Manager seeks county tax increases
County Manager Wendell Davis on Tuesday submitted to elected officials a fiscal 2014-15 budget request that calls for about a 3.5 percent increase in his government’s countywide tax rate.
The tax burden on many rural residents would go up even more because Davis’ request also proposes raising fire-protection taxes for four of the five rural fire districts where Durham County Commissioners have control over rates.
City residents, however, would see the county’s tax rate rise only by 2.73 cents per $100 of assessed value. The change would add $40.95 to the annual property tax bill facing the owner of a $150,000 house.
A breakdown of what the proposed rate increase would pay for shows that a penny of it is earmarked toward covering the costs of a “reclassification” of pay categories for 1,230 county employees.
“We have good talent, and we want to retain that talent,” Davis said, explaining the county hasn’t fully implemented the recommendations of a pay study since 1986.
The county, like most local governments, periodically hires consultants to check how its pay scale compares to that of comparable cities or counties, and to that for equivalent private-sector jobs.
Durham County officials launched just such a study last year.
It found that many positions are paid anywhere from 3.7 percent to 6.4 percent below the going rate offered by comparable governments. And the gap to equivalent private-sector jobs was anywhere from 5.5 percent to 16.8 percent.
The most numerous groups of employees targeted for pay adjustments include Durham County Sheriff’s Offices deputies, Department of Social Services caseworkers and social workers, and EMS medics.
The overall rate increase also includes 0.87 cents to cover “operational needs,” including the hiring of more paramedics to improve EMS response times.
Another 0.86 cents would cover rising debt payments associated with the construction of schools, libraries, the new courthouse and the new Health and Human Services Building.
The debt-related increase isn’t as steep as Davis’ predecessor, former County Manager Mike Ruffin, was predicting last year. Davis said the county recently sold more of a bond issue voters approved in 2007, obtaining for them a 2.91 percent interest rate. That saved about $800,000 in annual expenses.
But county officials nonetheless expect to spend $61.4 million on debt repayments in fiscal 2014-15. The overall budget, counting state and federal money that flows through the county, will be $552.3 million.
Meanwhile, the fire-district rate changes would affect residents of rural Durham who live in areas covered by the Lebanon, Redwood, Bahama and Bethesda fire departments.
Rates in the remaining Durham-controlled district, Parkwood, wouldn’t change.
Two other rural fire departments, Eno and New Hope, are based in Orange County and cover only small portions of western Durham. The Orange County Commissioners control those rates.
Davis is proposing that the fire surcharge in the Bethesda district -- covering rural eastern Durham -- go up 0.5 cents per $100 of assessed value. Rural residents pay the fire tax on top of the overall county tax rate.
Lebanon, Redwood and Bahama cover northern Durham and would see increases per $100 of assessed value of 0.7 cents, 2.75 cents and 3.9 cents, respectively.
For them, the changes are going to pay for increased staffing, as recommended by a recent study of the rural fire service. Bahama would get the equivalent of nine new firefighters, Redwood three and Lebanon one.
“It’s an effort to provide additional manpower for [handling] incidents, both for fighting fires and for firefighting safety,” Deputy County Manager Lee Worsley said.
The fire study identified staff shortages in several rural departments, particularly Bahama, which at any given time has only one firefighter on duty in the substation that covers the Treyburn Corporate Park.
The increase will make sure that two firefighters are on duty in Bahama’s three stations 24/7. Worsley said that’s in line with an agreement county officials reached with Bahama’s leaders earlier this year.
Davis proposes “flat” funding for the Durham Public Schools and Durham-based charter schools. That translates into a $150.3 million outlay, counting school-related debt payments.
The school board requested an additional $716,000 to cover charter school growth.
Both it and Davis assume DPS also will benefit from nearly $630,000 in one-time revenue from the quarter-cent sales-tax surcharge voters approved in 2011. The extra money is from fiscal 2013-14 collections, which have been better than original projections.
At 3.5 percent, the overall county tax-rate increase would run well ahead of the prevailing consumer-price inflation rate, which at last check was 1.5 percent.
County Commissioners will review the manager’s proposed budget during a series of work sessions this month and next. They likely will vote on it on June 23.
Commissioners Chairman Michael Page said he will push colleagues to schedule additional review sessions, as he doesn’t think they’ve allotted enough time to the process.
Another commissioner, Ellen Reckhow, said she was “a bit surprised at the size of the tax-rate increase” Davis is requesting. She had expected a 2-cent increase proposal, which corresponds to what Ruffin was predicting last year for increased debt service.