Most residents of Clark County won’t notice the impacts of the $21.6 million in cuts and fund transfers proposed to balance the 2017-2018 budget. But county officials say that a lack of revenue and rising expenses for the county, largely from labor, could cause services to be cut in coming years.
“This has been building for more than a decade,” Deputy County Manager Bob Stevens said. “For 15 years now, we have been incrementally dealing with the fact that revenues are a tiny bit shorter than our expenses.”
Each budget cycle, he said, the county has had to come up with short-term fixes that don’t address how the county is structurally unable to raise enough money to cover its expenses.
“We’ve put off maintenance, we’ve put off saving for the future with new buildings,” he said. “These are things that are going to compound and come home to roost.”
County figures project expenses to rise 3.2 percent annually between 2016 and 2020 to cover the rising costs associated with employee retirement and medical costs. Wages and benefit costs are projected to rise $7 million in 2016 alone.
Although county figures show that sales tax revenues have risen from $22 million in 2009 to $31 million in 2015 and property taxes have risen from $51 million to $57 million during that time frame, they haven’t kept pace with costs, said Stevens.
The 2017-2018 budget introduced by the county manager calls for a 1 percent increase in the property tax levy beginning in 2017, raising $1.8 million. Council Chair Marc Boldt said that he expects the tax increase to be approved by the council. If the council does approve the increase, it’ll be a reversal from a year ago, when councilors voted for a 2 percent cut to property taxes.
Under state law, counties are prohibited from increasing their property tax levies by more than 1 percent each year. Clark County has forgone the opportunity to increase the levy since 2011, losing out on $16.5 million in revenue.
“That is revenue we have consciously forgone in the face of a structural deficit,” Stevens said. “We are the only jurisdiction in Southwest Washington that has not done the 1 percent (increase), and that is a major reason we are struggling.”
However, Stevens said that even the added revenue won’t cover rising labor costs. He said the situation won’t improve unless legislators make changes to state law to allow local jurisdictions to raise more revenue or better control labor costs.
Councilor Julie Olson said she wants fewer unfunded mandates placed on local jurisdictions.
“The math doesn’t work,” Olson said. “We are going to have to look at really cutting services [in coming years]. It’s the reality we are faced with.”
The county has a policy of keeping $23 million in reserves to maintain its cash flow and guard against an unexpected dip in revenue. Councilor Jeanne Stewart said that in coming years, the county may have to start using its reserves if the situation isn’t resolved.
In the meantime, the most noticeable change will likely be in park fees. Eric Christiansen, parks program coordinator, said that the county stopped charging $3-per-car parking fees at its four regional parks at two boat launch sites in 2013. He said the new budget will reinstate those fees and also increase the shelter reservation fees, as well.
Boldt, Olson and Stewart voiced overall support with the budget but expressed unease with using $7.5 million in debt financing for IT and other projects.
