PORT ANGELES — Halfway through the 2011 fiscal year, Clallam County’s deficit is less than anticipated, but the 2012 budget is looking grim.
County Administrator Jim Jones told the three Clallam County commissioners at a public hearing Tuesday that the 2012 budget will fall well short of revenues needed to maintain county spending and that layoffs could be needed.
“We’re looking at some pretty severe cutbacks,” Commissioner Mike Chapman said.
Discussion mentioned up to 25 layoffs as a possibility.
This year, however, “we’re doing a little better than we were expecting,” Jones said.
The county expected to spend $1.65 million more than it expected to receive and absorb the extra cost with general reserves.
The county’s deficit, as of June 30, was $896,000 less than what was budgeted, he said.
The county budgeted $32,964,470 in expenditures and expected $31,305,788 in revenue.
“The economy is performing as expected,” Jones said.
County sales tax collections are up 2.99 percent, property taxes up by 2.86 percent and excise taxes up by 3.92 percent, he said.
The county’s projections show the economy should continue its upward trend.
In the second half of 2011, the Elwha River dams removal project will provide a boost, Jones said.
However, the county’s interest income dropped by 23.88 percent, Jones said, and state cost-of-living and retirement increases are in the works for 2012.
2012 budget
“The county will likely be upside down by $2 [million] to $2.3 million,” Jones said.
About a third of the 2012 deficit will be in cost-of-living, or COLA, increases for county employees.
COLA increases amount to $811,000, with most employees receiving a negotiated 3 percent raise.
It would take the elimination of 25 full-time positions to make up the deficit created by the COLA increases, Jones said.
“We would still have $1.2 million to trim,” he said.
The county can no longer use its $9.4 million reserve, which has been spent down to the minimum necessary to keep in reserve, Chapman said.
“It’s not just a savings account,” Chapman said.
The county can no longer absorb the losses, and the money will have to be cut from somewhere, he said.
Chapman recommended that the county go back to the unions and negotiate to suspend COLAs.
“This is unsustainable,” he said.
“We’re giving raises as we’re laying off.
“That’s what hit me on the side of the head as I read it.”
Jones said he did not believe that general across-the-board cuts will be possible this time.
“We have to identify some things we won’t do anymore,” Jones said.
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Reporter Arwyn Rice can be reached at 360-417-3535 or at arwyn.rice@peninsuladailynews.com.
