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County Manager: Schools, Libraries Are Budget Priorities

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During a breakout session Wednesday night, one group of citizens discussed its picks for budget priorities. Photo courtesy of

County Manager Harry Jones told a public forum in Cornelius Wednesday that his budget priorities for next fiscal year include funding for education and libraries as well as paying down debt and a possible pay raise for county employees. Mr. Jones was among several county leaders who addressed the meeting at Cornelius Town Hall Wednesday night. Joining him were Mecklenburg County Board of Commissioners Chair Jennifer Roberts, District 1 Commissioner Karen Bentley, and county Budget and Management Director Hyong Yi. It was the third and last in a series of meetings across the county in recent weeks to engage citizens in a dialogue about the county's budget and priorities as it plans for next year. County officials are completing work on a recommended budget for 2011-12 that Mr. Jones will present to the county commission on May 17. CITIZENS ASKED TO HELP PRIORITIZE Only about 20 citizens from Cornelius, Davidson, and Huntersville showed up for the meeting, which was facilitated by Meck Connect, a county initiative to encourage citizen involvement in community governance. Following brief remarks from the county officials, the citizens were put to work. They met in small groups, and were asked to rank their budget priorities from a long list of county-funded items. Libraries and parks and recreation were among each group's top priorities. Transportation was also high on the lists. During the breakout sessions and a Q&A, speakers complained about the recent county property revaluation and taxes, and spoke up for schools, parks and libraries. Elaine Powell of Charlotte implored Mr. Jones to hold on to funding for Parks & Recreation, saying it was a key factor in quality of life. County officials noted that they face big challenges when state officials ask counties to take over expenses formerly paid by the state. Resident Kim Fleming of Davidson said she hopes the same won't happen at the local level, with the county asking towns to take over expenses once paid by the county, such as libraries. She noted that Davidson and Cornelius came up with $350,000 total last year to help "keep the library system whole," and said she hopes the county can restore some library funding this year. "We just urge the commissioners to look at the library funding and to keep the community branches in the communities, even before you would look at increasing regional branch library hours, because they are that important to these communities,"she said. Mr. Jones wasn't making any promises. "There are some competing demands on what is a very limited budget," Mr. Jones said in his introductory remarks early in the meeting. The county finds itself making up for generous spending in past years while still dealing with the residual effects of the economic downturn two years ago. The county has had to cut $150 million from its budget over the past two years, which is more than most North Carolina counties' total budgets. It now is working with a budget of $1.3 billion, which means it must operate at about the same funding levels as it did in 2007, Mr. Jones said. Staffing levels also have been reduced over the last few years to levels as low as those in 1998, Mr. Jones said. HOW DID WE GET HERE? Budget and Management Director Hyong Yi sought to answer that question by sharing a summary of the county's economic profile and budgeting over the last decade. "2001 to 2008 was a great time to be in Mecklenburg County," he said. Employment rates were high, which was no secret, as 180,000 people moved to the area within eight years. The new residents generated for the county increased funds from property and sales taxes, which are the county's primary sources of revenue. And, to keep up with the increased demands of a growing citizenship, the county approved over those eight years $1.5 billion in bond referenda, creating debt that, by law, must be repaid. With the bonds, the county built more than 50 schools, several libraries and parks, among many other items, and in less than a decade, the county's debt service essentially doubled. Then, in 2008, "everything kind of fell off the table," Mr. Yi said. The unemployment rate jumped from 3 percent to 10.6 percent in less than one year, and the county saw a dramatic decline in revenue from property and sales taxes. Faced with great challenges, county officials were forced to make drastic cuts to the budget, and it seemed nothing was safe, including schools and libraries. HOPE FOR NEXT YEAR Those sacrifices put us in a much better position for 2012, Mr. Yi said. Because of the tough decisions made by county officials over the last couple of years, the starting budget gap for FY 2012 is just $500,000, he said. That's the difference between projected revenues, and continuing spending at current levels, he explained afterward. At the same point a year ago, the shortfall was $95 million. "We have stabilized the budget," he said. Mr. Jones said he hopes the county this year can "reinvest" in areas where budgets were slashed. "This year I think is going to be a very important budget for us because I know there is a very strong sentiment in the community about reinvesting in some of the services and programs that were reduced," he said. But Cornelius Commissioner Jim Bensman was wary of premature optimism. "Stay as flat as you can in terms of expenditures over the next year," he told the county officials, as it is too soon to determine certain key revenue elements, such as the result of the county-wide tax revaluation. The county has 41,000 appeals to hear. TAX RATE? Mr. Bensman said he's worried county officials are preparing residents for a tax increase, and he told Commissioner Roberts he thinks the county should adopt a "revenue neutral" tax rate. After a revaluation, the state requires municipalities to calculate a new tax rate that brings in roughly the same amount of revenue, subject to adjustments for natural growth and annexations. In most cases, that means reducing the current rate. Ms. Roberts said county officials understand that many people still face hardships. "We have no concept that everything's over," she said. She said it's too early to say what the tax rate might be, because the county is still needs a clear picture of of other revenue trends, including sales taxes and possible cuts in state funding. In an interview afterward, she said the county needs to look at a revenue-neutral rate on one end and keeping the current tax rate on the other. "We need to look at what are we going to sacrifice if we go revenue neutral, what are we going to lose in our schools and our libraries, etcetera, and how much can we get back by going closer to rate neutral," Ms. Robert said. "I want to hear the full picture, then I'll start advocating," she said. CORRECTION: This story has been updated to correct the first name of Elaine Powel. David Boraks contributed to this story. Bailey students selected for CMS Honors Band