THE TENTATIVE 2016/2017 COUNTY BUDGET CAME IN AT A DEFICIT OF $1,941,284….BUSINESS IS SLOWING DOWN AT TRI AND REVENUES TO THE COUNTY ARE FLAT…MAYBE DOWN…..THERE MAY BE A GAS TAX INCREASE ON THE BALLOT, THE PROPERTY TAX CAP IS PROBABLY GOING TO BE LOOKED AT BY THE LEGISLATURE ….AND NOT IN A GOOD WAY…..AND NO VIRGINIA THERE WILL BE NO PROPERTY TAX ROLLBACK FOR STOREY COUNTY RESIDENTS……
By Nicole Barde
The agenda for this meeting is HERE and County Manager Pat Whitten’s summary of this meeting is HERE. To listen to audio of this or other Commission Meetings go HERE.
The vast majority of the meeting was dedicated to reviewing the 2016-2017 County budget.
There were few staff updates and only one Board update. Commissioner Jack McGuffey reported that although NACO had thought to have a coordinated/consistent “Pro and Con” for the proposed gas tax increases slated on the November ballot that they decided to have each county develop their own. Later in the meeting it was also noted that the Legislature is looking at what they can do to increase the residential property tax cap or eliminate it since revenues are not growing as fast as needed to fund ever increasing spending. Let that sink in for a minute…………last election cycle the voter defeated margin tax came back as Sandoval’s business tax…..because the state said it couldn’t fund it’s expenses…..this cycle a potential increase in gas tax……next cycle…… possibly greatly increased property taxes. Oh yes, and let’s give away more tax abatements and cut no spending.
Item #12- Consideration and possible action on ratification of County manager decision to retain Ann Delahay to appraise leased from the Bucket of Blood for courthouse parking.
This was approved since Pat Whitten had already hired her to do the appraisal in December and this commission’s approval was a technicality. The courthouse parking lot cannot be improved unless it is owned by the county. In order to buy it from Commissioner McBride, it needs to be appraised by a duly sworn in appraiser.
County Comptroller Hugh Gallagher began the budget process review by giving a somber summary of the U.S. and global economic scenario. It was a CNBC snippet………slowdown indicates a recession, international factors, Chinese bubble, debt overhang from banks , housing and student loans, less than rosy employment figures, central banks out of tricks……looking like the setup to the last recession. Hugh continued, in Storey County property taxes to the general fund are down, building permits are also slowing down….all of these indicators signal “ caution” going forward for the 2016/2017 County budget. And so it began:
The bottom line in this first pass of the county’s tentative 2016/2017 budget is that it was a deficit budget by $1,941,282 of expenses over revenues. As a side note….the County also had a deficit budget ACTUAL in 2014/2015 of $2,512,366 and expenses look to come in over revenues by $ 194,111 again in the current budget year.
The 2016/2017 tentative budget revenues are projected to be $13,518,824…..about 7.8% higher than the current 2015/2016 budget BUT about $850k of the “revenues” are Tesla offsets that Tesla is contractually obligated to pay Storey County for all of the added manpower and equipment required to support them at TRI. So in reality true revenues are flat to last year.
Expenses came in at $15,460,108 or 21.4% higher than last year….a 21.4% increase in spending………21.4%…………. Our Debt to TRI is sitting at about $46 million and climbing.
Of the $1.9 million 2016/2017 deficit approximately $1.1 million was a 31.9% increase submitted by the Sheriff’s Office, $324,212 was a 59% increase for the D.A’s office and $112, 021 was a 19% increase for Community Development. All other departments came in an average of about 8% increase over the current budget year with about 5% of that being salary and benefits increases.
I’ll just summarize the larger budgets here:
The Sheriff’s budget was higher due to Sheriff Antinoro’s request for 6 additional deputy headcount based on a standardized staffing model. He noted that he had been holding his deputy headcount down over the last couple of years. He said that he was at a point where he had to add staffing to ensure proper coverage for the county. Additionally, he said that he needed some new vehicles to replace those too old to repair safely. Commissioner Lance Gilman recused himself from the approval process of the Sheriffs budget due to his current private lawsuit against the Sheriff.
