Cuts in government spending, particularly in the areas of water and sewer services and law enforcement, were preferred over tax increases as the means of balancing county and municipal budgets by the participants in two online polls conducted by The Union Daily Times.
Union County Council and Union City Council have both approved the new county and city budgets for fiscal 2012-2013. Both budgets are balanced as required by law, but the county and the city took different approaches to balancing their respective budgets.
The county’s 2012-2013 budget totaled $12,347,822. or $125,560 more than the $12,222,262 budgeted for fiscal 2011-2012. The budget, which took effect July 1, includes a 3 percent cost-of-living increase for county employees, $300,000 for new patrol vehicles for the Union County Sheriff’s Office, a one-time match of $50,000 for improvements at the Union County Airport, $54,000 to replace funding the county has lost due to state budget cuts, and $135,000 for a “Futures Account” for any special needs that arise during the year.
What it did not include was tax increase. Instead, council authorized a $539,000 transfer from the county’s reserve fund to balance the budget which funding the cost-of-living increase, patrol vehicles, airport improvement, state funding replace and the Futures Account. The transfer reduced the reserve fund from $4.1 million to $3.7 million, a fund balance equal to approximately 30 percent of the county’s operating budget. It is standard practice for local governments to maintain a reserve fund balance equivalent to 20 percent of their operating budget.
The city’s 2012-2013 budget, which also took effect July 1, totals $41,771,510, a decrease of two percent or $691,350 less than the $42,462,860 budgeted for fiscal 2011-2012. The decrease in the total budget is due to a decrease in its largest component, the Utility Fund, which covers the operations of the City of Utility Department. The Utility Fund portion of the budget for fiscal 2012-2013 is $34,012,670, a decrease of $1,253,170 from the $35,265,840 budgeted for the current fiscal year.
This decrease occurred despite the inclusion in the budget of a 3 percent cost-of-living increase for all city employees but the mayor and members of city council. It also includes $3.48 million for utility infrastructure improvements and $145,000 for equipment replacement.
Despite the decrease, the city’s budget included a tax increase, albeit a small one. The municipal property tax was increased from 74.3 mills to 80 mills under the new budget. However, council eliminated 5.6 mills levied in fiscal 2011-2012 to cover a loss of revenue the city experienced the previous fiscal year. This left a net tax increase of .1 mill or an addition 40 cents a year on the tax bill of the owner of a $100,000 home within the city’s municipal limits.
The budget also included increases in the rates the city charges for water, sewer, natural gas, and electricity. The increases were attributed by city officials to increased costs due to a combination of factors including environmental mandates and the decrease of the city’s industrial customer base. Depending on whether or not a customer who receives all four services lives within or without the city, the rates increases could anywhere from an additional $8.36 per month to an additional $9.40 a month.
Had the participants in two online polls conducted by The Union Daily Times on the budget process gotten their way, the county and city budgets would have been balanced through cuts in spending, particularly in the areas of infrastructure and law enforcement.
The first poll pointed out that “The 2012-2013 budget process is underway in Union County. Local governments are required by law to have a balanced budget.” Readers were then asked, “While no tax increase is currently being proposed, should taxes be raised to balance the budget or should spending be cut?”
Of the 206 persons who voted in the online poll, 78 percent said cut spending while only 22 percent supported raising taxes.
This was followed up by a second poll that asked, “If instead of raising taxes, government should cut spending, where should the cuts be made?” Readers were given the choice of having cuts made in water and sewer services, law enforcement, fire protection, road and bridge maintenance, and emergency medical services.
Of the 143 readers who voted, 43 percent called for cuts to be made in water and sewer services, 33 percent in law enforcement, 15 percent in road and bridge maintenance, 3 percent in emergency medical services, and one percent in fire protection.
In addition to giving final approval to the 2012-2013 budget, county council also approved an ordinance authorizing a referendum on changing the county’s government from council-supervisor to council-administrator. The referendum but be approved by the US Justice Department, but if it is approved then it will be place on the November ballot.
A new online poll being conducted by The Union Daily Times addresses this issue, asking readers “Should Union County’s system of government be changed from council-supervisor to council-administrator?”