Chapel Hill City Council discusses how to allocate $ 7.9 million in excess funds

Chapel Hill City Council ends its 2021 fiscal year with $ 7.9 million more than expected, according to a presentation from its Jan.5 meeting.

One of the main topics of the recent meeting was the balance of the City’s surplus funds, and council must decide how to allocate these funds to best serve the interests of the community.

Amy Oland, director of business management and financial officer for Chapel Hill, said the city has had an incredibly strong year-end. The city’s prudent budget, unexpected sales tax growth, and staff savings resulting from the hiring freeze contributed to the additional $ 7.9 million.

“The city was very conservative at the start of the FY21 budget because we recognized that there were a lot of factors that we weren’t sure how the pandemic would impact,” Oland said.

When the budget was originally created, staff predicted a 5% drop in average sales tax revenue. However, Oland said there had been a 15.7% increase over sales tax revenue from the previous year.

In addition, the hiring freeze implemented to reduce expenses after the start of the pandemic resulted in savings of $ 5.9 million. Usually only $ 2-3 million is saved by vacancies due to turnover, retirements and other factors.

Of the $ 7.9 million in excess funding, Oland and chief executive Maurice Jones recommended that only $ 4.5 million be made available for general use.

City of Chapel Hill staff recommended that the $ 4.5 million go to council and community interests in areas such as climate action, affordable housing, pandemic recovery and maintenance buildings and streets, according to the presentations of the meeting.

Of that $ 4.5 million, staff recommended that $ 500,000 be allocated to climate action projects in Chapel Hill, including the city’s approved climate action plan.

Staff recommended that $ 500,000 be allocated to affordable housing and social service projects that need funding. In addition, staff recommended that an additional $ 500,000 be spent on building maintenance and $ 500,000 invested in the streets.

“As we have mentioned several times to the board, we have fallen behind in maintaining our buildings,” Jones said at the meeting. “We’ve reduced that over the years… and we think it’s time to take a step forward in meeting some of those needs.”

Jones recommended that the City allocate $ 1 million for vehicle replacement, which would go to the current backlog of $ 5 million in City vehicle replacement that has been caused by years of postponements. Jones also said $ 500,000 could be spent on installing splash pads at Chapel Hill.

Council member Amy Ryan said she would like most of the money to be spent on climate action, maintenance and affordable housing projects.

“I don’t feel like it’s found money,” Ryan said. “I feel like it’s some kind of money that we borrowed from the past, and we have to pay it back.”

Council member Camille Berry said she would like to see the money reallocated to areas where it was taken and would prefer not to include water jets among the potential uses.

“We’ve been very careful with the spending, and it just doesn’t seem like there’s integrity there and then apply it when we have needs to be met that we’ve put on hold,” he said. said Berry.

Pro Mayor Tem Karen Stegman said restoration of vacancies as well as maintenance should ultimately come first.

“I think we’ve asked our staff and the public to do more with less, and I think we’ve paid the price,” Stegman said. “We don’t want to make this the new normal for our staff level and workload. It’s just not sustainable.”

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