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Members of Cumberland County’s staff unveiled their recommended budget to the public Thursday, setting up weeks of deliberation over how the county will spend its taxes throughout fiscal year 2023.
County Manager Amy Cannon and the rest of the county’s staff set the value of the proposed budget at just under $553 million, an increase of about 10% from the current fiscal year.
The property tax rate, which is 79.9 cents per $100 of property valuation, would remain the same. The county’s annual solid waste fee of $56 would also stay the same.
Property taxes, sales taxes, motor vehicle taxes and money from the federal and state governments are the county’s primary sources of funding for the budget — 48%, 17%, 7% and 21%, respectively.
Property tax revenue is projected to increase by more than $2 million while motor vehicle tax revenue would increase by more than $1 million in the new budget above the level of the current fiscal year.
For fiscal year 2023, the county is recommending that more than $60 million be collected in sales tax, a 4% increase in what is projected to be collected by the conclusion of fiscal year 2022 on June 30.
Even with these revenue increases, however, Cannon said during her presentation Thursday to the Board of Commissioners that overall growth in the budget is limited compared to expenditure increases.
“I had to make some tough decisions to balance this budget,” she said. “But our focus remained on three things: to maintain current services, to address unmet needs where possible within the funding available and to continue advancing the board’s strategic priorities.”
Those three priorities, laid out by Cannon, are the continued development of the Crown Event Center to replace the Crown Theatre and Arena, public water access for Gray’s Creek and addressing homelessness within the county.
To address homelessness, Cannon said the county had received $1 million from the N.C. General Assembly to construct a homeless shelter. She said the county is collaborating with the Cape Fear Valley Health System and Fayetteville Technical Community College.
‘The new normal’
Cannon said new realities associated with the COVID-19 pandemic have forced the county to push money in new directions to adapt.
“The last two years have been characterized by rapid, abrupt and constant change because of the magnitude of the pandemic,” she said. “Uncertainty continues as we transition to what I’m going to call this evening, ‘the new normal.’”
At the top of this list was inflation.
“The increased cost of goods and services and interest rate hikes will continue to reduce disposable income,” Cannon said. “Economic optimism nationally among chief financial officers has eroded in the first quarter of 2022.”
In the proposed budget, mandated increases from the state or those associated with health costs amount to $6 million.
One mandatory cost hike is the increased price of health insurance for county employees. Contributions that the county must make to the employee retirement fund have also increased.
The N.C. Department of Public Safety has required counties to increase their share of youth detention facility costs, Cannon said.
The state late last year also required that certain school employees in each county receive a minimum wage of at least $15 an hour. A wage increase of 2.5% of anyone already at the $15-an-hour mark is also required.
Due in part to this, the Cumberland Board of Education requested a school budget of $88.2 million, an increase of more than $5 million from last year.
Due to the new $15-an-hour minimum, the school sought the ability to address salary compression, a situation where the difference in wages between employees of different experience levels is minimal.
However, Cannon said the county is not required to address salary compression. Therefore, the recommended school budget is lower than requested, at $84.3 million.
General increased labor costs are also a cause of increased expenses in the county budget.
Cannon said increased labor costs are a trend across the country due to the pandemic.
“It’s impacted people both mentally and physically,” she said. “It’s caused employees to reflect on their priorities and life in general. Americans are seeking better pay, but even more than that, they’re seeking flexible work schedules that create a better work-life balance.
“The Great Resignation has had an impact on all organizations. Cumberland County is not immune from this workforce crisis.”
Cumberland has experienced worker resignations, Cannon said, that have resulted in an average employee age of 44 and an average of four years of experience with the county.
To help maintain its current workers, Cumberland is incorporating a 4% cost-of-living pay increase into the proposed budget.
The county is also increasing the annual pay of entry-level detention officers and deputy sheriffs to $40,457 and $44,000, respectively, both an increase of about $2,700.
Cannon said the county conducted an analysis of the salaries among Cumberland employees. The majority of workers made close to the minimum in their salary ranges.
“Our pay structure lacks a mechanism to move people throughout their range,” she said. “From a recruitment perspective, the minimum salary by many of our grades is no longer competitive in this employee-driven market.”
To address this, the county has included a $95,000 worker study in the proposed budget as a way to determine how to best retain employees.
Cannon said the city of Fayetteville had recently conducted a similar study. In Fayetteville’s proposed budget, the city is including merit pay increases for employees, Carolina Public Press reported.
Other counties, including Harnett, Durham, Guilford, Forsyth and New Hanover, are in various stages of conducting pay studies, Cannon said.
Deliberation over next few weeks
The Cumberland County Board of Commissioners plans to conduct work sessions to discuss the recommended budget on June 1, 8, 13 and 15.
Each work session will take place at 5:30 p.m. at the Cumberland County Courthouse in Room 564.
A public hearing, where residents can voice concerns over the budget, will take place at 7 p.m. June 6 at the courthouse in Room 118.
The Board of Commissioners may hold a work session immediately following that hearing based on community feedback on the budget.