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County forms plan for future budgets

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With expenditures catching up with revenues, the county is looking into plans for future budget years

By Shaina Stockton

INDEPENDENCE — As Grayson County’s budgeting season continues, the Grayson Board of Supervisors sought a review of the county’s finances in order to address the years ahead.
The county’s budget for the 2018-19 fiscal year has presented its share of challenges. Grayson has gone nine years without raising taxes; but expenditures are catching up to the county’s revenues, leaving the county to develop a plan for future budgets. The county’s savings has been eyed as a means to fund some of the expected shortfall of $2.1 million in FY 2018-19, but supervisors expressed concerns about dipping into this resource again in the future.
Corbin Stone, managing director of Robinson, Farmer and Cox Associates, presented a financial forecast to the supervisors at their May 21 budget meeting. During the discussion, Stone commented that the county’s financial trends are not alarming from his perspective, and that their current fund balance sits at a comfortable number.
“Your revenue has not been growing at the same rate as your operating expenditures,” Stone explained to the supervisors. “Expenditures are catching up, and are starting to pass those revenues.”
Stone noted that the county isn’t showing any staggering downward trends, despite their commitment to not raise taxes for the past nine years.
“That is impressive,” Stone said.
Stone shared that he recommends a 10 percent minimum of the combined school and county budgets. However, this recommendation clashes with the recommendation of 20 percent by the county’s auditor.
As of the previous fiscal year, the balance was 26 percent.
Supervisor John Fant shared that one of the board’s concerns is that a lower percentage would interfere with the county’s ability to receive help, such as procuring loans.
“The trends would affect that moreso than the total,” Stone said. “What we see now is that you have a healthy fund balance, and are simply dipping into it.”
“The struggle I’m having is determining the appropriate [percentage]. You’re making the argument that we need to adjust revenue, but the fund balance is sitting at 11 percent higher than we were recommended. If 15 percent is the number, is there a better use of our money? Should we be trying to pay off more debt, or do things to get the fund balance down to a more average number?” asked Fant.
Stone explained that it is ultimately the board’s choice as to what their minimum balance will be. He added that the rock-bottom number he would suggest is 10 percent.
Stone also addressed the option of raising taxes in order to fund future debts, and to catch up on revenues in the coming years. However, supervisors commented that they were hesitant to go in that direction, and wanted time to explore their options and inform citizens before making that kind of a change.
“For some people, going up even one cent [on taxes] might be a big deal. My question is, would we be on solid ground to make that case? Because I’m concerned that we’re not,” Fant told Stone. “Looking at the numbers, maybe we have too much here [to suggest an increase], based on your recommendations.”
“What I’m hearing here is that we have a little more time to adjust the income strain than we would have if we were sitting at, say, 15 percent,” Supervisor Tom Revels said. “I’m encouraged by what we are hearing here. We don’t have to necessarily address the revenue issue immediately. We have more time.”
Stone agreed with Revels.
Supervisors asked Stone what the biggest reason is for the rise in expenditures. Stone responded that small increases each year are the result of inflation.
“Inflation is going to hit you, and over time you will see the effects,” Stone said.
Moving forward, Leesa Gayheart, director of finance for the county, confirmed that the next step for the county is to explore ideas for adjusting revenues in the future.
“This will be the last time we can do this,” she told the paper, in reference to using the county’s savings to make up the shortfall. “We can’t maintain the level of expenditures and services without hurting our fund balance.”
During the meeting, the board approved a motion to hold a public hearing on the budget during their regularly scheduled monthly meeting on June 14.