asheville: a financial crossroads 2010

7/27/2019 Asheville: A Financial Crossroads 2010

1/12

Asheville, NC 2010:A Financial Crossroads

Presented to the Asheville City Council by:

Gary W. Jackson,City Managerandthe Executive Management Team

January 4, 2010


2/12

1

Introduction

As 2009 comes to a close in the midst oa global recession, the city o Ashevillefnds itsel at a fnancial crossroads that is

indicative o other signifcant times in itshistory. Over the last 200 years, through aseries o events and decisions made by localand state leaders, Asheville hasestablished itsel as a regional hubor business activity, employment,medicine, services, and culturaland recreational opportunities.During that time, Asheville hasgrown to be the largest city westo Charlotte, an area that generallyincludes 23 counties, 11,000square miles and more than onemillion people. Tis geographic area is roughlythe size o the state o Massachusetts.

Asheville was incorporated in 1797 and grewslowly until the late 19th century when itbegan a period o very rapid growth ater thearrival o railroad. Tat period o expansion particularly impacting growth in industry,

tourism, and housing was punctuated byhistorical fgures like George W. Vanderbilt.Te real estate crash o 1929 brought thatperiod o growth to an abrupt close. Duringthe Great Depression, Asheville was the onlycity in the country that did not deault on itsbond obligations, and the city slowly repaidthe debt over the next fty years. Partly as aresult o this fnancial position, the city sawlittle growth again until the 1950s, when post-WWII manuacturing and tourism growth

led to new economic health. Tat growthalso led to an increase in area when a series

o major annexations were implemented bythe city. Ater another cycle o slow economicactivity in the 70s, Ashevilles downtown

experienced a rebirth in the 1980s and 1990sas visionary community leaders promptedpublic and private investment in downtown

redevelopment. As a result,Ashevilles downtown has beenacclaimed as a national example ourban revitalization.

Ashevilles position as a regionalhub has brought challenges andopportunities as city leaders havesought to accommodate demandsor economic development, city

services, improved inrastructure, and publicacilities to support a growing and diverseregional population. Along the way, Ashevilleleaders have tried to balance the tax burdenon property owners within the municipalboundary with the needs and expectations oa population that ar exceeds jurisdictionallines. Tis report ocuses on the issues and

challenges acing Asheville as it seeks toaddress its fnancial structure while embarkingon a path to deliver the communitys visionor what it wants Asheville to be. It includesa perspective on the citys role as a regionalurban center, its growth and capacity tocapture a burgeoning population in the county,revenue diversifcation and the overall impactthe citys fnancial picture has on city servicesand citizen satisaction. Finally, it will posealternatives in response to the question, What

kind o city do we want to be, and what will ittake to get there?

What kind of city do we want to be,and what will it take to get there?


3/12

Why Cities Matter

Cities are centers o economic activity areas in which businesses choose tolocate in order to beneft rom the proximity

o inrastructure, other business, labor marketsand external economies o scale. Due to theconcentration o inrastructure and economicactivity, cities also provide a rich varietyo goods and services, as well as social andcultural opportunities.

Te municipal governments role in acommunitys economic prosperity is crucialyet sometimes overlooked. Te municipality

provides a local transportation network orthe movement o goods and people; operates

water and sewer systems; collects solid wastes;provides or the saety o the public as awhole through police and fre services; buildsand operates essential acilities like parkingstructures, airports and auditoriums; supportsparks and recreation programs that attractamilies; ensures sae and reliable buildings;helps rebuild obsolete sections and improvehousing stock. Trough all its activities, a citylays the oundation or an attractive, appealingand prosperous community.

Te economic ootprint o a municipalityrarely corresponds only to its municipalboundaries. Te economic sustainability ocities is inter-related to the quality o lie ina region, where areas outside o municipalboundaries beneft rom the citys investmentin inrastructure as well as higher employment

and income opportunities. Successul citiescontribute to competitive regions, stimulatinggrowth and employment. As a region grows

and urbanizes, it stands to reason thatthe demands on and importance o themunicipalitys services also grow. Te fnancialburden o those services becomes moreaordable or a city i the costs can be spreadacross a greater portion o the population thatbenefts rom them.

