Editorial: Facing a longstanding challenge

March 14, 2014 

For the past few years, Zebulon leaders have had to grapple with shrinking revenues and increasing demand for services as the population grows. The challenge remains this year and difficult decisions lie ahead.

The town faced the loss of one revenue stream from the state of North Carolina last year. By the time the dust had settled, the town recouped about half that money. By then, however, the town’s budget had already been set without including any of that money.

That fact may make it a little easier to build a spending plan this year. As Zebulon begins the budget-building process, though, it also faces increases in water and sewer rates that customers will have to pay. It also must deal with a shrinking industrial tax base that means there will be even less money in the coffers. Without new growth to offset the losses, the town has just a few viable options.

One option is to pull from its savings. The town has a robust savings account that amounts to about 50 percent of the money it would cost to operate the town for a year. In other words, if the town didn’t bring in a dime of money, town operations could run normally for six months. Towns like Zebulon build health savings accounts for two reasons: to deal with major unexpected expenses like natural disaster recovery and to help get it through hard times like we’ve seen over the past few years. If ever there was a time when it makes sense to spend some of the town’s savings, this might be the time.

The town’s other option would be to take a hard look at expenses. Many of the painless cuts have already been made. Additional cuts would eat into the quantity and quality of services the town provides to residents, from sweeping the streets to running youth baseball and softball leagues. Most painfully, it could also mean the loss of jobs. We don’t particularly see the town staff as bloated to excess, which makes it that much more difficult to make staffing cuts.

But as business owners in many other industries have found, staffers left behind after traumatic cuts have proven capable of becoming more productive when they are called upon.

We would love to think the town’s current budget challenges won’t come to such draconian measures, but the problem is a real one and decision-makers should keep all their options open as they head in to this budget season.

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