WINTON – Despite a slight increase in projected spending, Hertford County’s operating budget for 2012-13 is built using the current tax rate and includes a raise for county employees.

Hertford County Manager Loria Williams presented her budget proposal to the county’s board of commissioners at their meeting here earlier this week. Williams recommended a $23.52 million operating budget for 2012-13, which reflects a three percent increase in spending compared to the current fiscal year.

The proposed budget maintains the current 84-cent tax rate (per $100 of value). Williams said the tax rate is based upon an estimated valuation of real and personal property amounting to $1.47 billion and a collection rate of 94 percent. That increased valuation, Williams said, will generate an additional $443,506 in the tax levy

Her proposal includes moving nearly $1.5 million of appropriated fund balance.

“That’s higher than I would like it to be,” Williams said of moving fund balance over to the general fund, “but nearly $400,000 of that is for non-recurring expense for capital projects.”

Meanwhile the county’s unreserved fund balance remains healthy, standing at approximately $5 million, or 24.05 percent of the general fund budget. For counties the size of Hertford, the North Carolina Local Government Commission recommends an unreserved fund balance between 15 and 25 percent.

Also included in her budget proposal is a 3 percent cost of living increase for county employees. If approved, that pay hike would bring the county’s payroll to a shade over $7 million.

There are no increases in user fees for county water and solid waste customers in the proposed new budget.

Williams said the challenge of building the 2012-13 budget was to continue to provide federal and state mandated programs, and doing so during a downturn in the local and national economy, while attempting to address the county’s short and long term capital improvement needs – to include the new courthouse and E-911 Center, roof replacements on county buildings and the installment of a updated telephone system for county offices.

“We have created a capital reserve fund for these projects,” Williams said, adding that the fund will continue to set aside, as promised, the new one-quarter cent sales tax (an estimated $435,000) as well as earmarking an additional 15 percent (or $200,000) of the one cent sales tax (that is returned by the state to the county) for future capital projects and/or operations.

Williams noted that hikes in insurance continue to impact the county budget, pointing out that those costs will rise by nearly $200,000 ($2.06 million to $2.21 million) in the coming year. She added that fuel and utility costs were hard to predict while on the flip side sales tax revenue to the county remains sluggish ($3.16 million this year and $3.27 million projected for 2012-13).

“The economy is on the mend, but it’s slowly on the mend,” she stressed.

Capital projects were roughly $600,000 this year and projected at $518,00 next year.

Williams built her proposed new budget by using five significant revenue streams – $11.97 million (representing 51% of the overall budget) of ad valorem taxes, $4.46 million (19%) of restricted intergovernmental funds, $3.27 million (14%) of other taxes and licenses, $1.499 million (6%) of appropriated fund balance, and $1.026 million (4%) in sales and services.

On the expenditures side of the budget, four departments within Hertford County local government will receive the lion’s share of the $23.52 million – $6.38 million (27%) for Human Services, $5.66 million (24%) for Public Safety, $5.65 million (24%) for Education, and $4.95 million (21%) for General Government.

The commissioners have scheduled a budget work session on the morning of May 31. That afternoon the commissioners plan to meet with the Hertford County Board of Education to work on the local budget needs of the school system.

On the passage of a motion, the commissioners scheduled a public hearing for the proposed budget at 7:30 p.m. on Monday, June 18. They plan to schedule a special called meeting for 9 a.m. on June 26 to adopt the new budget, which takes effect July 1.