Proposed Black Mountain budget up 27% in 2021-22

Public hearing on $14.3 million spending plan scheduled for June 21

Fred McCormick
The Valley Echo
June 20, 2021

The Black Mountain Town Council will consider approving a $14.3 million budget for the 2021-22 fiscal year following a public hearing scheduled for 8:30 a.m., Monday, June 21. 

The proposed spending plan, which reduces the town property tax rate from 33.25 cents to 30.60 cents per $100 of valuation, is 27% higher than the 2020-21 budget, adopted at the onset of the COVID-19 pandemic. 

Town Manager Josh Harrold presented his recommended budget and five year capital improvement plan to the board, June 3. The entire document can be viewed as an attachment to the agenda for Monday’s meeting on the town’s website (link here). 

The proposal allocates $10.8 million to the general fund, up 20% over last year; a 31% increase in the $2.2 million water fund; $900,000 to the golf fund and $392,000 to fund a newly established stormwater utility.

“We have been able to fund quite a few things in this year’s budget, especially compared to last year, which was lean due to the pandemic,” said Harrold, who presented a proposal incorporating a revenue neutral property tax rate in March. 

N.C. General Statute 159-11 requires municipalities to include an ad valorem tax rate maintaining the local government’s revenue as neutral in years when a general property reappraisal has been conducted. Buncombe County, which reassesses property values every four years, mailed updated notices of assessment to property owners in January. 

“The revenue neutral tax rate will be 30.6 cents, so it will be dropping by more than two cents from the current rate,” Harrold said. 

The town is projecting $4.7 million in revenue from property taxes in the upcoming fiscal year, which begins July 1. The ad valorem and Department of Motor Vehicles tax funds approximately 44% of the 2021-22 general fund, which supports the town’s six departments, public buildings and government boards and commissions. 

General fund

Of the four subcategories that make up the total budget, the general fund accounts for 75% of overall spending. Approximately 44% of the expenditures finance the town’s police and fire departments. 

Fire services will receive $2.2 million in the proposed budget, a 20% increase over last year. Three new lieutenant positions, one for each shift at the department, will be added in the upcoming fiscal year, and funding for a new deputy chief vehicle and emergency signal on Montreat Road are included in the $135,000 capital outlay line.

The police department budget of $2.4 million, up 11% from 2020, includes a $120,000 capital allocation that will purchase two new vehicles and fund a renovation of the evidence room. Two part-time positions within the department will be consolidated to create a new full-time position.

Public works will place an increased priority on street paving in the upcoming fiscal year, with $500,000 in Powell Bill funding generated from the state’s gasoline tax. An additional $100,000 will support the construction of sidewalks along a southern portion of N.C. 9. 

The town will increase vehicle maintenance and repair allocations to its sanitation department, which is entering its second year. The $860,000 budget for trash and recycling services will include $56,000 to maintain the department’s fleet. 

Proposed capital projects in the general fund is increasing by 118% in 2021-22, and includes $80,000 for the installation of solar panels on the roof of the Carver Community Center. Recreation projects funded in the upcoming fiscal year include renovations to the tennis courts at Lake Tomahawk and approximately 10 new benches for the surrounding park.

The town expended approximately $578,000 on capital projects in the 2020-21 fiscal year, which began as the emerging COVID-19 pandemic created uncertainty about its potential financial impact. 

The increase in the budget this year, according to Harrold, is due to a variety of factors. 

“For one, revenues didn’t decrease as much as we anticipated,” he said in a June 18 interview. “Our sales tax revenue remained steady and we tightened up last year’s budget not knowing what to expect.”

Building permit revenue for 2020-21 is estimated to be higher than initially projected, he added. 

“Some of this budget reflects that surge in growth, which you can see if you drive around town, Harrold said. “There are quite a few factors that allowed us to address some needs this year.”

American Rescue Plan funding

The Town of Black Mountain will receive $2.39 million in funding through the American Rescue Plan, a federal aid program signed by President Joe Biden in March. That funding, which will come in two equal installments in 2021 and 2022, is not included in this year’s budget, but will support necessary infrastructure projects. 

The town will utilize $1.2 million dollars this year on stormwater and water infrastructure this year, according to Harrold. Those projects will focus on structural repairs to the dam at Lake Tomahawk and replacing six-inch water lines along U.S. 70 with 10-inch lines. 

Stormwater utility fund

The town council adopted an ordinance establishing a stormwater utility and supporting fund in its June 14 regular meeting. The move was in response to a notice of violation from the state due to funding allocations and program deficiencies for stormwater management. The creation of the publicly funded service, which will operate the town’s Municipal Separate Storm Sewer System (MS4), is reflected in the 2021-22 budget.  

The budget recommends $393,000 to fund the department, which will be staffed by one employee in its first year. The stormwater management enterprise fund will assess annual fees to property owners within town limits to operate the utility. 

Approximately 70% of the town would be classified within in the first of the five-tier fee system. The proposed rate for those property owners would be $6 per month, billed annually. Tier 2, moderate impact, carries a $20 fee and Tier 5, greatest impact, is $100. The third and fourth tiers, undeveloped and exempt, do not have associated fees.

Water rates to increase

Customers who purchase water from the town will pay 10% more in the upcoming fiscal year, as the water fund budget of $2.2 million rises 28% over estimated 2020-21 expenditures. The rate increase will equal $3.42 extra per month for the average user of around 5,000 gallons.

The town is projecting water sales in the upcoming fiscal year to total $1.5 million, according to Harrold, but taking on 450 new water customers from the City of Asheville has not generated as much revenue as anticipated. 

“Our purchasing of water from the City of Asheville has gone up, which is to be expected,” he told the board in its June 3 meeting. “On the flip side of that, we haven’t seen the increase in revenue we should have, and that’s been a little concerning for me and the staff.”

Harrold planned to meet with officials from the City of Asheville to determine a cause of the discrepancy, and cited water loss due to leaks and outdated meters as a potential factor. 

“But, we should be at a higher number for sales than we are, based on the amount of water we’re purchasing,” he said. 

The expanded water fund will support an additional staff position in the department, and $250,000 in capital outlay to complete the transition of customers from Asheville. The town will appropriate approximately $50,000 to balance the water budget. 

Golf revenue up in 2020-21

A substantial increase in revenue for the town-owned golf course in 2020-21 will help propel the golf fund to a 47% increase in the new fiscal year, when the recommended budget proposes $905,000 for the operation. 

The golf course generated a combined $320,000 in green fees and memberships in the current fiscal year, up from $262,000 in 2019-20. Harrold is hopeful that the trend will continue. 

“I’ve got $290,000 in green fees (in the budget) and our membership fees went up a little, so I think we’ll see an increase in that line item,” he said. 

The town contributed $130,000 from the general fund ahead of the 2020-21 budget to support the golf course, but plans to allocate $77,000 in the upcoming fiscal year.