By Tim Gardner
By a unanimous 5-0 vote, the Avery County Board of Commissioners adopted a new 2024-2025 fiscal year budget during its June 3rd regular monthly meeting.
All commissioners—Chairman Tim Phillips, Vice-Chairman Dennis Aldridge, Martha Hicks, Wood Hall (Woodie) Young, Jr., and Robert Burleson—were present for the meeting. County Manager Phillip Barrier, Jr., Assistant County Manager and Clerk to the Board Cindy Turbyfill, County Finance Officer Caleb Hogan, and County Attorney Michaelle Poore also attended.
The 2024-2025 fiscal year begins July 1st. By State of North Carolina law, a new fiscal year budget has to be adopted no later than June 30th each year as a fiscal year runs from July 1st until June 30th of the following year.
Avery’s 2024-2025 General Fund Budget totals $39,639,298.00 and includes $3,000,000.00 in Appropriated Fund Balance. Under its terms, the county’s tax rate will be 40 cents per $100 valuation. That includes 33.5 cents in general tax and 6.5 cents in fire tax. The proposed budget has no overall tax increase. The general tax and fire tax remain the same amounts as they were in the 2023-2024 and 2022-2023 fiscal year budgets.
The overall 2024-2025 fiscal year budget is a 6.85 increase from the 2023-2024 fiscal year.
The commissioners in collaboration with the County Manager, Finance Officer, other county officials, and county department directors spent months in deliberation determining and then finalizing how much funding each county agency will receive for the upcoming fiscal year as well as how much of county funds will be spent on various projects that are already underway or are in the planning stages.
Before the commissioners could vote to adopt or reject the proposed budget, they held a Public Hearing (as mandated by North Carolina Law) during the meeting about the proposed budget. The public was then invited to offer comments about it.
Young, Jr. said the 2024-2025 budget is not an ideal one, but that he supported adopting it.
Collectively, the commissioners and county manager stressed that the new budget does not place financial burdens on the county’s taxpayers.
The commissioners approved the 2024-2025 fiscal year budget following the public hearing.
Hogan said the budget provides a 5 percent Cost of Living Adjustment (COLA) pay increase for all county employees.
Usually among the largest parts of the county budget and one that often creates a high volume of interest each year from the county’s citizens and taxpayers is the amount provided to Avery County’s public schools.
The overall education funding amount by the county is the third highest in the 2024-2025 budget. $12,926,988.00 was allocated for public safety, followed by $7,371,441 for human services, and then $6,721,328.00 for education. The education budget for the upcoming fiscal year is a $113,555.00 increase over the $6,607,973.00 allocated in the 2023-2024 county budget.
The Education funding is for the Avery County Public School System and Mayland Community College. However, most of the education funding is extended to Avery County Public Schools.
For fiscal year 2024-2025, the county commissioners allocated the Avery Public Schools $6,255,000.00, including $5,505,000.00 in operational funding and $750,000.00 in capital funding.
According to Hogan, Avery Public School System officials requested an operational funding request of $6,259,088.00 for the 2024-2025 fiscal year, but did not request a certain amount in capital funding, instead giving county officials an amount of $11,872,392.83 that would cover the school system’s entire current needs and those of the next few years.
The operational funding the county allocated to the school system for the upcoming fiscal year is a 2 percent increase from what was allocated during the 2023-2024 fiscal year, although it is $754,088.00 less than the $6,259,088.00 that the school system requested for the upcoming fiscal year.
However, when all funding to and continued payments for school projects such as new construction and renovations which are not listed in the 2024-2025 budget ordinance, but are factored in, that amount increases to $9,668,279.00. Using that financial criteria, the Avery County Public School System moves to the agency that is the second highest funded by the county.
Newly-elected Avery County Board of Education member Michelle Krege Burnop addressed the commissioners for approximately 45 minutes with hopes of the public school system obtaining more funding from the county.
Avery School Board Chairman John Greene also addressed the commissioners for about five minutes asking them to provide more funding to the school system.
