May 22, 2019
By: Dwayne Page
The county needs more revenue to operate over the next year and a property tax increase may be coming.
Except for action on the road department budget and a property tax rate recommendation for the 2019-20 fiscal year, the county budget committee has completed its work in preparing a spending plan for the county commission to consider this summer.
Although the budget committee has proposed some line item transfers and cuts along with new revenue from fee increases compared to the current year, new spending has also been added to the new budget
During Wednesday night’s meeting, the county’s financial advisor Steve Bates updated the committee on the county’s projected financial condition over the next year. In the general fund, the county is operating under a budget of $9,215,870 this year. That is projected to increase in the 2019-20 budget year by $608,361 to $9,830,231.
Without a tax hike, Bates said the county general fund is expected to be in the red by $1,681,933 as of June 30, 2020 if spending goes according to the proposed budget. To balance the budget, the county would have to pull the $1.6 million from the fund balance (cash reserves)
In order to keep the county from digging into its fund balance (cash reserves) to operate and to meet the state required local Basic Education Program (BEP) match for schools, Bates said an overall property tax hike of 36 cents is needed (32 cents more for county general and 4 cents more for schools). The property tax rate is currently $1.83 per $100 of assessed value. If increased by 36 cents, the rate would go to $2.19 per $100 of assessed value.
Bates also offered the committee another option, increasing the overall tax rate by 29 cents (25 cents more for the general fund and an additional 4 cents for schools) which would put the tax rate at $2.12 per $100 of assessed value. Even under that option, the county general fund is projected to run in the red by $473,132 as of June 30, 2020 if all budgeted funding is spent.
According to Bates, the county could get by on an overall 29 cent tax increase for a few years but it would have to keep a close watch on spending.
The budget committee has not yet signaled what it will recommend to the county commission on a proposed tax rate for 2019-20 but is expected to weigh all options and make a decision at the next meeting on Wednesday, May 29.
In the meantime, Bates plans to put down on paper three tax rate proposals for the committee to consider.