City approves first reading of proposed FY24-25 budget News Staff Mon, 07/22/2024 - 4:47 pm
(THOMAS WALLNER | THE GRAHAM LEADER) City Manager Eric Garretty speaks at the Graham City Council meeting Thursday, July 18 regarding his reasoning for the increase in the property tax rate as well as the water and wastewater rates. 
(THOMAS WALLNER | THE GRAHAM LEADER) The Graham City Council meets Thursday, July 18. The council discussed and approved the proposed budget for the city during the meeting and had a presentation on the budget from City Manager Eric Garretty. Shown from left to right are council members Jeff Dickinson (back), Jack Little, Shana Wolfe and Mayor Alex Heartfield.
X
Thomas Wallner editor@grahamleader.com
A first reading of the proposed budget for the upcoming fiscal year was approved by the Graham City Council last week with suggested cost-of-living adjustment raises and increases to the city’s street repairs.
The city has eight major operating funds which are the general fund, water and sewer fund, garbage fund and special purpose funds for the Young County Arena, Graham Municipal Airport, Library of Graham and Hotel Occupancy, or Visit Graham.
Across all funds the proposed budget has $7,373,655 budgeted for all personnel expenses, $1,071,596 for capital outlay for vehicles/equipment, $10,510,100 for major capital projects, $1,409,700 for debt service and $14,371,747 for maintenance, operations and contracts.
General Fund
The general fund will be increasing $272,105 from the amended FY24 budget and is being proposed at $8,825,058.
Revenues from property taxes support 41% of the general fund which are services such as Graham Fire Rescue, Graham Police Department, Graham Streets Department and more. Other sources of revenue include sales taxes, reimbursements and fines, fees and permits.
The proposed budget includes a recommendation to increase the property tax rate to a value of $0.665 per $100 of valuation from the current rate of $0.635 per $100 valuation, or a 4.72% increase.
“It’s just a little bit under the tax rate that was adopted in fiscal year (FY 2019) and (FY 2020). So... more or less pre covid, we were about at this tax rate,” City Manager Eric Garretty said. “Now I realize there have been substantial increases in assessed values in the intervening period, but I do want to say what’s happened is inflation has caught up to us, and I think that’s what’s causing the similarities in the numbers that you’re seeing in the tax rate.”
The city began its budget planning process early in the year with a workshop held in January. During that meeting it was determined that the city wanted to focus on street repairs and those initiatives are still important for the budget as it is being proposed.
“This budget proposes an investment of over $700,000 for repair and rehabilitation of our city streets and $550,000 for repairs and rehabilitation of our water storage infrastructure,” Garretty said. “The budget also includes an across-the-board cost-of-living adjustment between 3.5% and 4.5% for all our employees with regard to the compensation rate structure.”
The city is proposing a new $57,800 reserve fund for contingencies, a new part-time code enforcement position which pushed the fund up $60,266 and an increase to the ambulance contract from $35,000 to $50,000.
“I think that budgeting for the $50,000 as requested by the hospital is prudent and the county is making those budget adjustments as well,” Mayor Alex Heartfield said. “I think with the cost of providing services that is a fair amount for them to ask.”
Being proposed with the 3.5-4.5% cost-of-living adjustment for all employees is the establishment of an entry level wage of $13.50 per hour to aid in employee retention and mitigate the effects of inflation.
Water, Sewer Funds
Proposed increases to both the water and wastewater rates are included in the budget after a rates study was performed by Willdan Financial Services.
“The fiscal impact of this ordinance will be an average increase of just less than 9% in water and sewer charges to customers. Tapping fees are set to increase in the range from 135% to 230%,” Garretty said. “These increases are necessary to ensure the water and sewer systems are financially stable and able to fully recover the cost of operation, maintenance and recapitalization.”
The sewer fund is increasing $19,825 to a proposed $1,654,340 in the budget. The funding for the budget includes a new generator for emergency back-up power at the wastewater treatment plant.
Collection and maintenance at the treatment facility saw a $67,030 increase from the amendment to the proposed budget, due to increased cost of supplies and materials.
Being proposed is a $153,818 decrease in the water fund to $6,464,500. The administration budget increased by 23% due to transfers in for the water storage tank rehabilitation project and minor waterline construction.
Three positions previously budgeted for the water department were eliminated for this upcoming fiscal year due to the city being unable to fill the positions with qualified candidates.
General Capital Fund
A new general capital fund was created to budget for projects not associated with enterprise funds or park projects.
Included in this fund are $750,000 for a county fire truck, $75,000 for cemetery drainage, $1 million for the Texas Street paving project, $5 million for an airport non-runway surface project and $1.4 million for sidewalks and trails.
The city will receive funding for the fire truck through a grant and the cemetery drainage project is being completed through an endowment fund. Those are the only two projects in this fund that have funding available at the start of FY25, with the remainder being funded through future grants sought by the city.
Lake Fund
The lake fund contains all revenue generated from the sale and lease of properties located on Lake Graham and Lake Eddleman. The budget is lowering 60% from $3,078,570 to $1,236,800 in the proposed budget.
The city is set to suspend its lake lot purchase program in September 2024, pending a review. The fund balance in this fund is reserved for future projects related to Lake Graham and Lake Eddleman and for projects related to the city’s municipal water supply.
“With regard to expenditures in this fund, contract services are primarily related to legal fees and survey fees in support of lake lot sales,” Garretty said. “In addition ...in this fiscal year and next fiscal year, we are involved in a multi-year project to rehabilitate the boat ramps at both Lake Graham and Lake Eddleman.”
Public Hearings
The city will host two public hearings at 8:30 a.m. Thursday, Aug. 15 at the City Hall council chambers at 608 Elm St. The two hearings will be regarding the proposed budget as well as the increase in sewer connection charges, water tapping fees and water and wastewater service charges.
The city will consider the budget for final adoption during their meeting Thursday, Aug. 29. A public hearing will be held on the property tax increase at 11 a.m. Monday, Sept. 9 at the same council chambers location.
“For us to not have to raise taxes to 66 and a half cents, there will be things in this budget that we will have to take out. …I would encourage members of the public to attend... those meetings and offer their input and guidance to us as council members on the budget,” Heartfield said. “There will be things in this budget that we will have to prioritize and determine, ‘Is this item important enough to us to affect a property tax increase?’ And it’s going to be a hard decision that we’re going to have to make.”
The city manager said despite the increases in the proposed budget, the council is addressing all the key incentives it laid out in January with this budget as it is currently presented.
“Even though we still need to have some discussions about some things we need to do in potentially reducing the tax rate, if that’s council’s desire, you’ve met all these priorities with this budget,” Garretty said. “You’re investing in streets, you’re retaining quality employees, you’re keeping the city functioning, you’re replacing aging vehicles, you’re absorbing the increases in critical services such as ambulances.”
Most Popular
Comments / 0