I have taken the last few months off from writing to work on the Campaign for Wilmington’s Future, which was a committee that was working towards the passage of the Wilmington Municipal Income Tax increase that I have written about many times on this site. After a successful campaign, I am glad to be back writing about local issues. Working on the campaign, learning from city government officials about the budget, having conversations with a variety of residents of Wilmington about the city and its government has been an education and enlightening experience for me.
The current budget situation
One of the biggest questions that we got during the campaign was “where is the money going?” Well, part of this answer was easy-the majority would go towards covering the deficit, while much of the remainder would be used to help build the city’s carryover (aka rainy day fund). This would leave an estimated $500,000 per year for the City to spend, ostensibly on infrastructure projects–with streets taking a top priority. Throughout the campaign, this is what the City had emphasized as its spending plan. While not as specific as many would have liked, the administration felt that it would be potentially irresponsible to give more specifics and have unforeseen circumstances change plans.
How should the city proceed?
Now is not the time for city officials to rest on their laurels. Passing the tax was a very important step in the right direction to help the City work towards a more secure financial future while increasing investments in infrastructure projects. During the campaign, Republicans, Democrats, and Independents worked together for the future of the City, showing support across the political spectrum. However, the City cannot ignore the nearly 2000 people who voted against the tax. This could be partially seen as a referendum on how the City communicates and pursues active transparency. While the City had open forums and a special Council meeting to discuss the tax, many still felt like information was not as readily available as it could have been.
I have written about the importance of citizens to be engaged in their local government’s activities. Additionally, I have written about transparency being an issue in local government (although I did praise the City for its efforts at publicizing Council meetings). This is a time for the City to have be aggressively transparent. Those people who were skeptical about the tax (many of whom still voted for it because they understood its importance) need to feel that their voices are being heard. The City should proceed quickly with public discussions on the budget, with Finance Committee leading the way with meetings being held in Council chambers to show residents of Wilmington exactly how they are planning on spending the money that has been entrusted to them.
It is time for Wilmington to begin the process of moving forward into the future, know that its short-term fiscal future looks brighter. However, the City must be prepared to listen to Wilmington residents and work together to invest in Wilmington. I encourage residents of Wilmington to go to Council meetings related to the 2017 budget to learn more about how their money will be spent, and I encourage Council to welcome these engaged citizens into these incredibly important discussions.
One thought on “Where does Wilmington go from here?”
One man’s suggestion
City Income Tax Revenue Projections with ½% rate increase
1. 2016 revenue has increased 15% from 2015 to $5,230,177 X 5% = $5,491,085 projected 2017 revenue.
2. Assuming a conservative revenue growth rate of 5% for the following five years:
2017 base: $5,491,085 X 1.5 = $8,236,627 (.5 increase = $2,745,542)
2018 base: $8,236,627 X 1.05 =$8,648,458 (.5 increase = $2,882,819)
2019 base: $8,648,458 X 1.05 =$9,080,880 (.5 increase = $3,026,959)
2020 base: $9,080,880 X 1.05 =$9,534,924 (.5 increase = $3,178,307)
2021 base: $9,534,924 X 1.05 = $10,011,670 (.5 increase = $3,337,222)
Explanation of data:
2016 tax revenue will be $5,230,177 x a 5% growth rate in 2017 will produce $5,491,087. If the .5% levy passes the revenue will increase by $2,745,542 to $8,236,627.
The levy will produce $15,170,849 over the five year live of the levy.
Although the income tax is not the only source of revenue it is the major source.
In my considered opinion the city should not be tempted to repeat the mistakes of the past when the city experienced a sudden increase in revenue. We hired a a full time HR director, an assistant Police chief and a code enforcement/engineer among other bells and whistles included in the 2008 10,243,017 general fund budget.
I suggest that the priorities be:
Year I $1million for street repair; 20% of an estimated 2021 general fund budget to begin replenishing the reserve/carryover fund. Meet service obligations.
Year II $700,000 for streets including state match for S. South St. replenish reserve and meet service obligations.
Year III $500,000 for streets; replenish reserve; begin buying city debt including landfill etc. Rehab fire station II
At the end of 2021 we should be out of debt, use permissive tax to maintain streets have a 30-40% carryover for rainy days. A excessive carry over in 2008-2009 saved us from fiscal emergency in 2010-2015