Page 13 - Watauga FY22-23 Budget

BUDGET MESSAGE FOR FY2022-2023

debt service payments, to include the 2022 Certificates of Obligation debt
issuance.

• Significant revenue increases are projected in sales tax receipts in comparison to
FY2021-2022 budget and forecast. Sales tax is trending approximately 17%
above original budget expectations due to economic recovery and increases in
prices for goods and services. Sales tax is influenced by economic trends, and
the higher revenues are in part due to higher prices on goods due to inflation.

• Other revenue increases include charges for service revenues. This budget
assumes a return to pre-Covid recreation operations and events that will be made
possible by restoring positions. Ambulance revenues are projected to increase
with the increased EMS staff to run a second ambulance in the City.

• In this year, we have strived to restore positions reduced during the pandemic and
fund appropriate staffing levels. 12.75 full-time equivalent positions have been
added to the FY2022-2023 budget, of which 7.25 full-time equivalent positions are
restored and funded. 7 full-time equivalent positions are funded by the American
Rescue Act Plan (ARPA) grant funds.

• A cost-of-living increase is included in the amount of 3% for all employees and the
step program continues to be funded for public safety personnel.

• The City’s health insurance increase is budgeted at a 21% increase over prior year
due to high claims in the current year.

• This budget will utilize American Rescue Plan Act (ARPA) funding to implement
projects approved in the Spending Plan Framework in July 2022. These projects
include infrastructure projects, restoring positions, leave bank liability reduction
program, and supplies and equipment.

• Water and wastewater rates are projected to remain the same in this budget but
will be evaluated in the second quarter of the fiscal year.

• Recommended capital improvement project funding is included in this budget.
These include continuation of infrastructure projects (streets, water, sewer,
drainage), traffic signalization projects, the Fleet Services facility expansion, and
parks improvements. The annual funding level for the sidewalk program has been
increased in order to make a bigger impact in addressing sidewalk maintenance
needs throughout the City. A food business park at Capp Smith is included in
partnership with the Economic Development Corporation. The majority of the City’s
capital project funding is through debt issuance. The 2022 debt issuance in the
amount of $5 million will fund these projects and capital outlay needs. The Capital
Improvement Summary is included in this budget document.

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