In addition to making attempts to keep the 2016 expenditures in check, the county will rely on fund balances to make up the difference.
Commissioners met on December 29 with a budget-focused agenda. They began by unanimously approving adjustments to seven separate funds to ensure a balanced budget for 2015. The seven funds were all showing deficit balances and needed increases in fund appropriations.
The Commissioners then turned their attention to the 2016 budget. Their actions culminated several months of budgetary work. A number of factors impact the out-of-balance budget, including a significant decrease in property tax revenues.
The annual property value report in June, 2015 showed a $176 million drop in the total value of private property in the county. This significant cut in the tax base results in significantly decreased property tax collections. The budget shows a nine percent drop in tax revenue, from $6.588 million last year to $5.983 for the current budget year. The one-year drop in property tax collections exceeds $600,000.
In addition, a number of factors have increased costs for the county, including a 30 percent increase in the cost of health insurance for county employees. Commissioners approved a five percent Cost Of Living Adjustment (COLA) in 2015.
Another significant change is the increased cost of public health for the county. In 2015, the county cut ties with the Southeast Utah District Health Department (SEUDHD) and created San Juan Public Health to coordinate public health efforts.
It took several months for the new department to secure contracts to provide public health services, including immunizations, public records and WIC (Women Infant Children) services. The increase in expenditures and decrease in revenues for public health drained the fund balance for public health from $300,190 in January, 2015 to a $109,539 deficit by November, 2015.
While the overall situation is of concern, there are some bright spots. Economic Development Director Charlie DeLorme reports that Transient Room Tax (TRT) revenues are up by $60,000 and are expected to increase an additional $100,000 in the coming year. Commissioners added $10,000 to the TRT funds that are forwarded each to the incorporated cities in the county (Blanding and Monticello). The increase is from $60,000 per year to $70,000 per year.
The Road B fund is looking better. The Utah State Legislature increased funding for roads through a gasoline tax. In addition, county voters approved a .25 percent sales tax for transportation funding.
In an attempt to decrease expenditures, Commissioners cut $15,000 for the county lobbyist in Washington, DC.
After discussion, Commissioner decided the leave the $35,000 expenditure for either The County Seat television program or for some other public relations program.
The commissioners tried to make the budget break-even, but there was no way to accomplish that. They had agreed earlier to not raise the property tax rate for property owners and the value of the centrally assessed property in the county has declined dramatically.
Commissioners expressed the hope that possibly the Latigo Wind Farm could help turn some of the centrally-assessed value around. It is estimated to have a property value of approximately $125 million.
While there is no way of knowing for sure what future property values will be, market factors such as low oil and gas prices, depressed uranium and copper markets, and a weakened economy point to lower property values in 2016.
Commission Chairman Phil Lyman said, “It feels a little like we are rearranging the chairs on the deck of the Titanic” as the drop in the tax revenue is the bigger problem.
After looking at moving funds here and there and finding no real solutions, Commissioners adopted a $12.2 million general fund budget. The budget includes a one percent COLA for county employees. Commissioners said that there is really no benefit to giving no COLA raise to employees for a few years and then trying to catch up.
Commissioners closed by expressing gratitude that previous commissioners had seen this time coming and had set up the “rainy day” funds. However, they realize that spending more than you receive in revenues is not sustainable.
The total value of the ten “rainy day” funds exceed $35 million