Christiansburg leaders have been given a proposed budget for 2018-2019, which includes no tax increase.
Tuesday night, Treasurer Valerie Tweedie told town council existing revenue streams should be up four percent for the general fund, while operating expenditures will decrease by two percent. Thus, no new tax increase will be needed for the estimated $59.2 million budget.
Residents will see a slight increase in water, sewer and garbage fees. Water rates will rise from $6 monthly for 1,000 gallons or less to $7. Sewer rates will rise from $9 monthly for a 1,000 gallons or less to $10.
The garbage rate increase from $17 to $22 is directly connected to plans for curbside recycling that will begin July 1.
Town Manager Randy Wingfield recently said that the increase to cover the cost of the curbside recycling would prevent another increase in subsequent years of the contract, and cover ongoing administrative costs to manage the program and monitor the contractors.
The town is expecting to see increases in revenue from property taxes, meals tax, lodging tax and sales tax.
Three new positions are included in the budget for the rescue squad. One shift supervisor is slated to become full-time, while two 32-hour positions will also be shifted to full-time. All three will be funded via the town’s revenue recovery monies that are collected through the rescue squad’s service calls.
Capt. Joe Coyle of the rescue squad said the change in staff is needed so his department can continue to give 24/7 excellence service to the community.
The budget does include a two percent merit increase for town employees totaling $245,000. Additionally, town employees will be given a one-percent “cost-of-living” increase as well as awards for those reaching their fifth, 10th, 15th and 20th years of service.
The public works department will replace several pieces of equipment in the upcoming budget that includes a backhoe, sewer cleaning machine, air compressor, golf cart, two pickup trucks, two dump trucks, a mini excavator, two dump truck bodies, a service van and a hydraulic vehicle lift.
The community will see several major capital projects begun during the upcoming fiscal year including the $7.04 million for upgrades to the North Franklin/Cambria interchange.
The town will only have to contribute $10,000 to the project with the majority of the monies coming from Virginia Commonwealth Transportation funding.
No new debt is proposed for the new fiscal year. Other new initiatives slated to appear during the time period include construction of way-finding signs and the purchase of a portable skating rink and a mobile stage for special events particularly in the downtown area.
The town also plans to conduct an employee wage and compensation study and upgrade the phone systems for the police department and wastewater treatment plant.
The budget was presented on a night when a businessman approached the governmental body about the elimination, or at least the decrease, of the town’s cigarette tax. Remon Yassa, who owns the BP gas station and convenience store on North Franklin Street, said that he is losing business, because people are going to stores outside the town’s limits to buy their cigarettes.
“And when they do that, they also buy other things from that store and not mine or others in the town,” he said.
Yassa pointed to the fact the town has also lost money. “Dating back to June 30, 2011, Christiansburg’s actual budget shows a cigarette tax revenue of $721,820. Now in the budget summary for 2017-2018, you only show revenue of $500,000. That’s a loss of $222,820 in tax revenue in just six years.”
Currently, the town’s cigarette tax is $4 per carton, or $0.40 a pack. The rate increased in 2009 from $0.30 per pack. For at least two years, the town showed revenue of over $721,000 with a high of $772,965 in 2009. From there, the amount has been on a decline with a projected revenue of $513,200 for the current fiscal year.
“With the continued increase every year of the cost of living, the consumer is looking for every venue to save money. The majority of the consumers will be willing to drive a few feet outside of the Christiansburg tax limit to buy their cartons four dollars cheaper and their pack 40 cent cheaper,” Yassa said.
With this in consideration, he said many stores and tobacco shops are now opening stores just outside the town’s boundary, so they can grab as much of the cigarette volume as they can.
“As a consequence, both the town and stores within the town are suffering a loss of volume and loss of customers,” he said.
The solution he presented to council calls for the reduction of the cigarette tax by $3 a carton to $1 per carton. He encouraged the town to try the new tax amount for two to three years and see what happens with revenue.
Council members thanked Yassa for his presentation and admitted the scenario is something that needs to be discussed.
A council work session to discuss the budget will be held in early April. A public hearing on the water and sewer increase will be held in late April, and a public hearing on the budget could be held in early May. A final vote on the budget could be ready by late May.