The takeaway from the city’s pre-budget presentation Monday is that despite pressure on city services from an increasing population, things are going fairly well for the City of Raleigh’s bottom line.
Residents will be happy to know that it’s unlikely the new budget will require a property tax increase, and city employees won’t have to fear layoffs. They could even see a re-established merit raise, which was cut two years ago.
Since the start of the recession and the ongoing slow recovery, unemployment rates are creeping downward and building permits, property taxes and sales taxes have been creeping up.
Compared to other North Carolina municipalities, Raleigh is doing OK. Still, there is plenty of room for improvement.
The city hasn’t been able to hire many additional staff since the economy crashed — even as the population has continued to increase, putting strain on city services. All departments have felt the pinch as workloads have increased but positions remain vacant, according to City Manager Russell Allen.
Today, there are 274 vacant positions across city departments.
Allen said the city has only added one additional police officer since 2009, despite the city’s fast growth. In 2009, 15 firefighter positions were also added to go along with a new ladder company. Few firefighters have actually been hired.
Also, deferred maintenance that the city has been putting off on vehicles and buildings is starting to come due.
The city can only put off buying a new fire truck ($1.1 million) or garbage truck ($260,000) for so long.
“We have expensive things that our folks need to do their jobs,” Allen said.
There are also plenty of unknowns, which add pressure to the city spending. Expenses for Dix Park are still included in the proposed budget, but those numbers could change depending on how state legislators react to a bill that would terminate the city’s lease. (As of this posting, Senate Bill 334 passed the Senate and its companion House Bill 319 is in a House committee.)
The impact of federal sequestration may also trickle down to Raleigh’s budget.
Councilor Russ Stephenson said Monday he doesn’t see anything in the pre-budget plan about how the city will meet its transit goals as outlined by the 2030 Comprehensive Plan.
Many of those goals, such as increasing bus service, are contingent on the Wake County transit plan, Allen said. The Council will be required to weigh transit against other expenditures, such as employee raises.
The actual budget won’t be presented until the end of May, but here are some highlights:
- No additional property taxes unless a transportation bond is put on the October ballot and approved by voters. Councilors will discuss that in more detail next month.
- No employee layoffs planned.
- Unemployment is at about 6.8 percent, up 1.5 percent since 2008, but down from from about 7 percent last fiscal year.
- Property tax revenues increased from $184 million in fiscal year 2012 to an estimated $191 million for 2013. Property taxes for cars have increased 7 percent.
- Sales tax increased from a post-recession low of $58.7 million in 2010 to an estimated $71.5 million for fiscal year 2013. It’s growing by about 4 percent each year.
- City departments have requested 112 new positions totaling $5.4 million. Of those, 30 are for firefighters to fill a new station, and 29 are for Parks and Recreation.
- Solid Waste Services is operating at 62 percent cost recovery, which leaves some room open for possible fee increases.
- Development revenues are expected to increase in the next budget by $2.3 million.