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(Rhett White, Columbia’s town manager, delivered the following 2021 budget message, and accompanying financial documents, to the board of aldermen on May 4.)

By Rhett White

Columbia Town Manager

This is my sixteenth opportunity to prepare and present a budget for the Town of Colombia. Unlike past years that started with new growth or exciting new projects on the horizon, the 2020-21 fiscal year will begin with great uncertainty.

Columbia’s two largest water and sewer customers — Whitecap Linen and the State-operated Tyrrell Prison Work Farm — are closed, with the resulting loss of more the 50% af annual water/sewer revenues. Another unknown is the impact of the COVID-I9 Virus that effectively closed most businesses, schools and institutions to any normal activity in March with reopening dates and conditions still in doubt. State officials report sharp declines in sales tax and other revenues that will impact the Town budget. Payment of property taxes may also lag as businesses are closed and large numbers of individuals are out of work.

Prior to the last revaluation several years ago, the tax base within the town of Columbia was approximately $56,600,000. The most recent revaluation placed the value of taxable property in the town at $42,966,000, a loss of $13,834,000. This was a 24% reduction in value, yet we were able to maintain the same level of services during the past three years without a tax increase.

The uncertainty of State legislative action that may adversely impact municipal budgets remains a real concern, and the economy, at least in our rural area, has yet to show signs of overcoming the recession of recent years. As for now, this General Fund Budget assumes that the few remaining long-standing revenue sources will not be eliminated.

The town has a healthy fund balance invested in certificates of deposit that still only earned minimal interest during the past year. We are told that interest rates may improve slightly during the next year, but the projected rates will not significantly grow the town’s investments.

The fund balance more than meets requirements placed upon municipalities by the North Carolina Local Government Commission (NCLGC) which expects towns to maintain a healthy rainy day fund in case of significant emergencies or natural disasters. Amounts in excess of NCLGC requirements have also been set aside as Board-designated reserves in anticipation of costs associated with operation and maintenance of the town’s water and wastewater treatment facilities, other unexpected repairs and future capital needs.

The town has $916,786.00 in designated reserves. The non-designated fund balance totals $2,043,811.00. Even after matching the USDA grant and loan and committing $500,000 in local funds to the wastewater treatment project five years ago, the town is in good facial order by most standards.

For more than a decade we have felt the effects of the most recent economic recession. The downturn in the nationwide housing market and crisis in lending brought residential development in annexed and subdivided areas of Columbia to a standstill. The construction industry in our area has not recovered and shows few signs of improving during the next fiscal year. This provided time for the town to do additional planning for growth and to better anticipate the challenges that will come when the economy turns around. Although residential development has been slower to build than may have been expected, the town moved forward with infrastructure improvements that will provide ample capacity for commercial and residential development in the near and long-time future.

FY 2019-20 has not been a good year in terms of business stability. Dollar General moved into a larger building and continues to serve as a shopping hub (along with Food Lion and Family Dollar Store). Unfortunately these businesses were significantly impacted by the prison closing. The Winery, a landmark for travelers, closed. The former oyster bar on Main Street is still vacant, and a long-time insurance agency closed, only to be replaced by another insurance provider. The large waterfront building that recently served a boat builder is also unused.

We observe some positive signs even during the prolonged recession. Capt. Neill’s Seafood added a value-added product to its crab processing operations last year. The Duck Thru on US-64/Scuppernong Drive added to our business community. A potential business developer is looking seriously at a site on the south side of US-64/Scuppernong Drive. These projects indicate confidence in the local economy and future growth of the town.

There are pressures on the budget. Increased electricity rates add to the town’s utility costs. The prices of chemicals used in water and wastewater operations, in asphalt patch materials and a host of other regularly purchased supplies and materials continue to increase. Prices for those commodities do not decline when petrochemical costs drop. We also continue to see fuel surcharges tacked onto delivery bills even though motor fuel costs have dropped dramatically when compared to a few years ago.

It seems that all prices are rising.

The water treatment plant and water wells are now at the age that more frequent maintenance is needed. We will continue to find ourselves replacing or rebuilding motors, replacing bearings, and making repairs as needed. The Town’s reserve funds mean that adequate funds are available for major repairs when unexpected needs occur.

Health insurance provided to the town through the NC League of Municipalities is increasing 5% percent this year. No other increases are expected. The premium for Worker’s Compensation Insurance is expected to stabilize.

This budget calls for the town to make another contribution to the Tyrrell County Sheriff’s Office for enhanced in-town law enforcement services. The amount of $96.366.00 is the same amount provided to the Sheriff’s Office during each of the past seven years. I am recommending that the contribution to the Tyrrell Volunteer Fire Department (TVFD) remain the same as in FY 2019-20 — $29,884.00.  We will add $2,000 to the fire truck reserve to replenish that fund and to help with a future fire truck purchase.

Although no new locally funded programs or initiatives are planned, the Town will use grant funding to continue or undertake four projects. A State Soil and Water Conservation grant of $33,000 is budgeted to complete maintenance dredging to a section of the Bush Hazrell Canal, and to construct a flood gate to prevent some of the flooding during high river tides that affects the Columbia Avenue, Howard Street and Virginia Avenue areas.

Two Community Development Block Grants (CDBG) will get underway in FY 2020-21. One is $1,965,000.00 and will construct a new lift station and replace 60-year-old sewer lines on N. Road Street.

The other is $750,000.00 and will focus on neighborhood revitalization in the South Broad/Scottsville streets area, including demolition of several derelict structures.

Finally a $200,000.00 Hurricane Matthew grant from the NC Housing Finance Agency is funding repairs to five hurricane damaged homes.

The proposed FY 2020-21 Budget includes a 2% pay increase for employees. You have some dedicated hard working employees who go the extra mile to complete their responsibilities and serve the residents of this town. They frequently make do with inadequate equipment and resources, stretching tax dollars, and they deserve some recognition of their valued services. A raise of 2%, although not much, keeps pace with the published inflation rate.

The budget continues support for the Scuppernong River Festival and the River Town Christmas celebration at previous levels. There is funding for the Partnership for the Sounds at the some level as in FY 2019-20.

This is not a municipal election year so no funds are budgeted for that purpose.

This budget proposes a 20.5 percent increase in water and sewer rates. This is in response to the loss of our two largest customers and more than 50% of our water/sewer revenues. This increase is necessary to assure that the enterprise fund will remain in the black by covering the full costs of operations. Even so, money must be appropriated from the fund balance to balance the Water/Sewer Budget.

Otherwise both the General Fund and Water/Sewer budgets are largely unchanged.

This budget is based upon a tax value of real property within the Town of Columbia that is $43,451,336.00. Projected collections are 94%, a figure that we should be able to reach with aggressive tax collection procedures.

The proposed 2021 year tax rate will remain unchanged at .601 cents. Although I normally have a reluctance to use the fund balance (savings account) to balance the General Fund Budget, I am comfortable this year. This is approximately the amount of our carry-over bills from June into July. Our deposits are certainly adequate to allow this luxury.

I suggest that you schedule the required public hearing on the budget for the June 1, 2020 Board of Aldermen Meeting.

I appreciate the questions, suggestions, advice and support offered during the budget making process. I also join the other town employees in appreciation for the opportunity to serve the Town of Columbia, the Board of Aldermen, the town’s 841 residents as well as the businesses, agencies and organizations that are located within Columbia.