Town of Franklin Budget

Fiscal Year 2017-2018

» DOWNLOAD A COPY OF THE APPROVED BUDGET FOR FISCAL YEAR 2017-2018

The Town of Franklin strives to provide quality services in a cost effective manner to all citizens. The Town of Franklin continues to operate in sound financial condition with a stable fund balance. This budget addresses the continued need for infrastructure planning for the Town of Franklin. General government revenue sources are estimated to remain the same, with the exception of current year advalorem taxes and cable television franchise tax. Current year ad-valorem tax is suggested to decline by $42,024.00. Senior exemptions account for $23,914.00, tax deferred accounts for $13,756.00 and tax exempt for partially outside city limits accounts for $4,354.00. This in total accounts for the current year ad-valorem tax decline. Cable television franchise tax is no longer taxable. Therefore, there will be no cable television franchise tax collected for this fiscal year.

The current ad-valorem tax rate of twenty eight ($0.2800) cents per one hundred dollars ($100) of valuation is recommended for fiscal year 2017-2018. However, the Town continues to experience slow growth in water and sewer revenues. It is paramount that the Town of Franklin ensures water and sewer revenues can sustain expenditures in order to maintain existing infrastructure and planning needs for future water and sewer infrastructure. The Town should carefully prepare for unanticipated loss of revenues. Therefore, diligently maintaining a stable fund balance is key to long term financial success.

Personnel:
This budget calls for a two (2) percent cost of living adjustment and a one (1) percent one-time payment based on salary for all positions. The one (1) percent one-time payment is suggested for December 2017. The Town's health insurance, dental, property and workers compensation premiums are expected to remain at current budgeted rates. Employee benefits are expected to remain the same with the exception of employee contribution percentage for family health coverage.

Capital Projects:
The Town will continue working on phase one (1) of the Water Treatment Plant Upgrade and Expansion project. Bid approval is expected May 2017 and construction is expected to commence July 2017.

Capital Outlay Equipment:
The Town continues to address current infrastructure needs within Finance, IT, and the Streets Department. Tyler Technologies is currently working with the Town of Franklin in replacing existing financial, tax and utility software. Tyler Technologies has scheduled the Town of Franklin a go live date for financial and tax software for July 10, 2017. Utility software is scheduled to go live September 25, 2017. An additional server is needed to store data for all new software modules. The estimated cost for one (1) additional server is $6,200.00.

The IT department is in need of two (2) switches for Town Hall and the Waste Water Treatment Plant. One (1) additional switch is needed at Town Hall to allow more ports for data. The switch at the Waste Water Treatment Plant is over five (5) years old and needs to be replaced this budget year. The cost for both switches is $9,600.00. This budget also addresses the need to upgrade fiber lines for more bandwidth capacity. The current bandwidth for all Town facilities is eight (8) megabytes. The IT department suggests upgrading the Town of Franklin's fiber line to twenty (20) megabytes. This would increase Town facilities bandwidth from eight (8) megabytes to twenty (20) megabytes. The cost for this upgrade would be $5,300.00.

The IT Department is also requesting a new phone system for Town facilities. The current phone system is almost ten (10) years old. Parts for the current phone system are no longer available due to the age of the system. The warranty period and service contract are no longer valid due to the age of the system. The total cost for the new system is $17,500.00.

Improvements to Memorial Park are budgeted within the Streets Department. Memorial Park is centrally located in the heart of Franklin. Many residents and visitors utilize Memorial Park. The Town of Franklin has made significant improvements to the outside area of Memorial Park over the past couple of years. This budget allots $17,000.00 for interior improvements to Memorial Park.

Capital Outlay Improvements:
Funds have been budgeted to replace the tent at the Gazebo area. Administration has been working with various companies to design a tent that would be better suited for the vast use of the Gazebo located downtown. Funds have also been budgeted to begin the replacement of Town of Franklin banners.

