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HILLSVILLE — Losing Carroll County as a water and sewer customer will probably cause future rate increases for other users in Hillsville, the town manager warns, but for the upcoming fiscal year the budget proposes holding the line on both fees and taxes.
The fiscal year 2010-11 budget proposal is a lean one, according to Town Manager Larry South in his annual budget message. On top of the challenging national economy, Hillsville will also take a hit with Carroll County's decision to change water and sewer service providers.
Projections for the general fund expenses have been estimated at $2.12 million. The capital program expenses are projected at $864,000.
Town officials believe that general fund revenues will top expenses by $211,479, though. The budget information notes that this should lead to a healthy fund balance of $463,331.
South expressed a litany of concerns at the outset of his message.
"There is no doubt that the continuing troubles in the national economy, new and potentially very expensive federal legislation, cuts in state budget allocations and loss of revenue in the water and sewer funds because of the actions of Carroll County all present both current and future budgetary challenges," the town manager wrote. "This budget asks for no tax or fee increases, but water and sewer rates will most likely have to be reviewed for potential increases within the next couple years."
Carroll County is supposed to start sending its sewage to Galax for treatment any time now. South also notes that Carroll will begin to buy its water from the regional partnership with Wythe County and Wytheville as soon as possible.
"Right or wrong, what they are doing will most likely result in increased fees to Hillsville water and sewer customers," South wrote. "Of course, the legal expense dealing with them and the lawsuits have been tremendous."
The budget proposal, if approved, would set the water department total at $984,847 (including capital improvements of $425,000) and the sewer department total at nearly $1.47 million (including capital improvements of $589,000).
In addition, the town's proposed budget:
• continues funding for a sidewalk project on East Grayson Street.
• continues to pay for all full-time employees' health insurance, including a 14.1 percent increase in premiums.
• contains no salary increases with the exception of raises that may come from additional training or certification.
• continues the popular series of downtown celebrations, which has proven successful in bringing many visitors to town.
• cuts most contributions and donations by 10 percent.
The fund balance has decreased for three years, South wrote. "That, along with the health increase are the primary reasons no salary increase is included.”
On the plus side, this budget proposal should not lead to a reduction in fund balance — if the revenue projections are accurate, he wrote. That should make the following year's budget less of a challenge.
It's not all bad, South stressed.
"We expect lots of visitors this year because of our concerts, the Crooked Road and the 75th anniversary of the Blue Ridge Parkway, which should result in positive returns for many of our businesses."
Citizens can continue to help their own community by shopping locally, South added. "The town's primary revenues come from sales taxes or business licenses in some form, all of which are a direct result of the sales of local merchants and professional offices.”
The revenues that the town derives from these sources pay Hillsville employees' salaries, health insurance and other expenditures, he wrote.
Shopping local is just a good idea, South wrote. "Local businesses are our community. Families, employees, our churches, civic organizations and schools are all in many ways dependent on them and their success. We must support them."