On Thursday, the Board of Mayor and Aldermen gave final approval to the 2018-19 general fund, city school and Water Department budgets with no property tax increase.
Although the additional Water Department revenue from the rate hike is reflected in the 2018-19 budget, a new ordinance outlining the exact rates must be approved on three readings before the increase takes effect.
City Attorney Bill Phillips said he hadn’t received specific numbers on that rate hike to be drafted into an ordinance yet, and that won’t be ready for the BMA’s consideration until the July 24 meeting.
Phillips noted, however, that if the BMA chooses, it could knock out two of the three required readings at one meeting and get the rate hike approved in two months instead of three.
That’s what the BMA did during a special called meeting Thursday afternoon, approving the second reading of the 2018-19 budgets, followed by a public hearing, and then approved the third and final readings of the budgets.
The Rogersville City School budget contains no additional funding.
The general fund budget will use $710,655 in savings, but the city will also be making its final $525,000 payment on the 1998 bond issue that paid for a Rogersville City School classroom addition and renovation project.
That’s $525,000 that won’t be in the expenditure column when it comes time to compile the city’s 2019-20 budget.
Rogersville officials anticipated ending the current fiscal year on June 30 with $2.73 million in savings.
The city’s $1.67 property tax rate.
New spending included in 2018-19
— A $150,000 one-time expenditure for the H.B. Stamps Public Library/Rogersville Senior Center building, which is due for some renovations. Hawkins County will split the cost of those projects.
— A recurring $2,000 increase in the Hawkins County Humane Society’s contribution for a total of $8,000.
— A recurring $3,500 increase for the Chip Hale Center, for a total of $4,500.
— A one-time expenditure of $53,000 for a Bobcat front-end loader for the Street Department.
— A one-time expenditure of $140,000 for a new garbage truck for the Sanitation Department.
— A 3 percent salary increase for city employees.
— An additional $39,000 for asphalt and other street repair materials.
The Parks and Rec Department has applied for a $1 million grant to make improvements to the swimming pool, City Park pavilion and other park projects.
The city will find out in October if that grant is approved. If so, there will be a 50 percent match for all park grant funds that are spent.
But those potential expenditures weren’t included in the proposed budget and would have to be addressed as budget amendments if necessary.
The Water Department budget
The impending 23 percent rate increase will help pay for about $2 million in system repairs and renovations and offset the department’s $67,000 deficit.
Last month the BMA approved a cash transfer of up to $100,000 to ensure the Water Department can pay its bills
The water rate hike increases the minimum water rate for a city resident by $3.85 from $18.19 to $22.04 for the first 1,000 gallons.
The current average bill for city residents who use 4,000 gallons of water per month would increase by $10.78, from $46 to $56.78.
Not including anticipated loan funds, that rate increase is projected to give the department a $60,287 surplus as of the end of the 2018-19 fiscal year.
Although a reported $338,929 allegedly stolen by former Water Superintendent Shawn Hatchett over a two year period obviously contributed to the current deficit, acting Water Superintendent Bill Pearson said the need for a water rate increase was inevitable.
Pearson told the Water Commission earlier this month that the sewer system isn’t financially self-sufficient and that the Water Department has basically become a repair shop. That’s why the department is issuing a $2 million bond in 2018-19 to address a long list of needed renovations and repairs in both the water and sewer systems.
Last month the BMA voted 4-3 in favor on the second of three required readings of an ordinance abolishing the Rogersville Water Commission and placing the BMA over that department.
The third and final reading of that ordinance is scheduled for July 24 as well.