Capital Outlay Vehicles:
The Police Department will be replacing one (1) patrol vehicle with over 100,000 miles. The Sewer Department will be replacing one (1) ½ ton pick-up truck with over 100,000 miles.

Contributions:
Non-Profit funding for community organizations are left at the current budget total of $40,000.00.
Economic Development funds are left at the current budget total of $7,000.00.

Debt Service:
All debt payments are budgeted as required by law. General debt service principal is budgeted at $168,120.00 and interest at $26,755.00. Fire debt service principal is budgeted at $71,181.00 and interest at $3,387.00. Water and Sewer debt service principal is budgeted at $658,315.00 and interest at $223,190.00. The Town secured a $3,578,750.00 loan through the North Carolina State Revolving Loan Fund for Upgrades and Expansion to the Water Plant. The first debt service payment will not be due until fiscal year 2018-2019.

SunTrust loan for General, Water and Sewer projects was entered into in 2012 and will be paid in 2024. The total loan amount for SunTrust is $4,903,805.29.

Bank of American for Water and Sewer projects was entered into in 2010 and will be paid in 2025. The total loan amount for Bank of America is $3,820,423.14.

State Revolving loan for Waste Water Treatment Plant was entered into in 2013 and will be paid in 2033. The total loan amount for this project is $6,507,962.59.

Diversified lenders loan for new software was entered into in 2017 and will be paid in 2020. The total loan amount for Diversified lenders is $181,528.56.

PNC and Entegra Bank Fire Trucks loan was entered into in 2011 and will be paid in 2020. The total amount that will be paid for the Fire trucks will be $1,502,836.32.

By Department:
Fire Department: The current fire tax rate is $0.0445 cents per one hundred dollars ($100) of valuation. A modest tax increase is suggested for fiscal year 2017-2018. Funds are budgeted based on a proposed fire tax rate of $0.0545 cents per one hundred dollars ($100) of va luation. Franklin Fire Department must begin preparation to replace existing fleet that is approaching service life. Based on the proposed fire tax rate no fund balance would need to be appropriated for fiscal year 2017-2018. Also, fire call pay for volunteers is expected to remain at current rates. Current rates are $5.00 for medical calls and $12.00 for fire calls.

Water and Sewer Department: Funds are budgeted to replace the sewer line at Old Ingles and the sewer line at Harrison Avenue. The cost anticipated to replace the above referenced sewer lines is $121,000.00. Funds are also budgeted to replace the water line at Apple Tree Lane, the pump station at Apple Tree Lane and the booster pump at Brookwood. The cost anticipated to replace the above referenced water lines is $54,000.00. All of the above referenced projects are part of the Town's Capital Improvements Plan (CIP). The basin at the water plant only needs to be cleaned every five (5) years. However, this budget allots funding of $30,000 this fiscal year. The reason for this is to continue a reserve account for this project in preparation for cleaning the drainage basin in fiscal year 2018-2019. The total estimated cost to clean the drainage basin is $150,000.

Water and Sewer Rates:
Based on current estimates water and sewer revenue combined are projected at $3,807,911.00. A modest appropriation from water and sewer retained earnings of $324,456.00 is recommended. Martin and McGill completed a detailed water and sewer study in January 2015. In order to maintain the existing infrastructure, to upgrade/expand the water plant and to continue funding the Town's Comprehensive Improvements Plan, a modest water and sewer rate increase is recommended. A four (4) percent rate increase is recommended for water and sewer. The proposed rate increases only affect base and volume charges but not tap, connection, or other miscellaneous charges.

Conclusion:
This budget for Local Fiscal Year 2017-2018 is balanced as required by law and continues to provide existing services while meeting the governing board's priorities and polices. This budget includes an appropriation in general fund of $450,000.00 for Powell Bill. This budget also recommends a one (1) time modest appropriation from general fund balance of $119,000.00 to address the Town's infrastructure needs. This budget addresses long term infrastructure planning for the Town of Franklin while maintaining a healthy fund balance and providing quality services in a cost effective manner.

Sincerely,
Summer Woodard
Town Manager