City officials will debate a budget that aims to address a backlog of capital projects delayed by the recession, amid signs that the economic recovery will result in more tax revenue.
On Monday, City Manager Russell Allen proposed a $679 million budget for the fiscal year that begins July 1, an increase of 2.35 percent more than the current year despite a smaller operating budget.
“It is going to take us a while to dig ourselves back out, but it is certainly much more positive than previous budgets,” Allen said. “It was still a difficult budget.”
Allen said residents will not see any decline in services. Some maintenance programs – particularly of roadways and greenways – and 911 operators will see staffing additions.
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The proposed budget includes money for major capital projects that had been put off in previous years because of the recession, thanks in part to a $40 million transportation bond approved by referendum in the fall. Water, sewer, and street capital projects in particular would see notable increases.
The operating budget, just short of $384 million, represents a $3.2 million cut from the current year, according to the city. Even with the cut, Allen’s budget recommends 32 new positions while eliminating 10. And after granting $500 bonuses in lieu of raises last year for city employees, the budget includes merit-based salary increases equivalent to roughly 2 percent for full-time salaried workers.
City council members would get a $5,000 pay raise and be allowed to participate in the city’s health and dental insurance programs; their salaries haven’t risen in 20 years, according to the budget.
The budget includes a 0.91-cent property tax increase approved in the bond referendum in the fall. The tax for a home valued at about $188,000, the median value in Raleigh, would rise by a little more than $17 a year. The city’s tax rate would jump to $0.3826 per $100 in value, still among the lowest city rates in the state. In Wake County, only Cary, Apex, and Morrisville residents pay a lower rate.
Allen proposes spending $168 million on capital projects, with $101 million directed toward aging public utilities and more than $30 million for transportation.
“We have to,” Allen said of funding capital projects. Maintaining outdated facilities costs more in the long run, he said, but the money just hasn’t been there since the recession began sapping revenues in 2008.
After a public hearing June 4, the City Council will get a final version of the budget in place by July 1.