The Town Council will receive an extensive quarterly budget review from Town staff at its Tuesday morning meeting that, according to meeting materials posted on the Town website just yesterday, will include discussion of an updated capital improvement plan, assessment/analysis of the Town’s unassigned fund balance, and an overview of the Town’s current financial status and upcoming major capital expenses.
This review is described in those materials by Town Manager Cliff Ogburn as the “initial” quarterly review in a budget update reporting framework requested by the Town Council. Mr. Ogburn is proposing that next year’s reviews be held in January, April, and October.
The Town Council, which adopts its new fiscal-year budget in June after a mandatory public hearing, will meet at 9 a.m. Tuesday in the Pitts Center.
See the meeting materials here: https://mccmeetings.blob.core.usgovcloudapi.net/soshoresnc-pubu/MEET-Packet-48b27117a02a46218d05052e56f22eab.pdf.
We consider it regrettable that the Council meeting agenda notice, which was published Sept. 13—a week before the meeting date—made no mention of a quarterly budget review and that Mr. Ogburn did not refer to such a review when he gave notice of Tuesday’s meeting at the Town Council’s Sept. 6 meeting.
The agenda says only, “Budget Items for Discussion,” and lists three broad topics, without context; Mr. Ogburn only alluded publicly to budget issues. The meeting materials were posted on the Town website a day later than such materials are customarily posted.
As we noted in our 9/15/22 post, we are unable to cover the Tuesday meeting, as well as the Planning Board meeting on Monday, but we will watch the Town Council meeting videotape and report to the Southern Shores public as soon as possible about significant budget news.
We encourage you to attend this important meeting or to live-stream it at https://www.youtube/com/user/TownofSouthernShores.
5-YEAR CAPITAL IMPROVEMENT PLAN
We commend to your attention now the Town’s proposed capital improvement plan, which has been reduced from 10 years to five years. You will find it on pages 45-48 of the meeting materials.
Residents will find proposed future sidewalk construction, which has been mentioned only in passing in Town Council meetings, of substantial interest. The Town has prioritized what it calls “future path segments” as follows:
Priority 1A: Ocean Boulevard, from the cell tower Triangle to East Dogwood Trail
Priority 1B: Ocean Boulevard, from East Dogwood Trail to Hickory Trail
Priority 2A: Hickory Trail, from East Dogwood Trail to N.C. Hwy. 12 (Duck Road)
Priority 2B: Hickory Trail, from Duck Road to the beach access
Priority 3: Hillcrest Drive, from Hickory Trail to Duck Road
Priority 4A: Sea Oats Trail, from East Dogwood Trail to Hillcrest Drive
Priority 4B: Sea Oats Trail, from Hillcrest Drive to Duck Road
Priority 5: Wax Myrtle Trail, from East Dogwood Trail to Hillcrest Drive
Priority 6: Chicahauk Trail, from the cul-de-sac to Trinite Trail
Priority 7: Skyline Drive: entire length
Priority 8A: N.C. Hwy 12, from U.S. Hwy. 158 to East Dogwood Trail
Priority 8B: N.C. Hwy 12, from East Dogwood Trail to 13th Avenue
According to the meeting materials, if all of these sidewalks were five feet wide and four inches thick, their total estimated construction cost would be $524,462.40. If the proposed sidewalks were eight feet wide and six inches thick—and, therefore, constitute multi-use pathways—their total estimated construction cost would be $1,198,538.88.
The Town has already committed to spending $1 million per fiscal year for at least 10 fiscal years to the street pavement maintenance plan, which started this fiscal year, although the work done in August and this month was originally scheduled for 2021.
At the Sept. 6 meeting, Mr. Ogburn raised the possibility of continuing with the pavement work scheduled for 2022, which was to be year two, in this fiscal year, and, thus, spending more than what was budgeted in FY 2022-23 for this purpose.
We refer you to the street-by-street pavement maintenance schedule that appears on pages 49-60 of the meeting materials so that you may know when your street will be serviced.
The Town did an excellent job of previewing this work and publicizing the maintenance schedule, including holding a public forum with the contractor, but residents were still caught unaware when construction started in August. We encourage you to sign up for the Town’s newsletter so you will be informed about public works projects and other public services. (NOTE: The seasonal Friday garbage collection has been suspended. Trash is now being collected only on Monday.)
The Town Council has made no secret of the need to raise property taxes in FY 2023-24. If you peruse the capital improvement plan, you will be reminded of some of the Town’s continuing capital obligations and learn of proposed additional spending. Among the former are the annual $1,202,939 debt for beach nourishment over the next five fiscal years and the annual $314,020 obligation for the 30-year loan that funded the fire station construction. Twenty-five years remain on this debt service.
Besides a request for additional funding for the streets in FY 22-23, Town staff is also seeking approval of a new budget appropriation of about $1 million to pay for replacement of the Trinitie Trail Culvert at the Trinitie Trail Bridge in Chicahauk.
Personnel from Kimley-Horn and Associates, Inc., a surveying, engineering, and planning/design firm based in Raleigh with whom the Town contracted, will present their findings regarding options for replacing the existing aluminum pipe arch culvert at the bridge before the Town Council discusses budgetary matters. These options are detailed in the meeting materials.
Staff also seeks an increase in the annual appropriation for canal dredging and maintenance—from $20,000 to $50,000—and a one-time “contribution” for such maintenance this fiscal year of $100,000.
DARE CAMPGROUNDS DUE REFUND FOR OCCUPANCY TAXES
In another financial hit, the Town of Southern Shores is being required to refund some of the monies that it received from Dare County in its distribution of occupancy taxes because Dare incorrectly collected occupancy taxes from campgrounds which, by N.C. statute, are not required to remit them.
Occupancy taxes are typically paid by any lodging property that also pays sales tax, such as hotels and motels, bed-and-breakfasts, and short-term rental homes, including Airbnb housing. We would be curious to know why Dare thought they should be applied to campgrounds, which don’t rent out rooms.
According to a meeting agenda item summary by Mr. Ogburn, the Town may be liable for a maximum refund of $165,000 and a minimum refund of $50,000, depending on the statute of limitations applied for the overpayments. The minimum would apply, he explains, if the statute of limitations is only three years.
The Town Council will likely approve Tuesday a resolution that authorizes the Town Manager to refund the Town’s share of the overpayments of occupancy taxes. This resolution appears in the meeting materials on page two. (Resolution 2022-09-03.)
If three years is the minimum statute of limitations being considered and the Town faces a maximum exposure of $165,000, Dare County clearly was in ignorance of the state law for far longer than any competent county government should be.
Dare County shares occupancy tax revenues with all six municipalities and the Dare County Tourism Bureau and uses a percentage of these taxes to finance its Beach Nourishment Fund.
ANN G. SJOERDSMA, 9/17/22