Smithfield’s proposed budget for 2016-17 would take more money out of the pockets of residents by raising water and sewer rates.
That same budget would put more money in the pockets of town employees, and that didn’t sit well with Sonja Bustos, one of two residents to speak Tuesday night during a public hearing on the budget.
“Didn’t we just get an increase ... and you want to increase it again?” Bustos asked.
Broadly, the council’s answer to that question was yes. Specifically, the average utility customer would pay an extra $5.50 a month for water and sewer, money the town would use to begin rebuilding its aging infrastructure.
Town employees, meanwhile, would take home 2 percent more each month.
Bustos, who lives on Dr. Martin Luther King Jr. Drive, didn’t like that math.
“I don’t think anyone should get another 2-percent increase in pay,” she said. “I don’t think it’s fair that you guys get an increase ... if you guys can’t get it together in the water and sewer.”
Councilman Travis Scott argued that even with the proposed increases, Smithfield’s water and sewer rates would still compare favorably with those in neighboring towns.
Previously, the town manager’s staff has said the water and sewer departments are spending a combined $2 million more annually than they are taking in. That’s mostly because Smithfield is paying unnecessarily to treat rain water seeping into cracked sewer lines. The town puts that cost alone at $1.64 million annually.
At the very least, a consultant says, Smithfield needs to reduce that seepage by half, but that won’t come cheap. The town needs about $5 million to rebuild its water and sewer infrastructure, and it’s opting for substantial rate increases over hefty loans because the departments already have nearly $1 million in debt.
The other resident who spoke – Tony Nixon of Cedar Drive – wanted to know how the town decides which loans to pay off first. Town Manager Michael Scott and finance chief Greg Siler said that when the town has a little extra money, it opts to pay off the loans with the fewest payments remaining. For example, they pointed to one loan with just one $175,000 payment left.
The council will likely adopt a 2016-17 budget when it meets at 6:30 p.m. June 20. Among other things that budget would purchase three police cars, replace a fire engine, purchase new software for the finance department, spend $300,000 to resurface streets and replace a garbage truck.
Electricity rates would fall another 2.5 percent, a byproduct of Smithfield selling its ownership stake – and its debt – in a number of power plants. And the town would stash $175,000 in savings to help pay for a backhoe and street sweeper in 2017-18.
The budget calls for no increase in Smithfield’s property-tax rate. Scott, the town manager, said revenue from the property tax and sales tax was holding steady.
“That’s where it should be,” he said of that combined revenue number.
Abbie Bennett: 919-553-7234, Ext. 101; @AbbieRBennett