The Jefferson County General Fund budget is projected to operate at a deficit in 2019, with spending to be 3.6% greater than revenue, according to the draft budget proposal from County Administrator Philip Morley’s office. 

The 2019 budget blueprint earmarks $20.37 million for spending, which is about 1.4% higher than 2018. However, projected revenues for next year are $19.66 million, a figure that is nearly five percent below projected 2018 revenues, accounting for much of the deficit. 

Under the new plan, proposed spending for 2019 will have risen nearly 10% since 2016, while revenues are projected to rise just 1.9% over the same period. The deficit in the proposal is also expected to burn through 10% of the county’s Unreserved Fund, reflecting a warning from last year’s budget presentation which estimated that continued deficit spending would drain 87% of the county’s Unreserved Fund by early next decade. 

Central Services Director Mark McCauley said the 2019 deficit budget plan would slow the rate of decrease in the Unreserved Fund so that only 77% would be taken away over the next five years. When asked if spending increases of 9.7% over three years coupled with revenue growth of 1.9% over the same period is sustainable, McCauley said, “No it’s not,” but noted that over the past decade, half of the county budgets ran a deficit while the others produced surpluses. McCauley also stressed that county planners tend to be conservative in estimating revenues for the coming year. 

County Administrator Philip Morley’s November 29 memorandum to the Board of County Commissioners bemoans various problems in raising revenue.  Morley singled out the state’s Democrat-controlled legislature for criticism writing, “Washington State’s funding model for county government, especially for rural counties like ours, remains broken.”  

Morley also described as “arbitrary,” the state law that prohibits counties from raising property taxes by more than one percent per year without voters having a say. “In 2007, the State Legislature reinstated Tim Eyman’s I-747, which had been ruled invalid by the state Supreme Court. State law arbitrarily constrains revenue growth in property taxes to an arbitrary 1 percent limit annually (excluding new construction) without a vote of the people,” wrote Morley. 

Aside from limits on government raising property taxes, Morley also noted that the value of new construction in Jefferson County has averaged less than one percent per year for the past eight years. The Morley memorandum promotes planned improvements in computer technology to speed the permitting process and mentions efforts to, “make our regulations more understandable and efficient for citizens to comply with,” but did not address any changes to regulations or ordinances that might encourage more new development. 

Morley’s memorandum explained how principal and interest payments on the county’s $6.29 million in debt are decreasing and are expected to decline in the coming years. However, Morley cautioned that the county would not be able to assume new debt through, “additional capital bonding capacity,” until 2022. 

Revenues from property tax, sales taxes and other tax-based revenue sources in 2019 are projected to be 9.2% higher than three years ago, but funds from other sources are not keeping pace. Revenue from fees and other sources including PUD taxes, the marijuana tax, investment income, the liquor excise tax and other sources, is estimated at $3 million for 2019, down nearly 28% from last year. 

The projected deficit for 2019 isn’t stopping the county from hiring more people. The budget proposal for next year calls for an increase in Full Time Equivalent (FTE) hiring of 6.91 persons, the largest year-over-year hiring increase in nearly a decade. While FTEs are spread across 39 different county departments and offices, the largest hiring increases are planned for the county assessor, the prosecutor’s office, public health and community development. 

McCauley said some of the new hires are temporary or short-term jobs. “The increase in the Assessors Office is to handle a workload surge,” said McCauley. Additional staffing for the prosecutor’s office is also expected to be short term, McCauley said. 

Funding for the Board of County Commissioners, which has been flat for the past two budget cycles, is proposed to rise 2.9% compared with last year. However, proposed 2019 spending for the commissioners this year is nearly 21% higher than three years ago.

The BOCC has scheduled a public hearing on the budget for Monday, December 3 at 10:00 am.