PORT ANGELES — Clallam County lawmakers are looking for ways to spend “excess” general fund reserves to help family budgets and foster economic development.
The three commissioners Monday discussed three potential ways to improve the economy and provide relief to struggling citizens.
Among the ideas was a temporary sales tax holiday — perhaps 0.1 percent for one year or 0.2 percent for six months — to save taxpayers $500,000.
Other ideas were to grant money to organizations that help the community, including $40,000 to Olympic Medical Center and $20,000 to Forks Community Hospital for uncompensated care, and to allocate $1.5 million for the design, engineering, repair and replacement of the failing sewer lines in Clallam Bay and Sekiu.
Board Chairman Jim McEntire floated the ideas in rough form March 23.
The proposals were molded by County Administrator Jim Jones at the direction of the board for discussion.
“I think the broad outlines here that you’ve suggested, Jim, have support here from the full board,” McEntire told Jones.
“There’s some details to work out.”
Commissioners took no vote on the spending issue Monday. They asked Jones to “fine tune” the proposal for further discussion.
Changes to general fund reserve spending would likely take effect next year, officials said.
Clallam County has about $9.1 million in restricted reserves and $3.2 million in unrestricted reserves in its general fund for day-to-day operations.
Two weeks ago, representatives of Serenity House of Clallam County and the Port Angeles and Sequim food banks requested one-time grants of county money for what commissioners viewed as worthy projects.
That prompted a lively discussion about spending down reserves.
Commissioner Mike Chapman said he came to the realization that government money sitting in a bank does no good for the economy.
Clallam County earns about 0.9 percent interest on its investments.
Jones said he worked with the Prosecuting Attorney’s Office to draft his recommendations.
Much of his research centered on the mechanics of providing taxpayer funds to nonprofit groups.
Last month, commissioners authorized the spending of $150,000 through a contract with the nonprofit Clallam County Economic Development Council.
“Basically I’ve come to my own conclusion that we cannot give, gift or loan [general tax] money to organizations, non-municipal corporations, flat out,” Jones told the board.
“Now, we can contract. And again, that becomes tricky. We can contract with anybody, nonprofit or otherwise, but essentially the contracting work that we do needs to be work that we could otherwise already do ourselves.”
Clallam County’s sales tax rate is 8.4 percent.
The board has the legislative authority to temporarily or permanently not collect one-half of 1 percent of that tax, Jones said.
Three counties in the state take less than the 0.5 percent, and one county takes none of it, Jones said.
“Right now, we’re taking the full second half of a percent,” Jones said.
Most sales tax revenue comes from construction. Automobile sales represent the second-largest source of sales tax collected in unincorporated areas, Jones said.
“I kind of like a significant tax holiday, and we might want to think about what time of year we do that if there are peaks and valleys of sales tax activities,” McEntire said.
A temporary sales tax reduction “goes directly to family budgets,” McEntire said.
Frustrated by the apparent hurdles of getting county funds to organizations, Chapman suggested a permanent sales tax cut and increased county spending.
“You know what, move everybody back to 40 hours a week,” Chapman said.
“Increase staff. At least it’s being spent.”
Chapman added: “It’s sad that we can give $150,000 to the EDC but we can’t help the food bank.”
After speaking with Jones and Prosecuting Attorney Mark Nichols, Chapman said in a telephone interview that he had misinterpreted parts of the staff recommendation and spoke out of context.
During the meeting, Chapman said permanent sales tax relief would assist the parent who earns $25,000 a year and pays high utility bills.
“A sales tax holiday is kind of a gimmick,” Chapman said.
“If you want to do the right thing, just cut it. Just be done with it.”
Chapman, who announced last month that he would not seek a fifth term in office, also pitched a county grant for the planned expansion of the Feiro Marine Life Center on the Port Angeles waterfront.
About 15 individuals affiliated with Serenity House of Clallam County attended the meeting Monday on behalf of the organization that provides emergency shelter, transitional housing and support services to the homeless.
“To me, there’s something wrong with a system that says you can’t help the poor,” Commissioner Bill Peach said earlier in the meeting.
The board has extended its Monday work sessions to allow more time for free and open discussion.
Commissioners do not talk elsewhere because a gathering of two or more commissioners represents a quorum and must be advertised under open public meetings law.
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Reporter Rob Ollikainen can be reached at 360-452-2345, ext. 5072, or at rollikainen@peninsuladailynews.com.
