Sunday, February 27, 2011

Better Fasten Your Seat Belts, Watauga County

County Commissioners’ "Pre-Budget Retreat," 2011

Near the very end of the grueling two-day, 12-hour marathon of reviewing county “budgetary challenges,” staged exclusively for the education of our elected County Commission, county manager Rocky Nelson announced that he would be retiring at the end of his current contract. He promised that he would complete the budget for FY 2012 but said it will be the most painful of the 11 county budgets he’s prepared since taking the job.

He wasn’t kidding (and he deserves some sort of local Purple Heart commendation for shouldering one of the most difficult, and thankless, jobs in local government).

Mr. Nelson starkly summed up the choices for current County Commissioners, based on projections that county sales tax revenues “are projected to remain flat.” Watauga County will be short on revenue anywhere from $2.5 million to $4 million (with the higher figure more likely), depending on how many unfunded mandates the NC General Assembly pushes down onto county governments. The four choices Mr. Nelson offered the commissioners:
1. Raise property taxes. Watauga County is currently ranked 6th lowest in tax rate of the 100 NC counties.

2. Call for a public referendum for a quarter-cent sales tax hike.

3. Raid the county’s fund balance (“rainy day,” emergency, and daily cash-flow operations fund), which could put the county in long-range jeopardy and out of compliance with mandates from the state.

4. Cut muscle (and bone) in county services (including appropriations to public schools, since education accounts for over 40% of the budget) ... which will mean firings of many employees (including, naturally, teachers and other school personnel).

The Republican majority made it very clear that option # 1 is off the table. Surprisingly, option # 2 is definitely on the table with the Republican majority, as is option # 3. The county’s fund balance is healthy, due to astute budgeting for the past three years, but it’s a sitting duck, there for the taking (and several commissioners are clearly prepared to take it, despite warnings not to).

Commissioner Gable said he was in favor of a land transfer tax in the county, evidently unaware that since that mechanism (voter referenda) was put in place in NC, every county that attempted to institute a land transfer tax was beaten at the polls, following strong negative campaigns mounted by the real estate industry. Plus the Republican majority in the General Assembly has already announced that they intend to repeal the law that allows counties to even try for the tax.

Quarter-Cent Sales Tax Hike
The biggest problem with a quarter-cent hike to local sales taxes would likely be the timing of a public referendum, since the county’s 2012 budget must be completed by July 1, and there’s a set time mandated by state law between the calling for a tax referendum and the actual scheduling of a vote (60 days? 90 days?).

Not to mention the political hand-stand the Republican commissioners will be performing locally: after campaigning against the quarter-cent sales tax hike last year, they’ll be in a vulnerable position calling for the same thing this year – despite any reasonable explanation about how the money will be used.

Vice Chair David Blust, citing himself as a model of personal budget-cutting, said he was in favor of raiding the fund balance and cutting muscle & bone, which will mean, practically, the firing of many people, including many teachers, teacher assistants, and other school workers.

Former chair Jim Deal said his top priority was still education and that jobs and economic development ranked number 2. Many interesting and even exciting economic development initiatives were presented during the two-day retreat, including the positive revenue stream now beginning to flow into county coffers from “green energy” at the county’s landfill (“energy park"), the development of Watauga County into a premier outdoor-activity destination in the East, the need for water/sewer infrastructure on the Doc & Merle Watson Scenic Byway, etc. All of these initiatives seem prime now for debilitating neglect.

Commission Chair Nathan Miller seemed ready to scapegoat the new Watauga High School as the cause for all the county’s budget problems. He wants cuts to services and inevitably to jobs. Miller and the other Republicans have an eye on the “outside” funding to agencies and non-profits that supply everything from daycare for working families to unwanted and abandoned pet rescue (and many, many other public services).

Commissioner Tim Futrelle wondered out loud how putting people out of work was going to help the local economy. Commissioner Deal said that cutting funding to outside agencies was just another way of cutting services, and the Commission needed to be honest about that. “We’ve been doing budget cuts for the last three years, and we don’t need to be asking Rocky Nelson to make further cuts without being honest that we’re talking about firing people.”

Mr. Nelson pointed out that it’s been three years since county employees have had a raise. Do you want me to cut employees fringe benefits further? he asked.

