We have reviewed the town’s draft budget for FY2010 and made our recommendations to Town Council on June 9. The following summarizes these:

1. Debt reduction — The town’s debt now exceeds $300 million. We urge Council to: (a) Reduce subsidies for non-essential facilities and services, (b) Reduce staffing to only essential positions, (c) Delay all non-essential Capital Improvements and review their need in the future.

2. Open positions: We recommend cancellation of all open positions as the current level of service provided without these people appears to be acceptable.

3. Staffing for permits and inspections: We recommend a reduction of staff for those handling permit, fees and inspections commensurate with reduced activity. Permitting is down 18 percent overall, and inspections have dropped 33 percent overall since FY2008.

4. Sewer and water rates: We recommend against an increase in water and sewer rates, since an increase in prices will result in decreased demand and lower water revenue. Cary can only reduce overall treatment costs if we increase the volume produced.

5. Energy cost reductions: We believe that the town staff can affect major reductions in energy (electricity, gas, vehicle fuels) over the next five years through innovative conservation coupled with facility and equipment usage. We recommend that the town manager and mayor set annual energy reduction goals for all staff units.

6. Prioritization of capital spending: We recommend the town develop a strategic plan that would predict capital needs with justification for the next three to five years. All projects should be prioritized according to need and include an annual assessment of risks, benefits, progress against targets and available alternatives.

7. Cash flow review: Beginning in FY2010, the town should begin a plan to eliminate taxpayer subsidies within the next two to three years for all non-essential services and facilities, for instance recycling, C-Tran bus, facilities for professional sports organizations and professional entertainers (WakeMed Soccer Park, USA Baseball Center, Cary Tennis Center, Koka Booth Amphitheatre), toilet and turf buy-back programs.

8. Delay of capital expenditures: A review of the capital improvements proposed for FY2010 revealed numerous items whose necessity should be questioned in light of the current economic crisis and changing demographics in Cary. For instance, many budget items include an inflation factor of over 10 percent justified by “increased costs for steel and asphalt” when in fact the costs for most materials have dropped dramatically in the past two years. Furthermore, we recommend against proposals relying on questionable “stimulus” funding from the federal or state government.

9. Third-party audit and Independent financial analyst: We recommend (1) Town Council engage a reputable independent auditor to review the FY2010 budget prior to approval, and to evaluate town performance against objectives in the most recent FY2009 budget; (2) Town Council hire a full-time financial analyst charged with continual evaluation of town finances, progress toward its objectives and to explore means to reduce the town budget and tax burden on its citizens.