Council Adopts 2018-2019 Town Budget - Tax Rate set at 36 cents

Following several weeks of research, budget workshops, a review of historical data, current year revenues and expenses and input from department heads, Town Council adopted the final 2018-2019 Budget for the Town of Lake Lure onJune 26.

It calls for a 8.4 cent tax increase over 2017-2018. Originally, an approximate 12 cent increase was proposed based on several highly critical projects that cannot be funded under the current tax rate of .276 cents per $100 of property value.

The total recommended budget for fiscal year 2018-2019 is $7,401,811.  The tax rate necessary to fund this budget is $0.360 cents per $100 of property value, a rate increase of $0.084 (8.4 cents)

  • General Fund revenues budgeted for fiscal year 2018-2019 totals $5,774,810.  This is an increase of approximately 9.76% or $658,111 budgeted last fiscal year.  The primary expenditures paid for out of the General Fund cover public safety, administration, public works, recreation and community enhancement.
  • The Town will retain a fund balance level of at least eight (8%) percent which is recommended by the North Carolina Local Government Commission.  With a Town as small as Lake Lure, it is important for the Town to maintain a strong fund balance.
  • Operating revenues for the Water and Sewer Fund are budgeted for $1,222,500.  This amount represents a $3,800 or a .32% percent increase in revenues budgeted from the last fiscal year. 
  • Operating revenues for the Electric Fund are budgeted for $404,501.  Without considering transfers or loan proceeds, this amount represents a $53,501 or 15.25% increase in revenues budgeted from the last fiscal year.  Charges for Service accounts for all but $1,000 of electric revenue. 

It’s important to note that 3 cents of the tax will go to the debt service for a future loan on the Lake Lure Hydroelectric Dam Repairs. 

By eliminating or delaying some capital costs, reducing some operational costs, and eliminating a newly requested Engineering staff position, Council believes that they have a budget that still accomplishes a great deal. 

Therefore, while a tax increase is deemed necessary to fund the Town’s important infrastructure needs, Council has worked together over the last several weeks to reduce the amount of the increase as much as possible.

Highlights of the 2018-2019 Budget and how the tax increase breaks down:

  • The  budget incorporates a $5-6 million dollar loan that the Town is applying for to fund in its entirety the multi-phase remediation project at the Lake Lure Hydroelectric Dam. Debt service on the loan, once received will be in excess of $350,000.
  • Also included in the proposed budget is the debt service on the already received loan of $12.5 million to replace the Town’s sewer system. Repayment of that loan will be approximately $545,000 a year. 
  • The budget funds all of the projects in the approved Capital Improvement Plan. The only change from the approved list of projects was a reduction in the engineering and design costs for the new marina and boardwalk from $300,000 to $150,000.
  • Water and sewer rates that customers pay will remained unchanged.
  • The budget funds a new position: Director of Parks & Recreation.

“Going forward with the plans, repairs, and dreams that we have for Lake Lure, it is especially important to prioritize our needs as a community and to begin to pay for those projects that will best position us for responsible growth and preservation of our most critical assets,” said Lake Lure Mayor Kevin Cooley. “While no-one likes to see a tax increase, we are confident that the improvements to our critical infrastructure will begin to position Lake Lure to be a much stronger community economically speaking.”

As referenced above, the Town’s updated Capital Improvement Plan has been a key component guiding the council’s budget priorities. Although many capital projects had to be eliminated or deferred, this year’s proposed budget funds the first year costs for 28 projects.