Commissioner Don Dixon acknowledged the county is fiscally sound now, but he is worried about the future.
“Our expenditures you know you’re talking 2023 and $116 million budget and $118 million in revenue, that’s too close,” Dixon said. “I know we always underestimate our revenue and I know hopefully it’ll do what it always has done and will be higher than $118 (million), but I’m just not comfortable with that number being that close.”
Prior to passing the 2022 budget last year, the commissioners approved an $18.5 million property tax rollback, but that break will not be extended. Dixon said it was a good move to make at the time, to give taxpayers some of their own money back to help get them through the pandemic, but things have changed: “if ‘23 ends up being as crazy as ‘22 we’re going to be really close making revenue and expenditures,” he said.
“It’s been a crazy economic time, unprecedented, uncharted, this is exactly why we keep the budget as tight as we’ve kept it, we’ve carried over the surplus, we’ve kept our expenditures down,” Dixon said. “I know we spent $18 million on a first time ever real estate program we implemented last year, that was a good thing, the economy needed it and I think if you’re going to do it that was was the time to do it.”
Boyko said inflation and the current labor crisis were big contributors to the bigger expense budget, contracted services are nearly 8% higher, materials and supplies have increased 9.2% from the 2022 to 2023 budget years.
During budget hearings, several other office holders told the commissioners they have had to staunch the exodus of employees by increasing wages, and the commissioners did the same with their own non-union workers. The wage adjustments cost nearly $4.3 million — a 6% increase — and are reflected in the general fund payroll budget for next year.
Dixon told the Journal-News these mounting expenses must be reigned in, and during budget hearings in October, he warned office holders and department heads they cannot add any additional employees that weren’t already accounted for in their 2023 budgets.
He told the Journal-News “it’s a slippery slope and I don’t want to start down — it it’s just too hard to get back” about allowing personnel costs to get out of control. “Been there, done that and we all know how that works ... then we’re laying off people and cutting hours and doing all kinds of crazy stuff and I don’t ever want to get into that again.”
Dixon was recalling the painful position the county was in during the Great Recession, when that and years of free-wheeling spending nearly catapulted the county off the fiscal cliff. The commissioners had to slash millions — by ordering mass layoffs — from their budget or contemplate raising taxes.
Twice, sometimes three times a year, pay hikes and increases in the double-digit range were normal back then. In 2009 Dixon and now-Supreme Court Justice Sharon Kennedy, who was the domestic relations judge then, convened a summit of office holders, department heads and business leaders, to deal with what was dubbed a “perfect storm.”
Commissioner Cindy Carpenter said there is another aspect of personnel costs — as a result of the pandemic — that is concerning.
“From our budget what I see as a warning sign is the growth in contract services, because we’re unable to fill our positions,” Carpenter said. “We’re spending more money for these additional contract services so we need to take a look at that. That’s one of the adjustments that had to be made since the pandemic how are we going to recruit a good workforce and retain that.”
Revenue impacted
On the revenue side, Boyko said that has also been impacted by the pandemic — she is projecting revenues will total $104.8 million this year, because of the property tax break, but the actual collection in 2021 was $129.2 million. Sales tax collections, the largest general fund revenue source, are estimated at $55.4 million by year’s end but she dropped that amount to $47.5 million for next year.
“For the second year in a row, this is the highest sales tax collection the county has experienced,” Boyko said. “Again because a lot of the money that was generated by the pandemic relief funds.”
Aside from the general fund, there are a number of departments and independent boards that operate on their own tax levies or are enterprise operations, such as the Water & Sewer Department that gets fees for its services.
All in, the total proposed budget for next year is $521.2 million to be paid for with $419.3 million in revenues. The carry over in non-general funds is nearly $385 million which will be used to balance the non-general fund balance.
The commissioners will likely pass the budget next week. Dixon told the Journal-News he doesn’t want to change anything in the spending plan. He just wants to make sure they remain vigilant and regularly keep the rest of the office holders and county employees apprised of the financial landscape, so they understand when hard choices might have to be made.
“We need to do a better job communicating with our office holders and our employees,” Dixon said. “It’s hard when you don’t know the whole story. It always sounds like the grass is greener on the other side of the fence until you get there. It’s to our benefit, our employees’ benefit and the office holders we keep sharing pertinent information about inflation numbers and interest rates and our revenues and our expenditures.”
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