Valdese proposes program cuts and pay changes to close budget gap

Editor’s Note: This is the second of two stories related to the proposed fiscal year 2026-27. Read more coverage in the April 25 edition.

Valdese leaders are proposing a mix of tax increases, fee hikes, operational changes, reduced work hours, and higher employee pay as they work to balance a budget strained by rising costs and future capital needs.

Town staff presented last week a proposed $8.9 million budget for the 2026-27 fiscal year during its annual budget retreat, outlining steps to close a projected $428,908 deficit.

Multiple budget cuts are on the table to prevent a $428,908 deficit, ranging from repairs at Tiger Gym to reducing full-time positions to 35-hour work weeks.

“Obviously these are not fun things to be cutting,” said Chief Financial Office and Assistant Town Manager Bo Weichel. “They’re not ideal situations, but they were designed to have the most minimal impact on our operations as possible.”

The proposed budget will be presented on May 11 at 5 p.m. at Town Hall. The public hearing was originally scheduled for June 1, but has tentatively been moved to May 28 at 6 p.m. at Town Hall, said Town Manager Todd Herms.

OUT OF THE BOX STRATEGY

A major driver of rising expenses is a townwide pay increase based on a recent compensation study, along with rising costs for retirement and employee benefits, both of which are designed to attract and retain quality employees.

To offset those costs, Valdese will reduce full-time work schedules to 35 hours per week for most employees, with employees earning higher hourly rates.

“No employee is going to be taking home less money,” Weichel said. “Their hourly rate would be adjusted for 35 hours. So, it’s going to actually save the town $74,000 this year in the budget compared to if they stayed at 40 hours. … Just by adjusting the schedule for these employees, we can decrease their work hours, save us some money in the budget, and that savings will continue year to year.”

Herms said the change allows employees to earn more annually despite working fewer hours.

“This will only be for hourly employees, ... shift employees such as firefighters and police officers are going to still work their regular shifts. … I don’t know if it’s going to work or not, but I don’t know how we can afford (competitive wages) if we don’t come up with some out-of-box thinking,” Herms said.

The alternative, town leaders said, would have been deeper cuts, including permanently eliminating positions, therefore ending the employment of people in those positions.

Herms also noted that, while the pay raises will be an improvement, Valdese will still pay less than some of its competitors.

Overtime budgets were flagged for reduction. Money budgeted for overtime pay was reduced in every department that offers overtime except the police department, where it jumped from a $20,579 yearly allocation to $27,056.

OTHER CUTS AND ADJUSTMENTS

In 2027, the town will only have one Family Friday Night per month rather than one each week from June to August, according to the plan. Reducing the number of Family Friday Night events allows the town to budget for more well-known bands while still reducing the expense.

Tiger Gym will also not have any repair work done in the coming year, meaning the water fountain, screening and coating hardwood floors, and painting the porch and railing have been postponed to save $8,000.

The Main Street Facade grant program could be suspended to save $5,000, and there will be no bouncy houses at the Spring craft show and Family Friday Nights in May and June to spare $2,500.

The budget plan includes a $30,000 cut from its contributions to the Burke Library system, leaving a $10,000 contribution in the 2026-27 fiscal year.

Other recommended budget cuts include:

• Repairing McGalliard Falls parking lot, $90,000
• Repairing windows on the east and south sides of the Old Rock School, $143,000
• Replacing the sanitation department’s 2016 F-150 truck, $45,000
• New Downtown Christmas decorations, supplies, and materials, $7,500

Town leaders say these budget strategies and recommendations reflect a broader financial reality facing Valdese and similar communities: Rising costs for infrastructure, public safety, and personnel are outpacing traditional revenue streams, forcing local governments to rethink how they deliver services.

At the same time, Valdese is working to fund a new combined police and fire department, adding another layer of financial pressure. The project is currently in the planning stages and could cost up to $1 million. That is a loose estimate. Town staff and officials will have a more solid estimation after contractor D. R. Reynolds determines a guaranteed maximum price (GMP) in the coming months.

In next week’s edition of The Paper, there will be a full-length article on discussions surrounding the public safety building project, the challenges of funding it, and Valdese’s current debt load.

Together, the recommendations reflect a town trying to hold the line and maintain core services while reshaping operations to meet a new financial reality.