City won’t increase tax rates or fees, but property tax increases with inflation

City of Statesboro staff is proposing a budget for fiscal year 2023 that does not include any increase in municipal tax rates or fees. However, it is enjoying an estimated 7% growth in property tax revenues and is expected to draw more than $2 million from the city’s accumulated fund balance.

“I am proud to tell you that we are presenting a balanced budget with no fees or rate increases,” City Manager Charles Penny told Mayor Jonathan McCollar and members of City Council.

It was at the start of Penny’s presentation during their Tuesday budget working session. Fiscal years are named for the calendar year in which they end, and the 2023 city, county, and state fiscal year begins this July 1. A public hearing on the budget is scheduled for June 7, when the board will hold a regular meeting at 9 a.m. and a council vote to pass it is scheduled for June 21.

The city’s general fund for the current fiscal year 2022 covers $18.14 million in appropriations, and the general fund projected total for fiscal year 2023 is $20.48 million, an increase of 12, 9%. The general fund is the part of the budget that receives property tax revenue.

But the overall budget for the City of Statesboro is much larger. In addition to the general fund and a separate fund for the fire services, it includes special funds such as those for the sales tax on special use local options, or SPLOST, and the sales tax for transportation. , or T-SPLOST, and corporate funds with their own charges, such as water and sewer, natural gas, storm water, and solid waste collection.

The combined budget for all funds – less interdepartmental transfers – is $63.16 million for the current fiscal year and is proposed at $73.34 million for next year, an overall increase forecast of 16.1%.

Recovery and hiring

Among the proposed new spending is a 4% “compensation plan adjustment” or general increase for city employees, in addition to any individual increases for job performance.

“Last year we made a 3 percent. Our compensation plan had fallen behind,” Penny said. “Now this year, we’re going to recommend a 4% wage adjustment for all city employees, and inflation is 8.5%…and we can never keep up with inflation exactly.”

He also proposes increasing an annual holiday bonus from $100 to $500 and adding a holiday on Good Friday.

In combination with increases and increased bonuses, the proposed hiring of several additional employees and the previous addition of certain positions for which full 12 month costs will be recognized for the first time in fiscal year 2023, account for a large portion of new spending.

Penny offers to hire a corporate recruiter at an expected cost of $75,000 and provide $50,000 for hiring an event manager.

The Statesboro Police Department will not be permitted in this budget proposal to add 14 officer positions as requested. But the department does not have all the positions filled in the currently authorized number.

In this budget, Penny offers to add two police officers, along with the cars and equipment they need, and said he authorizes police chief Mike Broadhead to “overhire” four additional officers if he gets first the currently authorized strength. Thus, he could add up to six other officers.

The city continues to budget for the costs of nine additional firefighters the board authorized for the Statesboro Fire Department a year ago. No more new locally funded firefighters are included in the proposed budget, but Penny said the city will again apply for a federal SAFER grant to add 12 firefighters.

The proposed budget also includes the first full year of projected costs for eight additional dispatchers who were authorized midway through the current fiscal year. This was done to transfer responsibility for the detailed dispatch of Statesboro firefighters, after the initial call, from the Bulloch County 911 center to the Statesboro Police Department’s internal dispatch center.

Four of the new dispatchers are budgeted from the city’s general fund; the other four from the firefighters’ fund.

Revenue Trends

On the revenue side, Penny and her staff forecast an 8.6% increase in general fund revenue, including 7% growth in the value of the property tax summary. This preliminary projection, provided by Chief Assessor John Scott of the Bulloch County Office of Tax Assessors, includes the growth of any new construction or building improvements in the city, as well as inflation in the value of existing properties.

Again, Penny is not offering any increase in the city’s mileage rate. But property taxes also rise with inflation in property values, and under a Georgia law known as the Property Taxpayer’s Bill of Rights, the city must either reduce its mileage to compensate for inflation in existing property values. , or announce a tax increase and hold three hearings. .

Penny isn’t offering a rollback either, he confirmed in an email Wednesday.

A discount or hearings are not needed for construction and development gains, only for inflation. Scott doesn’t have a breakdown of those categories yet, he said in a phone interview Wednesday, but he said his goal is to have it within the next week to 10 days. This data is required by county commissioners and the school board, as well as the city, as all have separate receding rates to be determined.

But he confirmed that inflation will account for the majority of the city’s digested growth. Home prices have skyrocketed.

“The majority of that would be inflationary growth,” Scott said. “Frankly, this housing market – this is my 39th year of property tax assessment, and I wasn’t here after WWII or Civil War or WWI – but during my 39 years old, it is certainly unprecedented what happened last year at 18 months.

Spend your balance

Even with the growth, the City’s proposed spending exceeds projected new revenues for fiscal year 2023 by more than $2 million in the general fund and more than $300,000 in the fire services fund.

A city request that the Bulloch County Board of Commissioners increase the county’s special mileage in the Statesboro Fire Department’s service district outside of city limits will be explored in a separate story.

From the end of fiscal year 2020 to the end of fiscal year 2021, the city increased its overall fund balances by nearly $5 million, to $28.9 million. In fiscal year 2021, the city received previously unexpected federal funding under the CARES Coronavirus Aid, Relief, and Economic Security Act. The general fund balance alone increased by $1.4 million, from $7.1 million to $8.5 million, as shown in Penny’s budget slideshow.

Another slide compared Statesboro’s current property tax rate of 7.308 million to those of 20 other nearby or similarly sized Georgia cities, showing Statesboro is in the bottom half.

Penny warned the mayor and council that they cannot rely on spending from an accumulated balance for long.

“We used $2,062,653 of the fund balance just to balance the general fund budget,” he said. “Now we have seen the growth of the fund balance so we can recommend it to you, but I also have to tell you that using this amount of money is not sustainable. You can do it for a year and then after that , we must have income somewhere.

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