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COUNCIL JUGGLES PRIORITIES, REALITIES IN COMING BUDGET

by Daniel Schere

daniel@yesweekly.com

The City of Winston-Salem is continuing to search for answers when it comes to meeting the city’s needs for services in the face of changes to the state’s tax structure.

At Monday’s finance committee meeting, city council members expressed concern about a potential loss of $1.8 million in revenue from stormwater fees as a result of legislation from the General Assembly being considered for Fiscal Year ’15-’16. The fees are used to fund Winston-Salem’s seasonal leaf collection program, which councilwoman Denise Adams says could become jeopardized down the road.

“Someone decided, or felt, or saw that the stormwater funds were being used inappropriately, and what it has done is caused a ripple that money can no longer be used discretionarily by the cities,” she said at Monday’s finance committee meeting.

Adams, along with council members Dan Besse, Jeff MacIntosh, Robert Clark, and Mayor Allen Joines were in Raleigh last Wednesday where they met with the Forsyth County delegation of the legislature. The meeting was one of three throughout the year which normally take place between the City of Winston Salem and the legislature.

The delegation included representatives Debra Conrad, Edward Hanes Jr. and Evelyn Terry.

They articulated their concerns about the effect newly adopted state laws may have on the city’s ability to raise funds. Among these consequences is a $400,000 decrease in revenue from taxes on business privilege licenses. Next year, only businesses with a physical location within Winston-Salem will have to pay the tax. The following year the tax will be repealed entirely, which is expected to lead to an additional loss of $2.6 million.

The deficit left by the exclusion of the business privilege license tax will be accounted for by an expansion of the sales tax base, which is projected to generate $568,000. In addition, the city is projected to lose $1.9 million next year as a result of the exclusion of software from the property tax base.

Adams said the council was aware of these potential side effects that restructuring the tax system could have as much as a year ago, but details like the business privilege license tax exclusion were embedded in the larger NC House Bill 998. She said by the time they realized this, they were reacting to the changes instead of responding.

While Adams says she does not know if last week’s legislative meeting will produce tangible results, she thinks it was necessary in sending a message.

“We may not get everything we want, and everything we ask for, but this gives you face time where you’re actually communicating with your representatives, the needs of the citizen,” she said. “If you don’t do that then they won’t know what you want.”

One expenditure change the committee discussed was a $50,000 increase in the occupancy tax fund which would go toward funding Old Salem. Councilwoman Molly Leight said Old Salem has been struggling financially of late, and had to close down one day each week as a result.

“The economic impact of what they do is so huge for the city that I think we do need to help more,” she said.

Councilman Derwin Montgomery said he agrees the additional funding is important but was curious why it was coming from the occupancy tax fund as opposed to the general revenue fund. Town Manager Lee Garrity did not think this would make a large difference, since 20-30 percent of revenue from economic development typically goes into the general fund as it is. Last year, a Fiat commercial was filmed in Old Salem in addition to 12 other commercials filmed in the city.

Old Salem is one of six community agencies to receive merit pay increases for Fiscal Year ’14-’15.

The committee also discussed ways to improve performance reviews of city employees and the possibility of conducting a disparity study of businesses owned by minorities and women. They want to ensure impartial studies are conducted in order to gain a better sense of where Winston-Salem stands among other cities in the state of similar size.

Community and Business Development Director Ritchie Brooks said Charlotte and Greensboro have conducted similar studies, and Winston- Salem would likely hire a consulting firm if it goes forward with the plan. Brooks said this usually costs around $200,000.

Councilwoman Adams said she thinks the study needs to be conducted by a diverse group which should include businesspeople in order to get the most accurate measure.

“It’s a huge responsibility, and it takes the task off of us,” she said of the plan to hire an outside firm.

A report from the Minority and Women Bus iness Enterprise Program in 2012-2013 showed that more than 17 percent of projects costing more than $300,000 were completed by minority and women-owned businesses.

But Council members Leight and Vivian Burke said the numbers for female employment may be skewed since many businesses are often owned by women but are run by their spouses in reality.

Following the finance committee meeting, the public safety committee discussed and approved a threeyear grant which would add 10 police positions to the city in an effort to cut down on violent crime. Last year there were 15 homicides in Winston-Salem.

Police Chief Barry Rountree said he thinks beefing up the police presence will help increase their visibility and cut down on drug-related crime.

Councilwoman Adams emphasized the importance of communication between law enforcement and the city’s urban inner core. She thinks officers need to spend more time on the street, and less time in their cars.

“I have no problem with the grant, but I need to know what they’re going to be doing,” she said. “They see that one on one face that they can identify with.”

It will cost $572,993 to hire the officers next year, and this will increase to $622,205 by 2016. The city of Winston- Salem will fund 25 percent of the hiring costs, while the rest will be paid for by the Community Oriented Policing Services program.

The committee also discussed the proposed public safety budget which includes a tiered merit pay increase of between 1.5 and 3 percent in an attempt to become competitive with the salaries of other markets around the state.

Also at the meeting, fire fighters made a presentation about stove top fire suppressors which they believe would cut down on the number of kitchen-related fires. An analysis from the fire department found that there were 150 cooking fires in 2013 which caused over $1 million in property damage. This was up from 127 fires in 2011 and $877,350 in property damage. !

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