Ashevilles role in the regional economy isdemonstrated by the signifcant growth the

city experiences with its daytime population.Among all cities in North Carolina with

populations o 50,000 or greater, Asheville hasthe highest daytime to nighttime populationratio, with more than 40,000 peoplecommuting into Asheville or employment(taking the daytime population rom 69,000 tonearly 110,000 based on the 2000 census). Tisdata does not take into account people whocome into Asheville or shopping or servicesnor does it account or the signifcant tourismindustry in the city. An analysis o Ashevillespublic saety data demonstrates that Asheville

supports an even greater non-residentialpopulation. According to the University oNorth Carolina School o GovernmentsBenchmarking Project, Asheville takes morecalls or fre and emergency services per capitathan any o the other 17 cities involved in theproject (178 calls per 1,000 people comparedto the next highest city, Charlotte, which has

Among all cities with populations of 50,000 orgreater, Asheville has the highest daytime to

nighttime population ratio, with more than 40,000people commuting into Asheville for employment.

2


4/12

126 calls per 1,000 people). Asheville wouldneed to add around 51,000 more people to itspopulation to bring its call volume more inline with the state average, bringing its totalpopulation to about 125,000 residents.

Given a citys impact on its surroundingregion, it is imperative or cities to seekfnancial sustainability, thereby supporting areliable economy and quality o lie. However,over time, the ability o a static municipalpopulation to bear the increasing costs osupporting a regional economy throughproperty taxes can become unsustainable.Eventually, the cost is no longer aordable,and citizens begin moving outside o

municipal boundaries seeking alternativehousing options, contributing to developmentsprawl and threatening slow municipalabandonment.

Balanced Growth:

Expansion vs. Retraction

I

n his book, Cities Without Suburbs, David

Rusk used census data rom 1950 to 2000to analyze cities fscal health in the context odemographics, growth patterns and economicbases. Rusk employed a measure o the degreeto which a city either captured populationgrowth or contributed through populationloss in a regional area and compared thatdata to indicators o the cities fscal health(namely bond ratings). Rusk called citiesthat captured a greater proportion o thepopulation as elastic while cities that lost

a greater proportion o the population werecalled inelastic.

Based on his research, Rusk concludedthat a citys ability to annex land rom itssurrounding county is a primary determinanto its fscal health, and that cities trappedwithin old boundaries have suered severe

racial segregation and the emergence o anurban underclass. On the other hand, citieswith annexation powers have shared in area-wide economic growth. As these areas grew,cities were able to capture portions o thesurrounding population so that the cost ormunicipal services could be shared by a largerproportion o the regional population.

It is important to note that Rusks research doesnot suggest cities should expand to the detri-

ment o rural areas or beyond their capacitiesto provide municipal services. On the contrary,it supports the notion o inter-dependencybetween the urban economy and the ruraleconomy, and urther suggests dense growthin urban centers is benefcial to rural areas byallowing them to remain undeveloped. It alsoimplies that growth beyond a citys fnancial orpractical means o providing services is ine-ective and unsustainable. In short, municipal

growth should be balanced and should seek toinclude that which is truly urbanized.

When Rusks methodology is applied to ninebenchmark cities in North Carolina over thesame fty year period, analysis shows Ashevilleis the most inelastic city. On average, citiescaptured 53.33% o the population growthin the county. From 1950-2000, Ashevillecaptured 19.39% o the population growth inBuncombe County. Tis means that or every

fve people who moved into Buncombe County,one moved into Asheville.

On average, cities captured 53.33% of thepopulation growth in the county. From 1950-2000,

Asheville captured 19.39% of the populationgrowth in Buncombe County.

