Douglas County leaders are keeping a wary eye on what happens with state budgeting decisions because of the ramifications they could have at the local level.
“Based on our past experience with state budget crises, we are just as concerned about the cuts and additional responsibilities that will be placed on counties after the Legislature has gone home,” Douglas County Administrator Craig Weinaug said Wednesday in a report to county commissioners.
When the state closes down prison and mental health bed space, it means the number of county jail prisoners increases and the county has additional costs, Weinaug noted. Closure decisions already made by the state could cost the county $500,000, he said. The county has identified another $500,000 in additional costs that state agencies could pass on to various county departments, without the knowledge or consent of the Legislature, Weinaug said.
“It is not a question of whether this will happen; it is a question of the extent to which each state agency will pass their budget cuts on to us after the Legislature has adjourned,” he said.
About 95 percent of county revenue comes from local sources, and most of it depends on the value of real estate, Weinaug said. He projected that the county property tax base this year will drop 2 percent and drop another 2 percent in 2010. Losses in state transfer funds that counties normally get will compound financial problems at the county level, he said.
Despite problems, Weinaug projected that at the end of this year the county will have an ending fund balance of more than $6.8 million, which would be a drop from the 2008 ending balance of $7.39 million.
The county budget will be balanced at the end of this year based on cost-cutting actions the county has already taken and some assumptions. Among those assumptions are that the county is willing to continue to freeze all types of pay increases, including cost of living, merit and longevity; that county subsidies to outside agencies are neither cut nor increased and that the state doesn’t put any significant additional responsibilities on counties; and that commissioners are willing to consider some cuts to capital outlay budgets.
Commissioners only asked that Weinaug continue to keep them informed about county finances.