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Back You are here: Home News Local and State News Local Carolina Beach To Hold Public Hearing On Proposed Budget June 12

Carolina Beach To Hold Public Hearing On Proposed Budget June 12

The Carolina Beach Town Council will consider a budget proposal for fiscal year 2012-2013 with a reduction in property taxes and no increase in utility fees.

By WILLARD KILLOUGH III
Managing Editor

CAROLINA BEACH - The Carolina Beach Town Council will hold a public hearing at their June 12, meeting at 6:30PM regarding the proposed 2012-2013 fiscal budget which begins July 1.
After many months of workshops and debate among council members about cutting expenditures, Town Manager Tim Owens has proposed a budget with a reduced property tax rate and no increases in utility fees.
A copy of the budget is available on the Town's website at www.carolinabeach.org under the page for "Town Manager."
Owens provided highlights to the Council in their agenda for the upcoming June 12, meeting. He explained the Town's Ad Valorem Tax Levy - or total value of all properties in Town - dropped by 34% from fiscal year 2011/2012 at $2,488,349,000 to $1,645,700,000 for 2012/2013 following the latest County re-evaluation.
The budget proposal calls for a property tax rate of $.235 per every $100 of property value. The revenue neutral rate is $.2621.
The revenue neutral rate is the property tax rate that would generate the same amount of property tax revenue as generated prior to the countywide tax revaluation. Historically that rate is set much lower following a revaluation because properties appreciate in value. This time the economy brought much lower values. In a good year it's designed to avoid a windfall in tax revenues for local governments. In this case, it's a call to bring in the same amount to continue operations.
The proposed rate is much lower than the revenue neutral rate. Owens explained water and sewer rates remain unchanged at $5.70 for 1000 gallons of water usage and $6.30 per 1000 gallons of sewer treated.
All water and sewer flat rate charges will remain unchanged. 
Also, there are no changes to solid waste fees and no changes in the $9 per month stormwater rate.
Owens explained, "There are no changes in rates and fees with one exception, $5000 application fee for communication tower and antennae co-locations and an $8,000 retainer for technical assistance for the same."
He explained, "After a lot of deliberation at numerous budget workshops, the Ad Valorem Tax Rate was reduced to $.235 from the original draft budget that was presented to Town Council at $.26. This was accomplished by a variety of measures including: 1) Not filling several vacant positions and cutting some expenses originally proposed, 2) increasing several revenue line items to better reflect anticipated collections, 3) Increasing the transfer from the Tourism Fund to the General Fund, and 5) Increasing the General Fund Appropriated Fund balance from the original estimate."
He explained, "It should also be noted that Sales Tax revenue projections were decreased in the General Fund from the fiscal year 2011/2012 Budget ($1,270,000) to the fiscal year 2012/2013 Budget ($1,066,334). This is a decrease of $203,666 from the prior year. This projection is a direct result of a proposed $.03 Ad Valorem tax increase proposed by Wilmington and a $.02 proposed Ad Valorem Rate proposed by Kure Beach" which resulted in a projected $100,000 loss in sales tax even if the Town stayed at revenue neutral.
He explained, "Likewise, it is estimated that with each $.01 drop in the Carolina Beach Ad Valorem Rate the Town could lose an additional estimated $50,000 in sales tax revenue. In all, the Town could see a reduction in projected sales tax revenue as a result of the above actions estimated at $225,000."
In New Hanover County, sales taxes are collected, sent to the state and then distributed back to the county. The county distributes those revenues by taking the largest share and the remaining funds are distributed to the City of Wilmington and beach towns based on their property tax levy. Lower the tax rate and you lose sales tax revenues. Raise the rate and you gain more.
Owens explained, "Finally, fiscal year 2012/2013 Ad Valorem Tax collection estimates were projected at $3,791,000 which is down from the FYI 2011/2012 projection of $4,200,000 for a reduction of $409,000. This projection is a result of lowering the tax rate from revenue neutral."
The Council will hold a public hearing and then consider adopting the budget. If changes are required, they must still adopt a balanced budget prior to the end of the month.