3


5/12

In the last ten years, despite rapid growthin the region, Ashevilles growth rate wasthe slowest o the 15 largest cities in NorthCarolina at 11%. Meanwhile, BuncombeCountys growth rate was more than 20%,near the statewide growth rate. Asheville has a

substantially lower population than the residual

portions o Buncombe County. As noted inable 2, Asheville is one o only two majorcities where less than hal o the populationlives in a municipality, and Buncombe Countyspopulation is much higher than most o theothers the 7th largest county in North

Carolina by population.

CityPop.1950

Pop.2000 County

Pop.1950

Pop.2000

Capture/Contribute

Asheville 53,000 68,889 Buncombe 124,403 206,310 19.39%

Charlotte 134,042 540,828 Mecklenberg 197,052 695,454 81.62%

Durham 71,311 187,035 Durham 101,639 223,314 95.11%

Gastonia 23,069 66,277 Gaston 110,836 190,365 54.33%

Greensboro 74,389 223,891 Guilford 191,057 421,048 65.00%

Hickory 14,755 37,222 Catawba 61,794 141,685 28.12%

High Point 39,973 85,839 Guilford 191,057 421,048 19.94%

Raleigh 65,679 276,093 Wake 136,450 627,846 42.82%

Wilmington 45,043 75,838 New Hanover 63,272 160,307 31.74%Winston-Salem 87,811 185,766 Forsyth 146,135 306,067 61.25%

PopulationRank in NC City

Pop.2007

Percent ofCounty Pop. County

Total Pop.2007

6 Fayetteville 181,481 57.2 Cumberland 316,914

4 Durham 228,480 87.7 Durham 260,420

11 Asheville 76,764 34.0 Buncombe 225,609

13 Gastonia 72,779 36.2 Gaston 204,971

8 Wilmington 101,526 52.8 New Hanover 192,235

10 Jacksonville 77,301 45.7 Onslow 169,302

14 Concord 71,071 43.2 Cabarrus 164,384

12 Greenville 76,222 50.2 Pitt 151,970

Table 1.

Table 2.

4


6/12

aken together, this data shows thatAsheville has had much less opportunitywhen compared to other similarly sizedcities to spread the cost o supporting aregional economy across the regions growing

population. As a result, Asheville maintainsthe highest general und revenues andexpenditures per capita in the state. Why?Compared to other larger cities in the state(50,000+), Asheville has had a very modestannexation history in the past 50 years. Tistradition o careul annexation is somewhatrelated to its confning topography, andmore related to Ashevilles limited ability touse the provision o utility services publicwater, sewer or electricity as a condition o

annexation. Instead, Asheville has relied oncontentious involuntary annexations to realizegrowth. Tis inormation is presented simplyas historical context and not as a singularalternative or addressing Ashevilles fnancialstructure. Even i Ashevilles ability to usewater service as a condition o voluntaryannexation changed tomorrow, growth in thecounty immediately surrounding Ashevillescity limits has already occurred and water

service is already available, signifcantlylimiting Ashevilles ability to voluntarily annexthese areas that most beneft rom the cityseconomy and inrastructure.

Resources &

Financial Capacity

hrough their ability to spread the tax baseover a greater portion o a regions wealth,many growing cities in North Carolina havebeen better positioned to match resources toservice demands. However, tax base sharingalone is typically not the only resourcecities have to balance the cost o services,inrastructure and capital investment requiredto maintain an economically competitiveand vibrant city and region. Other orms o

revenue diversifcation are used to providetax relie to citizens who reside within themunicipal boundaries.

Property Tax Revenues

In North Carolina, property tax is typicallythe largest source o municipal revenueand one o the ew sources which localgovernments have the power to set therates. Ashevilles budgeted $45.5 millionin property tax revenue or fscal year 2010makes up almost hal o the General Fundrevenues. Growth in real estate propertyvalues in Asheville since 2000 has yieldedsteady increases in property tax revenue.Tat growth has masked some o the

fnancial challenges Asheville is acingnow. From 2000-2008, the property taxrate decreased by $.14 while collectionsincreased by 80%.

