Budget is balancing act for commissioners

It’s crunch time for the county budget: Tonight, leaders will take a major step toward figuring out what will get funded and what’ll be left out to dry.

A long list of planned capital projects and slow economic growth have served to make this year’s budget especially tight, forcing commissioners to take hard looks at reducing funding for schools and other projects.

County Budget Director Donna Dean attributed the crunch to the exhaustion of one-time revenue services the county has relied on for the past several years.

She said commissioners might need to raise taxes in order to meet the county’s growing needs.

“You can’t get blood out of a turnip,” Dean said. “We’re going to have a gap.”

Commissioners will review the report Dean recently prepared after eyeing the county’s needs for the next decade, she said.

Those needs will cost the county almost $18 million — most of which will go toward building repairs.

Plans include major improvements to Orange County Jail and to the Northern Human Services Center, both in Hillsborough.

The county also plans to build two new senior centers and an Orange County campus for Durham Technical Community College.

In order to meet the county’s capital needs, commissioners might cut capital funding over the next 10 years to Orange County and Chapel Hill-Carrboro City schools.

Since 1988, the county has dedicated about 77 percent of its capital expenditures to schools. The proposal before the commissioners is to change that number to 60 percent.

“We’re in a catch-up situation right now,” Commissioner Stephen Halkiotis said. “Both school systems are going to be OK for a while … so we’re going to need to focus on the county’s capital needs.”

Economic Development Director Dianne Reid said the county’s economic situation is fairly stable, with vacancies down and steady rates in retail sales.

But that doesn’t translate into more tax revenue. Owners pay property on buildings whether they’re vacant or not, Reid said, and stagnant retail means the county isn’t getting any more in sales tax.

About 16 percent of county revenue comes from the sales tax.

Analysts predict that many local governments around the country will face similar budget gaps because of state and federal funding cuts and directives, Dean said.

Finally, Halkiotis pointed to Medicaid funding. North Carolina is one of only two states that requires counties to pay for the program.

“That’s a serious concern for me,” he said.

Contact the City Editor at citydesk@unc.edu.