'Difficult decisions ahead': Buncombe County expenses outpace revenues

ASHEVILLE – The Buncombe County Board of Commissioners will face tough choices this upcoming budget season. At the county’s first budget retreat for fiscal year 2025 Nov. 30 at the East Asheville Library, staff informed commissioners that the county’s recurring expense growth has outpaced its revenue growth.

Recurring expenditures, not including education spending, have increased by close to or exactly 7% each year from fiscal year 2021 to 2024, according to Buncombe County Budget Director John Hudson. Property tax revenues, which make up the largest portion of the county’s recurring revenues, typically increase 3% annually during non-reappraisal years, Hudson said. From fiscal year 2022 to present, property tax revenues increased 5% annually due to increases in the tax rate.

“At the end of the day, the trend is that our expenses are growing faster than our revenues,” Commissioner Amanda Edwards said at the session. “The bigger picture is we have some difficult decisions ahead of us.”

Recurring expenses contributing to the 7% increase include health and human services, public safety, general government, cultural and recreational functions, economic and physical development and transfers to community commitments. The county grouped education spending separately, although it is still a recurring expense.

The largest increases in expenses come from commitments made to general government, public safety and education.

General government operating expenses increased from $18 million to $31.7 million from the 2019 to 2024 fiscal years largely due to increases in information technology support and solutions and maintenance to repair county facilities, Hudson said.

Public safety operating expenses have increased by $8 million due to the community paramedics program launch, additional equipment, training, new uniforms and rising costs of contracted services, Hudson said.

The most significant increase came from increases to the county’s education spending, which rose from $84.2 million to $121 million during the five-year period. This includes a 28% increase in the last two years.

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Commissioners approved a 1 cent per $100 property tax rate increase intended to supplement local school employee pay as part of the fiscal year 2024 budget. This increase and a budget revision generated $6.1 million.

Ideally, Buncombe County would bring in enough revenue to pay for the entirety of its recurring services, Hudson said during the meeting.

For the 2024 fiscal year, Buncombe County has $420.9 million in general fund commitments. The county is currently projected to use $22 million in reserve funding to make up the gap in revenues from the current year. Hudson told the Citizen Times in a Dec. 1 follow-up conversation that the county needed to preliminarily dip into the reserves more to make up for a $4 million shortfall in sales tax projections, which are often volatile.

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Hudson told the Citizen Times that the county may not ultimately need to use the reserve funding if it brings in more revenue or spends less than it projects.

Commissioners will not see a draft budget until March, Hudson said.

Amanda Edwards told the Citizen Times Dec. 1 she did not want to comment on whether she would consider raising property taxes until she sees the budget. She said that she will evaluate budgetary services based on the service they provide to the county.

Board chair Brownie Newman told the Citizen Times Dec. 1 that commissioners will work hard to maintain the property tax rate in the upcoming budget cycle. He also noted that the county has already made some of the investments that have led to expenditure growth.

"They (the expenditures) will not necessarily continue on the same trajectory indefinitely into the future," Newman said.

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Hudson told the Citizen Times that part of the challenge commissioners will face is choosing from the wide array of capital projects. Staff presented commissioners a menu of projects that include renovations and repairs, updates to emergency services facilities and the ambitious Ferry Road development. The county will use debt service to pay for a lot of those projects, which Hudson said, would be paid through the general fund. He also noted during the presentation that demands for county services have increased during the past five years.

The next Buncombe County Board of Commissioners meeting will be at 5 p.m. Dec. 5 at 200 College St. in Asheville.

Mitchell Black covers Buncombe County and health care for the Citizen Times. Email him at mblack@citizentimes.com or follow him on Twitter @MitchABlack. Please help support local journalism with a subscription to the Citizen Times.

This article originally appeared on Asheville Citizen Times: Buncombe County budget season: Expenses growing faster than revenues