Sales Tax RevenuesProperty tax rates can also play a partin the distribution o sales tax revenues.In North Carolina, sales tax revenue isdivided among local governments based

on one o two methods: the per capitamethod or the ad valorem method.Buncombe County uses the ad valoremmethod, which means that sales taxrevenue is divided between the county,the local municipalities, the city schooldistrict, and the rural fre districts basedon each entitys share o the total county-wide ad valorem tax levy. Over the lasttwenty years, the City o Asheville hasseen a signifcant decline in its share o

the county-wide ad valorem tax levy,and thus a corresponding decline in itsshare o the sales taxrevenue distributed toBuncombe County.able 3 illustratesthis decrease in thecitys share o county-

5


7/12

wide sales tax revenue. Tis decline isprimarily due to two actors: 1) growthpatterns which have led to a greater shareo development occurring outside the citylimits; and 2) property tax rate decisionsduring revaluation years in which the citylowered its rate more than other taxingentities in Buncombe County. o quantiythe fnancial impact o this decline, i thecity had been able to maintain its shareo the ad valorem levy at the 1990 level,

it would have received approximately$3.0 million more in sales tax revenuein FY 2008-09. It should also be notedthat Ashevilles current sales tax share o19.60% ranks 16th among the 18 cities inNorth Carolina with populations 50,000and above. Only Gastonia and Caryreceive a smaller share o their county-wide sales tax revenue.

Occupancy Tax RevenuesOccupancy taxes are collected romindividuals who pay or a room or a spacein a hotel. In 2006-07, Buncombe Countycollected more than $6.5 million inoccupancy tax revenues. Local legislationstates that these revenues must betranserred to the ourism DevelopmentAuthority and used or the purpose o

promoting tourism in the county. Ashevilledoes not have access to these unds tosupport city acilities or inrastructure.Buncombe Countys county-wide roomoccupancy rate o 4% is the second lowesto 15 metro areas surveyed. In severalcommunities, the general assembly hasauthorized both a county and a city withinthat county to levy an occupancy tax. Citiesin the survey group that currently haveauthorization to levy their own occupancy

tax include Greensboro, High Point,Wilmington, Chapel Hill, and Gastonia.All fve o these cities levy an occupancy taxo 3.0%, which produces revenue rangingrom $985,000 in Chapel Hill up to $3million in Greensboro. Tis tax is used bymany communities, particularly those withactive tourism industries, to provide taxrelie to local residents who carry the cost omunicipal services and inrastructure thatbeneft visitors.

Utility RevenuesWhile many cities operate water and sewerutilities, and sometimes electric utilities,Asheville only operates a regional waterutility. In 2008, 83% o North Carolinawater utilities charged a higher waterrate or customers outside the municipal

90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10

City of Asheville Sales Tax Share24%

23%

22%

21%

20%

19%

23.25%

19.60%

Table 3.

6


8/12

boundary. Cities use dierential rates orutility service as a way to recover costs orcustomers who may be more expensive toserve because they reside in less dense areasthat are urther away rom the urban center.

As a result, city residents may experiencesome fnancial relie by paying lowerwater rates or service. In Asheville, dueto local legislation, the city is prohibitedrom charging non-city residents a rate orwater service that is dierent rom the ratecharged to city residents. Tis prohibitionextends system wide; thus, customer locatedoutside o Buncombe County are chargedthe same rate or water as city residents.

Other RevenuesLike other cities, Asheville recovers revenuerom other sources like ees or services,licenses and permits, the motor vehicle tax,investment earnings and intergovernmentalrevenue. Asheville has adjusted many oits ees or services over time to makethose areas ully unded through eerevenue, providing some fnancial relieto the General Fund. In recent years,

the city has explored opportunities orconverting additional services, like garbagecollection, that rely on the general und orfnancial support to independent enterpriseunds completely supported by user ees.However, there has been reluctance toimplement such plans because while theyprovide fnancial relie to the general und,they do not provide fnancial relie to themunicipal taxpayer.

