During a continuation meeting of the Macon County Board of Commissioners held on May 26, Macon County Manager Derek Roland presented his recommendations for a $59,047,113 budget proposal that would keep the county’s current tax rate at 40 cents per $100 of assessed property valuation.
“Right now, the local economy in Macon County is booming,” said Roland. “Residential and commercial development, retail sales, travel and tourism spending, and real estate sales remain at levels unsurpassed in over a decade while unemployment is approximately 3%. Population growth in Macon County of 1.5 percent from April 1, 2020‐ July 1, 2021 well exceeded that of the southwestern region at .92 percent for the same period.”
Ad Valorem Property Tax is the primary source of revenue in the general fund accounting for $31,169,114 or approximately 57% of total revenue in FY 23’. This amount is representative of a $502,938 increase in revenue over the current year’s original budget. The increase in revenue is attributable to a combined increase in collection percentage, +.22%, and value +$110,160,339, over the prior fiscal year’s original budget. Gross receipts, not reflected in ad valorem property tax will increase by $4,000 over the current year’s budget amount.
Revenue generated by the Motor Vehicle tax levy will account for $1,584,181 in FY 23’ revenue, representing a $129,688 increase over the current year original budget amount.
At an estimated $12,173,788 or 21% of total revenue in FY 23’, sales tax revenue will increase by $1,647,742 or 15.7% over the current fiscal year’s original budget amount. Population growth, economic development, and a shift towards online spending continue to drive sales tax growth in Macon County. Economic uncertainty however will result in conservative sales tax growth estimates for the coming fiscal year. The sales tax estimate uses actual collections data for the first 8 months of FY 22’, and assumes flat growth for the remainder of FY 22’‐ FY 23’.
Service fees are those revenues generated from services provided. These include recreational fees, ambulance fees, client payments for health and social services, building permit fees, etc. $4,191,792 has been budgeted for service fee collections in FY 23’. This is an increase of $256,199 or 6.5% over the current fiscal year’s original budget.
For many years, the fund balance has been a staple in Macon County’s financial stability and independence. While 20% of total expenditures is the minimum threshold for counties established by the LGC, numerous surveys, including the FY 21’ NCACC Budget and Tax Survey, have shown the average available fund balance for local governments in NC to be at least 32% of expenditures.
Fund balance in the general fund has increased significantly over the past two fiscal years as sales tax revenue continues to grow at record levels. Additionally, state and federal COVID‐19 relief funding has offset expenditures within certain functions of the operating budget throughout the pandemic, contributing to a revenue surplus in the general fund.
At an estimated 61%of expenditures or $36.1M, the unassigned fund balance in the general fund will continue to provide the county with much-needed financial certainty in what has proven to be extremely uncertain times.
“As such, it is very important that we continue to preserve this revenue source and plan adequately prior to using it, never forgetting the impact it has on our overall financial position,” said Roland. “No revenue from the fund balance has been appropriated in the FY 23’ Recommended Budget.”
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