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A fiscal “Tale of Two Cities”

Posted on June 19, 2008 by Staff

Comparing Boone to Carrboro … by the numbers

By Brian Voyce

Carrboro rulers love to compare themselves to Paris, France. But the town with the mightily overblown “Paris of the Piedmont” moniker is more appropriately compared to the town of Boone. Both are in North Carolina. Both are subject to the same municipal rules and laws from the state Legislature. Both are towns with a public university as the economic engine. Both are in the state-designated category of towns between 10,000 and 50,000 in population and roughly the same size (Boone, 14,473 and Carrboro, 18,611). Both do not incorporate an electrical utility in town financials. Both have had a population increase over the past five years of about 7 to 8 percent. Both are “blue” towns politically, compared to the rest of the state.

What would happen if one compared the fiscal management of these two seemingly similar towns? Which financial indicators would be similar? Which would be dissimilar? Why?

Before diving into the facts, one must first do some calibrating. One big difference financially between Carrboro and Boone is that Carrboro uses a separate water and sewer utility organization (OWASA). However, Boone incorporates these utility financials into its budget. Any comparison should back out these utility line items.

In doing so, a Carrburban may note a difference with Boone even regarding the cost of water and sewer. A residence in Boone using 5,000 gallons pays about $53.00 per month for water and sewer. That looks like a great bargain to a similar one in Carrboro paying (under the new proposed rates) about $73.00. So to start off, Carrburbans pay about 50 percent more for water and sewer than Booners. [See Chart Group A].

At first blush, the revenue comparison is about even, with Carrboro bringing in per capita total revenues of just 7 percent more than Boone. But how is that total revenue achieved?

Carrboro leans heavily on property taxes, with $520 levied per capita versus $326 for Boone. Carrboro levies 60 percent more in property taxes per capita. Even more glaring, Carrboro performs rather poorly in generating sales tax revenues despite over a decade of funding over a million dollars to a dedicated economic development office. Carrboro collects sales taxes of $180 per capita versus $278 by Boone. Yes, Carrboro collects only 65 percent of the per capita sales taxes that Boone collects. Put another way, if Carrboro had sales tax revenues like Boone, then instead of raising $3,353,665, Carrboro would raise $5,177,775 in sales taxes.

So what about spending?

Carrboro excels in spending, outspending Boone by 33 percent per capita. Put another way, if Carrboro spent like Boone, the town budget would be reduced by over three million dollars. Here are the comparative expenditures. [See Chart Group B].

Clearly, Carrboro relies more on debt to cover spending than Boone, spending $67 per capita on debt service versus $16 for Boone. Carrboro spends almost four times the amount of money per capita that Boone does on debt service. Moreover, Carrboro isn’t spending as much as Boone on public safety (85 percent of the amount Boone spends), but spending way more that Boone on transportation, spending over twice (245 percent) what Boone spends. Boone has lower debt and a greenways trail. (See
http://www.townofboone.net/departments/public_works/pdfs/Boone_Greenway_Trail.pdf.)

Specific expenditure categories reveal a different governance philosophy between the towns. For example, Carrboro is in a period of slowed growth, yet maintains a 14 member planning and zoning staff drawing $894,951 annually in salaries and wages. That’s opposed to Boone spending almost one half that ($487,391) for inspectors. Fire department salaries and wages in Carrboro are almost three times that of Boone ($1,563,310 versus $639,658). However, police department salaries and wages in Carrboro are only 24 percent more than Boone, despite Carrboro having a 29 percent larger population. Legal expenditures in Carrboro are almost twice that of Boone.

Perhaps the most outstanding difference is how much Carrboro spends on its governance board. Carrboro gives health care benefits to its mayor and aldermen. If you remain on the board long enough, those benefits are available even after you leave the board. Just the salary expenditures of the Carrboro board are almost three times that of Boone ($98,209 versus $36,900).

According to the “blue small university town” values reflected in the Boone budget, Carrboro simply overspends and spends unwisely. During their respective latest re-election campaigns, Mayor Mark Chilton and Alderman Jacquie Gist confused a budget presentation award as being one for fiscal management. They think their above fiscal management record is meritorious.

Acts have consequences. Electing town officials on the basis of compatibility over competence or pals over performance costs you. Promoting such town officials to higher political office costs you even more.

Click to enlarge. Click to enlarge.

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