PORT ANGELES — The Clallam County budgeting team is working hard to avoid layoffs due to a deficit budget.
County Administrator Todd Mielke presented the recommended budget for 2026 to the three commissioners, stating it will be used in upcoming budget discussions with department heads as the process carries on.
The commissioners took no action during Monday’s workshop, asking for a week to think over the options.
“If you asked me six weeks ago where I thought we were at, I would have told you I thought we would need to eliminate the equivalent of 25 positions,” Mielke said during his presentation. “There is a way using a lot of one-time budget adjustments that will not require a loss of positions. It is not sustainable. It will get us through one year. We will have a lot of work to do next year.”
When the budgeting process began this past summer, the county was looking at a $3.258 million deficit for 2026. By examining revenue gains and expenditure reductions, the budget team was able to improve that deficit to $1.931 million, according to the presentation.
Revenue gains were found from one-time sources as well as recurring sources. The county will take $549,000 from the Dungeness Off Channel Reservoir and Carlsborg water mitigation transfers and will sell surplus property for $200,000.
Recurring revenue gains include $112,000 from the sales tax forecast, $60,000 from the auditor’s office in election/voter fees and $42,000 from the Department of Community Development (DCD).
A large chunk of the deficit reduction comes from expenditure reductions. One-time reductions are reobligating $200,000 from American Rescue Plan Act funds to personnel costs and $193,000 from risk management allocation.
Recurring expenditure reductions include $388,000 from DCD grant-related professional services, $253,000 from the open labor contract placeholder, $153,000 from the Equipment Rental and Revolving fund, $106,000 from redundant software/systems costs and $61,000 from the Clallam Conservation District/North Olympic Library.
More than $2.7 million in department requests have been received asking for general fund support, but only $915,599 has been recommended for inclusion in the budget, according to the presentation.
“A lot of (department requests) are ones where we just simply don’t have any other option,” Mielke said, citing two upcoming murder trials as examples because the county will have to pay for expert witnesses.
The county’s general fund has many different sources of revenue for the budgeted $55.715 million for 2026. Those revenue sources are taxes ($26.880 million, or 48 percent), licenses and permits ($1.351 million, or 2 percent), intergovernmental grants ($4.137 million, or 7 percent), intergovernmental HCA Medicaid re-entry grants ($113,000), intergovernmental revenues from recompete grants ($597,000, or 1 percent), intergovernmental PILT, PUD Privilege Tax, criminal justice, marijuana/liquor excise, autopsy and other ($3.872 million, or 7 percent), intergovernmental timber sales ($963,000, or 2 percent), charges for goods and services ($10.321 million, or 19 percent), fines and penalties ($854,000, or 2 percent), miscellaneous such as interest and camping fees ($4.455 million, or 8 percent), other financing sources such as Medicaid reimbursement ($1.070 million, or 2 percent) and transfers into the county ($1.103 million, or 2 percent).
Revenues for 2026 are expected to be 5.61 percent (or $3.310 million) less than 2025, according to the presentation.
Total expenditures for 2026 are expected to be $58.222 million.
The bulk of the county’s money goes toward personnel costs. Payroll is at $29.573 million, or 51 percent, while benefits are at $11.639 million, or 20 percent. Other expenditures include $1.682 million (3 percent) for supplies, $9.679 million (16 percent) for services, $1.351 million (2 percent) for capital, $1.528 million (3 percent) for transfers out, $2.377 million (4 percent) for payment to risk management/WC funds and $392,000 (1 percent) for debt service.
Expenditures for 2026 are expected to be 4.81 percent (or $2.647 million) more than 2025, according to the presentation.
Toward the end of the presentation, commissioners were given six options to consider:
• Adopt the “allowable budget” for 2026, which currently does not require full-time employee (FTE) reductions but would require further cost reduction actions being taken in 2027;
• Adopt the budget under option 1 but consider the implementation of the new one-tenth of 1 percent criminal justice sales tax by July 2026 with a reduction of two FTEs;
• Adopt the budget under option 1 with the planned utilization of all HCA re-entry grant funds in 2026;
• Adopt the budget under option 1 but remove the assumption of payroll underspend to balance in favor of capturing payroll underspend as it occurs, which would require an estimated 10 FTE reductions;
• Adopt a “balanced budget” from an ongoing perspective, requiring an approximate 11 FTE reduction;
• Other: adopt a “balanced budget” utilizing cost reductions achieved through a combination of FTE reductions, other personnel cost reductions and/or elimination of funding for outside organizations and state programs that are not full reimbursed.
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Reporter Emily Hanson can be reached by email at emily.hanson@peninsuladailynews.com.
