Jefferson County faces projected $1.6M deficit

The Journal News, Feb 10, 2017: Jefferson County faces projected $1.6M deficit

CHARLES TOWN — According to Jefferson County financial director Michelle Gordon, the Jefferson County Commission is facing a projected budget deficit of $1.6 million as it begins budget deliberations next week.

At a public forum regarding the county’s fiscal year 2018 budget, held by the county commissioners at the request of the League of Women Voters of Jefferson County, the Gordon and county administrator Stephanie Grove presented information on property taxes and the county’s financial outlook.

Property taxes, which make up 59 percent of the county’s Fiscal Year 2018 general fund revenue, are collected on three types of property: Class II property, which is owner occupied residences, Class III property, which is non-residential property that lies outside of a municipal boundary, and Class IV property, which is non-residential property that lies within a municipal boundary. Grove said Class I property, agricultural personal property, is exempt from taxation.

Grove said taxes are levied per $100 of the property’s value, with a maximum levy rate of 28.6 cents per each $100 of property value for Class II property and a maximum levy rate of 57.2 cents per $100 of assessed property value for Class III and Class IV property.

“As property values decrease, the levy rate increases. As property values increase, the levy rate decreases,” Grove said. “The county can collect no more than 101 percent of what it collected the year before (in property taxes), but the Jefferson County Commission did not take that one percent increase last year. The county could raise the tax rate by 10 percent if it is not at the maximum, but there would have to be a public hearing on it. However, Jefferson County has never (enacted a 10 percent tax rate increase).”

Gordon said the second-largest source of revenue for the county is gambling revenue, despite the opening of casinos in Maryland. In fiscal year 2017, gambling generated $3.88 million in revenue for Jefferson County, or 16.2 percent of the total general fund revenue. For fiscal year 2018, gambling revenues are projected at just over $4 million, or 16.3 percent of the total general fund revenue.

“We’re losing gambling money because of the law that allows casinos to operate in Maryland, but that loss has flattened out over the past few years,” Gordon said. “In Fiscal Year 2012, the county received $5.9 million in gambling revenue. In Fiscal Year 2016, the county received $4,116,274 in gambling revenue, so it has gone down in recent years.”

Gordon said the county is assuming there will be a 17 percent decrease in table games revenue for Fiscal Year 2018, as well as a 5 percent increase in employee health insurance costs. She said the county may reach the maximum levy rate in Fiscal Year 2019 if projected budget trends continue.

According to Gordon, the county’s largest expenditure is public safety, which includes fire, police and emergency medical services and is projected to account for 49.7 percent of the county’s expenditures in Fiscal Year 2018.

She said general government expenditures, including personnel and equipment, are projected to account for the second-largest expenditure in Fiscal Year 2018 at 42 percent of the county’s total expenditures.

For the past four years, the budget in Jefferson County has been created using “zero-based budgeting,” in which the heads of various departments in the county must justify every expenditure item in their budget to the county commissioners. Gordon said projected budget submissions for the upcoming fiscal year total $24.6 million and expenditures are projected at $26.2 million, leaving a projected deficit of $1.6 million.

She said the requested budget items that account for the deficit include a request to fund 13 new positions in the Jefferson County Emergency Services Agency’s budget submission, which is expected to cost $1.2 million. Gordon said the Jefferson County Sheriff’s Office submitted a request for six new positions at a cost of $420,000. Additionally, the Jefferson County prosecuting attorney’s office submitted a budget request for one new position at a cost of $110,000, the Jefferson County Health Department requested $357,000 in funding and the county’s libraries requested $105,000 in funding for fiscal year 2018.

The county commission will preside over budget submissions beginning Monday, and all budget deliberations are open to the public. After all budget submissions have been made, the county commissioners will hold a public hearing on the fiscal year 2018 budget in March before submitting the county’s final budget to the West Virginia State Auditor’s Office.

Staff writer Mary Stortstrom can be reached at 304-725-6581 or on Twitter @mstortstromJN.