Service Impacts andCitizen Satisfaction

City leaders have been understandablyreluctant to increase property taxes as asole means o addressing Ashevilles fnancialconstraints. Clearly, Ashevilles ability to strictly

rely on the municipal propertyowner to support the needs andexpectations o a much largerpopulation is not sustainable;in act, that approach could

inuence whether businessesand citizens choose to locate inside or outsidethe city limits based on cost. As the proportiono low to moderate income residents is higherin Asheville than in the surrounding countyand other major cities in the state, the city hasinstead sought approaches to make living inAsheville more aordable. Leaders have ocusedattention on maintaining Ashevilles populationbase and attracting amilies and citizens bymaking Ashevilles quality o lie attainable or

people o all incomes.

As a result, city leaders have instead relied

on declining municipal budgets based onination-adjusted calculations to balance thecitys fnances. Shrinking resources inevitablymeans ewer services. Although expenses grownaturally every year, and some expenses likecosts or health care, uel and utilities havegrown considerably in recent years, the citysbudget has been balanced by trimming otherexpenditures, namely in capital investments(like public acilities, maintenance, and vehicles)and inrastructure (streets, sidewalks, etc.). For

example, although unding levels have remainedconstant, Ashevilles capacity to resurace streetsand construct sidewalks has decreased over time.Although the estimated useul lie o an asphaltstreet is approximately 20 years, the citys currentresuracing schedule is 81 years. Ashevillesreplacement schedule or vehicles, including o-road vehicles, is 15.4 years. Funding or acility

Although the estimated useful lifeof an asphalt street is approximately

20 years, the citys currentresurfacing schedule is 81 years.

7


9/12

maintenance is less than 1% o the citys overallbudget. And the citys ability to implementnew projects, like plans or greenways orreurbishing existing buildings, has beenseverely limited.

Tere is increasing evidence that these servicereductions have had a negative impact oncitizens perceptions o quality o lie in

Asheville. In a citizen survey conducted in2008, the city ranked below the benchmarkaverage in terms o citizen satisactionwith core services like street and sidewalkconstruction and maintenance, sanitation andrecycling services, parks and recreation acilities,and public saety support. At the same time,Asheville has been successul in addressingsome crucial inrastructure needs. Guided byan asset management study, the city invested

more than $40 million in water inrastructurethroughout the system in the last two years.A leadership decision was made to establisha dedicated unding source through a capitalimprovement ee paid by water customers inorder to fnance the cost o the improvements.A bond program allowed the city to quicklyaddress critical needs while improving waterservice and fre protection or water customersinside and outside the city limits.

In order to redress signifcant revenue shortallsduring the last fscal year, the city re-engineeredservices, eliminated positions and allocatedthe use o $2 million in reserves to achieve abalanced General Fund budget. Tis approachhas been common through the citys budgetprocesses over the last several budget cycles.Unprecedented economic conditions certainly

necessitated some short-term approaches tobalancing the citys budget; however, at the sametime, they exposed structural weaknesses in thecitys fnancial oundation that were previouslycompensated or by strong growth in property

values. Now that the country has experienced asignifcant correction in real estate values and aslowdown in new construction, and the revenue

picture shows no signs o improvement in FY2010-11, Asheville must explore alternativeapproaches to balancing its revenues withthe needs and expectations o its citizens.Projections based on frst-quarter revenuesindicate a revenue shortall o more than $5million in the coming year in order to maintaincurrent levels o service.

