City Manager Presents Proposed FY 2016 Budget

WASHINGTON, D.C. – May 21, 2015 – (RealEstateRama) — Kannapolis City Manager Mike Legg presented the proposed Fiscal Year 2016 budget to the Kannapolis City Council Wednesday evening. The proposed FY 2016 Total Budget is $59,539,383. The budget calls for a three cent increase in the property tax rate to cover the cost of acquiring downtown properties, investments in economic development and job creation, implementing a strategic plan for revitalizing the downtown, paying for the new City Hall and Police Headquarters, and establishing the Department of General Services.

The current tax rate is .60 cents per $100 valuation. The proposed budget would move the property tax rate to .63 cents per $100 valuation. This means the average home valued at $150,000 would now pay an additional $45 or $945 annually in property taxes.

The City’s budget is composed of two primary revenue sources: property taxes and sales taxes. “The economy is improving and there is an increase in property tax and sales tax revenues due to population growth. However, the City’s budget reflects an increase in expenditures due to the acquisition of downtown properties, the debt payment on the new City Hall and Police Headquarters, the hiring of personnel, expenses related to projects which have delayed due to the extended recession and the costs of delivering services to new people and businesses locating in Kannapolis,” said Legg.

The City is in the process of purchasing approximately 50 acres of property and buildings in the downtown core including the eight blocks of buildings located on Oak Avenue, West Avenue, S. Main Street and West First Street. The property includes the former Cannon Village, the Gem Theatre, the current Kannapolis City Hall offices, Wells Fargo Bank, the current Kannapolis Police Department, the former Plant 4 site and K-Town Furniture Building. The City is developing a revitalization plan which will focus on finding partners to purchase the properties and redevelop them into a mix of residential apartments, offices, retail stores, restaurants and other compatible uses.

The budget continues a City Council priority of significant investment in economic development; nearly $1 million of direct, personnel and operating investments to advance economic growth and job creation city-wide and nearly $1.9 million for the downtown initiative.

Approximately 338 new houses were built in Kannapolis in 2014 with about 750 people moving to the City. There were approximately 189 apartments constructed with 415 people now occupying these units. More people and more buildings results in the need for additional police, fire, garbage and recycling services.

The budget proposes hiring three new police officers, a risk manager and covers the total salary costs for 16 new firefighters. The City received a federal grant to pay for the firefighters which was a three year savings of $661,882 but the grant has now completely expired and the City must assume the costs of the firefighters. An independent firm, Springsted, conducted a staffing study that compared Kannapolis with cities across the Charlotte Metro Region and North Carolina and reaffirmed the need for these additional positions. The budget also reflects the associated costs of hiring these employees such as equipment and vehicles.

The City Hall and Police Headquarters is scheduled to open in late 2015. Instead of leasing facilities across the City all departments will be located in the new facility. A new department, General Services, has been formed to handle the maintenance, repair and operation of all City-owned buildings, including the new City Hall – Police Headquarters, CMC-Northeast Baseball Stadium, and the downtown properties as well as the grounds maintenance of all non-park common areas the City owns. This department will have a director, four custodians. Additionally, three full-time and five part-time grounds maintenance personnel from the Parks and Recreation Department will move to this Department.

The budget calls for the transition of all Planning functions to move from a contract service to a City operated function. The department will have a director, two senior planners, a GIS specialist, a planner, a planner technician and two code enforcement officers. The City expects to save $9,858 in 2016, and a greater amount next year by moving this function in-house.

The proposed budget calls for no increase in water/sewer rates or environmental fees but there would be an increase in stormwater. Stormwater fees will increase slightly with the average household seeing an increase from $3.60 to $4.50 a month. The Stormwater increase is the fourth and final one anticipated to cover all previous debt and expenses the City has incurred on Stormwater Projects.

The budget also includes monies for cost of living increases for employees, replacing aging computers, software, repairs to three Fire Stations, replacement of a knuckle boom truck for the streets department, street resurfacing, and many other small projects.

A public hearing on the budget is scheduled for 6 p.m., June 8, at the Kannapolis Train Station.

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