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The Village of Pinehurst will balance the Fiscal Year 2021 budget with an increase in local property taxes, dip into cash reserves and postpone programs. This is the preliminary plan laid out by Village Manager Jeff Sanborn in a virtual meeting of the Village Council Tuesday.

As it stands right now, the Village of Pinehurst’s budget will be $21.3 million, 3% less than this year. To balance the budget, property taxes will be raised by half-cent, $1.4 million in cash reserves will be used and programs will be deferred to later in the year.

“We lowered our revenue projects across many categories due to the impact of the COVID-19 pandemic,” said Sanborn. “We really don’t yet have a firm idea of what that impact is actually going to be.” The village is projecting lower revenue from sales tax, lower returns on investments and a drop in money collected from building fees.     

Unlike the federal government that can run budget deficits, local budgets must be balanced.

The increase in property taxes is part of a multi-year plan adopted by the Village Council last year. It calls for a half-cent increase each year for the next four years. That alone will not be enough to offset the slump in revenue, so the village also plans to use money from reserves called Fund Balance.

If the impact of COVID-19 results in even less revenue collected during the first quarter of the next fiscal year, Sanborn proposes to postpone a total of $855,750 in expenses. They include deferring improvements to Magnolia Road, Wicker Park and Cannon Park. Hiring for the new position of Transportation Planner could also be put off and the Welcome Center closed.

“We are not spending a dime on these things,” said Sanborn. That gives us about three months to actually assess the revenue situation as it is coming in. I think that by the August or September time frame we are going to have seen the actual sales tax numbers come in that are probably going to describe the worse case.” 

A public hearing on the budget is scheduled for May 26 at 4:30 p.m. All government meetings are being held online until further notice, in keeping with the state stay-at-home order banning gatherings of 10 or more people. 

To accommodate comments that would have normally been made in person, the public may contact the Village Clerk at [email protected] or 910-420-1631 in advance of the public hearing.

Members of the public will be able to review the budget for the fiscal year that starts in July, leave online feedback and make their concerns known by visiting https://engage.vopnc.org/lets-talk-budget.

Plans are for the final budget to be adopted in June.

The Village Council will hold two more meetings in May to work out the details of the budget before the public hearing. They will both be live-streamed using the Village YouTube channel, www.vopnc.org/live.

Sandhills_Sentinel~Article and photo by Sandhills Sentinel Reporter John Patota.

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