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Landis aldermen split as budget talks continue

LANDIS — For the town’s second budget workshop, Landis Interim Financial Officer Roger Hosey proposed to keep the property tax rate at 53 cents per $100 in valuation while offering relief for residents by having one rate for electricity at 10.5 cents per kilowatt-hour.

Aldermen on Wednesday went through line items of each fund and questioned the necessity of items for the 2019-20 fiscal year. Alderman Bobby Brown asked staff to justify department’s asks ranging from new chairs for the town hall to the salary to add an additional police officer. Alderman Tony Corriher said people were “on their backs” to cut spending.

Mayor Pro Tem Tommy Garver asked the board to consider decreasing property taxes by 2.5 cents per $100.

“I agree with everything that we’re proposed to do here, but I just think we make that change and give the citizens a break,” Garver said. “At every turn, we’ve had to go to the max on everything, and I just think we need to give something back.”

The board at large was not in favor of the tax decrease, and Hosey recommended the town keep the current rate due to the uncertainty of the future.

Mayor Mike Mahaley said he has seen boards be really conservative. Eventually, after time, things cost more.

Brown said he would like to get to the fund balance, which is partially a savings account for the town, to at a minimum of 8%, the State Treasurer’s Local Government Commission recommendation of reserve money. For the 2017-2018 fiscal year, the fund balance was just 0.8% of general fund expenditures, far below what the state recommends.

“I’d like to get us to where the LGC is happy with us,” Brown said.

The commission has sent letters for the past several years with concerns about the town’s low amount of money in the fund balance. Hosey offered ways through the town’s multiple funds to bring in money to save.

Hosey said building the fund balance will also provide some cushion as the town straightens out its finances.

Earlier this year, the State Bureau of Investigation opened up a probe of possible embezzlement involving the former town manager and financial officer.

“If I had a squeaky clean three years in a row of budgets I could look at, I could at a high degree of certainty … tell you what our expenses are going to be,” Hosey said. “Unfortunately, that’s not the situation that we find ourselves in.”

The workshop offered glimpses of possible previous mismanagement of funds. Brown asked if some of the $19,000 for building repairs could be funded through insurance. Zoning Administrator Brandon Linn said the town received insurance money for repairs caused by Hurricane Florence, but previous Town Manager Reed Linn “decided not to use those funds for that and, so with that being said, the funds that were supposed to go for the repairs did not.”

Corriher asked if Reed Linn stole the money. Interim Town Manager Kenny Isenhour said staff could not comment on that.

Aldermen also asked if town employees were able to take home town equipment for personal use. Staff replied “no.”

The electricity rate, proposed by Hosey, would eliminate 16 different residential rates and tiers, which range from 14.25 cents per kilowatt-hour to 10.75 cents per kilowatt-hour. Hosey said he was proud he was able to create a flat rate.

Hosey said the LGC was concerned about the electric rates, but he thought the flat rate was feasible. The significant costs of the electric fund would be shifted to the general fund. He called the utility the “bane of finances” for the town.

Hosey said he projects a decrease in water and sewer rate as the town invests in its sewer system that is treating stormwater due to leaks. The town was awarded money for the repair of the sewer system earlier this year.

Alderman agreed to set a public hearing for Monday’s Board of Alderman meeting to allow for citizen comments.

Hosey said he would post the budget presentation to the town’s transparency section of its website — townoflandis.com/transparency — following the meeting.

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