Murphy – In May, when the Cherokee County Board of Commissioners voted to evict Cherokee County Schools from the Central Office building at 911 Andrews Road, the board did much more than that – it also took away $1.2 million in annual sales tax revenue.
In the same meeting on May 23, the board of commissioners evicted Cherokee County Schools’ headquarters effective Aug. 2, and redirected an estimated $1.2 million per year in Article 46 quarter-cent sales tax revenue from schools for county government use.
The timing itself presents challenges. As if finding and preparing a new headquarters building and plugging a $1.2 million hole in a month or two weren’t enough, the time frame included a long Memorial Day weekend and flurry of graduations that school officials were obligated to attend.
Two weeks have passed since the one-two blow, with no public action or comment about how the school district plans to proceed. However, the school board’s decision to transfer many elementary and middle school students – which started the dispute with commissioners – is still scheduled to take place in August, when students return to class.
Evicted
Education accounts for just shy of 15 percent of Cherokee County government’s annual budget. Although education decisions are made by the school board, the county commission is responsible for approving most school district expenditures, from the district’s budget at the start of each fiscal year to budget revisions for unforeseen needs the rest of the year.
While much of the schools’ budget comes from state and federal funding, the county has budgeted more than $8 million in local funds for teacher supplements, locally funded teacher and staff positions, building repairs, infrastructure and a wide variety of other things.
Cherokee County Schools has occupied 911 Andrews Road essentially rent-free. Cherokee County Schools paid $2,300 per month rent on the structure from 2001 until June 2012, but paid rent with funds the county provided.
“Basically, the county was appropriating the funds to the school board for them to turn around and pay it back to the county in their monthly rent payments,” said Candy Anderson, the county’s chief financial officer. “Therefore, beginning in fiscal year 2013, the county ceased this practice and made their annual use of the building an in-kind contribution.”
An offer for Cherokee County Schools to move into the National Guard Armory off of U.S. 19/74 would include a similar arrangement.
The relationship between the board of commissioners and the school board has seen its ups and downs, but grew tense after the board of education decided to reorganize Martins Creek, Ranger and Hiwassee Dam schools, closing middle schools in Martins Creek and Ranger along with the elementary school in Hiwassee Dam.
Angry parents, frustrated by a lack of responsiveness from the school board and administration, sought help from the county board. Several commissioners expressed concerns, but their influence was negated because county schools planned to make necessary improvements in-house – with no county approval needed.
The county was looking at the old National Guard Armory to house county emergency operations, but at some point switched plans and decided to move emergency operations to the appropriately addressed 911 Andrews Road – Cherokee County Schools Central Office.
How or when that was proposed is publicly unknown; all meetings were conducted in closed session. But the 911 Andrews Road proposal came to the board for a decision in closed session on May 23. The board voted unanimously to evict the school district but offered it the old National Guard Armory as a substitute.
The old National Guard Armor is about 2 miles east of the present offices and offers the same square footage and parking space. The county shares the armory with the Town of Murphy, which uses the equipment bays to store firefighting equipment.
Cherokee County Schools would continue the sharing arrangement with Murphy if the school district accepts the offer.
Meanwhile, school board member Jeff Tatham has suggested using the former Marble Elementary School/The Oaks Academy campus to house not just county schools headquarters, but the school motor pool, food preparation and other services.
Tatham’s proposal lacked traction from the school board. The board voted in April to sell the Marble campus, but with the campus still unsold, the school board may rethink that decision as the simplest option available given time constraints and funding.
Article 46
Cherokee County Schools has benefited from two sales tax measures – a half-cent sales tax (Article 40/42, which remains in effect for schools use) and a quarter-cent sales tax (Article 46).
The Article 46 decision affects Cherokee County Schools and, to a lesser degree, Tri-County Community College. County schools has relied on Article 46 proceeds since voters approved it in 2016.
The proposed budget includes $321,401 in previously approved Article 46 expenditures – including a wide range of infrastructure projects, $153,551 for athletic trainers, $146,664 for a state school resources officer grant match and $6,626 for AED machines for school nurses.
