reality. If things improve and if the shortfall from previous years isn't as severe as it might be, they could revist the budget during the year.
Who's getting an increase?
- Elections--up from $636,352 to $748,894...this is a Presidential Election Year.
- Sheriff's Office--up from $11,668,160 to $13,223,840 plus $4,555,407 for the jail, up from $3,817,135...the total up from $15,485,295 (14.23% of the total County Budget) to $17,779, 247 (15.76% of the total).
- Emergency Management--up from $301,147 to $398,425.
- Fire Marshal's office--up from $367,040 to $415,237.
- EMS--up from $7,334,038 to $7,765,315.
- Animal Control--up from $1,541,250 to $1,743,512.
- Transportation TLC--up from $1,392,176 to $1,480,226.
- Veterans Services--up from $168,549 to $206,716...moving to a new location.
Who's taking a cut?
- Schools--down from $24,077,796 to $21,946,968, down from about 30% of the total County Budget in fiscal 2020 to 27.57% in fiscal 2021.
- Economic Development--down from $1,552,850 to $1,344,733.
- Cooperative Extension--down from $321,071 to $288,680.
Among outside agencies, Hesed House--$10,000 each year from 2017-2020, not in 2021 budget.
County employees won't get a raise in July, but may get one in January; they'll also have to pay a bit more for their health insurance.
County Manager Kelly Atkins told us the increases will only occur if revenues support them. He added, "nearly every department will take a significant cut if revenues do not come in to fund our projections. It is likely that the budget will be amended more than once during the year."
The total budget comes to $112,848,445; up from $109,596,626 for fiscal 2020. The first payment toward the debt that will be created to fund building of the new courthouse will by itself add $1.7 million to the debt service portion of the budget.
The proposed budget keeps the tax rate at $.599 (per hundred dollars valuation), the same as last year. Taxpayers can actually save a small portion of their tax bill by paying early (before September 1st when property taxes are officially due--although no penalty is assessed for late payment until early January). Lincoln is one of only a few North Carolina counties that still offer that early payment discount option.
Plans are to use a part of the County's Unassigned Fund Balance--about 2.5 million dollars from the $26,110,745 the County had at the end of fiscal 2019 (the 2020 figure is expected to be about the same, but the exact amount won't be known until all fiscal 2020 bills are paid). The County did use a part of its Fund Balance in one recent year and had expected to do likewise in another, but instead, money from taxes, etc. were better than expected and the Fund Balance actually grew that year.
In December of last year, Commissioners voted to adopt a policy of maintaining a 20% Unassigned Fund Balance. Previous policy had called for maintaining 15%. The Local Govt. Commission suggests that cities and counties maintain a minimum of 8%--or about one-twelfth of their total budget, enough to pay the bills for a month if there were no money coming in.
Lincoln County's Unassigned Fund Balance was just under $12.7 million at the end of fiscal 2014--or 13.4%. That was at the end of the so-called Great Recession period. By July 2015, the balance had grown to just over $20 million. It decreased to $18.4 million at the end of fiscal 2016, but grew to $24.5 million in 2017. In 2018, it grew to $26.9 million and was $26.1 million last Summer. That was equal to just over 25% of the total County Budget.
To keep the Unassigned Fund Balance at 20%, the County would need to maintain a balance of just under $22.6 million. That leaves the possibility of adding about one million dollars to the proposed budget without having the Fund Balance drop below the 20%. Atkins said Commissioners have discussed an item that may require using another $1.5 million from the Fund Balance early next (calendar) year.
Lincoln County Schools asked Commissioners for a $3.5 million increase in this year's budget. Under an agreement related to not issuing remaining authorized bonds approved in an election several years ago, the Commissioners had provided some additional capital outlay funds over the last three years--$1.2 million in fiscal 2018, $1.1 million in 2019, and $880,000 in the current year. That ended the three-year agreement, but the schools asked for another $800,000 for fiscal 2021 for HVAC and IT repairs and replacement in addition to their regular budget proposal.
