Henderson budget talks: teacher supplements, nonprofits, Blue Ridge Community College

County commissioners did not approve a budget at their June 3 meeting, instead agreeing to hear options from staff on how to fund items such as an increase in teacher salary supplements while considering a possible decrease in the tax rate.

With much of the 2024-25 fiscal year budget set, the board still has a remaining fund balance of nearly $1.6 million to allocate. That money isn’t enough to fund the last three items on the table, however, or provide for a tax decrease proposed by Commissioner David Hill.

One of the items commissioners are considering is a 1.5% increase in teacher supplements, but that alone would cost $1.5 million. Also up for debate are funds requested for solid waste and Blue Ridge Community College.

Meanwhile, Hill proposed lowering the tax rate by even a few tenths of a cent to save taxpayers some money, saying every tenth of a cent equates to $244,000.

Board Chair Rebecca McCall said commissioners could consider dropping the level of restricted fund balance below 12% in order to fund the remaining requests. The state recommends a minimum unallocated general fund balance of 8%, but county board policy is 12%.

The county has dipped below 12% in the past, including during COVID, and McCall said that might be worth doing again.

County Manager John Mitchell said the county can go below 12%, but reminded commissioners that the county is able to borrow money at a better rate with 12% in reserves than 10% or 8%.

He said staff members would “go back to the drawing board” and come back with a menu of funding options for commissioners to consider.

The board has until the end of June to approve a budget. Commissioners could approve the spending plan at its next meeting at 9:30 a.m. June 19, or call a special meeting if needed.

“Come hell or high water, we will vote on the budget at our next meeting,” McCall said after Monday’s budget discussions.

Teacher supplements and school funding

Several residents Monday urged the board to support teachers and fund the increase in supplements paid by the county. While salaries are set and funded by the state, Henderson County, like many others, pays teachers a supplement to attract and retain educators.

One teacher who spoke during public comment said a new teacher would have to spend nearly half their paycheck each month on housing alone, as teacher pay is not enough to live in the county.

McCall was willing to give the $1.5 million needed to increase the supplements, saying they are important and needed for the county to remain competitive due to low pay from the state. But she added that the Henderson County Schools system receives about 35% of the county budget, and the School Board’s job is to take those funds and make it work for teachers.

“I’m challenging the School Board to take the money that is allotted to them and make the things happen that need to happen,” she said.

McCall also addressed the school system’s request to continue funding for five social workers added during COVID. The school system has 14 social workers, which McCall said is the same number of social worker vacancies currently at the Department of Social Services. She suggested the social workers could move to DSS and be partially funded by the state, but still work in the schools.

Nonprofit funding

McCall said commissioners added back funding for several nonprofits, but some at lower amounts than requested. She would like to award the same amount of funding given last fiscal year to Pisgah Legal Services, but require that the money only be used for Safelight and services for the elderly, saying she doesn’t agree with some of what else the nonprofit uses the money for.

Commissioner Daniel Andreotta spoke about the need to scrutinize nonprofits and their funding requests. Nonprofits don’t have to pay taxes and can generate revenue to stay afloat, he said, adding that the organizations often do noble, needed work and have a right to organize how they see fit. But he has misgivings about funding some of the requests.

“I have had some concerns when I start reading some of the applications and reports of organizations that apply for some of your money. One in particular shows a revenue of $5 million a year, 84% going to salaries. … Another one, $13 million a year, with 88% going to salaries,” he said, listing more examples. “I don't give that a rubber stamp and let it pass. I don’t.”

The board doesn’t have a policy regarding how much to give nonprofits or how it decides which organizations to fund, and the results are difficult to determine. He feels a good rule is to partner with efficiently run organizations that meet essential services.

Andreotta believes there’s “a cutout” in the requests. He said the Flat Rock Playhouse in 2023 was a $4.2-million revenue-generating enterprise, with 64% going to salaries, and owns $2.6 million in real estate it doesn’t pay taxes on.

“I view this as a subsidy to a revenue-generating enterprise,” he said. “We’re not helping, per se, a quote, ‘help organization,’ stay afloat for a necessity service.”

Andreotta encouraged the board to look closely at nonprofit requests between now and the budget approval, since commissioners are entrusted with taxpayer money and residents deserve attention to detail and careful management.

Hill agreed with Andreotta and suggested that the board require nonprofits to report back on what they spent the money on. He said he appreciates what nonprofits do, but this would provide accountability to taxpayers.

PILOT funds

Commissioner Bill Lapsley said he would like to give the requested appropriation from the general fund to the Solid Waste department. He also asked that the board consider giving more of the PILOT money the county receives from the federal government to Mills River Fire and Rescue and Gerton Fire and Rescue.

The county receives a payment in lieu of taxes (PILOT) from the government for land in Pisgah Forest. Since the land is covered by Mills River Fire and Rescue, the county allotted $20,000 of the $61,000 it received in the current fiscal year to the department.

Lapsley suggested giving the rest of the PILOT money to Mills River, and some money to Gerton as well for its coverage of forest land.