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Council Work Session on the FY 2024-25 Budget Development
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Staff:
Department:
Chris Blue, Town Manager
Town Manager's Office
Amy Oland, Director
Business Management
Overview: Tonight, the Council will receive an update on the status of the FY 2024-25 budget development, hear from department directors about the backlog of needs, and discuss year two of the five-year budget strategy.
Key Issues:
Budget Foundation
* The Town's budget is an extension of the Town's mission and the Council's strategic goals.
* The themes seen throughout the budget are that: revenue is down across major revenue sources; the cost of doing business is up across all departments; we still have a significant backlog of needs.
* The FY 2024-25 budget continues to prioritize our employees, operations, facilities, fleet, and Complete Community.
Property Taxes
* Property tax is a local government's main source of revenue. Property taxes made up 48% of the Town's total revenue sources for FY 2023-24.
* Two factors affect the tax growth that the Town experiences.
o The first is the property tax rate growth. The Town's tax rate is currently 57.2 cents.
o The second is the total assessed valuation growth. The Town has historically experienced a 1.8% average assessed valuation growth. Over the last few years, that growth has been closer to 1%.
Sales Taxes
* Sales tax receipts are one of the best indicators we have of local economic conditions.
* Prior to the pandemic, sales taxes increased on average 5-6% per year.
* Post pandemic, sales taxes have increased between 6-12% per year.
* The North Carolina retail economy has slowed down and the record-breaking sales tax growth we have seen has likely come to an end.
Development Fees
* Departments evaluate the fees that they charge for services annually as they begin budget preparations for the year. During their evaluation, they compare the fees they charge with neighboring jurisdictions to make sure tha...
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