While the commissioners thanked Krege and Greene for their input, they did not change the funding amounts to the school system before adopting the new budget.
Burnop gave High Country Press the next four paragraphs of quotes with her feelings and concerns about the 2024-2025 budget the Board of Commissioners adopted regarding funding for the Avery County Public School System.
“I am very grateful that I was allowed to speak at the Commissioners Meeting on June 3rd, 2024. I thanked the Commissioners for the many things they have done to provide for Avery County Schools. I focused on the blessings in our school system, which begins with our Pre-K (Pre-Kindergarten) through 12th grade students. During the meeting, a commissioner stated that the Avery County School System receives more than $5,000 per student from the county. We have two budgets from the County-Capital Outlay and Current Expense. Our Capital Outlay budget was cut by $150,000.00 in 2022-2023 (fiscal year budget). With our current allocation of $750,000.00 and an upcoming student population of 1,841(including Pre-K), that is $407.38 per student to maintain all facilities and cover recurring operational costs such as reconditioning gym floors, reconditioning football helmets and pads, band equipment repairs, annual painting, roof maintenance, security camera maintenance, elevator repairs, and debt service on our turf replacement. This annual allotment does not provide funds to address urgent facility needs at each of our schools.
“The Current Expense budget for the 2024-2025 fiscal year does not cover our current level of staffing and operations. The Avery County School System has been utilizing fund balance (savings) to cover recurring expenditures to maintain staff and services for the past five years or more. The 2024-2025 budget approved by the commissioners this past Monday is $5,505,000.00, or $2,990.22 per student (including Pre-K). The Avery County Commissioners approved two school system budgets. When added together, the school system will receive a $3,397.60 per student in the upcoming fiscal year’s budget. Adding a one-time capital project or projects distorts the annual allocation and is not a true representation of the dollars per student provided to operate our schools, pay personnel, purchase supplies and materials, pay for instructional software, purchase student computers, support athletics programs, support the arts, and other essential costs to adequately serve our students and staff.
“The Avery County Commissioners did not agree with how the Avery County School System utilized ESSER (Emergency and Secondary School Emergency Relief) federal dollars. ESSER funds were spent appropriately and as required by federal and state guidelines. The Avery County School System was audited and commended for the plan developed and followed to use these one-time funds. All documentation and data pertaining to the use of ESSER funds have been provided multiple times to the County.
The Maintenance of Effort (minimal funding requirements by the state) and the commissioners’ desire to keep a low Maintenance of Effort because they will have to maintain any increases in our budget moving forward should not cause Avery County Schools to be restrained financially.
“The reality is that inflation is real, salaries are increased, retirement contributions increase, and health insurance increases. The funding fact is that the Avery County School System has received an average increase of 2 percent per year since the 2018-2019 fiscal year. This amount does not address increased operational costs and the current rate of inflation. Fund balance continues to be utilized to cover recurring costs, placing the Avery County Board of Education in a very difficult situation with difficult decisions to be made regarding our organization, personnel, and programs these coming (school and fiscal) years.”
The other part of the total $6,721,328.00 of education funding is for Mayland Community College, which will receive $466,328.00 from the county for the 2024-2025 fiscal year.
Also, for the 2024-2025 fiscal year, county departments were allocated $1,991,470.00 in capital outlay expenditures, which is $282,703.00 more than was provided in the previous fiscal year, when they were allocated $1,708,767.00
The following is a detailed budget message from the County Manager (Phillip Barrier, Jr.) and the Finance Officer (Caleb Hogan) to the commissioners and Avery County citizens before the budget was adopted:
In accordance with North Carolina General Statute 159-11, the Avery County Fiscal Year 2024-2025 proposed budget is respectfully submitted for your review and consideration. This document provides the financial framework for the programs and services which Avery County government will be undertaking in the next fiscal year. The budget provides the resources needed to ensure the delivery of governmental services in a fiscally responsible manner. The proposed budget is a continuation of the financially sound and conservative practices Avery County government has established and embraced. North Carolina General Statute 159-11 stipulates that a public hearing be held in order to inform the public and allow any interested citizens the opportunity to express their opinions about the budget after the budget message is presented. The Board held budget workshops to make changes to the proposed budget. This budget message represents an explanation of the budgetary decisions derived from in-depth dialogue between the County Manager, Assistant County Manager, Finance Officer, Department Heads, and changes made during budget workshops. The cumulative total of necessary operational and capital expenses considered in light of revenues generated by the departments, combined with State and Federal funding, determines the amount of funding that will be necessary from the citizens of Avery County.
