Mad River Union
HUMBOLDT – County spending continues to exceed income but its structural budget deficit is less than it was last year.
That was the upshot of a third quarter budget update given at the May 5 Board of Supervisors meeting.
Assistant County Administrative Officer Amy Nilsen reported that General Fund expenditures will exceed revenues by at least $1.6 million in the 2015 to 2016 fiscal year, which begins July 1. That gap includes $1.5 million proposed to be transferred to the county’s lean contingencies or emergency fund.
Costs will rise for a variety of services in the upcoming budget year, Nilsen continued. There will be two additional elections costing the county $325,000, the county’s general relief program needs $160,000 to cover increased caseloads and the county’s contribution to the court system is likely to increase by $100,000, she said.
If the additional funding is approved, the General Fund’s structural deficit will rise to $737,000, Nilsen added, for a total deficit of $2.2 million with the contingency fund contribution.
The county’s Aviation Enterprise Fund has been an ongoing drain because its fee revenues have been dropping as costs rise. The fund has a growing deficit and one of the recommendations approved by supervisors is to advance a $500,000 loan from another fund, the county’s motor pool.
Asked about the loan’s impact to the motor pool, County Administrative Officer Phillip Smith-Hanes said there’s enough money there to absorb a subtraction.
“There’s no magic about why it’s the motor pool that would loan money to aviation, it’s simply the place where we have quite a bit of cash – unlike the General Fund,” he continued.
The Aviation Fund’s ballooning deficit has been continually flagged as a problem and Smith-Hanes said that now is “a critical point in time where we do actually need to get an infusion of money in there from someplace.”
With changes in health care, the county’s Medical Services Program is down to one participant. The county will seek to have a $430,000 program fee waived and Supervisor Rex Bohn noted the program’s single-person enrollment.
“We could build that one person a hospital,” he said.
Smith-Hanes said “there’s no guarantee” the program fee will be waived but if it is, the county will use the money to chip away at its deferred building maintenance backlog.
Supervisors unanimously approved using this year’s fund balance to cover the upcoming deficit and authorized pursuit of the loan to the aviation fund.
Also approved were recommendations to discontinue voluntary furloughs and to transfer $50,000 from the General Fund to cover costs associated with establishing the McKay Community Forest.