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County’s budget woes appear less precarious than originally reported

Constructing a financial plan based on the amount of money spent during the prior year instead of the amount requested could eliminate a remaining $1.3 million deficit and enable Washington County to balance its 2011-2012 budget.
During a June 7 meeting of the Budget Committee, Mayor Dan Eldridge proposed a strategy that would retain services as they are with no new taxes or layoffs, and maybe even provide a pay increase for employees.
“Forget what you budgeted, look at what you spent” is the perspective Eldridge encouraged members to use in reviewing the latest version of the budget.
Though the books for 2010-2011 have not been officially closed, the numbers indicate the county finished significantly under budget.
“Office holders have held the line on expenses this year,” Eldridge said. “Clearly, we have not spent all that was budgeted.”
In fact, it appears revenue and expenses were almost even.
Refinancing and paying down portions of the county’s debt, changing its health insurance plan, and reducing funding to public agencies by 14 percent have chipped away at the deficit in the 2011-2012 budget, leaving just $1.3 million still to eliminate.
Some figures in the budget allow no flexibility, such as the $50,000 payment on the International Storytelling Center note that has five years left before it’s completed.
To demonstrate his idea for going forward, Eldridge presented a 2012 proposed budget for major departments using 2011 expenses rather than the amounts requested by the office holders. The difference allows a 3 percent payroll increase to be included.
“I put in the 3 percent as a number, but I don’t know if I’m prepared to cast it in stone today,” he said, admitting the county will need to make the salary structure a priority in order to remain competitive. “We have to balance the General Fund first because if money is needed in other areas, it will come from here. Until then, we don’t know if we can give money.”
Meetings with office holders were scheduled for the first of this week in order to have more information for the Budget Committee meeting on Wednesday, July 13.
Office holders will be asked to identify the 2011 expenses that will be impacted because of inflation, the expenses that can be eliminated, and special requests for the upcoming year.
“If we go through a deliberate process and everyone is reasonable, I don’t see balancing the budget being an issue we can’t accomplish,” Eldridge said.
Following efforts to restructure debt through the refinancing of bonds, Moody’s Investors Services recently assigned a credit rating of Aa2 to Washington County. According to the notification letter, “Moody’s believes the county’s overall financial position will continue to remain strong due to a healthy reserve position and prudent management, despite a potential reduction in reserve levels in fiscal 2011.”
Eldridge said the county may end up having used only $500,000 of the $2.5 million taken from reserves to balance the 2010-2011 budget.