View All Posts

Nov 01

Question 6: What Does, "Financial Reality Settling In" Mean?

Posted on November 1, 2017 at 9:56 AM by Waxhaw Communications

QUESTION 6: Can you explain more about the statement, “financial reality was settling in?”  

ANSWER:  The costs of growth are as varied as the factors which affect growth. There are capital costs associated with new growth, on-going day to day operating and maintenance costs associated with growth, costs for hard and soft services, and the costs to replace existing and planned infrastructure.

The local municipal tax base pays much of the cost for local growth. With that comes the responsibility of ensuring that the costs of growth are sustainable and based on reasonable, manageable amounts of growth. In 2015, the Board conducted a financial exercise – true budgeting – to better understand all of the costs facing us. There was no Capital Improvement Plan – our list of prioritized investments - a core to any strong town. We had no financial plan for critical pieces of the infrastructure – roads, storm water and environment. In creating our “master plans” we had developed a wish list that had as an initial cost nearly $150 M. Minimal progress had been made on our tax base as it continued to be heavily skewed towards residential. And all of this was being managed by a set of financial policies and tools that were outdated.

In the 2015/2016 budget we established financial performance as our number one Strategic Initiative:   

Strong Financial Performance: Provide financial resources in a prudent and responsible manner through traditional and alternative sources of revenue, effective budgeting, and cost control with a focus on maintaining a healthy fund balance

Over the last three years we have put in place a comprehensive financial system and polices:

  • 2015: Policies were modernized to align with State guidelines;
  • 2015 / 16: Departments and department budgets were defined and established for the first time to provide clear performance and financial accountability;
  • 2015/17: A “pay as you go” Capital Budget was established; and
  • 2017/2018: A full Capital Improvement Plan is being established with timelines and priorities.

With that Waxhaw has re-engaged with our regional and state partners on infrastructure. And while there is much more work to be done, the foundation is in place on the financial side to better manage how the Town operates and grows. And all of it is done transparently through the annual budget process. Our budgets can be found on waxhaw.com