EC Council OKs $67.2M spending plan
By Jon Hawley
Tuesday, June 26, 2018
Elizabeth City City Council voted unanimously Monday night to approve the city’s $67.2 million budget, green-lighting a spending plan that accounts for the city’s growing personnel expenses and pays for major upgrades to the city's utility billing and metering systems.
Council voted 7-0 to adopt the budget — Councilor Kem Spence was absent — two weeks after a June 11 public hearing at which no citizen objected to the spending plan.
The approved budget raises the city’s motor vehicle fee from $15 to $20 a year, generating revenue to help with the costs of replacing the bridge at the entrance to the Oxford Heights neighborhood. The spending plan also sets new “system development fees” that will lower the costs new businesses pay to set up water-sewer service.
The budget holds the line on property taxes, leaving the citywide levy at 65.5 cents per $100 of valuation. The additional levy for the downtown municipal service district also remains at 8.5 cents per $100.
The budget also holds the line on electrical and water-sewer rates, as well as solid waste and stormwater fees.
While not raising taxes, rates, or fees other than the motor vehicle fee, the budget covers increased costs for employees and retirees and several major projects. The budget absorbs an 8-percent increase to health insurance premiums for city workers — a cost of nearly $300,000 — and, at council's direction, also offers employees a 1-percent raise costing more than $100,000. The plan also continues $300 holiday bonuses for the city's hourly workers, costing taxpayers about $47,000.
The budget also absorbs higher-than-expected health costs for retired city workers. City Manager Rich Olson reported last month he miscalculated retiree benefits by $211,000, overestimating the savings from retirees on less costly health insurance plans. The overage is spread across multiple city funds, meaning it will cost the tax-supported general fund about $110,000, an amount Olson proposed covering by tapping into fund balance.
The budget also includes about $100,000 more for the fire department. About half that amount covers the cost for a new firefighter position. Council asked for more firefighters after retired Fire Chief Larry Mackey publicly pleaded for more firefighting personnel, claiming they were needed to make the fire department’s response to fires safer. The other half of the increase will address “salary compression,” awarding raises to specific firefighters who Olson argued aren’t paid well enough.
The budget also includes about $70,000 to add an additional information technology position.
The budget also advances several projects. Among the most important is a $200,000-plus upgrade of the city's utility billing software. Council last month approved hiring Plano, Texas-based Tyler Technologies to replace the city's decades-old Logics Classic utility software.
If all goes well, the new software will improve customer service and allow city residents to better manage their accounts online. It also will set up the city to implement a new “smart” metering system, a long-delayed project that Olson has said will allow the city and customers to better manage electrical use.
If the upgrade encounters problems, however, the city could risk a repeat of the failed conversion in late 2016 and early 2017. Technical problems with that conversion had customers' bills going out months behind schedule, causing confusion, frustration, and, for some customers, unpaid bills to pile up.
Other significant expenses in next year’s budget, which takes effect July 1, include:
* Financing more than $500,000 in work for the water treatment plant, including replacement of windows and a water accelerator, plus $224,000 for repairs at the city’s wastewater treatment plant
* $300,000 for a fishing pier, bulkhead work and other improvements at U.S. Coast Guard Park. While the city is expecting grants to cover about half the project’s costs, grants could also cover all of the costs, Olson has reported.
* Financing a new trash truck costing about $277,000.
* Reductions to the city's weatherization program from $260,000 to $160,000 after Councilor Johnnie Walton persuaded the council the city spends too much on the program. Councilors last month agreed to reduce the program and consider reinstating income limits on qualifying households. The city will apply the $100,000 savings toward finishing a second drive-through lane next to City Hall. Olson reported last month the city will have to spend more on the project due to poor soil conditions.
The $67.2 million City Council approved Monday includes the following provisions:
* Raises the annual motor vehicle fee from $15 to $20.
* Holds the line on property taxes, electric rates and water-sewer rates.
* Awards each city worker a 1-percent raise.
* Funds the hiring of an additional firefighter and an additional information technology officer.