Wake's Capital Improvement Plan at center of debate
Posted May 10, 2010 5:38 p.m. EDT
Updated May 10, 2010 11:21 p.m. EDT
Raleigh, N.C. — With nearly every Wake County government department facing budget cuts and staff layoffs, some people are questioning why officials aren't tapping into a $12 million Capital Improvement Plan.
The county's revenue is expected to be $17.9 million less than previous projections for fiscal 2009-10, which ends in June.
The money in the CIP account is used to pay for improvements like roads, schools and parks. But given the current state of the economy, Commissioner Stan Norwalk said Monday that he would support transferring some of the money to help fill shortfalls in the operating budget, which pays for salaries and funds programs.
"I think that there's money to be spent on people who are homeless and starving,” Norwalk said. "At the end of the day, it is your value and your judgment. It is really a value judgment as to what is needed to keep this community moving forward."
However, swapping the CIP money out could cause the county to eventually pay higher interest rates on bonds. That would ultimately transfer into a tax increase, Commissioner Joe Bryan said.
"We will make due with the money we have available. Does it mean some fine tuning? Yes,” Bryan explained. "I’m really concerned. I don't want to do anything that will impact our Triple–A bond rating."
Because of the AAA bond rating, the county has been able to get lower interest rates for projects like a jail expansion on Hammond Road, Wake Technical Community College construction projects and the new $214 million Wake County Justice Center.
Use of the CIP account is likely to be considered next Monday when County Manager David Cooke presents the budget to commissioners.
"It is still on the table," Cooke said.
Among the county departments dealing with cuts, the school system is facing at least a $20 million shortfall with as much as $34 million additional cuts possible, depending on how much funding the state allocates to the school system.
Officials have also said funding for the Human Services Department will be $10.5 million less to offset lower revenue from state and federal sources. Cuts in other departments, such as transit and libraries, are also being considered to close the rest of the deficit, which could reach $22 million, officials have said.