An Engaged Community

In addition to considering Ashevilles fnancialpicture, its also helpul to understand thevision and culture o the citys population.According to the 2008 citizen survey, Ashevillecitizens are active participants in the socialand civic lives o their neighborhoods andcommunities. Sixty-eight percent o citizensranked their ability to participate in communitymatters as excellent or good, a rating that is

above average or cities o similar size. Manyvolunteer their time and support charitablecauses. Moreover, there is little indicationo dwindling engagement ound in othercommunities. Opportunities to participatein social events and activities were ratedas excellent or good by 78 percent orespondents.

68% of citizens ranked their ability to participate incommunity matters as excellent or good, a rating that

is above average for cities of similar size.

8


10/12

A 1997 study conducted by the PewCharitable rusts ound that communitieswith high levels o civic engagement werecharacterized by residents who believe peoplelike themselves can make their communities

better places in which to live. Tis quality hasmaniested itsel in Asheville through aboveaverage interest and participation in visioningprocesses. When the City o Asheville hosteda Goals or Asheville orum in 2006, morethan 300 people participated in establishingand prioritizing community goals. A similarlevel o participation was seen three years laterwhen more than 300 citizens participated ina public meeting launching the downtownmaster planning process. Tis level o citizen

engagement in Asheville has been ueled bythe communitys entrepreneurial spirit ratherthan a government led or centralized systemo volunteerism. Te communitys vision anddesire to make Asheville a better place to livecoupled with its willingness to participate hasstimulated and supported signifcant strategicplanning eorts over the last ten years.

Te City o Ashevilles comprehensive plan, the

City 2025 Plan, was adopted in 2002 ater anextensive public input process. Te 2025 Planproposes a land use pattern, transportationnetwork and system o city services andinrastructure that reects the communitysgoals or growth as they were identifed anddocumented throughout 2001-2002. Te 2025plan was designed to be implemented by morespecifc plans and action items considered byCity Council, city sta, or other boards andagencies over time. Since then, Asheville has

pursued several strategic planning processes

ocusing on specifc areas o importance to thecommunity. By defnition, strategic planningis intended to be action oriented so as to showwhat steps must be taken to achieve goals, whomust take them, how much it will cost and how

those costs will be addressed; its outgrowthrom the comprehensive planning process islogical i not expected.

Te city o Ashevilles currentportolio o active strategicmaster plans includes 16dierent plans ocusing onareas including development

and land use, river redevelopment, aordablehousing, transportation, parks, sustainability,

and homelessness, among others. A ull listingo master plans can be ound in the attachedappendix. Because thirteen o the sixteenplans have been accepted by City Council andare entering the implementation phase, therehas been an increasing citizen expectationthat community improvements should bemoving orward. A rough estimated cost orully implementing the citys active plans ismore than $200,000,000. Spread out over

the course o 20 years, the city would need toinvest $10,000,000 per year to implement thecommunitys priorities captured in these plans.However, a majority o the plans currently donot have a dedicated unding source or call orone through a fnancing mechanism like bonds.At this point in Ashevilles strategic planningcycle, it makes sense or the citys leadershipto initiate a community conversation abouthow the vision and priorities contained in itsplanning portolio plans should be unded and

carried orward during the next ten years.

Current portfolio of active strategic master plans includes 16 differentplans focusing on areas including development and land use, river

redevelopment, affordable housing, transportation, parks, sustainability,and homelessness, among others.

9


11/12

his report highlights challenges andopportunities or Ashevilles uture.Over the last 50 years, Asheville has been

limited in spreading the cost o supporting aregional economy over a greater proportiono the regional population capturing areagrowth through voluntary annexation.Combined with the recent slowing in realestate markets and construction activity, ithas become more apparent that Ashevillesfnancial structure, particularly as it relates toaddressing the vision and expectations o thepopulation Asheville supports, is imbalanced.An increasing reliance on property taxes hasnot been a viable option or city leaders and

city residents. Sales tax revenues declined

signifcantly during the recent recessionand show no signs o immediate recovery.Signifcant expenditure cuts have alreadybeen implemented, and more will certainlybe necessary in the coming year. As a result,Ashevilles stated goals o being a leader inpublic saety, sustainability, aordability, andregional employment are in jeopardy.

