No tax increase for FY-25 budget

(5/27) The Town’s fiscal year 2025 budget was introduced at the April Council meeting. The budget does not include a property tax rate increase, which will stay at 14 cents per $100 of assessed value.

The budget is broken up into two main categories, also known as funds. The General Fund is used for paying day-to-day Town operating expenses, which include office salaries, insurance, vehicle maintenance, &c, and the Water Fund pays for operation of the water plant.

For FY-25, General Fund income is estimated to be $4,847,768, with expenditures of $5,914,087. The deficit of $1,066,319 is primarily due to Capital Project expenses. To offset the difference, the Town will be adding $1,066,319 from the surplus fund to the revenue to "balance" the budget.

Town Manager Sean Williams explained that the deficit will be covered using carryover funds from prior years when the Town failed to spend all the budgeted monies. Williams pointed out that while the Town was fortunate to be able to draw upon this surplus, it is getting smaller each year and the ability to pull from it may soon no longer be an option.

Principle sources of revenue for the General Fund are property taxes of $1,158,873 (increase of $96,540 in FY-25) and State income taxes of $1,241,183 (increase of $57,143 in FY-25). Other notable changes in revenues include Program Open Space revenue decreasing from $243,600 in FY24 to $45,000 in FY-25.

General Fund expenditures are set to increase by $100,585. The main sources of the increase are trash collection and yard waste pickup costs. Williams explained that fuel surcharges and dumping fees are a big part of these expenses. Maintenance salaries are also projected to increase by $30,000. Project Open Space work, however, will see a decrease in expenditure of $70,565.

With the Maple and Maryland Avenue Road reconstruction projects all but wrapped up, the Capital Projects portion of the General Fund expenditures will see a decrease of $1,528,200 to $1,131,196. FY-25 projects include the purchase of a dump truck with salt spreader & snowplow, a stump grinding skid steer, an additional skid steer, and a tractor cap, as well as the renovation to the Public Works building, all totaling $208,200.

The Water Fund revenues are expected to increase from $1,449,000 to $4,880,757, an increase of $3,431,757.85. The large jump is primarily driven by the infusion of $3,138,837 from The American Rescue Fund Act (ARPA), which will be allotted to cover the cost of the Discovery water main replacement. The remainder of the increase comes from water usage charges ($120,000) and the special assessment fee ($152,920) designed to help pay back the loan for the water plant at $100 per residence.

Water Fund expenditures include minor increases for building maintenance, salaries, and the cost of chemicals for water treatment. The most substantial expenditure in the Water Fund will be the Discovery water main replacement.

Commissioners Gary Baker and Tom Gilbert were both concerned by the $3,380,000 price tag for the project. Williams explained that the engineering stage and the first two phases are covered by ARPA funds. "It’s the years following that will be a challenge because we need around $1,500,000 for each phase. This is why raising rates is important," he said.

Williams said the project cannot wait any longer as the water main is experiencing more and more breaks, and even though they plan on doing the worst parts first and phasing the rest in, Town staff expect it to be at least a 10-year project. "I would love to see this done in two years, but we just don’t have the money for it," Williams said. "We also need to consider that Glade Town will need a water main replacement soon and there is the Green Street project to consider, plus whatever else that comes up."

Williams pointed out that after the water mains are fixed, they will need to redo the roads, adding to the cost for the repairs.

Expressing concern about the ability of the Town to fund the work needed down the road, Gilbert suggested the Council look at raising the water rates. "An increase in water rates of 10% every year is the easiest way possible. In three years, that gives us about $350,000 in profit. It won’t pay for all of the projects, but every little bit helps."