Memo-05-08-2018-Item-10

May 8, 2018

MEMO TO:        Mayor Barber and Board of Commissioners

FROM:             Frank A. Rush, Jr., Town Manager

SUBJECT:       Presentation – FY 18-19 Recommended Budget - (Summary & Suggested Motions)

The FY 18-19 Recommended Budget is complete and will be formally presented to the Board and the public at the May 8 regular meeting.  In an effort to better educate the Board and the public about the Town’s budget, I will make a detailed presentation summarizing the FY 18-19 Recommended Budget, and will provide handouts for the public at the May 8 meeting. 

I have attached a copy of the “Budget Message”, which provides a comprehensive discussion of the issues associated with the FY 18-19 budget.  A “Quick Summary”, “All Funds (Summary)”, “General Fund Budget Summary”, and other materials are also attached.  The full budget document will be provided to you under separate cover, and is also available on the Town’s website. 

The total FY 18-19 Recommended Budget is $10,669,900, a $787,733, or 7.9% increase from the adopted FY 17-18 budget.  The Board should note that this increase is skewed by an accounting change for EMS service fees ($215,000), and also by the one-time inclusion of proceeds from the Islander Drive land sale ($200,000) that will reimburse the Future Beach Nourishment Fund.  Without the inclusion of these two revenue sources, the increase would be $372,733, or 3.8%.  The General Fund is the largest component of the Town’s budget, with total expenditures of $9,998,100, which is a $543,924, or 5.8% increase from the adopted current year budget.  Without the accounting change for EMS service fees, the increase would be $328,924, or 3.5%.   The Future Beach Nourishment Fund budget is $939,500, which includes $200,000 from the Islander Drive land sale proceeds, and is thus more than recent years.  The full amount of $939,500 would be reserved for future beach nourishment activities.  Recommended appropriations are also included for the Half-Marathon Fund ($72,000), the Beach Music Festival Fund ($55,300), and the EMS Volunteer Fund ($5,000).

In accordance with the Board’s top budget priority, I am pleased to report that the Recommended Budget includes no increase in property tax rates and most other fees.  The recommended General Fund tax rate for FY 18-19 is unchanged at 15.5 cents per $100 of assessed value, with 14 cents allocated for general Town services and 1.5 cents specifically earmarked for beach nourishment.  The recommended Primary Benefit District (oceanfront and inlet-front properties only; for beach nourishment) property tax rate would remain at 4 cents, and this rate, along with the $400,000 transfer from the General Fund, will enable the Town to reserve the historical annual amount for future beach nourishment activities (plus the $200,000 Islander Drive land reimbursement).  There is also no change in the Town’s annual solid waste fee, and this fee would remain at $228 for all developed residential properties, which equates to $19 per month for all Town solid waste services (trash, recycling, yard debris collection, beach strand collection, and more).  The Recommended Budget does include two relatively minor fee adjustments:  a $50 annual (or $4.17 per month) increase in all Community Center membership categories, and the addition of Fridays for regional beach access parking fees.  These fee increases will impact approximately 350 of the Town’s 7,370 real property taxpayers. 

The FY 18-19 Recommended Budget includes sufficient resources to enable Town staff to maintain the high service quality expectations of our residents and visitors, and includes funding to compensate Town employees fairly, replace necessary vehicles and capital equipment, meet inflationary and other service demand pressures, and enhance staff capabilities.  The Recommended Budget includes a few notable service enhancements, including funding for additional NC 58 corridor aesthetic enhancements, additional lifeguard coverage during the summer season, full-year funding for the new EMS department, and the establishment of a reserve fund for future golf cart path infrastructure improvements.  The Recommended Budget also facilitates a major beach nourishment project in eastern Emerald Isle, significant streetscape improvements along Islander Drive and improvements to the Western Ocean Regional Access, and initial park improvements at the new McLean-Spell Park. 

 

Overall, I believe the FY 18-19 Recommended Budget represents a fiscally responsible spending plan for the next year, and that it addresses the Board’s expressed priorities.  We have tentatively scheduled two special budget meetings for the Board to review and discuss the Recommended Budget.  The first one is scheduled for Wednesday, May 16 at 9 am in the Town Administration Conference Room, and Town department heads will brief the Board on their respective budgets at that meeting.  The second special budget meeting is scheduled for Tuesday, June 5 at 6 pm (also in the Town Administration Conference Room), and will also include the legally required public hearing.  These dates and times can be adjusted, and additional budget meetings can be scheduled as necessary or desired between May 9 and June 11.  I am hopeful that the Board will formally approve the FY 18-19 budget at your regularly scheduled meeting on Tuesday, June 12 at 6 pm. 

I look forward to reviewing the Recommended Budget with you in the coming weeks.