Over the past few months the Rocky Mount City Manager and Council have made some bold proposals that impact our community. They have proposed building an event center that will cost citizens over $60 million to build and finance while the ten year projected operating loss is $4.3 million. Most recently they have proposed a 3% to 9% pay raise for city employees to help with retention. Depending on your point of view you can argue these proposals will be a benefit or a detriment to our community but either way you should consider how we stack up against the competition. For comparison purposes, we are going to consider data the Town Manager of Huntersville, NC uses when presenting his budget to the public and town board. Comparison of the Top 20 NC Municipalities by Population – 2014. Although, we could have referenced The New & Observer article regarding the declining population in rural North Carolina featuring Rocky Mount.
Since 2011 Rocky Mount’s population has been flat but in 2014 our population declined by 2.4% and went from the 15th most populous city in North Carolina to the 16th. The only other communities to lose ranking in 2014 were Wilson, Greenville and Winston-Salem. Yet Wilson and Greenville gained population but not at the same pace as Huntersville and Asheville.
A declining population has a direct impact on the health of our economy. Our city budget is impacted by a reduction in licenses, permits, sales and property tax revenues. Will we have enough money to maintain our capital investments, support our services and operate facilities; not to mention, many municipalities such as Huntersville will use this information to encourage prospective businesses away from Rocky Mount.
Our property tax (ad valorem) rate of $0.58 per $100 of property value is one of the states highest which is just behind High Point and Greensboro. For example, a home in Rocky Mount with a tax value of $150,000 and a tax rate of $0.58 would have a tax bill of $870 (($150,000/100) x .58 = $870). Yet that same home in Raleigh would have a tax bill $296 less than Rocky Mount because the tax rate in Raleigh is $0.3826 per $100 of property value. Yes, you would be hard pressed to find a $150,000 home in Raleigh but when folks are deciding where to locate they only see that Rocky Mount’s rate is 34% greater than Raleigh’s rate.
This report indicates Rocky Mount has the most city employees per 1,000 people than the other municipalities mentioned. We have lead this category since 2011 and our next closest competitor is Wilson who lags Rocky Mount by 11.7%. The average top 20 municipality has 10 employees per 1,000 people while Rocky Mount exceeds the average by 41%. There are many factors to consider when staffing a city but our numbers should raise many questions like if we are operating with too many employees and at the most efficient level.
Will our declining population place additional strain on our budget forcing an increase in our property tax rate, a cut in services or both. What will our tax rate be in 20 years if we adopt all the initiatives proposed (event center and city employee pay raises) and we continue to have a declining population? Could we be at $1.00 per $100 of property value? If so, our example of $870 in tax obligation will increase to $1,500.
At what point do businesses and people leave because they can no longer afford to live in Rocky Mount? Does this cause our unemployment and crime to increase? Will we have to reduce our city staff because we no longer can afford to employ them? Are these concerns too extreme, too paranoid or just fiscally responsible?