CHINA GROVE — An audit conducted of the town’s budget for the previous 2020-21 fiscal year shows additional tax revenue led to an increased fund balance for China Grove.

The audit was performed by certified public accountant Will Honeycutt, who delivered a report on his findings to the council on Tuesday night. Honeycutt’s audit found that China Grove ended the fiscal year on June 30 with a $3.07 million total fund balance, an increase of $200,943 over last year’s balance of $2.87 million. The balance does include some items that are restricted. The unassigned fund balance, which is not restricted and partially functions as a savings account, is $2.2 million.

The increase is largely a result of an increase in property and sales tax, which both remained strong despite the continued COVID-19 pandemic. Property tax increased by approximately 3% and sales tax increased by over 13% from fiscal year 2019-20 levels. The town collected $1.96 million in property taxes and $1.2 million in sales tax. Town Manager Ken Deal said the continued bump in sales tax is “very encouraging.”

Honeycutt issued an unmodified opinion, meaning the town’s financial statements met requirements demanded by regulations and they were prepared in accordance with accounting principles, criteria and standards. Mayor Charles Seaford was pleased with the report.

“We’re in great standing,” Seaford said. “As a town, with the population, with the investments we have, with the people we’ve got, I’m happy.”

After avoiding any major purchases in the 2019-20 fiscal year due to the pandemic, China Grove made some new investments in last fiscal year. The town made improvements to its board room, purchased a pumper/tanker and completed ladder truck repairs for the fire department. It also purchased a 2022 Gator vehicle, a Dodge Ram and a Toyota 4-Runner for the Police Department. In total, the town spent $453,256 in equipment and $24,494 in infrastructure during the fiscal year.

China Grove also decreased its total debt by about $361,000 during the current fiscal year. The key factor in the decrease was the debt service payments made. 

In other meeting business:

• Seaford provided updates on two properties in town that have the potential to be new developments.

Seaford said there is a developer considering purchasing the property at 221 S. Main St. across from China Grove Family House to open a restaurant. There are two structures on the property, one of which would be torn down and the other would be the restaurant. However, a majority of the land is located within the North Carolina Railroad Company’s right-of-way. As a result, the developer would own the property but the North Carolina Railroad Company would have the right to force them to relocate if it wanted to place another track on the property in the future.

The potential for the N.C. Railroad Company to force a move is why Councilman Steve Stroud backed off from his plans to purchase the property 221 S. Main St. and relocate his security company downtown.

The railway corridor could also be holding up another development at 911 S. Main St. A storm-damaged building with a missing roof is currently located on the property, but Seaford said a person is interested in buying the land to open a daycare center. The property, owned by the town, is also mostly in the railway corridor.

“That was their biggest scare,” Seaford said. “What can the railroad do? They can go in there and make you tear it down at your expense.”

Assistant Town Manager Franklin Gover said he will be in touch with a representative from railway corridor management on the dilemma.

• Town Council re-appointed Alan Corriher and appointed Barbara Heim and Adriana Leach to the Parks and Recreation Advisory Board. Heim and Leach will be filling previously vacant seats.

• Town Council adopted proclamation for Martin Luther King Jr. Day on Jan. 17 and for China Grove School of Choice Week from Jan. 23-29.