PORT ANGELES — Clallam County’s budget deficit for 2017 is looking “significantly better” than it did six months ago, a county executive said Tuesday.
That’s not to say that the county budget can be sustained as it is structured over the long term, County Administrator Jim Jones said in a midyear budget review Tuesday.
Jones’ midyear projection shows $36.85 million in general fund revenue and $38.60 million in general fund expenses for a $1.75 million draw on reserves at year’s end.
“Again, it’s significantly better than the $2.7 million [deficit] that we had budgeted,” Jones told commissioners in a public hearing Tuesday.
Clallam County’s general fund for day-to-day operations was $49,921 in the red as of June 30 compared to a budgeted shortfall of $321,999.
Jones’ analysis showed decreased spending in all major categories.
Actual revenues were matching or outperforming the budget in taxes, licenses and permits, charges for goods and services, fines and forfeits, and miscellaneous items such as investment income and park and fair fees.
The midyear budget was lagging in intergovernmental revenues — based largely on the late passage of the state budget — and other financing sources such as the sale of county timber, which is down 42 percent.
If the midyear projections hold true, the Clallam County general fund reserve would have a year-end balance of $9.5 million. Most of that reserve is restricted for emergencies.
Looking ahead, Jones said Clallam County is facing an “unsustainable” structural budget deficit of up to $2 million per year.
“We really only have three options,” Jones told commissioners. “One, increase revenues. Two, lower expenses. Or three, some blending of the first two.”
Jones defined a structural deficit as a “term of art that says outside of extraordinary, one-time things, ongoing revenues are less than ongoing expenditures.”
“In our case, around $1.7 [million] to $2 million a year is what I’m projecting,” Jones said.
“The revenues that we can expect annually are short by that amount of money over expenditures that we can expect annually in our current structural setup.”
Because the meeting packet indicated that the budget review would be delayed by one week, commissioners will continue the public hearing at 10:30 a.m. next Tuesday.
Commissioner meetings are held in Room 160 at the Clallam County Courthouse, 223 E. Fourth St., Port Angeles.
In his report, Jones included an article about Mason County’s $2 million midyear budget deficit and the commissioners there directing elected officials to cut their budgets by 17.5 percent.
The July 10 Seattle KING-TV story quotes Mason County Sheriff Casey Salisbury as saying he might have to lay off eight of 53 deputies as a result of the budget cuts.
“This is going on all over the state,” Jones said.
“As I’ve talked to my colleagues at the administrator’s conference, all counties have this structural problem, not just us.”
Clallam County is in a unique position because of its “more-than-adequate budget reserves,” Jones said.
“But structurally, we all need help,” Jones added, referring to the 1 percent cap on property tax increases.
“The 1 percent limitation on what is typically about 40 percent of our total revenue that’s been ongoing since 2007 when costs have increased on average between 2.5 [percent] and 3 percent every year just puts us in hole that counties are not able to dig out of right now.”
The midyear budget review is available on the county’s website, www. clallam.net.
Clallam County recently launched a budget transparency tool that presents financial data in a user-friendly format.
To access the OpenGov platform, click on clallam countywa.opengov.com.
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Reporter Rob Ollikainen can be reached at 360-452-2345, ext. 56450, or at rollikainen@peninsula dailynews.com.
