New Town Budget Holds Taxes, Cuts Spending

The Clayton Town Council has approved a scaled-back $36.1 million budget for the coming fiscal year that cuts spending substantially and continues to hold the line on taxes.

It's the third straight year that town spending has gone down after several previous years of growth.

The final figure was even less than the already austere budget proposed by Town Manager Steve Biggs a few weeks ago. Among the cuts was the town's long-published monthly newsletter to residents.

"This will be a tough year," Biggs said. "Although most everyone expected that the recession would have begun to cycle up by this time, the worst of the economic slowdown has impacted on the FY 10-11 budget."

General Fund revenues are down $677,000 as a result of declining money from the state, reduced property tax billings and less revenue from growth activities such as building permits. He said raising taxes to compensate "could potentially delay a local recovery," so, instead, the new budget includes large cuts, including staff reductions and a pay freeze.

Several upcoming projects will continue as planned, including the new Law Enforcement Center, the "Downtown Plaza Project" at Main and Lombard Streets and the upcoming street improvement project. But other normal spending patterns have been disrupted, including support for local non-profit agencies that depend on town money for improved services.

Water and sewer rates will be going up slightly to bring them more in line with what other municipalities charge. In addition, the "antiquated" practice of giving water customers their first 1,600 gallons without charge will be discontinued. Water commodity cost will go up five percent and sewer rates six percent. The increase will cost the typical customer about seven dollars per month. The increases are partly in response to "a strongly worded letter of warning" from the NC Local Government Commission that the town's water and sewer prices, which haven't seen a major adjustment in more than a decade, are considerably lower than they should be.

Sewer fees fell $1.5 million short of costs last year, largely due to what Biggs called "the ever increasing cost of meeting strict environmental standards." Though the town's wastewater facilities are operating at a high level, he said rising costs have pushed the sewer fund "deep into the red."

Electric rates will remain the same for now, though Biggs said the town will need to upgrade conservation efforts to keep costs in line and avoid major increases. The budget includes additional funding for conservation incentives.

One department, the Parks and Recreation Department headed by Director Larry Bailey, will be expanding its operations this year despite cuts to its budget, mostly due to opportunities offered by the newly opened Clayton Community Center. Here's a look at some of what's new:
• Many new classes for youth, adults and seniors, including dance, fitness, art and pottery
• New athletic opportunities such as basketball, volleyball and youth volleyball
• Sports camps
• An expansion of the Summer Playground program
• New indoor walking programs for adults and seniors
• New partnerships in expanding programs with agencies such as the Department of Public Health and the NC Agriculture Extension Office to offer health clinics, walking incentives, gardening help, healthy eating initiatives and more

Staff reductions include 11 full-time positions and two part-time positions. In addition, three full-time employees will be working reduced hours. Raises will be eliminated for the second straight year.

While the cuts, especially to staff, are painful, Biggs said the town must continue what he called "a demonstrated commitment to financial strength."