Budget
The draft budget for Fiscal Year 2014 will be reviewed by Council at their May 21st meeting. Here are some of the highlights:
- Total Budget: $77,962,600 (up 2.0% from current budget year)
- General Fund: $36,049,227 (up 4.1% from current budget year)
- No tax increase. For Fiscal Year 2013-14, the ad valorem tax rate is recommended to remain at $0.39 per $100 of valuation.
- New estimated total tax base of $4,761,350,000.
- A one year growth rate of 4.5% in the tax base or an approximate $204,043,000 increase from the current FY2012-13 estimate.
- One cent of the tax rate now yields $461,000.
- No increases in water, sewer, or electric utility rates.
- The monthly cost for residential garbage and recycling will increase by 19 cents.
- 9 New employee positions. 3 are Parks Maintenance positions related to the opening of several new park facilities.
- 3% of payroll budgeted for merit-based employee pay adjustments.
| Major Projects | |
| Street Re-Surfacing | $1,000,000 |
| Fire/Rescue Engine | $400,000 |
| Renovations – Fire Station #2 | $290,000 |
| Design Services – Fire Station #5 | $190,000 |
| Greenway/Playground/Park Repairs | $145,000 |
The Budget Process
You might consider the annual operating budget to be the town’s most important work product. It gives Apex town officials the authority to collect revenue and make expenditures, depending on the priorities of the council, staff and community.
By June 30th each year, the council is required by state law to approve the budget for the coming fiscal year (July 1 – June 30). Staff begins estimating revenues and expenses for the coming year, and seeks public input beginning in January. Generally by May, the Manager has a draft budget complete for Council's review and public comment.
Revenues
Most of the town's revenues come from ad valorem (property) tax, and State-collected revenue, such as the state sales tax. These revenues make up the General Fund.
50% Property Tax
34% State Collected Revenue
7% Solid Waste Fees
5% Fund Balance
2% Program Income
2% Development Fees
Expenditures
All expenditures related to day-to-day operations of the town come from the General Fund. Capital projects, such as the construction of roads, parks, and other public facilities, are also budgeted with General Fund dollars. Any expenses related to the maintenance and operation of water, sewer, and electric services come not from the General Fund, but instead from their respective Utility Funds.
42% Public Safety
12% Parks & Recreation
10% Environmental Services
10% Community Development
9% Public Works
9% Administration
8% Internal Services
Fund Balance
The town’s Fund Balance is much like a savings account, as compared to a household budget. If the town brings in more revenues than expected or spends less than the budgeted expenditures, then at the end of a budget year these differences, these extra funds, become part of this savings account that constitutes the Fund Balance. Some have also described the Fund Balance as a “rainy day fund” that can help during economic downturns when revenues decline.
The North Carolina Local Government Commission requires all North Carolina municipalities to maintain at least 8% of one year's general fund operating expenses in their Fund Balance. The Town’s policy is to maintain that ratio at 25% as a minimum. In Apex, that equals about $7.6 million. Currently, the town’s Fund Balance stands at $13.1 million, or 37.8%.
It is important to maintain a healthy Fund Balance. Bond Rating Agencies analyze a municipality’s practice of Fund Balance usage and adherence to their Fund Balance policy. These agencies have been quite pleased with Apex’s fund balance maintenance: Standard & Poor’s rates Apex as AAA (the highest possible rating), and our Moody's rating is Aa1, only one step down from AAA. These ratings allow the town to borrow money at the most favorable interest rates.