[Durham INC] New Strategic Plan, Council Advice Guide Durham's 2012 Proposed Budget

[Blalock, Amy]

CITY OF DURHAM

Office of Public Affairs

101 City Hall Plaza

Durham, NC 27701

 

 

News Release

 

For Details, Contact:

Beverly B. Thompson

Director

(919) 560-4123 x 11229

(919) 475-2362 (cell)

Beverly.Thompson at DurhamNC.gov

 

 

 

 

For Immediate Release: May 16, 2011

 

 

 

New Strategic Plan, Council Advice Guide 2012 Proposed Budget

Balanced Budget Projects Modest Tax Increase for Debt With No Impact on
Services

 

DURHAM, N.C. - As Durham slowly emerges from the effects of the
recession, this year's budget continues to reflect citizen priorities,
City Manager Thomas Bonfield said Monday night, as he presented a
proposed 2012 budget, which includes a slight tax increase of $0.56
cents per $100 of assessed property value for debt service. That
increase raises the annual taxes for the owner of a $150,000 home by
$8.40.

 

Thanks to strategic decisions and processes began, supported, and
endorsed by Durham City Council members during the last three years,
this year's budget was a lighter load, both for the administration and
residents, Bonfield said. "While the challenges of budget delivery in
these economic times were many as we began with a projected $5 million
shortfall, it was clearly a lighter load than the $20-to-$40 million
gaps faced in the prior years. I am convinced that this lesser burden
was less about economic recovery and more about decisions supported and
endorsed by this City Council," he said.

 

While overall revenue growth is projected to increase only slightly by 2
percent, expenditures are expected to grow by 3.4 percent. With this
scenario in mind, Bonfield stressed how the City's new strategic plan
goals narrowed the focus to priority levels of service customers want
and expect, along with the understanding of resources necessary to
provide those services. Key among the City's goals is being a
well-managed city, which, according to Bonfield, encompasses many
factors included in the budget - tax rates, debt load, bond ratings,
fund balance, utility rates, and citizen and employee satisfaction.

 

Bonfield recommended a total preliminary budget for fiscal year 2011-12
of $362.4 million, about $9.1 million or 2.6 percent higher than last
year's budget, including a 11 percent smaller general fund budget of
$182.7 million as compared to last year's budget for the City's core
services. The majority of the decrease was due to the creation of debt
service and solid waste enterprise funds to more clearly account for
these two activities.  

 

Bonfield recommended a two percent increase for general pay plan
employees along with restoration of one percent to employee 401(k)
plans. "City employees are the strength behind the services provided to
the community, so our commitment as we faced the second consecutive year
of reduced resources, was that compensation would be our highest
priority as economic recovery brought additional revenues, or as cost
savings could be generated," Bonfield said.

 

Although 10 positions were eliminated in next year's budget, 21
positions are new or unfrozen from last year's budget, many of which are
in the City's Water Management Department. About seven of those are
currently filled with employees, for whom the City is attempting to find
opportunities elsewhere in the organization. Also funded is a new Human
Resources position to manage the City's employee health fund, which
insures more than 5,100 lives, to help minimize costs and improve
employee and dependent health.

 

The budget also maintains the City's fund balance reserves, or rainy day
fund, at 12.5 percent, a little higher than recommended by Council.
About $360,000 of the overage will be used for one-time expenditures.

 

While the City strengthens its focus on rejuvenating neighborhoods,
allocating $500,000 for commercial revitalization to enhance the tax
base, create jobs, and reduce poverty and crime, about $255,000 will go
toward downtown improvements with building improvement grants and
Parrish Street preservation.  Also to help improve neighborhoods,
several programs, including enhanced code enforcement to identify the
city's "worst condition" houses for a three-year remediation plan and
other data-driven projects are funded to encourage redevelopment and
revitalization.

 

The capital improvement budget includes $50.5 million for new projects
and to complete existing projects. Funding is provided through impact
fees, water and sewer revenues, revenue bonds, stormwater fees, and
program income. Also, $82 million has been allocated for water and sewer
infrastructure improvements.

 

Other highlights of the FY 2012-2012 Proposed Budget include:

*          $500,000 for deferred maintenance

*         $500,000 for street repaving as recommended during the 2010
bond referendum

*         All police department sworn positions are fully funded

*         Funding for Warrant Control Office and a domestic violence
judge

*         An average rate increase of 4.7 percent for water and sewer
rates, costing the average household an additional $2.24 per month; and,
stormwater rates will increase an average of 8.5 percent, costing
homeowners an additional $2.40 to $10.08 yearly depending on the tier.

*         Funding for public safety - fire department, police
department, and emergency communications needs - totaling more than $78
million.

 

Bonfield continued to note that despite challenging economic conditions,
the City continues to maintain excellent fiscal status with a AAA
bond-rating from all three ratings agency - achieved by only 38 cities
nationwide - and a recent upgrade of its water and sewer revenue bonds
from Moody's.

 

A public hearing is scheduled for the preliminary budget for Monday,
June 6 at 7 p.m. during City Council's regularly scheduled meeting.
Final budget approval is set for Monday, June 20 at 7 p.m. in the City
Council Chambers. 

 

Copies of the proposed budget will be available on the City's website at
www.DurhamNC.gov/Departments/BMS by 5 p.m. on Tuesday, May 17. Copies
will also be available in the City Clerk's Office and in the City's
Budget and Management Services Department, which are both located inside
City Hall at 101 City Hall Plaza, Durham.

 

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