Page 14 - City of Watauga FY22 Adopted Budget

BUDGET MESSAGE FOR FY2021-2022

in more revenue in the operating budget and cover the 2021 Certificates of
Obligation debt service payments.
• Significant revenue increases are projected in sales tax receipts in comparison to
FY2020-2021 budget and forecast. Sales tax is trending approximately 17%
above original budget expectations due to economic recovery and additional
marketplace provider sales tax receipts and other on-line sales. In addition, in the
2021-2022 Fiscal Year, the General Fund will receive an additional one-quarter
(¼) cent sales tax due to the results of the May 2021 election in which an increase
to rate that totals one and one-quarter cent sales and use tax was approved. The
¼ cent sales tax was previously dedicated to street maintenance and ended on
December 31, 2020 due to a failed November 2020 ballot measure to reallocate
the ¼ cent sales tax from street maintenance to economic development.
• Other revenue increases, such as fines and fees are estimated as the Municipal
Court collections are beginning to recover. Additional increases are expected in
charges for service revenues. This budget assumes a return to pre-Covid
recreation operations and events. Additionally, ambulance revenues are projected
to increase with the increased EMS staff to run a second ambulance in the City.
• 8.75 full-time equivalent positions have been added to the FY2021-2022 budget,
of which 6.5 full-time equivalent positions are restored and funded. The 6.5
positions were not funded in FY2020-2021 to balance the budget. Positions
continue to remain unfunded/frozen. The City continues to evaluate vacancies to
ensure the best use of each position in the organization as economic conditions
improve.
• Certain recreational programs and events not budgeted in the prior year are
included in this year’s budget. These include gym use for the public, the summer
camp program, and increased hours of operation for the Community Center, and
program events. The staffing at the Recreation Center is proposed to be increased
due to these changes.
• Salary increases are included in the amount of 3% for the employee pay plan and
the step program continues to be funded for public safety personnel. The current
fiscal year didn’t include salary increases of any type for non-public safety
personnel.
• Health insurance increase is budgeted at a 2% increase over prior year.
• Supplemental programs were evaluated and included if the request was essential
to operations, or if the request provided for an increased efficiency in operations.
• The Traffic Safety Program expenses to include personnel that was previously
funded by the Traffic Safety Fund have been moved to the General Fund. This
resulted in three (3.0) traffic officer positions and related expenses being moved
to the General fund, resulting in a significant increase in Police Department
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expenses. This transition was necessary due to the 86 Legislative Session
prohibiting municipalities from utilizing “red light camera enforcement”.
• Transfers to the Equipment Replacement Fund to cover motor vehicle, technology,
and equipment have not been included in the General Fund and Crime Control
and Prevention District this year in order to balance the budgets. This program will
be re-evaluated next year for funding if economic conditions continue to improve.

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