Island County elected officials and department heads decided to declare a financial emergency during a tense roundtable discussion Wednesday afternoon.
The resolution wouldn’t have any legal effect, Budget Director Elaine Marlow explained, but it would convey a message to the community and staff about the seriousness of the projected $1.2 million budget deficit next year.
“Whatever we end up doing is going to impact basic services,” Commissioner Helen Price Johnson warned.
The officials discussed ideas for raising revenues and cutting costs, including selling park land, logging county-owner property, asking voters to increase property taxes, putting a sales tax increase on the ballot, adding furlough days, borrowing money, increasing fees, limiting office hours and changing employees’ medical insurance. The officials weren’t enthusiastic about any of the ideas and most were rejected outright.
Over the last year, commissioners already cut $4 million from the current expense fund, also known as the general fund, and laid off dozens of employees. Marlow suggested that more layoffs or reductions in staff hours may be unavoidable to balance the $22 million budget.
“My recommendation to the board will be to reduce salaries and benefits,” Marlow said, pointing out that those costs account for about 74 percent of the budget.
Marlow alarmed county officials by passing out a list of potential reductions. The cuts were an across-the-board 8 percent reduction to all departments, which she stressed was “just a starting point for discussion.” Several officials declared that they simply couldn’t lose any more people and continue to function, let alone meet their statutory requirements.
Sheriff Mark Brown runs the largest department dependent on the general fund. With an 8 percent cut, he would lose $485,000, which amounts to about seven deputies.
Brown made his opinion about potential cuts in his office clear.
“It’s very, very dangerous to cut any deeper than you’ve cut in my agency,” he said. He urged commissioners, who hold the purse strings for the general fund, to prioritize spending and not cut across the county departments equally.
Brown lost four deputy positions, including a corrections deputy in the jail, and a half-time civil employee over the last year.
One of officials’ greatest hopes for cutting costs may not work out. They wanted to save about $736,000 a year by switching the county’s medical insurance. But Larry Larson, director of human resources, said he was having trouble getting union leaders to the table.
“I’m having difficulty getting them to understand the severity of the problem,” he said.
The deadline for the county to make changes to the medical insurance is Nov. 9, which makes a change for 2010 seem unlikely.
The county commissioners had discussed changing medical plans for non-unionized employees, which they could do without negotiations. It would save the county $180,000 a year, but the commissioners are having second thoughts about the fairness of a lesser plan for non-represented folks.
Like many jurisdictions in the state, the county is facing budget woes because of the recession. Marlow originally said the shortfall would be $1.4 million, but a change to a state-preferred accounting method means the general fund should receive an extra $200,000 a year from restricted funds.
Marlow predicts that revenues from sales tax will remain flat next year. Treasurer Linda Riffe anticipates that investments earnings will continue to plunge.
The one bright spot is the county’s reserve funds. The 10 percent contingency fund remains intact at $2.2 million. The county also has $881,000 in unreserved fund balance. The county could spend the money to help balance the budget, but it would be a one-time fix. Marlow said she will recommend that the commissioners don’t blow all the money to get through 2010.
At the end of the meeting, the officials asked Marlow to draft a resolution declaring a financial emergency. Public Works Director Bill Oakes said he would look into county property that could potentially be sold. Larson said he would try to work with the unions. The commissioners are scheduled to continue budget discussions on Monday.
“I’ve said all along that 2010 is going to be a tough year,” Marlow said.
