2005
BUDGET SHORTFALL – Real or Imaginary?
2005
BUDGET SHORTFALL – Real or Imaginary?
By Deborah Newcomb Ashtabula County Commissioner
February 15, 2005
During the 2001 budget process, projections showed that revenues for the general fund operations were stagnant and would not keep up with expenditures and MANDATED costs passed on down from the State of Ohio unless the county elected officials made some changes to their budget process. The County General Fund budget is made up of estimated resources (revenue) plus cash carryover from the prior year.
In 2001 the carryover was approximately $2.3M, in 2002 and 2003 $2.9M and in 2004 the carryover was reduced to $2.4M. During this time frame the Commissioners did not replace personnel or combined jobs; enacted bulk purchasing measures; worked to reduce workers compensation; enacted quarterly spending plans and re-bid health insurance and went to health insurance pooling. In various departments under our control, 15 personnel were not replaced. Personnel costs are the bulk of general fund expenditures with the Sheriff’s office the largest department in the general fund.
In 2004 the carryover was reduced to $2.4 million and the County experienced increases in gasoline, utilities, indigent defense, felony caseloads, foreclosures and other state mandated costs. Now, in 2005 the County is faced with a 23% increase in health insurance costs and a carryover of $1.3M due to the increase in expenditures for 2004.
While people would like you to believe that this budget shortfall is about the lodge, or the water company or the county nursing home that is far from the truth. County budgets all over Ohio are in financial trouble and they do not have a lodge, a water company or a nursing home. All counties have funds outside the general fund called “enterprise” funds, self-sufficient funds that have their own revenue source and expenditure line items. The Lodge and Conference has been built and permanent financing is in place under separate accounts from the General Fund. Economic Development funds used over the two year planning and construction period have been paid back as well.
The County Nursing Home has ALWAYS been separate from the General Fund and has been through some difficult times with the Medicaid cuts made by the State that impact County-owned facilities greatly.
The Ashtabula County Water System has over 5,000 customers that pay the debt of the water purchase and have money to operate and build and repair existing water lines. In only two years of operation, water rates have been lowered 5%; over 70,000 of linear feet of waterline has been replaced or added and two water storage tanks rehabilitated. This fund is OUTSIDE the general fund and cannot be used for general county fund operations.
During the election, the budget challenges were discussed and what everyone seems to forget is that I stated the Commissioners are obligated to pass a balanced budget and that there would be challenges with revenue sources and state mandates and possible state cuts. Personnel layoffs are always the last resort. In my mind it’s time now to prioritize needs and NOT just cut all the elected officials equally across the board, but based on the safety and security of our citizens. As commissioners we do not all agree with this stance. But since the Governor is proposing to cut local government funds by 20%, reduce indigent defense reimbursement another 4% and who knows what else the legislature will cut, it’s imperative that we develop this 2005 budget on a clear set of priorities.
At the sales tax hearings, two messages came out loud and clear – no tax without the vote of the people and no cuts to the Sheriff’s Department. The only way to accomplish both was to enact an ½% emergency sales tax that is collected NOW and allows the people to vote in November to continue the sales tax. Since the State will rollback a ½% of their sales tax (or ½ penny) it would not be an increase at all. Earmark the funds for criminal/justice activities and make it temporary, not permanent.
Without this additional revenue or some other revenue source, cuts are inevitable. As an elected official, preserving the health, safety and welfare of our citizens needs to be the priority. If you have to wait in line for a marriage license, copy of a tax map, paying fines or tax bills, then that’s what should happen, because we all know when you need a sheriff’s deputy, you can’t wait in line. The budget shortfall – it’s reality!