County Manager Pat Whitten and Commission Chair Marshall McBride reminded the sheriff that he had been asked in prior budget cycles if he needed additional deputy resources and he had always said no. Pat Whitten said that in absolute terms the amount of his increase was significant and needed to be looked at and reduced.
Pat Whitten, Marshall and Jack exercised Sheriff Antinoro vigorously on his need for additional headcount citing that he could change the current 10 hour shifts to 12 hour shifts and attain the same coverage without the large increase in spending. That he could revise the current procedure for vehicle pickup and save expense, time and minimize liability to the county.
County Manager Whitten also noted that the current BIA contract for the Jail may not be to the County’s advantage and it may be costing us more than previously thought. Hugh said that they will look at the BIA contract, the vehicle utilization as well as jail operations and give a report at a future date. More on this at a later meeting.
For the District Attorney’s office budget DA Langer explained that the increase was due to significant increase in workload for both criminal and civil cases. Additionally, there was an increased administrative burden for such things as Ordinance review and revision and investigations that had to be done. She said that as always, it’s difficult to forecast but indicated that she would not spend the money if it was not needed. Her tentative budget was approved up to the maximum she requested with the proviso that she would not spend to the maximum if not needed.
The Community Development budget increase was driven by expected increased activity at TRI but it will be adjusted (up or down) as the business activity picture out there becomes clearer.
After the budget reviews Lance said that the Commission did not like what they are seeing, that it was not a balanced budget and that the real work by the departments to pare it down begins now. He said that that the county IS growing but that the national business climate is not good and he sees softness and a drop off in TRI business 9 months out and spending needs to be cautious.
I have to say I was surprised by Lance’s statement. Something fundamental must have recently shifted and shifted quickly. Lance has been frequently and often touting “great economic prosperity” and declaring Storey County the “richest place on earth” beginning in December 2014 ( Item #23) and most recently that I have seen, at the Ben Carson Pipers appearance in February of this year. Based on first pass 2016/2017 revenue projections and the recent statements by both Lance and Hugh in this meeting…..it looks like Lance has been overselling it.
At the last Commission meeting on March 15 I specifically asked if the Commissioners had given any guidance to the departments, as the governor had given to HIS departments, that they were to prepare a flat to 5% down budget this year due to revenue shortfalls. I was told no, that things were on track. Despite the “what…. me worry?” response I was given at the last meeting it now seems that things are not so on track.
In December 2014 :
“ Mr. Gilman believes it is time to establish a plan for all residents of Storey County to share in the financial success of TRI and the Tesla transaction. Vice Chair Gilman is requesting County staff to prepare a plan specifying an amount of reduction in property tax rates that the County can afford, a time frame for the reduction, and any other reduction for fees and assessments that occur on an annual/routine basis that would be feasible. It is requested that a staff report with a proposed plan be delivered within 60 days, with a target date of the first Commission meeting in February” December 2, 2014 Commission minutes.
Well….there will be no tax rollbacks. Lance himself asked about it during this budget review and Hugh said that it wasn’t feasible to do . That the Legislature is going to be looking at different property tax methods and so he doesn’t want to mess with our tax base. Hugh said that he would look at a rebate of some sort although it has never been done before. I appreciate the efforts but would rather not have had the expectation set in the first place without first doing the analysis.
At the end of the meeting under Public Comment I got up on behalf of Andria Daley and the Big Bonanza Opera to thank Marshall McBride and Pat Whitten for the County’s underwriting of $1500 for the event. Pat Whitten also gave Pipers the courthouse parking lot to cordon off for event parking. That $1500 made all the difference in the success of the event. Many people came in from Reno and rediscovered Pipers. They were impressed with both the production of the opera and the “hospitality” of the event itself. Many thanks for the community support!