Curry County commissioners will begin “very preliminary” discussions today about the 2018-19 budget, as it again faces a shortfall of between $300,000 and $1 million, said Interim County Administrator John Hitt.
Curry County’s Road Reserve and contingency funds, not tax revenue, are all that stands between the county providing basic services or potentially laying off staff and closing departments, Hitt said Monday.
County commissioners will discuss their options as it starts work on the 2018-19 budget at a 10 a.m. workshop in the commissioner board room in Gold Beach.
Analyses of revenue and expenses — including Hitt’s suggested additions to bring certain services up to minimum requirements — means the county could face an estimated $1 million shortfall, he said.
Even if commissioners opt out of Hitt’s recommendations, the budget will still be between $300,000 to $400,000 short, he said.
All is not lost, however, he said.
County leaders have the option of taking money from the road fund reserve — it has about $30 million — or using contingency or unallocated funds that weren’t used this fiscal year to balance the budget.
“In my opinion, the (proposed additions) would improve levels of service for departments that have been most impacted by the budget reductions of recent years,” Hitt said in a memo to commissioners and budget committee members. “It would seem unlikely that even if these increases were removed that more ‘tinkering’ with departmental line items would balance the budget without further degradation of service levels in key departments.”
Needed to spend
Hitt’s recommendations include providing more money for sheriff’s patrols, jail repairs and technology improvements, among others. He will also suggest the board and its budget committee establish service-level priorities for each department if more budget cuts are contemplated this year.
“It depends what resources the county commissioners want to consider employing, be it the road fund or general fund contingencies or unappropriated ending reserves,” Hitt said when asked if budget talks could get ugly. “If they’re willing to use some, it’ll be OK. If they’re not, definitely yes.”
Gov. Kate Brown sent a letter to county commissioners last Thursday urging them to use road funds to balance the budget, saying ensuring the safety of citizens “must be considered a top priority. With a reserve balance of approximately $30 million, Curry County’s road fund could help ameliorate your immediate issues.”
Former Roadmasters Dan Crumley and Doug Robbins have aggressively fought against commissioner boards touching the road funds, noting one major slide can wipe out a good portion of reserves.
And departmental cuts are not out of the question, either, Hitt said.
“Do we cut the assessor’s office to half-time?” he cited as an example. “That’s $250,000 to $300,000 there.
“Yeah, you can chew on it and improve on it line item by line item, as excruciating as that might be,” he continued. “But the real big-picture question is, if we don’t want to use other funding and want to cut out everything I recommend including, how do we get there? It would be significant, by elimination or near-elimination of departments or major scale-backs in opening or the hours we’re paying people.”
Curry County’s basic services are funded by what is now the lowest tax rate in Oregon, since Josephine County voters approved a tax hike last fall to bring its rate to $1.09 per $1,000 assessed valuation.
Curry County’s is at $0.599 per $1,000, and brought $1.2 million to general fund coffers for this fiscal year, said county Accountant Louise Kallstrom.
“Your tax-paying residents of Curry County deserve and expect to be safe in their community,” Brown wrote to commissioners. “It is impossibly challenging to provide this assurance when only eight deputies are funded.”
Brown added she is concerned that ongoing budget cuts and years of scrutiny the public safety budget has received will deter Sheriff John Ward’s ability to attract new officers — a complaint Ward has had since he took over the helm from Sheriff John Bishop.
Yet, voters have never approved a ballot question asking to increase property taxes for the general fund, even when they were worded to fund only law enforcement.
“It is worth repeating that the Oregon State Police cannot be a substitute for local law enforcement,” Brown’s letter reads.
“As your governor, I appreciate the challenges that come with deciding how to balance a budget,” she continued. “Setting priorities that reflect the values of your community is a key part of the work you do. Ensuring your citizens and visitors are safe is, without a doubt, a key priority, and I hope you do everything you can — including accessing your road fund — to achieve that goal.”
Get back to basics
Preliminary ideas Hitt will propose to county commissioners today include providing more money for the sheriff’s department for jail improvements and to get patrols on the road 24/7.
“Without that, yeah we can get by,” he said, “but we don’t have 24/7 coverage, which is the absolute bare-bones minimum service level of virtually the entire United States.”
The items he would like to include in next fiscal year’s budget would add about $100,000 to $200,000 to the cost.
If all his suggestions are not included, and if no reserve or contingency funds are used, Hitt said the budget will still be about $300,000 to $400,000 short.
“It’s a hard call,” he said. “You can always go back and save a little money here and there, but will it amount to $300,000? No. Even at the current bare-bones level, we’re looking at significant levels of cutbacks.”
The shortfall is neither unexpected or surprising, elected officials agree.
“Curry County has, for several years, faced significant challenges in putting together its annual budget,” Hitt said in his memo. “As costs for almost everything — especially (retirement benefits), health insurance and vehicles — continue to rise, county revenues have fallen. Budget hearings have become protracted as intense scrutiny of even smaller line items has occurred in an attempt to match declining revenues with increasing costs of service.”
Little has been done in the ensuing years to address the revenue shortfall, except to spin off complete departments into nonprofit organizations. All of those are faring well, and the county reaped the benefit of not having to pay retirement benefits, one of the biggest stressors on the budget.
An unknown that will prove helpful is how much money Curry County will receive due to a piece of legislation slipped into Congress’ omnibus spending bill last week and approved last Friday. That legislation renewed for two more years the Secure Rural Schools program, which will provide $400 million in the next two fiscal years to Oregon’s O&C counties. The money has been provided since 2012 to fill the shortfall the county is supposed to receive in sales tax receipts for logging on federal lands within the county.
Hitt plans to outline options the county could take as it goes through budget hearings this spring, ranging from doing nothing to critically examining items, line by line, during budget committee meetings.
He also would like commissioners to develop a long-range plan to increase revenue to meet basic service levels and pay back borrowed money used to balance the budget in past years.
Another option is still available, although no commission board has been eager to consider it since it was put into law in 2012.
That year, legislators approved House Bill 3453, which allows Curry and other financially strapped O&C counties to declare “fiscal emergencies.” The state would then work to streamline county operations — and pass on the costs of those services to residents.
Due to expire Jan. 2, it was renewed “at the last minute — the very tail end” — of the last legislative session of 2017, Hitt said.
Other ways to boost revenue that don’t require a vote of the public include fee increases.
“Maybe, over a period of four, five, six years, you could get to a point where, while we’re not well off, but we’re better off than we are right now,” Hitt said.
Reach Jane Stebbins at firstname.lastname@example.org .