Gates County manager unveils proposed FY 2025-26 budget; recommends revenue-neutral 66¢ tax rate

County Manager Scott Sauer presented the Gates County Board of Commissioners with a proposed balanced budget for fiscal year 2025-26, telling commissioners the presentation marks the start of the board's formal budget process.

Sauer said the budget as prepared meets the revenue-neutral tax rate calculated after the county's revaluation. "We hit the revenue neutral tax rate... at 66¢," he told the board, and said that rate would generate a levy of $8,656,767. Sauer presented a baseline budget plan of approximately $16,615,347 and described items the administration built into the baseline and options the board could consider.

Primary elements in the proposed plan - Revenue neutral tax rate and levy: proposed revenue-neutral tax rate of 66 cents per $100 of assessed value; estimated levy $8,656,767. - Overall totals: Manager described a budget plan figure of $16,615,347 and later summarized general-fund and all-funds totals during the presentation; staff noted the proposed budget is roughly 2% below last year's ordinance on a like-for-like comparison. - Staffing and personnel: recommendations include funding salary adjustments the sheriff requested (to address pay compression and restore a previously frozen position), adding an income-maintenance caseworker 3 in Department of Social Services (50% anticipated to be reimbursed by the state), converting a part-time custodian to full time in building and grounds, Board of Elections part-time positions to remain at sub‑benefit hours, and adding a senior meter technician funded fully by the utility enterprise fund. - Public safety and 911: the consolidated 911 communications arrangement with Perquimans County increases Gates County's share by $87,020 in the proposed plan; manager highlighted investments in vehicle leasing that replaced aging fleet and spread costs. - Schools and Board of Education requests: the Board of Education submitted requests that would require roughly $2,845,000 in additional general-fund support; the manager proposed carrying current expense for schools at the board's historical baseline of $2,953,000 in the recommended column and identified options for using the capital reserve fund for nonrecurring school needs, technology, or the nutrition program. - Fund balance and capital outlay: staff proposed appropriating $317,463 of fund balance for one-time capital items, including $167,000 for emergency management projects, $113,000 for building and grounds (including roofs at county facilities), and $24,000 for the Tri-County Bridal Shelter roof. - Capital reserve and debt service: the capital reserve fund held $2,236,832 as of May 30, staff said; school debt-service obligations tied to the Central Middle School loan remain significant — manager reported the outstanding principal at about $5,740,000 and total remaining obligation (principal plus interest) around $6,730,150, with final payment expected in 2038. - Retirement and benefits: employer retirement rates will increase for general county employees to 14.4% and to 16.08% for law enforcement; next year's employer cost for health, dental and life-insurance premiums for funded positions was presented at about $904,432, with the county paying 100% of the health-premium share for employees. - Utility and FEMA context: manager reiterated the county's water and wastewater utility was designated as a distressed unit by the North Carolina Department of Environmental Quality in August 2022, underlining the ongoing importance of the water-meter replacement project and other utility investments.

Board questions and follow-up Commissioners asked for additional detail on several items including cost-of-living adjustments (Sauer said a 3% COLA would cost roughly $199,000 and estimated a 1% COLA would cost about $66,000), the audit contract amount, water and sewer indirect-cost allocations, and use of fund balance for capital projects. Commissioners expressed differing views about using fund balance for one-time capital needs versus conserving reserves; several asked staff to provide a detailed list of the proposed capital outlays.

Schedule and next steps The board agreed to hold a work session on Monday, June 9 at 10 a.m. to review budget detail. Staff noted the public hearing for the budget is scheduled for June 18 at the regular meeting and that the auditors' FY2025 kickoff meeting is set for June 11.

Ending Manager Sauer presented the revenue-neutral scenario and a recommended baseline while leaving several options for the commissioners to consider during follow-up work sessions; the board scheduled further review before a public hearing on June 18.