The general fund budget for this year is $107.5 million so the various entities have submitted expenses that are nearly 8% over goal. The commissioners in their budget directive did allow for a 7.5% increase for materials and supplies and contracted services due to inflation. Plus a 3% hike for salaries and benefits.
Boyko told the Journal-News the fact the various offices exceeded the commissioners’ expenditure goals is not “unique” and everyone always seems to be able to trim budgets accordingly, “I don’t see this year being any different.” But budget setting is not easy, especially now.
“Projecting a $100-plus million budget with various elected offices, departments and other county operations is challenging enough, then integrate economic recovery from a pandemic, volatility in the economy and our revenues are subject to that volatility,” Boyko said. “Those make it even more challenging to present a budget which the board of commissioners can adopt and ensure that all of our statutory responsibilities and services are being met.”
Boyko told the board she is still working on estimated revenues but the projected amount is $118 million, “we want to go back and look at some of those revenue sources that are contingent on the cycles in the economy, since the tax budget in July some information obviously has come out that demonstrates the economy is grimmer.”
Several years ago, when finances were very tight, the budget hearings with some office holders and departments could get testy, the past few years they have been very friendly affairs. Commissioner Don Dixon said the upcoming hearings will reflect the uncertain economic times.
“I’m going to be asking them if there’s any way they bring this in a little tighter because 2023 has changed in the last 90 days,” Dixon said. “They’re all very reasonable and they’ve been very good to work with, they understand, they go to the grocery store, they buy cars.”
At the last minute this year the commissioners approved an $18.5 million property tax rollback which was estimated to save taxpayers about $67 per $100,000 in assessed value. Butler County Auditor Roger Reynolds just lost his fight with the state over an average 20% value hike on about half the county’s taxpayers, but the commissioners haven’t discussed extending the tax break yet.
Commissioner T.C. Rogers said it is “too soon” to think about another rollback.
“We did $18 million, that was a huge amount, we could do it but we actually ended up being very thin at the end of our budget because of that,” Rogers, “I don’t want to give out any encouragement we would do that again.”
He said they won’t know if the economy is going to free fall into a recession next year so he can’t say whether he will allow the departments to have all they requested either.
“I’ve not finalized a way to make sure we’re covered mid-year ‘23 if there’s a downturn. We will know if there is going to be one or not by that time,” Rogers said. “I’m going over a couple options and we’ll just see which one sounds plausible. Yes we have money now but we don’t know if it’s going to be bad or how bad.”
The latest dashboard of general fund expenses versus revenues is through July and it shows $67.2 million in revenue collections to cover $67.4 million in expenses. The county has plenty in reserves, the beginning general fund balance for this year was nearly $113 million and $15 million in the budget stabilization fund. However, the commissioners are committed — after the county nearly fell off a fiscal cliff following the last recession — to maintaining a structurally balanced budget, which means they don’t use savings for operating expenses.
The tax rollback was Dixon’s idea but he agrees with Rogers it’s just too soon to tell if an extension would be feasible given all the plausible “data points” pointing toward a recession.
“It’s just too early to tell how long it may be and how painful it may be but one can only look at the national debt right now and clearly see it just can’t go on,” Dixon said. “There’s just too many uncertain things out there but from my perspective, I’m going to take a real conservative approach to this budget.”
In the 2023 tax budget Boyko projected a 5% decrease in sales tax revenues — the county’s largest revenue generator — to $48 million. The county collected $52.7 million last year and budgeted $50.5 million for this year. As of September the county had collected $41 million, an 5% increase year-to-date but collections.
Boyko told the Journal-News she was heeding the predictions of economists when she set that figure.
“All economic prognosticators say that we’re going to be entering a probable recession,” she said. “And with a recession prices are high, the ability to borrow money is high, those things all effect consumer spending and consumer spending is a direct impact on how much we collect in sales tax.”
The commissioners have also received $74.4 million in federal American Rescue Plan Act dollars — and have awarded $52.4 million thus far — but received $200 million worth of requests. Commissioner Cindy Carpenter wants to spend general fund dollars on some of the unfunded projects so she said she isn’t sure a tax break is a good way to go right now.
“We haven’t looked at the rest of the requests for the ARPA dollars, those projects are important to Butler County and we will run out of ARPA dollars,” she said. “I think the commissioners need to look at that to decide are we willing to contribute any of our general fund dollars to the projects that help move Butler County towards recovery. So I guess a financial analysis is needed, that’s important whether we’re talking about giving a tax break to property owners or not.”
Sheriff Richard Jones’ budget consumes the lion’s share of the general fund — because he has 400-plus employees — and as usual he is first on the agenda for Monday. Finance Director Vickie Barger budgeted $45.7 million for next year — $52.8 million including non-general fund expenses — which represents a 3.87% increase over this year, down from the 10% hike he proposed last year, “it’s a pretty lean budget.”
On the revenue side she is estimating $15 million for the general fund, the majority about $9.5 million is for boarding prisoners from other police agencies. She is also anticipating $6.3 million in non general fund revenues, mainly from other jurisdictions like Liberty Twp. where the trustees contract with the sheriff for dedicated deputies manning their outpost.
Last Jones asked the commissioners to approve filling pandemic-induced vacancies. When COVID-19 descended the commissioners asked everyone to cut their budgets to the bone. The sheriff eliminated 14 positions, froze hiring and overtime and took other steps to comply.
Chief Deputy Anthony Dwyer told the Journal-News, “it’s hitting us and we’re not back to full strength from years gone by, but we’re holding our own” so they aren’t asking for more people.
“Staffing issues is always a problem, my medical staff for the jail is depleted, I think I’m five or six corrections officers down and we’re just getting by and obviously I’m always looking for dispatchers,” Dwyer said. “So we are dealing with those shortages just like everybody else is, but I think we’re probably positioned a little better than some of the agencies that have struggled.”
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