County spending next year to reflect worries about 2017
Garfield County property and sales tax revenues are expected to be about the same next year for purposes of maintaining county government services at the same level as this year.
But concern is building about a likely downturn in tax revenues for 2017 due to the recent decline in natural gas production in the county.
County Finance Director Ann Driggers presented revenue projections to county commissioners Monday for purposes of starting the 2016 budget planning process.
Although county property tax revenues are a far cry from the $71 million generated in 2010, they have rebounded to $43.4 million for this year with a small increase projected to $45 million for 2016, Driggers said.
But the drop in natural gas production is about to be reflected in property taxes that are levied on new production sites come 2017.
“We could be looking at a significant decrease in property tax revenues at that time,” Driggers said.
How much is hard to say at this point, she said.
But it does raise questions about how the county wants to plan for spending next year in anticipation of what will be coming down the pike the following year, county commissioners agreed.
“Even though the economy might be better in other parts of the county, because of our reliance on oil and gas we are going to have some hard times,” Commissioner Tom Jankovsky said.
“We really need to get the message out in 2016, otherwise the reality of what we expect to see in ‘17 is going to be very drastic,” he said.
While the county is likely to maintain operating expenses at the same level next year, new capital projects or equipment and any new personnel requests not already approved this year are not likely to make it through the 2016 budget process, Jankovsky and the other commissioners advised county department heads.
Commissioner John Martin said he would like to see department heads start to plan for reductions of about 2 percent to 5 percent over the next year in anticipation what’s coming in 2017.
“We are going to tighten it up,” he said. “That’s not to hurt our employees or the public, it’s just reality, and we need to prepare for that reality.”
Still helping the county’s financial situation is a large reserve fund balance totaling about $107 million, split among several different county funds.
If that overall balance has to drop below $100 million, “I’m not going to scream about it,” Martin said. But those funds shouldn’t be used to artificially support new spending, he said.
“We are using our fund balances wisely, and we need to continue to do so,” he said.
Also helping the situation has been a steady stream of sales taxes that come into the county coffers, Driggers said. Sales tax revenues for 2016 are expected to be about the same as this year, at $10 million, she said.
Other revenue sources are also expected to hold steady, she said.
Garfield County’s overall spending budget has remained roughly the same, at about $130 million, for the past two years.
The county expects to have budget requests from each department by August, and will have a proposed 2016 budget by Sept. 30. Public hearings on the budget will be held in October.
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State department of transportation crews are well on their way to clearing Highway 82 to Independence Pass, which should open on schedule May 27 at noon.