A projection of Fayetteville’s revenues over the next several years shows that the lingering effects of the recession are far from over. An economic projection covering the next five years was a topic of the recent Fayetteville City Council retreat and included little revenue growth through 2017.
Finance Director Lynn Robinson said the assumptions for 2012 general fund revenues included a 0.73 percent decrease in property taxes and an accompanying property tax roll-up to offset the projected 8-10 percent decrease in the millage rate.
The estimation for the county’s total tax digest numbers are due in early April. Chief Appraiser Joel Benton recently announced that residential and agricultural properties will see an estimated 8 percent decrease with the total digest potentially experiencing an 8-10 percent decrease once the numbers for commercial and industrial properties are finalized.
Robinson said projections for 2013 showed no growth in property taxes followed by a 1 percent growth in 2014, 2 percent in 2015 and 3 percent in both 2016 and 2017. She said those projections were based on a small amount of current activity, both commercial and residential.
Robinson in looking at the coming 2013 budget year referenced the likely sizable decrease in the tax digest but projected that local sales tax revenues might increase by 2 percent along with a 1 percent increase in licenses and permits and a 2 percent increase in business taxes.
A look at 2014 showed a hopeful beginning to recovery with a 1 percent growth in the tax digest and a 2 percent increase in sales taxes, business taxes, licenses and permits.
The projection further out to 2017 showed a hopeful continuation with only incremental growth of the tax digest and small increases in sales tax and other business-related revenues.
Revenues continue to be impacted by the economic recession, Robinson told the council.
The 5-year forecast included no new personnel or capital outlays. Fayetteville was arguably the first local government in the area to anticipate the recession. The council on the recommendation of the finance department instituted a hiring freeze several years ago, has eliminated a number of vacant positions from the budget and implemented expense-saving measures such as the employee voluntary reduction-in-hours program. Those measures are still in effect and are projected to continue.
Fayetteville in 2008 had 163 full-time equivalent postions. That number today stands at 131. The largest reductions came in general government, public works, housing and development and water and sewer.