FY2020 Budget

Each step of the budget cycle is based on the guidance and understanding of Town Council, attention to community priorities, and an emphasis on historical context, trend analysis, benchmarking, forecasting, and continuous process improvement. Pre-budget meetings with departments in January served as a mid-point check-in for the current year and to understand projected needs and requests. These meetings are effective in collaborative participation and decision-making, providing valuable insight into needs and opportunities. Information was shared with Town Council as a part of its winter retreat. A pre-retreat budget workshop with Town Council occurred in February 2019. Follow-up to requests for additional information and expanded detail was provided to Town Council in March 2019. A year-end forecast, sharing of observed trends and a preliminary FY 2020 discussion of observed trends and factors influencing budget development, projected budget requests, budget preparation work already in progress, and a budget calendar were shared and discussed. Town Council and staff have also worked collectively to explore and advance the Capital Investment Plan (CIP). Town Council has also received periodic updates on major projects (supplemental to regular updates provided in News and Notes) to remain abreast of ongoing work and progress. Departmental budgets were submitted in late February. Multiple meetings to review and assess requests occurred over several months to align significant identified projects and work items with available resources. The level of justification required for any budget request remains high. Departments aid in review and tough choices through prioritization of individual department requests that are used to balance overall organization budgetary and staff capacity. Recurring expenses such as staffing and increased programming are reviewed carefully, as they add to future base budget levels. The Fiscal Year 2020 proposed operating budget maintains the philosophy of maximizing the use of available capacity resulting from the excess of revenues over routine expenditures for impactful programs and initiatives. It also provides the funding necessary to : 1) replace and replenish assets that are essential to the work of the Town, 2) maintain and adjust base budgets in a reasonable manner, 3) enhance staff efficiency and workload management and oversight, and 4) provide allocations to identified budget priorities . Capital projects of a significant cost and long-term benefit to the Town are appropriated through a combination of available operating capacity, reserves, and strategic use of debt financing. Revenue forecasts continue to be balanced with reasonable conservativism but have become more aggressive (as implemented in FY 2019) to reflect positive economic conditions locally, while acknowledging uncertain economic forecasts and a concern of a pending cyclical recession. A fund balance appropriation to support one-time needs was used in FY 2020 to ensure essential needs are incorporated into the fiscal year plan, while retaining a small excess fund balance capacity over the minimum 25% policy to further protect the Town for a recession, should one occur. The Town continues to support efforts by the North Carolina League of Municipalities to secure additional municipal revenue options, including evaluation of a local option sales tax. The state legislature remains more conservative in its consideration of this subject, but positive efforts continue. A combination of revenue generating tools, such as a future solid waste fee and/or adjustment of the stormwater fee, in connection with review of updated property tax valuation and related tax revenue generation will be a high priority for the work of Town Council and staff in the upcoming year. Equally important will be the planned timing and amount of a future bond referendum to support critical infrastructure projects. User fees have been updated for Fiscal Year 2020, where warranted, due to the cost or time required to provide those services. No adjustments to the stormwater fee are recommended for Fiscal Year 2020. The comprehensive stormwater operations study in process will evaluate the current rate structure and level of

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