Person County mid‑year fiscal update: revenues up $2.1M, expenditures up $3.6M; county previews FY26 budget and CIP

Finance Officer Tracy Clayton presented the county’s mid‑year fiscal update for fiscal year 2025 (July–December): revenues were approximately $2.1 million higher than the prior year mid‑point, primarily driven by property taxes and timing differences in large taxpayer payments, while expenditures rose by roughly $3.6 million. Personnel costs were a primary driver of higher spending (about $1.1 million), driven by lower turnover, implemented cost‑of‑living adjustments and higher benefits costs. Clayton reported a mid‑year net deficit of about $1.5 million between revenues and expenditures.

On revenues, Clayton said sales tax collections appear to be flattening and that Person County faces a pattern of sales tax refunds and timing effects; she cautioned staff were projecting a flat sales‑tax year for FY26. She said some revenue increases were one‑time or timing‑related, for example, shifted tax payments and reimbursements. Interest earnings have fallen with changes in interest‑rate conditions, and state/federal reimbursements to DSS have increased, offset in part by declines in some inmate reimbursement and PATS grant funding.

On expenditures, major drivers included personnel (DSS, sheriff, EMS, 911), inmate medical costs, PCC current expense, and some timing changes (capital encumbrances versus vendor payment timing). Clayton noted purchases of PATS vans and airport fuel‑pump compliance work and said many capital outlays are timing‑dependent.

Tax assessor Russell Jones provided a property tax revenue preview tied to the county reappraisal. Jones said overall property valuation collections through the fiscal year exceeded budget expectations and recommended conservative estimates for state‑appraised property. He outlined an early estimate that one penny on the county tax rate would generate approximately $550,000–$761,000 (estimates vary as values settle and appeals are processed). He described the informal appeal and board‑of‑equalization processes and noted many North Carolina counties are seeing large reappraisal increases this cycle.

County Manager previewed FY26 budget drivers: roughly 21.5 new positions requested across departments (preliminary), rising health‑insurance renewal estimates (preliminary +10%), salary index tracking around 3.4% and capital needs including continued investment in the recently purchased Human Services building, Person Industries/Piedmont Community College projects, and the second round of limited obligation debt for school improvements. The recommended CIP presented at the retreat was preliminary: departments requested $18.6 million for the upcoming year and the five‑year ask totaled roughly $169.4 million. Staff recommended a constrained five‑year plan and continuing to seek grant funding and use available ARPA funds for targeted projects.

Timeline and next steps: the recommended CIP will be presented April 7 with anticipated adoption April 21; the county manager will present the recommended FY26 budget May 19 (including a referenced revenue‑neutral tax rate); the public hearing on the recommended budget will be June 2 and final adoption is scheduled for June 16. County staff told commissioners they are monitoring revenues and expenditures, will minimize fund‑balance appropriations where possible, and will return budget amendments and any required fund balance uses to the board for approval.

Cliff notes: mid‑year revenue +$2.1M; mid‑year expenditure +$3.6M; net mid‑year gap ≈$1.5M; staff monitoring and preliminary budget work underway.