Mr. Gable said he was against cutting employee benefits, and Mr. Deal added, “If we’re going to cut anybody’s pay, we have to cut ours first.”


Your Friendly Neighborhood Teahadist said...

Thanks for the even-handed and informative reporting. Posts like this are why I keep reading WataugaWatch.

I would say, though, that we at ASU haven't had raises for years either--on top of that we had furloughs. We also saw our health care benefits reduced while the contributions taken out of our paychecks went up. After all that, I'm not inclined to pay more taxes to protect county workers' benefits from a similar decline.

Anne said...

Ha. Put the 1/4 cent back up for a referendum and let's get everyone to vote for it this time! I mean, last time we would have gotten a rec center out of it. This time we can just throw it down a toilet with nothing to chow for it. Yeah, that's the ticket!

The commissioners have been cutting and cutting for years. There is no damn fat, so now it's all about screwing public employees.

Anonymous said...

JW, I doubt if you'll post this, but are you claiming that the new WHS is NOT the source of the County's budget problems?

Examine the County debt and break it down. Almost $80M for the school, not counting the huge interest on it. These two figures are the bulk of the county debt. The WHS cost will be a colossal weight around county taxpayers neck for many, many years, and all your newspeak will not change this undeniable truth.

brotherdoc said...

JW said he was going to quit posting Anonymous's comments but the Anonymouses of the area continue to outright dare him to post their comments. JW is a lot more longsuffering than people give him credit for. As for the county budget deficits, I would vote for a 1/4 cent sales tax but a higher property tax really makes a lot of sense. Our rates are low--the original story says that 94 counties of NC's 100 have higher rates--and NC's property taxes are considerably lower than in many comparable areas of the country. I know this will not be a popular post...Jerry, I count on you to post it anyway.

Guess Who said...

The former Democrat Commission spent us into this mess. Now the Republican controlled Commission has to get us out.

There is a strong possibility the Democrats wasted money to try to make the tax rate go up after it became evident there was a good chance of Republicans taking over the Commission. This would have been a smart political move on their part. The more pain they could cause the public under the Republicans trying to undo the Democrat waste, the better it would be for Democrats because people would not know Democrats caused the pain in the first place.

Watauga TAXPAYER said...

Only a few months ago the Democrat County Commission wanted to raise the sales tax in order to spend MORE money and take on ADDITIONAL debt for a rec center. Now it turns out that we can't even pay for what we already have in this county but some of you STILL argue that we should have raised our taxes and taken on more debt for a rec center.

Sell the old high school! Sell the Brookside park land which we overpaid for! Stop spending money on the new mountain bike park and lets just start paying our bills!

When we become prosperous we can talk about spending more money on things we would like to have. In the meantime, lets pay for the things we NEED to schools, county services, etc!

G.I.G said...

Grueling 12 hour marathon over two days? 6 hours a day work does not sound all that bad to me .

brotherdoc said...

Wait a minute, hold your horses. Under whose Presidency did the nation's economy fall into the toilet? Remember that guy named Bush? It was who, again, who racked up the largest deficit in the history of the Republic before his party took the shellacking in 2008? It's no wonder the public is frustrated--we see the same old party that could hardly get enough tax breaks from the government in the last regime now blaming the deficit on Democrats. I know the national media does nothing to raise the memory level of the public above that of a goldfish but that's no excuse for the parrots on the right to perpetuate the problem.

Anonymous said...

County Taxpayer, that's the problem. 'Sell the old WHS property? Who would buy it, the way it was packaged, even years ago? So the then BOC Chair could bail his pal out, not to mention, helping even more friends out with the very dubious choice for the new WHS property. Remember what the then BOC chair's remarks? 'We need these huge fund balances for land purchases.' We found out why the BOC chair wanted the funds for.

Ok, those of you, including many Republicans, who wanted your big fancy, most expensive high school in NC history. A few tried to warn you about the instability of the economy, and what this project would cost us.

Now, go enjoy and brag about your massive, very expensive WHS, and try to find ways to maintain it with personnel, etc. Enjoy it!

