PORT TOWNSEND — Jefferson County administrator Mark McCauley said the county has had a few good financial years, but a recent indicator from the Conference Board indicated the potential for a recession.
McCauley presented a resolution to the Board of County Commissioners on Monday to establish methods and procedures to be employed during recessions and periods of severe financial stress.
Conference Board is an economic think tank, which McCauley said he checks on a monthly basis.
“2008, 2009, the great recession required this county to undertake some drastic actions in order to align revenues with expenses,” said McCauley told commissioners Monday. “That included reducing work weeks, furloughs, hiring freeze. Looking at this economic landscape, using August data (from Conference Board), there’s a recession signal flashing. Then looking at our 2025 revenues, we see two of our significant revenue sources that are going to be shrinking, that being investment income and DNR timber.”
The reduction in revenue could be as significant as $500,000, according to a document accompanying the resolution.
The resolution, which the commissioners passed, provides the county with an outlined set of actions, both for assessing financial health and reducing expenses in the case of reduced revenue.
The resolution provides management tools for bringing about work-hour reductions, hiring freeze, reductions to the general funds operational transfer, reductions or freeze on discretionary spending, and reduction in workforce.
McCauley said Clallam County has made recent moves to reduce its spending, including cutting positions.
“The city of Vancouver, where I hail from seven years ago, they have a $47 million deficit,” McCauley said. “They are proposing five new taxes and are eliminating nine jobs.”
While Jefferson County is not faced with making such a drastic decision to balance its budget now, it is prudent to be prepared for times of financial stress, McCauley said.
The resolution also provides staff with methods and guidance for assessing and working through the county’s financial situations, such as financial forecasting, where staff meet on a monthly basis to consider financial performance and trends.
Finance staff also are directed to consider the size of problems, propose strategies, work with elected officials and directors, and receive commissioner approval before taking actions, along with other steps spelled out in the resolution.
The resolution was a collaborative effort from a core financial team, including treasurer Stacy Prada, finance manager Judy Sheperd, auditor Brenda Huntingford and Human Resources director Sarah Melancon. The resolution was further improved by prosecuting attorney Phillip Hunsucker, McCauley said.
“I just think that this educates people in the county,” McCauley said. “The methods that we might have to employ, not in any particular order or in any particular combination. It would be determined by the severity of the stress and the urgency of it.
“I think by adopting this, you’re signaling not only to the community but to people who work in the county, that we know what we’re doing, and should the requirement arise, that we would know what to do and how to respond to it financially.”
Commissioner Greg Brotherton responded to McCauley’s presentation, noting conversations he has had with long-term county employees and how heavily they were impacted by the 2008 recession.
“I think there’s a resilient way to do it that shields our departments when we do start having to use some of these,” Brotherton said. “I just want to be really measured in the application of remedies, as well as we are moving forward in times of excess.”
McCauley said the procedures being considered are safeguarded from thoughtless implementation.
“Under the procedure, we involve the budget committee, directors, electives and the board before we implement anything,” he said. “So we are in agreement about which methods to apply and when and how severe they should be, and then maybe an incremental approach, all with the goal of trying to minimize impact on the people who work here.”
The Department of Community Development is still three full-time employees (FTE) behind where it was before 2008, McCauley said. After cuts during the recession, the department went from 25 FTEs to 14 or 15, he added.
“It was brutal,” he said.
“In my first time here, I heard a lot about, especially around the Department of Community Development, their ability to do their work was hampered for that entire time period,” Commissioner Heidi Eisenhour said. “I’ve seen it and heard it in the community a lot, so I would like us to think about how, going forward, if we have to implement any of these measures, how do we reduce the amount of sustained damage that we do to our community as a result of these actions.”
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Reporter Elijah Sussman can be reached by email at elijah.sussman@sequimgazette.com.