As presented, the 2024/25 budget is balanced based on a total property valuation of $6.315 billion. This represents an increase of 301,230,288 million dollars or 5.01 percent over last year’s valuation of $6.014 billion. The general fund tax rate will remain at 33.5 cents ($0.335) per $100 valuation, which will generate an estimated $20.7 million dollars in revenues. The county-wide fire tax rate will remain at 6.5 cents ($0.065). The Fire Commission and volunteer fire departments will receive an estimated $3.99 million dollars in revenue.
The combination of these two rates results in an overall tax rate of 40 cents ($0.4000) for the 2024/2025 fiscal year. This rate remains to be a decrease from the revenue-neutral tax rate and a 15-cent decrease from the 2021-2022 fiscal year.
Current inflation and economic conditions place a burden on Avery County’s working families. It also makes balancing the county’s budget difficult. Overall expenses are projected to increase 6.85 percent from the 2023/24 budget. To keep the tax rate at the current rate and balance the budget, it is necessary to appropriate $3.0 million from the fund balance as has been the practice during other times of economic uncertainty. The Avery County commissioners pledged to keep the ad valorem tax rate the same for our taxpayers for the 2024/25 fiscal year.
Barrier, Jr.’s and Hogan’s budget message continued with the following breakdowns:
GENERAL FUND
Expenses-
The total General Fund Budget is set at $39.6 million. This is a 6.85 percent increase from the 2023/24 fiscal year.
General Government is increasing by $158,794.00. The increase is primarily attributed to an employee cost of living adjustment. The county continues to take a “proactive approach” with buildings, general maintenance, and capital service needs.
Public Safety is increasing by $1,106,083.00 The increase includes an added sheriff’s deputy position, new software, service contract enhancements, three new vehicles, and body cameras for the detention center employees.
Transportation is increasing by $269,481.00 The increase is due to five new vehicles and the increased cost of fuel.
Environmental Protection decreased by $294,998.00 primarily due to no current major capital needs for the Solid Waste Department.
Economic and Physical Development is increasing by $129,878.00. The increase is primarily due to operating expenses. The economic development committee plans to host other employee retention seminars for businesses, advertise with the chamber of commerce, and attend training seminars. The budget will also cover contracted services for the occupancy tax which will begin in 2024-2025 budget. These expenditures will not exceed $47,250.00.
Funding for Human Services is increasing by $1,075,831.00. The increase is primarily due to new state Medicaid programs, and the employees to administer the program which are partially funded with state and federal revenues.
Cultural and Recreation is decreasing by $6,083.00. The primary reason is there are no major capital needs for the Parks and Recreation Department, as plans for a new recreation center continue. Funding for the Mountain Alliance youth program, Avery County Fair, Little League, North Carolina Rush Soccer, Dogtown Wrestling, Oasis, and others are all addressed in this budget. Also budgeted is the animal services contract with Mitchell County Animal Rescue. Thanks to state funding, architectural plans for the two-county shelter will be announced soon.