This country and state are facing a financial armageddon. And of course, your solution is to raise taxes, alwasys raise taxes, despite the realities of already high taxes and the very high jobless rate.

Another insult to the taxpayers; another insult to the working and middle class Americans, the NC and Watauga taxpayers. You got your big fancy high school. Again, I say, enjoy it!

Deborah Greene said...

Are we in what they call "rainy day" times? They have way way way more than the State requires them to set aside. They have bragged about this for years. Deal doesn't want to spend any of the "rainy day" fund because he and his cronies have plans for that money.

That high school that cost almost $80 million (not counting interest, the one that is already falling apart. The one which the we paid millions to the architect who is being blamed for much of the problem. Yet, it probably has to do with skipping necessary due diligence which is par of Deal's modus operandi.SNAFU

Deborah Greene said...

Yeah! He is finally retiring. However, he should have been fired years ago. To say that he has been in control of the budget for the past 6 years is a joke. Deal has been charge of everything. I remember when we first mentioned to the commissioners that we had a big fund balance back in 2000, Deal didn't know it or at least he acted like he didn't. He denied it. However, he asked Doris Isaac to get back with them at the next board meeting. And, he then said it was "earmarked". And, he didn't refer to it as a "rainy day" fund. He said that the county needed to buy up land and that the fund was for buying property. And, his first purchase was shortly thereafter. He purchased the Smitherman Winkler property from his client. No appraisal. And, then he told us all of the problems that plagued the property when it came time to put it back on the market. This is the one where he represented both the buyer and the seller. Then we borrowed the money to purchase the other properties. It think the philosophy is to leverage the fund balance. Borrow as much as possible to make the purchases and then use the "rainy day" to make the payments.

I asked the finance director what the current "rainy day" fund balance was and she said that it didn't change until the next audit. I have some swamp land I can sell you if you believe that. Doris Isaac always kept track of it. This finance director says that it isn't necessary because there is a lot in there so she claims that she doesn't need to keep up with the balance.

Isn't it time for Tweetsie to pay up? We borrowed the money to purchase the $3 million track for them. They're paying $1 per year with the idea that they will add capital to Tweetsie and eventually buy it back from the county - interest paid by the taxpayers of course. Another leech!


You are right again BrotherDoc.

It's Bush's fault.

It's always Bush's fault.

Obama has added more to the deficit in 2 years than Bush did in 8....but it's Bush's fault.

The democrat county commission built the most EXPENSIVE HIGH SCHOOL ever built in the state of NC...but it's Bush's fault.

The democrat commission borrowed money and bought property to lease to tweetsie railroad for $1.00 A YEAR (how many of us would like a deal like that?)...again, Bush's fault.

BOC bought land on Brookshire road with NO PLAN for it at all. I remember the discussions AFTER they bought it that "maybe we could use it for low cost housing", "maybe we could expand the industrial park", "maybe we could put a park there"....Doesn't anybody think it's a good idea to have a demonstrated NEED for land before you go buy it? Wouldn't it make more sense to determine what the needs of the county are and THEN maybe address them with land purchase or whatever? Not here though....let's buy some land. We can borrow the money and pay it back with tax dollars later and maybe we can find some use for the land....THAT's what the Dem Watauga County COmmission did..and it (of course) is Bush's fault.

Anonymous said...

Yes, Brotherdoc, that's another level and another subject.

Yes, that warmonger and liar Bush did what his big bankster bosses said and spent more money and wasted so many more precious lives, our youth and civilian innocents, on the latest war to end all wars. And still, Obama does the same thing with no end in sight. But the Arabs are finding out they have been doublecrossed by Kissinger and company re: OPEC. BOTH parties and their Wall Street pals are filthy traitors and all should be arrested, tried and executed.

Mike D. said...

"BOTH parties and their Wall Street pals are filthy traitors and all should be arrested, tried and executed." - Anonymous


Arrested and tried by whom, exactly? Since you don't trust either party in our two party system, exactly which group do you trust to administer the justice you seek?

It sounds to me as though you have gotten caught up in the spirit of protest spreading through the Middle East, except you don't want freedom, you want blood vengeance.

Am I right?

Anonymous said...

"Am I right?"

From what I have seen of your posts.....I would have to say, "rarely".