FY23 FULL BUDGET REPORT ADOPTED

for future capital projects for FY 2023 over FY 2022. The convergence of new resources specifically committed to afford anticipated debt obligations and continued economic side-effects to some programmatic resources overshadows realized Census impacts within state distributed resources and from the Town’s resilient tax base growth. While resources are strategically aligned within this budget recommendation to focus on stabilization of core services, care and maintenance of existing assets, continuation of previous innovative initiatives as well as advancement of some desired capital amenities, it bears limited program service expansion. Community service demands continue to grow. For FY 2023, the available capacity between revenues and base budget expenditures is approximately $4.98 million. Recurring expenditures requested in the FY 2023 proposed operating budget continue to closely approximate available capacity. Basic routine services and recurring expenses (excluding transfers, contributions and grants, and one- time capital out lay) are approximately $37.4 million at the current fiscal year’s operational service levels. Proposed additions to recurring and routine expenditures to the base operating budget are $4.68 million for FY 2023 and represent a 13% increase to the base operating budget. Of this amount, approximately $1.965 million represents funds transferred to the debt service fund for future debt service payments. The remainder reflects investment in existing staff and operational increases essential to meet current needs. Two new positions, one in the General Fund and one in Stormwater, reflect the only new recurring costs proposed in the operating budgets. Beyond the increase in recurring and routine expenditures, the FY 2023 budget proposes an additional $6,170,400 to support targeted capital projects, programs and initiatives that enhance accomplishment of the strategic plan, maintain, and improve Town infrastructure, and support priorities of Town Council and the expectations of a growing community. Recurring/routine and non-routine items are more fully described in the Budget Priorities Summary. Substantially all of these items relate to a need to replace, repair and maintain existing assets and equipment necessary for programs and services. FY 2023 proposed operating budget recommendations for personnel, debt, and use of fund balance are described in more detail in the following sections of this budget message. Capital Reserve allocations of $2.16million are proposed for future spending in key areas of roadway and transportation improvements, parks and recreation improvements, fire apparatus purchases and the remaining Municipal Service District project. There is no proposed allocation for the prepaid acreage fee reserve as the financial liability for prepaid fees has been reduced due to property sales, particularly in the McCrimmon area. New debt service 0f $1,395,000 is added to the budget in FY 2023. New debt service reflects partial principal and interest payments related to the issuance of $16,500,000 of general obligation bond debt in May 2022. Together, the targeted programs and initiatives and capital reserve allocations totaling $9,925,400 account for 77% of the $12,785,400 of the budget requests identified in the proposed FY 2023 operating budget. Other non-operating budgets for FY 2023 include obligations related to NC pension plan and post- employment obligations:

Retirement Health Care Fund (OPEB) Retirement LEO Separation Allowance Fund

$ 408,600 $ 88,700

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