Citing the extraordinary impact of COVID-19, Durham County manager Wendell Davis told the Board of Commissioners Monday that the fiscal landscape has shifted, requiring “strategic approaches to ensure adequate resources are available to address critical life and safety issues while funding statutory mandates and requirements by county governments.”
His proposed budget for the 2020–21 fiscal year has changed along with it.
Davis presented a budget of $675.9 million, a 2 percent year-over-year increase in spending. The budget proposes no tax increases and foresees less revenue coming in than previously expected. Davis projects that the county’s property-tax-collection rate will decline, as will revenue from hotel occupancy taxes, sales taxes, and other sources of county funding.
Davis’s proposed budget calls for a hiring freeze and blocks employee salary increases, which will yield $4.5 billion in reserves for the county to “address unanticipated COVID-19 and economic expenses.” He expects the cost of employee benefit plans—specifically, health insurance—to rise 9 percent on account of an older workforce. He recommends putting $4.5 million in reserves to “address unanticipated COVID-19 and economic expenses.”
Davis recommended $5.23 million in additional funds for Durham Public Schools: $3.23 million to support the growth in students and $2 million for maintenance. The DPS Board of Education had asked for nearly $19 million, which would have provided funds for 761 new students as well as to raise the system’s minimum wage to $15 an hour.
Across the board, Davis says, requests for new funding totaled $40 million.
“There were no new revenues to support any of those requests because of the pandemic,” he says.
Davis told commissioners additional funding was needed to purchase personal protective equipment, support temporary housing for the unsheltered at Urban Ministries, and to address increased cleaning standards as outlined by the Centers for Disease Control and Prevention.
The county faces a vast loss in projected revenues. Davis told the board that in February the county was projected to generate between $12 million and $15 million in new funding. Those figures have shrunk to $216,468.
“We don’t have any new revenues,” he says. “When COVID hit all that went away. That’s the big issue. We don’t have any new dollars.”
Davis says county government sectors are anticipating federal assistance from the CARES Act, which allocated $150 billion to state, local, and tribal governments.
“The schools will receive funding as well from the CARES fund,” he says.
Davis says the pandemic doesn’t pose a threat to the county’s credit rating. For more than two decades, Durham County has been one of 66 in the U.S. to benefit from a triple-A credit rating, which makes the county attractive to banks and companies.
To keep that rating while funding the county’s other priorities, Davis has proposed a wide swath of cuts throughout county government, including to budgets for the Sheriff’s Office, county administration, human resources, social services, soil and water conservation, and veterans services.
A budget hearing is set for May 26 at 7:00 p.m.
Contact staff writer Thomasi McDonald at tmcdonald@indyweek.com
DEAR READERS, WE NEED YOUR HELP NOW MORE THAN EVER. Support independent local journalism by joining the INDY Press Club today. Your contributions will keep our fearless watchdog reporting and essential arts and culture coverage viable in the Triangle, coronavirus be damned.
