THIS WEEK'S TOP STORIES
To close budget gap, a pay-to-play recreation plan
By Jackie R. Broach
Charging for use of new recreation facilities in the works throughout Georgetown County is something that should be considered as the county tries to fill gaps in its budget, County Council Member Bob Anderson said.
At a budget workshop this week, he asked county staff to look into a plan that would shift the burden of cost for recreation projects from the tax base to people using facilities the county plans to construct under its capital improvement plan, such as a new tennis complex in Litchfield.
“That would really break that money loose to be used in more core services,” Anderson said. “We would then have that money to move around and take care of shortfalls somewhere else.”
The county is facing another dismal budget year, though there are signs of improvement on the horizon, County Administrator Sel Hemingway said.
The potential loss of more than $220,000 in local government funds from the state, coupled with rising costs for fuel and employee benefits are expected to be the biggest challenges this year as county officials try to put together a balanced budget.
The changes add up to a shortfall of more than $500,000, which staff is currently working to fill by looking for savings in all departments.
In addition, the county faces a $434,936 gap projected in its environmental services budget over the next six years as a result of an ongoing landfill expansion.
But Anderson’s idea to help plug some of the gaps wasn’t met with enthusiasm.
Fees are already in place for some facilities and activities within the recreation department, Council Member Lillie Jean Johnson pointed out.
“We don’t want to get to the point that fees are raised so high the public can’t use facilities because they can no longer afford them,” she said. “If we’re going to look at fees, let’s be reasonable in terms of what the public can afford.”
Otherwise, she worried, the county might end up having to close facilities that are needed, but going unused.
Council Chairman Johnny Morant said he would prefer to see a budget with no tax increases or fee increases, something council stressed last fall when it flatly refused to approve fee increases to help pay for the landfill expansion.
Anderson joined the council in January.
“At some point in time, one needs to take care of the cost of whatever you’re using,” Anderson said. “I think the total burden can’t always be on the public sector.”
He suggested the county use one facility as a test and determine how much of a user fee would cover its costs.
Staff will bring back a report that shows what other communities charge.
In the meantime, work on the budget will continue as staff tries to get a draft ready to present to council on April 26 for the first of three required readings.
The county anticipates getting just under $2 million from the local government fund for its 2012 budget, Hemingway said. That’s a far cry from 2008, when the county got $3.2 million from the fund.
The level of funding has dropped steadily since then, reaching $2.2 million last year — a decrease of more than $340,000 over 2009. Cuts this year were initially expected to be about $160,000.
Cuts could still prove to be more extensive. Hemingway said he’s heard projections that vary from eliminating the funding to cutting it in half. But for the last three weeks, projections have called for a cut of about 10 percent.
“We’re holding our breath it doesn’t change,” he said.
After this year, Hemingway predicts funds will hold steady for a year then begin a slight increase.
The county saw a mid-year increase in health insurance premiums and, while more increases aren’t expected in the coming year, that will account for an additional $75,000 that has to be worked into the budget.
The county also has to increase its contribution into state retirement plans, an added expense of about $40,000.
But the biggest cost hike is expected to be for fuel.
“We all know what’s happening at the pumps right now,” Hemingway said.
And it’s projected to get worse. County staff estimate fuel costs will rise by about $200,000.
Council Member Ron Charlton asked if county vehicles have GPS devices and if adding them might cut down on fuel waste.
Johnson suggested taking a closer look at which employees have possession of county vehicles all the time.
Hemingway said staff will be looking at everything and making an in-depth study of all expenditures. They’ll also look at energy savings and evaluating an ongoing energy efficiency program.
“As we move forward with that and get more historic data, we’re hopeful we’ll see greater savings than we budgeted for and can incorporate those into solutions for fiscal year 2012,” he said.
Using fees the county collects from tourism and real estate activities as a forecasting tool, the economic outlook for the county appears to be headed for improvement, Hemingway said.
Building permits in the county rose slightly in 2010 and a steeper climb is expected next year, continuing through 2015. A similar trend is predicted for recording and documentary stamp fees.
With accommodations taxes collected on short-term rentals, “we’re starting to see the same trend,” Hemingway said. “This summer we were ahead of previous years and we maintained that advantage through the fall.”
Vehicle taxes have stayed flat — an indicator that people are choosing to keep and repair vehicles instead of buying new ones. But “pent up demand” will eventually see car sales rise, Hemingway said. Until that happens, the county is predicting a modest increase in annual vehicle tax revenue.
A steeper increase is projected for property taxes. The county projected a 1 percent increase in the current budget, but it looks like the increase will be closer to 1.8 percent, Hemingway said.
Future projections show property tax revenue rising from about $11 million to $11.5 million by the end of the coming fiscal year and more than $12.5 million by the end of 2015.