County sees budget shortfall of $1.9 million
Public hearings slated for later this month
By Michael Prochaska
A millage rate increase is on the table, if not in Fiscal Year 2013, than in FY14, according to Morgan County Manager Michael Lamar.
The Board of Commissioners took a preliminary look at next year’s budget last Thursday in preparation for two public hearings scheduled Tuesday, June 19 at 6:30 p.m. and Thursday, June 28 at 7 p.m.
The budget calls for an increase of expenditures for FY13 by approximately $158,000, bringing the FY13 fund balance up to about $14 million from $13.89 million.
Due to the expenditure increase, a $623,000 revenue reduction and $1.13 million of the FY12 fund balance depleted, the county will see a total shortfall of $1.91 million.
A continual reduction in property values could cause a $900,000 decrease in revenue if the millage rate remains the same, Lamar said, adding that to generate the same revenue, or to rollback, the county would have to levy 10.4 mills.
Lamar’s recommendation was to use $1.91 of the county’s $6.72 million FY12 Fund Balance and leave the millage rate at 8.99 mills.
He referred to the proposal as “the most difficult budget cycle I’ve had to deal with” and said he does not expect the budget to be in much better shape for FY14.
“This is a solution for this year and it was a solution for last year,” Lamar said. “It is not going to be the solution for next year...We are reaching a point where we have no choice but either to add more reductions in spending or consider raising the millage rate.”
Commissioner Mack Bohlen said he is not a proponent of increasing the millage rate but that it may be necessary to go ahead and adopt an increase to offset a steeper rise in years to come.
“I’ve been here before, and I’m going to tell you now that I think you’d be better off served to have a small millage rate increase this year than a great one next year,” he said. “If you keep dipping into the fund balance, it’s just a matter of time until there’s not going to be a fund balance.”
Though the budget is due at the end of the month, millage rate approval is scheduled for the last week of July.
Commissioners agreed that, if passed, a July 31 Northeast Regional Transportation Special Purpose Local Option Sales Tax (TSPLOST) referendum could aid in keeping the millage rate down.
Though many of the TPLOST projects are dedicated outside the county, Morgan County will receive about $1.2 million in discretionary spending, Lamar said.
That amount is almost identical to what is currently spent out of the roads and bridges department on the general fund, he said.
Additionally, if TSPLOST loses, the local contribution for state-funded road projects will triple from 10 to 30 percent.
“TSPLOST is on everybody, whether you own, rent property or pass through,” Bohlen said.
If TSPLOST passes, the revenue collected would be budgeted for the last six months of FY13 and continue for 10 years.
Lamar said that Athens-Clarke County voters would ultimately carry the most weight in deciding the fate of the proposed 1 percent sales tax increase because that jurisdiction has one of the largest voter populations.
Printed in the June 7, 2012 edition