In the lead-up to the Article 46 vote in 2016, Cherokee County Schools published a brochure calling the referendum “an investment in the future of Cherokee County … improving our schools with common ‘cents.’ ”
“Less than a cent from you can mean a higher quality education for students attending Cherokee County Schools and Tri-County Community College,” according to the brochure. Revenue from the sales tax “will be used to repair and maintain aging buildings and keep facilities up-to-date. Maintaining existing personnel needs and mending the deficit created by deep state cuts in funding and the lost of small schools funds is a top priority.”
The question on the ballot was set by N.C. General Statute 105-537(c): “[ ] FOR [ ] AGAINST Local sales and use tax at the rate of one-quarter percent (0.25%) in addition to all other state and local sales and use taxes.”
Cherokee County voters approved the sales tax referendum with a final vote of 1,091 for and 584 against, but note – the ballot question made no mention of education.
Once the ballot measure passed, the board of commissioners voted to levy the tax, finding “that the levy of the one-quarter-cent county sales and use tax is necessary to help address and alleviate fiscal constraints within Cherokee County.”
Here are minutes from that meeting: “Following the recently approved sales tax referendum by Cherokee County voters, a motion was made by Commissioner (Cal) Stiles to approve a resolution to levy an additional quarter-cent sales and use tax. Motion seconded by Commissioner (Roy) Dickey. Motion passed.
“The commissioners agreed that during their tenure as a board, that the additional tax would be used to fund education. However, any future board could use the funds for any budgeting needs.”
That “any future board” is the Cherokee County Board of Commissioners in 2024.
Earlier in that June 2016 meeting, a local hotel manager predicted the future.
“Aurelia Stone, manager of the local Best Western, shared concerns about the recently passed quarter-cent sales tax referendum,” according to the minutes. “Mrs. Stone was upset that the resolution did not designate that the tax would be used only for funding schools. The county manager explained that the resolution could not designate funds for a specific purpose, but that the intent of the current board is to use the sales tax for education.”
The first Article 46 quarter-cent sales tax proceeds were spent in June 2017, $15,000 for a summer camp program and $98,104 for two classroom teachers. In 2018, $416,746 went to operations and $90,000 went for Chromebooks. Total 2019 expenditures of $334,664 went to infrastructure including chillers, sidewalks and a $103,444 match for a school resources officer grant.
In 2024, the school district’s proposed budget includes $1.45 million in approved Article 46 expenditures, including more than $370,500 in projects carried over from previous years. The Article 46 decision becomes effective July 1, the first day of the 2024-25 fiscal year.
County spending
The board of commissioners opened its budget workshop on May 23 with a closed session. The board reconvened in public to announce it had voted to evict Cherokee County Schools’ main office from the county-owned building at 911 Andrews Road.
The county intends to house emergency services management in the building after spending months renovating the National Guard Armory for that purpose.
Following that bombshell, the board went into its ordinary budget polling session. That’s when the board gives up or down votes to budget items that were not covered in the county manager’s recommended budget.
A big part of the workshop involved payroll options. County services have been hit hard in their attempts to hire and keep skilled workers lured by higher pay offered by neighboring counties and agencies.
County Manager Randy Wiggins proposed a 2 percent cost of living adjustment for county workers at a cost of $388,166, but a consultant, the Cary-based Management & Personnel Services Group, suggested two options to make the county competitive, ranging in cost from $1.26 million to $1.95 million per year.
Wiggins didn’t like either option.
“We believe county personnel are the most important asset and should be paid accordingly; however, this large of an increase could not possibly be covered in the budget without a millage increase,” Wiggins said in his budget proposal. “This cost would result in an approximate millage rate increase of 5 cents.”
Anderson looked at the two proposals and came up with a third that was significantly cheaper and still helped move county pay forward competitively. Her plan includes pay bumps from 2-5 percent at a cost of $1.4 million, including the 2 percent cost of living raises.
The board liked that option and approved it, then turned to other revenues and expenses.
Two revenue options increased landfill fees – solid waste fee from $75 to $85 and tipping frees from $80 per ton to $90 per ton with a $4.50 minimum. The third revenue option was to undesignated Article 46 sales tax revenues effective July 1, adding $1.2 million to the county budget and removing $1.2 million from the schools budget.
The county also removed an assistant manager position from Emergency Medical Services, saving $67,213.
In all, commissioners had an additional $1.49 million to spend on their budget, while the school district was hit by a $1.2 million cut along with eviction from its longtime headquarters.