Despite the challenging fnancial picture, thereare also reasons or optimism. Asheville is

supported by a diverse, engaged and innovativepopulation. Just as downtown revitalizationwas driven by community vision in the 1980sand 1990s, the communitys ownership oAshevilles master plans is apparent andessential. Involving citizens in identiyingsolutions to Ashevilles fnancial constraintsand prioritizing investments will certainly be

necessary and valuable in the uture. With astrong sense o community and its locationin scenic Western North Carolina, Asheville

will also continue to be a desirable place orproessionals, amilies and retirees to live.

Asheville and Western North Carolina arealso well positioned with a knowledgeable,experienced and inuential State legislativedelegation. In addition, the executiveadministration in Raleigh is led by a Governorwho is sensitive to the needs o Asheville andthe surrounding western region. Asheville hasalso ormed several successul partnershipswith Buncombe County and the Asheville

Area Chamber o Commerce, including the

recent opening o the Development ServicesCenter or one stop review and permitting andthe consolidated emergency call center.

One alternative to the challenges Ashevilleaces is to choose to be a low-tax, low-servicecommunity, cutting expenditures, programsand services as necessary to maintain balancedbudgets each year. Tere is evidence to suggestthat Asheville may be realizing this alternative.It is, however, a valid alternative, particularly i

the goal is to keep tax rates at the lowest levelspossible while not identiying other undingalternatives. Tis option would limit the citysability to implement master plans or otherstrategic programs over time.

Another alternative is to embark on anaggressive legislative and community process

Just as downtown revitalization was driven by communityvision in the 1980s and 1990s, the communitys ownership

of Ashevilles master plans is apparent and essential.

Leadership and Policy Alternatives for the Future

10


12/12

to build a diverse and balanced mix orevenues to balance Ashevilles tax base withthe regional demands placed on its services.Pursuing an extension o the quarter-centsales tax approved by the State to help address

fnancial constraints might be a frst stepin such a process. Tis approach might alsoinclude exploring the easibility o a bondprogram combined with access to otherrevenues that tap the regional and tourismpopulation as a means o bringing tax equityto Asheville citizens. As with the progressmade with improvements with the cityswater system, Asheville has demonstrated asuccessul approach in identiying a dedicatedunding source to leverage additional fnancial

resources or investment in a regional resource.As part o the mix, city leaders might alsoconsider an expanded involuntary annexationprogram, although the downside o such anapproach includes prompting animosity anddistrust in neighboring communities, as well asthe risk o time consuming legal challenges.

Regardless o the leadership strategy, theCity o Asheville will need to continue to

combine a tradition o rugal and innovativemanagement practices with ecient cityoperations.

Examples o these practices are:

Automated garbage collection one o

the most cost ecient systems in NC Asheville project nationally recognized

disease management program that helpscontain health care costs

Fuel/feet conversions partnership with

natural gas station with Buncombe Countyand Mission Hospitals to implementa systematic diversifcation o eet toalternative uels

Energy management cost savings continued implementation o the cityssustainability management plan

One stop shop streamlining thedevelopment plan and permitting process

Asheville must continue to pursue rightsizing,

reengineering o service delivery to make themost cost eective use o the limited resourcesavailable.

Whatever the strategy encompasses, it cannotbe realized in a short period o time. It willrequire signifcant investment o time andeort, and will necessarily involve all o themajor stakeholders in Ashevilles uture. Evenwith this strategy, cost containment measures

and revenue enhancements will be necessaryin the short term, until the benefts o a long-term approach can be realized. Te challengesacing Asheville have not developed overnightbut have evolved over a fty year period,and will require a long-term commitment toseeking regional change and partnership.

The challenges facing Asheville have not developedovernight but have evolved over a fty year period,and will require a long-term commitment to seeking

regional change and partnership.

11

asheville: a financial crossroads 2010

Documents