January 31, 2013Greensboro city staff claimed that the city will have a roughly $6 million budget gap next fiscal year at the Greensboro City Council's first budget meeting of 2013, despite the fact that the city has been able to buy whatever it wanted and give away money throughout the past year.
According to staff, who addressed the council at a Monday, Jan. 28 meeting in the plaza level conference room at city hall, the 2013-2014 budget is projected to have a gap of $6 million to $6.5 million, which would require a 2.5-cent tax increase to close.
The city has not been tight with its money over the last year. In 2012, the city council voted to buy the old YWCA property for $1.67 million and wrote a check for the full amount and immediately paid to have the building torn down.
The council also regularly gives funding to various groups that ask for it. The council gave the Greensboro Performing Arts Center Task Force $200,500 from the general fund to help fund the second phase of the task force's work, and had already given the task force $50,000.
The council also voted earlier this month to sponsor the National Scholastic Athletics Foundation New Balance Nationals Outdoor track meet with $200,000.
The 2012-2013 fiscal year had an estimated gap of about $4 million at the beginning of the budget process.
Staff also presented several unfunded items that council has shown interest in, and suggested the use of two-thirds bonds. Staff said that the city could borrow up to $9 million in two-thirds bonds available in fiscal year 2013-2014 and another $9 million in the fiscal year 2015-2016.
Two-thirds bonds do not require voter approval. According to Mayor Robbie Perkins, "Two-thirds bonds are bonds that we are retiring, but we can reissue them without voter approval, and that is where the criticism will come."
Councilmember Tony Wilkins said he would vote no on the use of two-thirds bonds.
Councilmember Nancy Vaughan clarified with staff that the city's two-thirds bond capacity was not related to the $20 million in user fees and hotel-motel tax that the city may consider for the Greensboro Performing Arts Center (GPAC).
The most contentious issue discussed at the meeting was the Florida Street extension, a roughly $3 million project to extend Florida Street from Lee Street to McConnell Road.
Perkins has advocated the project as a way to increase accessibility to the Joint School of Nanoscience and Nanoengineering; however, Councilmember Jim Kee said he was opposed to the project, which would cut through a portion of the North Carolina A&T State University Farm.
"I think those funds can be better used in other parts of Greensboro," Kee said.
Kee said there were a lot of additional costs to the proposed Nealtown connector, and that the money that would be spent on the Florida Street extension could be used there. He cited the fact that the city would need to remove an old landfill, likely paying to have the garbage shipped to Republic Service's Uwharrie landfill.
"Those citizens need to be considered as well. They've been waiting a long time for the Nealtown connector," Kee said.
Kee also pointed out that A&T had not officially come out in favor of the project, although they had been accommodating to the city. "They are trying to be good corporate citizens and find a way to help us with this road that quite frankly we don't need," Kee said.
Vaughan said she was not comfortable with the Florida Street extension either. "I just don't think that it's the best investment of that $3.2 million," she said.
Councilmember Marikay Abuzuaiter, who voted against the project at the Dec. 23 meeting of the Greensboro Urban Area Metropolitan Planning Organization, agreed, saying, "I am very, very cautious because this has not even gone to the A&T board of trustees."
Perkins said that it's a problem that the Joint School of Nanoscience and Nanoengineering only has one entrance, and that people coming off McConnell Road have to drive through rundown neighborhoods to reach it.
Perkins said, "I just think it is something that long term is gonna need to be done. If ya'll don't want to do it, great. But we need to look at something that is equal or better."
Councilmember Dianne Bellamy-Small agreed with Perkins on the importance of the Florida Street extension, and accused Kee of trying to "cannibalize" one part of east Greensboro for another.
Perkins suggested bringing more stake holders like the A&T board of trustees to the table.
Assistant City Manager Andy Scott also gave a presentation on encouraging businesses to come to Greensboro and focused on shovel-ready sites, which the council has been discussing throughout the year.
Scott suggested buying and grading land at Reedy Fork along US 29. He said not having a site ready had deterred businesses from coming to Greensboro. "The most frequent response we hear when we get bumped from a list is that we don't have the right size site in the right place ready to go."
Perkins said that if the city wanted to take that approach, then they needed to be prepared to give the land away to developers to compete with the incentives of other cities.
Councilmember Zack Matheny, who has advocated acquiring shovel-ready sites for months, said, "Robbie, I'll give it away." Matheny also suggested partnering with Piedmont Triad International Airport to prepare sites.
The council also discussed the fact that Greensboro has one of the highest property tax rates in North Carolina. Wilkins suggested that the council look at reducing the tax rate. However, Perkins said the budget may be too tight.
The council also heard a presentation on salary compression in city departments, which refers to the salary of managers being too close to or below the salaries of people working under them.
Director of Human Resources Connie Hammond said the problem would cost a total of $672,153 to correct completely.
However, Hammond recommended addressing "the most egregious of the egregious" issues first, by adjusting salaries in the Police and Fire departments as well as supervisors in other departments.
Hammond said that would cost $182,175 to address, and would fund one-third of the most serious compression problems.
She did not say whether fixing the "compression" caused by the fact that Coliseum Manager Matt Brown is paid $212,332, while his boss City Manager Denise Roth makes $175,000, would be fixed – or how