Tax increase talk continues to grow
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As the Budget and Finance Committee began budget talks in earnest Monday night, commissioners were confronted with totally depleted fund balances in some cases, creating major deficits in some of the funds. This is particularly true with the ambulance service fund, which, if the estimated 2006-2007 budget of $1.95 million is passed, could end up in the hole by an estimated $477,000.
Since 1 cent of property tax currently generates around $48,406, officials agree it would take a 10-cent property tax increase for the proposed ambulance service budget just to break even.
Budget and Finance Committee chairman George Smartt, who has warned against dwindling fund balances for several years, said the situation doesn?t bode well for the budget in general, since, with no fund balance to fall back on, there is no insurance against financial disaster.
?Breaking even is not a good fund balance,? said Smartt, pointing out volatile fuel prices as one potential problem, which prompted a comment from director of accounts Linda Hillis.
?That?s why it?s important to have a fund balance,? Hillis said. ?We need something in there to take care of things like that.?
Three funds were discussed in Monday?s talks. The Sanitation Department fund, the Drug Control fund and the Ambulance Service fund.
The Sanitation Department budget, at $1.03 million was also in the red, with an estimated deficit around $73,000, but much less so than the Ambulance Service fund, requiring only 1.5 cents in property tax to balance.
The Drug Control budget of $91,800 is completely self-funded by drug fines, forfeitures and penalties.
Faced with what was looking more and more like a situation which could require a major property tax increase just to balance the budget, committee member David Hill wondered about the wisdom of the county commission?s reluctance to vote a property tax increase for the past four years.
?We can?t pass this budget with a deficit,? Hill said. ?We?re going to have to have some more pennies in there. Either that, or we?re going to have to cut it.?
Commissioner Herschel Wells pointed out a problem that many commissioners were avoiding discussing openly, voting in a tax increase in an election year.
?I don?t believe there?s enough votes in that court to come up with a penny,? Wells said.
Hill responded to Wells? comments by pointing out it ultimately fell to the Budget and Finance Committee to present a budget, even with a tax increase, whether it was a popular decision or not.
?Every committee is submitting budgets,? Hill said, ?and every one of these budgets is going to have an increase, and we?ve always taken it upon ourselves to try and get this down to what we thought the commission would pass.?
Smartt said past cost-saving measures are becoming difficult to maintain.
?In the past we?ve found money out of debt service and found money out of fund balance,? Smartt said, ?and now it?s come back to bite us.?
?We?ve depleted all the fund balances over the last three years,? Hill said, ?and this is the fourth one we?re working on as a commission. We?re at the bottom of the barrel.?
?I don?t think the vote?s there for a tax,? Wells reiterated. ?So I say let?s give it back to them and let them cut it.?
Commissioner Ken Martin pointed out the obvious.
?What happens there is they want other departments to cut, not theirs,? Martin said.
?That?s been tradition,? Smartt agreed.
?It gets forced back to this committee,? Hill said, ?and that?s another monster we?ve created over the last four years.?
?Well, somebody has to do it,? Wells said.
Hill said he felt one problem is the different committees were only seeing the budgets they are responsible for controlling.
?I don?t think they can really see what they?re doing unless they see it all, the whole picture,? Hill said. ?They?re just looking at their budget. Let?s give it to them like they passed it, all in one big picture and let them see it like it actually is. Let the whole commission see it before we change it. If overall these budgets put together require a 15- or 20-cent increase in the tax, let them vote that down in the commission, and then figure out where they?re going to make their cuts.?
Budget talks will continue in coming weeks as more committees turn in their budgets, some of which are rumored to require substantial increases by themselves. The commission won?t be required to pass a budget until its Aug. 21 meeting, since October is the budget deadline.