County Gets Reading Assignment
GRAND RAPIDS — Kent County officials will have some required reading this week when they get the 2008 budget book. Then members of the Finance Committee will make the first of their comments next week about what they have read in the first of three review sessions they’ll hold before the board adopts all the budgets in mid-December.
As expected, the general operating budget will get the most scrutiny as it funds the vast majority of county services. The preliminary 2008 spending plan is $132.9 million, down by about $1 million from this year’s budget. Next year’s total revenue is expected to rise by $2.7 million above this year’s receipts to $133.6 million, and leave the county with a slight surplus next year.
Almost all of the projected revenue increase, $1.9 million, will come from property-tax payments. Fiscal Services Director Robert White reported other revenue sources will remain fairly stagnant for the year.
“All other revenue items will decrease by $155,000,” he said.
On the spending side, White said wages would rise next year by less than 1 percent from this year largely because the county will trim its work force by at least 15 employees.
County Administrator and Controller Daryl Delabbio said up to 35 jobs could have been eliminated and that some of the 15 positions were already vacated.
“This is going to be difficult. We’re going to have to make some decisions that some people aren’t going to like,” said Commission Vice Chairman Richard Vander Molen, who also chairs the Finance Committee.
Employee insurance coverage is projected to rise by 3.8 percent, or $484,000, next year. But that hike will follow the 11 percent upward adjustment the county made earlier this year for the 2008 budget.
White said there are two significant factors that will determine whether the county can balance its general budget. One is having the state balance its general budget without lowering its revenue to the county, like Lansing did this year when the state kept $2 million of liquor-tax receipts Kent was supposed to receive. Delabbio said he will have the answer to the state’s budget before commissioners have to adopt the county budget.
The other factor is that the overall taxable value of properties in the county has to rise by 3.9 percent above the current value. County officials, though, won’t know if that has happened until May, five months into the fiscal year, when the equalization report is released.
The county’s fiscal year is the calendar year.
As for this year’s general budget, revenue exceeded expenditures by nearly $10.4 million at the end of September, which marked the end of the third quarter. Still, that surplus was nearly $2 million below the one the county had the same time last year.
“All revenue, excluding taxes, is up 6 percent,” said White.
White said the county had a 2.1 percent increase in property-tax revenue from last year through three quarters, and the bulk of that revenue would be coming in the fourth quarter due to the shift in payment dates for property taxes the state imposed three years ago. He said the 2007 general budget would have a deficit of $2.5 million.
The county’s lodging-excise tax is also likely to end the year with a deficit as revenues are up by only 1.1 percent from last year, when those receipts rose by 13.2 percent. White said the fund’s shortfall could reach $1.5 million, possibly $600,000 higher than last year’s. Total revenue has been projected to be $5.6 million.
The fund’s main expenditure is the bond payment for the construction of DeVos Place, a $4.9 million expense this year. The payment rises each year by more than 3 percent, and White told the Finance Committee spending changes for the fund have to be made.
“You can’t sustain this level of spending in 2008,” he said.