Town of Franklin BudgetFiscal Year 2016-2017
The Town of Franklin continues to operate in sound financial condition with a stable fund balance. This budget addresses the continued need for long term financial and infrastructure planning for the Town of Franklin. General government revenue sources are estimated to remain the same, with the exception of rent. The Town continues to make improvements to Memorial Park. This budget recommends increasing Memorial Park facility rent from fifty ($50.00) dollars per rental to seventy five ($75.00) dollars per rental. The current ad-valorem tax rate of twenty eight ($0.2800) cents per one hundred dollars ($100) of valuation is recommended for fiscal year 2016-2017. However, the Town continues to experience slow growth in water and sewer revenue. It is paramount that the Town of Franklin ensures water and sewer revenues can sustain expenditures in order to maintain existing infrastructure and planning needs for future water and sewer infrastructure. The continued involvement of the North Carolina General Assembly in local government affairs has certainly weighed heavy on local government budgets. The elimination of the privilege license tax accounted for $30,000.00 in revenue loss for the Town of Franklin. The Town should carefully prepare for unanticipated loss of revenues. Therefore, diligently maintaining a stable fund balance is key to long term financial success.
This budget calls for a one (1) percent one-time payment based on salary in lieu of a cost of living adjustment for all positions, in December. The Town’s health insurance, dental and workers compensation premiums are expected to remain at current budgeted rates. Employee benefits are expected to remain the same. Administration re-classified one (1) employee that is currently budgeted in Billing and Collections as a Customer Service Representative to an Administrative Assistant in Administration’s budget for fiscal year 2016-2017.
The Town will continue working on phase one (1) of the Water Plant Upgrade and Expansion project. Bid submittal, approval and construction will commence this budget year.
Capital Outlay Equipment:
The Town needs to address current infrastructure needs within Finance, IT, Police and the Streets Department. For numerous years infrastructure repairs and improvements have been delayed and have reached a point that they must be addressed. New accounting software is needed for the Town Finance Department. The current software system is over seventeen (17) years old and does not allow for online payments or credit/debit card payments to be accepted. Administration, Finance and IT would like to recommend that the Town look at Tyler Technologies as the new software provider for the Town. This expenditure has been budgeted in the IT budget. The Town will need to budget for the full amount of the lease purchase at $161,445.00. However, the debt service payment for fiscal year 2016-2017 will only be $45,383.00. The Town should also consider replacing the firewall at Town Hall. The current firewall is refurbished and is over five (5) years old. The Town is starting to experience problems with the current firewall. The Police department is in need of a generator to ensure that all data can be securely backed up in the event of a prolonged power outage or natural disaster. The Streets Department is in need of a new commercial lawn mower. The current commercial lawn mower is over ten (10) years old and was refurbished when the Town purchased it. The current mower is beginning to have numerous mechanical issues and is starting to cost the Town considerably in repairs.
Capital Outlay Improvements:
Funds have been budgeted for Fox Ridge culvert and street repair work. The culvert located at Fox Ridge is severely deteriorated. The deterioration of the culvert has caused street maintenance issues.
Capital Outlay Vehicles:
The Police Department will be replacing one (1) patrol vehicle with over 100,000 miles. The Water and Sewer Department will be replacing one (1) ½ ton pick-up truck with over 100,000 miles.
Non-Profit funding for community organizations are left at the current budget total of $40,000.00. Economic Development funds are left at the current budget total of $7,000.00.
The Whitmire property has been removed of all asbestos material. The Franklin Fire and Rescue Department completed a live burn exercise on the existing structure. Funds have been budgeted for cleanup and debris removal.
All debt payments are budgeted as required by law. General debt service principal is budgeted at $206,638.00 and interest at $28,158.00. Fire debt service principal is budgeted at $150,484.00 and interest at $27,131.00. Water and Sewer debt service principal is budgeted at $648,083.00 and interest at $243,084.00. The Town secured a $3,578,750.00 loan through the North Carolina State Revolving Loan Fund for Upgrades and Expansion to the Water Plant. The first debt service payment will not be due until fiscal year 2017-2018.
Fire Department: The current fire tax rate of $0.0445 cents per one hundred dollars ($100) of valuation is recommended for fiscal year 2016-2017. Funds are budgeted for new hydraulic equipment. Current hydraulic equipment is over ten (10) years old. A modest appropriation from fire fund balance of $190,143.00 is recommended for capital purchases.
Water and Sewer Department: Funds are budgeted for the completion of Forest Avenue water and sewer line repair. This project is part of the Town’s Capital Improvements Plan (CIP). The generator located at the Industrial Park pump station is no longer in operation. Funds have been budgeted to replace the generator. The basin at the water plant only needs to be cleaned every five (5) years. However, this budget allots funding of $30,000 this fiscal year. The reason for this is to continue a reserve account for this project in preparation for cleaning the drainage basin in fiscal year 2018-2019. The total estimated cost to clean the drainage basin is $150,000. The Town anticipates the retirement of one (1) employee in the water and sewer department. It is recommended that the Town consider hiring a full-time utility maintenance mechanic. Funds have been budgeted for this position. This budget also designates funds for a full-time Engineering position.
This position will be a tremendous cost savings and a benefit to the Town as progress continues with the Water Plant upgrade and Expansion Project, as well as with other various projects in the Town’s Comprehensive Improvements Plan.
The Town began upgrading the Waste Water Treatment Plant in 2010. Over $5,000,000 was spent on upgrades to the plant. The Town continues to make substantial investments in the Waste Water Treatment Plant daily. Chemicals, pumps and aerators are used daily to process septic discharge that is transported to the Waste Water Treatment Plant. In order to continue to treat septic discharge and maintain the Town’s infrastructure it is recommended that the Town increase current dumping fees from five ($0.05) cents per gallon to ten ($0.10) cents per gallon.
Water and Sewer Rates:
Based on current estimates water sewer revenue combined are projected at $3,295,500. A modest appropriation from water and sewer retained earnings of $275,718 is recommended. Martin and McGill completed a detailed water and sewer study in January 2015. In order to maintain the existing infrastructure, to upgrade/expand the water plant and to continue funding the Town’s Comprehensive Improvements Plan, a modest water and sewer rate increase is recommended. A four (4) percent rate increase is recommended for water and sewer. The proposed rate increases only affect base and volume charges but not tap, connection, or other miscellaneous charges.
This budget for Local Fiscal Year 2016-2017 is balanced as required by law and continues to provide existing services while meeting the governing board’s priorities and polices. This budget includes an appropriation in general fund of $450,000.00 for Powell Bill. This budget also recommends a one (1) time modest appropriation from general fund balance of $127,724.00 to address the Town’s infrastructure needs. This budget addresses long term financial and infrastructure planning for the Town. Both financial and infrastructure planning will be fundamental in preparing for future growth and economic development for the Town of Franklin.