Education is locally budgeted at $6,721,328.00 an increase of $113,555.00. This includes a $8,555.00 increase for Mayland Community College. The remaining increase of $105,000.00 is due mainly to free Pre-Kindergarten and supplies for students in Avery County schools. In addition to the regular capital outlay of $750,000.00, the debt payment for the new Avery High School of $925,000.00, and the continued payment for Banner Elk school of $347,355.00 will be made. Also, not reflected in this budget is the project for the high school kitchen, roof, and HVAC renovation at $2,140,924.00. Other safety capital needs may additionally be addressed with project ordinances throughout the year. Student population is estimated to decrease from 1,823 students to 1,768 for the 2024-2025 school year. The Avery County Schools’ operational local funds budget is $5,505,000.00. With the yearly capital, the debt service and the project ordinance, the total local tax dollars for Avery County schools committed in 2024-2025 will be $9,668,279.00 or 33 percent of ad valorem and local option sales tax revenues. When divided by the estimated student population, that’s $5,468.49 per student.
Of the total budgeted expenditures, Public Safety is the largest consuming 32 percent of the total budget. Education and the associated debt service is the next largest expenditure at 20 percent. Human Services is third at 18 percent, while all other County functions total 30 percent.
Revenue-
Property tax revenue is projected to increase by $920,000.00 or 4.64 percent from last fiscal year (2023-2024).
Local Option Sales Taxes are projected to increase by $406,238.00. Sales tax has rebounded from the expected decrease due to the Coronavirus (COVID-19) pandemic, and we continue to experience growth in our economy.
Other Taxes and Licenses are projected to only increase by $60,000.00 due to a projected slowdown in real estate sales.
Intergovernmental revenues are projected to decrease by $18,400.00.
Licenses and Permits are projected to increase by $62,000.00 over the last fiscal year (2023-2024).
Sales and Services are projected to increase by $201,000.00 primarily due to increases in revenue in Emergency Medical System (EMS) revenue, and State funding for Transportation.
Investment Earnings and Other Income are projected to increase by $200,000.00 due to higher forecasted investment income.
Property tax revenue will generate 52 percent of the County’s revenue, followed by sales tax at 21 percent, intergovernmental transfers at 8 percent, sales and services at 7 percent, fund balance appropriation at 7 percent, and all others at 5 percent.
OTHER FUNDS
Fire Tax Fund-
The Fire Tax Fund budget for the 2024/25 fiscal year is 3.99 million dollars or $199,606.00 more than last fiscal year.
E911 Fund-
The E911 Fund budget for fiscal year 2024/25 is $189,942.00. This is a decrease of $6,402.00 from the prior fiscal year.
Revaluation Fund-
The Revaluation Fund budget is $137,076.88 for the fiscal year 2024/25. Avery County budgets annually for the mandatory revaluation. It should be noted that the County performs an in-house revaluation using existing staff instead of contracting out this service. January 2026 will be our next effective date for revaluation.
FINANCIAL STABILITY
Avery County is proud to report that the county fund balance exceeds the state requirements. This amount provides great financial stability and coverage in the event a catastrophic event was to strike the county. The County must have the financial resources available to address unknown and unexpected situations that could cripple our community if we are found unprepared.
CAPITAL PROJECTS
Over the past several years, Avery County has developed and adhered to a financial plan designed to promote a “pay-as-you-go” capital philosophy. As a result, the county has funded and completed the Agricultural Center, the Avery Community Center, the County Recreation Pool, the new classroom addition at Avery County High School, and the new DSS (Department of Social Services) building. Also because of proper capital planning, the use of lottery funds, and the use of some fund balance, Avery County has avoided a tax rate increase for the construction of any of these capital projects.
The current major capital projects are:
Avery High Kitchen Renovation
Started spring 2024
Finish in August 2024
Estimated Cost $2,140,924.00
Parks and Recreation Center
Start Spring 2025
Finish Fall 2026
Estimated Cost-To be determined
With funding from the State budget grants, Avery County has completed the new DSS building and is currently finishing its Probation and Parole office. And work has begun on the addition of the Elk Park Fire Department.
OVERVIEW
The 2024-2025 Fiscal Year Budget Ordinance for Avery County is respectfully presented for adoption this 3rd day of June 2024.