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Cornelius News

Covid-19 fall-out will affect town budget

March 23. By Dave Vieser. Just a few weeks ago, the major budget decision facing Cornelius commissioners was whether a tax increase might be needed starting July 1. The world has changed in the past month and there’s some speculation now on whether municipal budgets can be formulated accurately between now and June 30, given the volatile state of the economy.

The formal budget retreat at the Graylyn Conference in Winston-Salem has been cancelled.

The FY21 budget will be done prior to June 30, said Town Manager Andrew Grant.

The preparation process, however, has undergone extensive but necessary modifications. The annual budget retreat in Winston-Salem scheduled for the week of March 24 has been rescheduled to be held locally and town officials will be meeting within safe distances at Town Hall and via the internet as they crunch the numbers.

Both current and former commissioners say developing the new budget should still be possible even it’s done remotely.


“The annual budget retreat is useful for discussing the idiosyncrasies of a municipal budget with individual interactions between the elected officials,” said Commissioner Mike Miltich. “Hopefully we can achieve the same results and get the budget done, even if we do some of it virtually.”

Former Commissioner Dave Gilroy agrees. “I also expect the town’s budget planning and approval time table to remain as normal. When you think about the structure of our town budget, sources of revenue, and the bulk of the expenses, this crisis should not dramatically change the time table or the underlying fundamentals. This is likely to be true even with federal and state fiscal conditions in traumatic shock.”

Sales tax revenue is the major issue on the revenue side.

Expenditures tied to road projects could be delayed to accommodate shortfalls.

“There are definitely really important things subject to flux,” said Gilroy, the town’s long-time—and former—budget hawk.

Town Manager Grant said sales tax revenue is budgeted for the fiscal year it is collected. “So, yes, [it is] collected and spent in the same fiscal year,” he said.

Traditionally the annual proposed budget is unveiled by the town manager in early May and by law must be adopted no later than June 30.

There is, however, a fallback process in place to cover certain expenses such as employee salaries should local municipalities in North Carolina fail to adopt a new budget, according to Kara Millonzi of UNC’s School of Government.

“State law authorizes a governing board to make interim appropriations until the budget ordinance is adopted. This authority is limited, though. The interim appropriations only may be made for the purpose of paying salaries, debt service payments, and the usual ordinary expenses of local government for the interval between the beginning of the budget year and the adoption of the budget ordinance.”