For Immediate Release

February 7, 2002


Cumberland County Board of Commissioners
Release Statement on Impact of Governor's Decision
to Withhold $2.1 Million in State Reimbursements

Cumberland County's economic outlook took a drastic turn for the worse with Governor Mike Easley's announcement Tuesday that the state will cut more than $209 million in state reimbursements scheduled to be paid this fiscal year to local governments.

For Cumberland County, the loss in revenue is $2.1 million, which amounts to approximately 2 cents on the property tax rate.

The property tax rate in Cumberland County is already the 7th highest in the state. County officials were depending on the promised state reimbursements that are already included in the current fiscal year budget.

The Cumberland County Commissioners see the withholding of the state reimbursements as more salt on a wound that has yet to heal. The Governor's action further exacerbates a particularly difficult and challenging budget year that required a 2 cent property tax increase, the laying off of more 100 county employees, and elimination of 150 vacant positions.

Most county departments are struggling with 15% cuts and operating budgets at 1997 Fiscal Year levels. This includes our Health Department, Area Mental Health Authority, Sheriff's Office and Library system. Reduced budgets mean reduced services to our citizens. There's no question - our citizens deserve more.

Our employees also deserve better. We continue to lose county employees because of our inability to maintain competitive salaries. All our employees have been called on to carry increased workloads due to eliminated jobs.

Our current Medicaid costs are likely to exceed last year's cost by almost $2 million and continue an upward spiral. The economic recession is reducing our primary revenue sources, property taxes and local option sales taxes. The City of Fayetteville's on-going vigorous annexation program has cut Cumberland County's revenues by over $5 million per year. Capital expenditures and infrastructure investments have been slashed to caretaker levels or, in many cases, deferred.

All members of our Cumberland County Board of Commissioners have signed a letter to Governor Easley that states our case plainly and emphatically. Their letter urges the Governor not to intensify our budget struggle by failing to make payments to North Carolina's counties and cities of our scheduled reimbursements.

Our Board encourages our county citizens to ask the Governor not to solve the state's budget crisis on the backs of local government.

If the Governor is reluctant to release the scheduled reimbursements, we strongly urge him to call a special session of the General Assembly to grant counties the authority to levy a one percent sales tax to offset the deficit.

We encourage the Governor to work with us to find solutions rather than to continue to inflict fiscal distress on counties and cities. We also encourage our Cumberland County Legislative Delegation to work with us and the Governor in this effort.

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