The Town of Hillsborough proposed budget for fiscal year 2019-20 has been sent to the town’s Board of Commissioners (BOC) with property taxes and stormwater fees staying the same, water and sewer increases set to rise by five percent and a proposed minimum wage of $15.
The roughly $22 million operating budget is made up of General Fund and Water and Sewer Fund expenses both totaling close to $10.5 million and Stormwater Fund expenses adding up to just over $650,000.
“It’s no surprise that we have a very tight budget again this year,” Hillsborough Mayor Tom Stevens said in a press release. “Our longstanding budget principles — take care of what we have, invest strategically for the future, and keep rate impact on citizens as low as we can — are taken very seriously. We can’t do everything we’d like, but I believe our budget represents the value of supporting town staff to do their work well and do it right. In the long run, that delivers the best value for the citizens we serve.”
If the BOC decides to keep property taxes at the current rate of 62 cents as is proposed in the budget, 2019-20 would be the seventh consecutive year that the town has gone without a tax increase.
The proposed five percent increase in the water rate would be used to pay for debt service on the West Fork reservoir expansion, a project costing roughly $14.5 million. The in-town rate would increase 44 cents per 1,000 gallons while out-of-town rates would increase by 86 cents per 1,000 gallons. The average in-town customer would pay an extra $1.70 per month and the average out-of-town customer would pay an extra $3.32 per month with the increase.
“The reservoir project cost around $15 million in total, so we will be paying debt payment increases on that for quite awhile,” Jen Della Valle, the assistant to Hillsborough’s town manager, said. “In fiscal year 2020 we will pay around a half million dollars in debt service payments.”
The sewer rate, which would also increase by five percent, would go back into the materials, staff and equipment required by the enterprise Water and Sewer Fund. The average in-town customer would face a $2.51 sewer increase per month and the average out-of-town customer would pay an extra $4.91 per month for sewer services.
In the projected financial plan for fiscal years 2020-21 and 2021-22, which were presented in conjunction with the proposed 2019-20 budget, water and sewer rates are proposed to increase five percent per year for the next three years.
Adopting the $15 minimum wage — as well as adding merit raises — for town employees would cost an estimated $315,000 for the year. According to the town’s 2019-20 budget workbook, these increases would be implemented to combat the rising cost of housing in Orange County.
The planned budget also proposes repaving five percent of Hillsborough streets, a part of the town’s plan to repave streets on a 20 year cycle that would cost around $360,500. Gas tax revenues from the State Street-Aid Program would cover $175,000 of this cost.
Other budget highlights include relocating the public works facility to the town facility on N.C. 86 N. This move would cost $127,000 and would take the place of building a new public works building at an estimated cost of close to $3 million.
The town’s payment to Orange Rural Fire Dept. for fire protection services is proposed to increase by $43,000 to pay for the department’s operational cost.
There is also a proposal to convert an existing vacant community policing position to an assistant police chief position for the Hillsborough Police Dept., a position that would be paid for by combining the salary and assigned vehicle appropriated for the vacant position with nearly $45,000.
The proposed budget plans on a 1.2 percent decrease in General Fund expenses, a 10.5 percent decrease in Water and Sewer Fund expenses and a 7.2 percent increase in Stormwater Fund expenses. The General Fund — mainly funded by taxes — pays for operations including public works and police. The Water and Sewer Fund and Stormwater Fund pay for their own operations as enterprise funds.
“Not everything could make it into the town budget, but the recommended budget reflects the town principles we hold ourselves to,” Della Valle said. “We are encouraging community members to let us know what they think, by email or phone or coming out to the public hearing.”
The Hillsborough BOC will receive public input on the planned budget at a public hearing on May 28 at 7 p.m. in the Town Hall Annex.