FY2021 Budget

recommendations for personnel, debt, and use of fund balance are described in following sections of this Budget Message.

The Stormwater Fund, an Enterprise Fund, is funded primarily by Stormwater Fund revenues based on an equivalent residential unit (ERU) fee, currently set at $25 per ERU, permit fees, and any grant revenues received for stormwater projects. The stormwater ERU fee has not changed since FY 2016 and no change is recommended for FY 2021, pending the development of a stormwater master plan that establishes a framework for future capital projects and maintenance needs for the stormwater utility. Stormwater ERU revenues are increased by less than 1% over the FY 2020 budget. The basic level of stormwater programming for the upcoming fiscal year remains consistent with existing operation levels. There is no general fund subsidy proposed but does include use of Stormwater Fund Balance appropriations to offset onetime expenses. The Municipal Service District (MSD) budget for FY 2021 assesses a tax rate of $0.10 per $100 assessed value for the costs related to the transfer and improvement of the private streets to public street standards. Five of six original MSD projects are complete. The Gables is the final project remaining. With an estimated cost in excess of $1 million dollars and the current rate of accumulation of tax increment revenues and the town’s regular matching allocation, this project will not occur until FY 2025 unless the town elects to accelerate funding through an increased allocation. Six original MSD neighborhoods approved an assessment of a special tax rate annually, beginning in FY 2014. The tax rate will continue to be levied for all six neighborhoods until the cost of all improvements for all projects is complete. The MSD tax increment is anticipated to generate approximately $117,000 at an estimated 99% collection rate in FY 2021. The General Fund has provided for an annual transfer to the MSD Fund of $110,000 to accelerate funding for these projects and will be repaid by the MSD tax increment over time, even after all projects are complete. The repayment timeline is approximately 25 or more years and is dependent upon both the revenues collected from the tax increment and the cost of the MSD projects themselves. Individual neighborhoods are not relieved of their responsibility for payment of the MSD tax increment until all street improvements within the district are complete and funds advanced by the General Fund are repaid.

Other non-operating budgets for FY 2021 include obligations related to NC pension plan and post- employment obligations:

Retirement Health Care Fund (OPEB)

$ 413,000

Retirement LEO Separation Allowance Fund

$ 88,600

Capital Projects Funds with approved project ordinances are on multi-year budget schedules and are not related to the annual operating budget ordinance unless through planned interfund transfer(s) or debt obligation(s).

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