Catawba County is planning for about $3.3 million less in tax revenue than originally planned, but still expects some growth in revenue, County Manager Mick Berry said.
The expected decrease in revenue is due to the COVID-19 pandemic, which the county is expecting to decrease sales tax, property tax and building services revenue in fiscal year 2020-21
“We’re not having negative revenue growth, we’re just not growing as we had anticipated,” Berry said at a special budget meeting of the Catawba County Board of Commissioners on Monday.
Before the coronavirus pandemic hit, the county was expecting an increase of 3 percent in revenue. Instead, the county is expecting about a 1.5 percent increase, Berry said.
Nearly all of the expected drop in revenue comes from sales tax. The county is budgeting for a 4 percent decrease in sales tax from fiscal year 2019-20 to 2020-21, Berry said.
Before the pandemic hit, the county was expecting sales tax revenue to increase about 3 percent from this year, to about $32.8 million. Now, the county is expecting about $29.6 million in sales tax revenue, down from about $31 million in sales tax revenue budgeted for the current fiscal year.
“We don’t anticipate it to grow like we thought we would,” Berry said.
The county is still expecting growth in other areas of revenue like property tax and permit fees, so county revenue is still expected to grow, Berry said. The county is expecting about $201.9 million in revenue in 2020-21, up from $198.9 million in the 2019-20 budget.
To make up for the decrease in expected revenue, the county is considering several areas of the budget to reduce and projects to delay.
Among those was the potential delay of opening Mountain Creek Park. But at Monday’s budget meeting, several commissioners opposed the idea of not opening the new park.
The commissioners did agree to postpone the county’s plan to open all county parks seven days a week. The move would save the county around $230,000 in next year’s budget, Berry said.
To save about $374,000, the commissioners agreed to postpone hiring four new emergency services shift supervisors. Instead, the county now plans to evaluate sales tax revenue and medical demand through December and tentatively plan to hire two shift supervisors in April.
Berry also proposed the idea of delaying a new Sherrills Ford patrol district for the Catawba County Sheriff’s Office to save about $490,000 in startup costs for a new patrol district and four new full-time positions.
The commissioners proposed hiring two positions in July and, after seeing how sales tax revenue fares the rest of the year, potentially hiring the other two positions in the spring of 2021.
Cuts will also come from the school budget in a decrease of the planned 2.8 percent funding increase to 2 percent. The decrease saves about $359,000.
The commissioners have considered using some of the general fund, which is at about $39 million, to cover these projects.
A full budget is expected to be presented to the commissioners on Monday.
The county is also anticipating money from the state for COVID-19 relief, Assistant County Manager Mary Furtado said.
Gov. Roy Cooper allocated about $300 million for local governments to get for coronavirus aid. The funds will be dispersed by population, Furtado said. The county is expecting about $3 million, but that could easily change, she said.
What the money can be used for hasn’t been defined yet, Furtado said.
Concerned about COVID-19?
Sign up now to get the most recent coronavirus headlines and other important local and national news sent to your email inbox daily.