Atkins' original budget proposal--before the pandemic and resulting economic slowdown--had called for the schools to get $24,478,453, an increase of about a half million dollars from fiscal 2020. Commissioners made cuts at two budget meetings in April and May.
At least one Commissioner has pointed out in Facebook posts that the schools also have a fund balance. It's currently just over $1.2 million. The state actually recommends that the schools keep a fund balance that will pay for two months' salaries. For that, Lincoln County Schools would need to have about $1.6 million.
A recent Lincoln Herald editorial reported that Lincoln County Schools were (according to the Dept. of Public Instruction) the lowest funded per pupil of all 115 school systems in the state. The local funding portion of their per pupil expenditure is 99th. The chart the DPI provided was in a format that we can't easily share on our website, but here are the figures for school systems in our area:
PER PUPIL EXPENDITURE 2019 (Child Nutrition Excluded)
Lincoln County Schools
State $6,147.06 (107th)
Federal $393.40 (110th)
Local $1,503.18 (99th)
TOTAL $8,043.64 (115th)
Catawba County Schools
State $6,196.60 (105th)
Federal $590.55 (76th)
Local $1,813.89 (76th)
TOTAL $8,601.34 (110th)
Gaston County Schools
State $6,226.95 (102nd)
Federal $608.89 (70th)
Local $1,828.61 (75th)
TOTAL $8,664.25 (109th)
Hickory City Schools
State $6,444.85 (87th)
Federal $591.11 (75th)
Local $1,796.96 (77th)
TOTAL $8,832.92 (101st)
State $6,636.07 (75th)
Federal $699.68 (71st)
Local $1,982.66 (60th)
TOTAL $9,218.41 (80th)
Cleveland County Schools
State $6,819.92 (66th)
Federal $663.53 (57th)
Local $1,855.20 (72nd)
TOTAL $9,338.65 (74th)
In state per pupil funding, Hyde County Schools, $14,130.98
In federal funding, Halifax County Schools, $1,939.21.
In local funding, Chapel Hill/Carrboro City Schools, $6,237.67.*
In total funding, Hyde County Schools, $18,802.16.
*It's obvious that the folks in and around UNC believe education is important; they spend more local dollars on their schools than anybody else. Asheville City Schools are #2 in local per pupil funding at $5,777.97 per pupil. In school systems in our part of the state, Mooresville City Schools local funding is $2,781.91, 17th in the state. The DPI report compares the current expense (operating) budgets of NC's 115 school systems.
As Commissioners meet next Monday (June 15th) to finalize the budget, the question is how long will the current downturn in the economy last and how bad will it be? If they believe that it will go well into 2021 and that unemployment will continue to be double digit or perhaps 20% or more, then tightening the belt may be absolutely necessary. Some might question (and have) whether that means cutting the money for schools. It has often been noted that the biggest portion of the total County Budget goes to schools. Based on the proposal, it will be about 27.5% for fiscal 2021, down from 30.8% this year. Those percentages represent all the budget--including state and federal funds. The schools do not receive the largest portion of the local funding; that goes to the Sheriff's Office & Jail.
County Manager Atkins says the approval of the budget isn't necessarily final: if money from taxes, especially the sales tax income, is substantially less than expected, some further cuts may have to be made during the year. If the economy recovers substantially and more money comes in, it may be possible to increase some funding during the year. "Keep in mind, the budget in ALL departments will go down drastically if the revenues drop. The budget includes many things that will be on hold until revenues are better understood; so while it looks like several departments are going up, that may not be the case."
The time for public comments on the budget proposal was last Monday. While there will be a public comments period during next Monday night's meeting (with a limit of three minutes per person and 15 minutes total), that will come AFTER Commissioners make their decision on the budget. Monday night's meeting will be at 6:30 in the Commissioners Meeting Room at the County Administration Bldg. on N. Generals Blvd.
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