Western Wake County towns may have more cash on hand next year thanks to an upswing in the housing market.
Officials in Cary, Apex and Holly Springs say town revenues will be 2 percent to 4 percent higher than expected due to increases in building permits and sales-tax revenues.
Town leaders are beginning the budget process for next fiscal year, which starts July 1.
In Cary, revenue from building permits is 45 percent higher than expected, according to Budget Director Karl Knapp.
Digital Access for only $0.99
For the most comprehensive local coverage, subscribe today.
Sales-tax revenues are beating expectations by 7 percent, which is “largely the result of increased sales in building supplies and materials, along with a fairly healthy economy so far this year,” Knapp recently told the Town Council.
As a result, Cary plans to have 4 percent more money on hand than expected – about $5.4 million more.
Apex projects a 3 percent increase in revenues, according to Town Manager Bruce Radford.
Holly Springs Finance Director Mary Hogan expects a revenue increase of at least 2 percent in her town.
Morrisville is still crunching numbers, said Jeanne Hooks, the town’s budget manager.
The housing market is bouncing back in part because people continue to move to the Triangle and the job market is getting better, said Tim Minton, executive vice president for the Home Builders Association of Raleigh-Wake County.
The group reported that new single-family building permits were up 25 percent between February 2013 and February 2014 compared to the previous 12 months.
The Triangle’s jobless rate dipped from 7.3 percent to 5.1 percent over the same period. The Triangle added more than 21,000 jobs in 2013.
“We’re kind of the San Jose of the east now,” Minton said. “The tax base is pretty low. It’s a great place to retire or raise kids … and students who go to school around here don’t want to leave.”
Despite the upturn, town leaders are hesitant to estimate how much the revenue increases will affect next year’s budget.
Radford cautioned against the idea that Apex will have money to spend on specific projects.
Apex is like many in Wake County – it’s growing fast and needs revenue to keep up with increasing demand for town services.
Apex will likely move $1.5 million from savings to complete its budget for the fourth year in a row, Radford said.
“But we probably won’t need to touch it,” he said of the extra cushion in the budget. “We didn’t this year.”
Cary dipped into its reserves for the third straight year last year to make up its $307 million budget.
Knapp, Cary’s budget director, and Town Manager Ben Shivar said it’s too early in the process to say whether Cary will choose to use reserve funds for the upcoming budget.
Shivar said this is “one of the toughest budget development years I can remember.”
He said it was “extremely difficult to find the funding to meet the increasing demand for services.”
But this year’s unexpected revenue increase makes him optimistic about next year’s budget, Shivar told the Town Council.
“We’re seeing, finally, after the last five years, a better revenue picture for the budget going forward,” he said.