SNOW HILL — An early operating budget for Worcester County has been drafted and currently shows an $8.3 million shortfall that the County Commission will need to reconcile.
The budget shortfall, the gap between projected expenses and revenue, is technically closer to $14.7 million, but the county is planning to use $6.4 million in budget stabilization funds that the commissioners have not yet discussed.
Even with the use of stabilization funds, the gap between estimated county revenue and expenditures this year is a steep one.
“General Fund revenues based on current tax rates are estimated to be $176,399,189,” reported Chief Administrator Harold Higgins in a budget memo to the commission. “Requested general fund operating expenditures total $184,770,774. This leaves a shortfall of $8,371,585, which must be reconciled, either with reductions in expenditures, additional revenues or a combination of the two.”
As in years past, the largest portion of the budget, about 51 percent, focuses on public schools. The Board of Education has requested $79,463,091 in funding for FY15, an increase of $3,384,021 from last year. The county will also be paying $11,740,740 in school construction debt, which is not reflected in the board’s regular budget, bringing the total education expenditure to $91,203,831. Notable changes from last year include a requested payroll increase of 3.5-percent, representing $1,916,669, a 3.4-percent increase to bus contractors’ hourly rate and raising starting teacher pay from $42,222 to $42,644.
Other major requested budget expenditures include a $752,041 increase to the Sheriff’s department, a $1,063,172 increase to the Health Department and $1,012,396 in additional grants to towns. Additionally, the budget includes a $3,044,166 requested increase for salary, insurance and benefits for county employees. The total change in expenditures from last year is an increase of $16,127,120, or 9.6 percent.
On the revenue side, there was likewise an increase from last year to the tune of $7,755,535, or 4.6-percent. Notable changes include net property tax revenues rising by $252,584, a $500,000 increase in income tax revenue and $1,176,083 in other local taxes due mainly to the Ocean City Room Tax.
However, the general fund revenue also includes the use of $6,393,201 in budget stabilization funding, an increase of $4,739,759 from last year. While the commission will be able to use that money if they so choose, a few of the commissioners were uncomfortable with so much automatically being included in the preliminary budget.
“Last year the budget stabilization was the last thing that we added to the budget because nobody had wanted to cut anymore so then we had the money and went ahead and plugged it in to balance the budget,” said Commissioner Virgil Shockley.
Commissioner Jim Bunting also had reservations about assuming the use of such a large chunk of the roughly $17.7 million left in the budget stabilization fund this year. The commissioners have not yet discussed using the $6.4 million to help balance the budget, though Bunting acknowledged that the number was not pulled out of thin air but is the evolution of projections made in years past.
“That has not been anything that we have ever voted on. It comes from a projected budget until 2018,” he said.
If the commission does use the $6.4 million this year to reduce the current shortfall from about $14.7 million to $8.3 million, the projections would still be on track, though Bunting is concerned that the stabilization fund could dry up quicker than predicted.
Bunting, who has refused to vote for the last two county budgets, has indicated that he may take a similar route with the FY15 operating budget unless it changes drastically before the final vote in early summer.
“I’m not going to support the budget as it is. There are going to be major cuts before I’m going to sign it. I haven’t signed it the last two years and may not sign it again,” he said.
As the budget is still a work in progress, Bunting didn’t go into extensive detail but did reveal he is uncomfortable with how large the education budget has become and is skeptical of pay raises.
“I don’t see how we can give anyone any raises this year and then do our budget correctly. I just don’t see how we can do it,” he said.
During the budget discussion, Commission President Bud Church took a moment to emphasize the requested operating budget is only a draft and will likely see a serious overhaul.
“This is requested, we’re going to review, we’re going to have three or four meetings to go through it, there’s going to be a public hearing, there are going to be some additions, some subtractions, this is going to be massaged, this is not the final say, so don’t anybody run out of here and say this is final because it’s not,” Church said.
The next budget work session is scheduled for April 8 to be followed by additional sessions in May with a final budget expected around June.