County Administrator Mike Hatfield, working from a slide show and documentation completed shortly before the recessed meeting, said that updated revenue projections showed declining revenues not only for fiscal year 2020 but for the current fiscal year.
For next year’s county budget, Hatfield said the latest revenue projections call for $56.71 million against what recently had been $57.7 million in planned spending — a $1 million shortfall — despite a seven-cent real estate property and merchant capital tax rate increase approved by the board in April. That follows recent meetings between Hatfield and county departments and constitutional officers to cut their requests by a total of $6 million.
Future increases in debt service after consolidation of four high schools into two new buildings constructedt in the past five years is also putting near- and long-term pressures on the county, Hatfield said. The county can expect a $663,000 hike in debt payments in the upcoming fiscal year and more than $1.6 million in debt service through fiscal year 2027.
Hatfield said the only area left to cut was the school system. He recommended the board consider a $56.71 budget with a $944,000 cut to the $11.87 million level funding that the school board has requested from the county for its own $60.41 million budget.
“We’re down to where if we did any more, we’d be looking at eliminating personnel,” Hatfield said when asked by District 3 Supervisor J.H. Rivers if there was any other budget area that could be cut.
Hatfield said the school system’s overall county funding next year looks sufficient for the school board to make the 50 percent match required for state funds for a 5 percent teacher pay increase.
“It’s pretty bad when we’re going to cut (schools) by almost a million,” said District 3 Supervisor John Schoolcraft.
“We’ve cut other departments to the bone and not cut them,” said District 4 Supervisor and Vice Chairman Robby Robbins.
“We have cut them,” Schoolcraft replied.
“I don’t know how I can go out and tell people I’m for education,” District 2 Supervisor Steve Bates said of the proposed cut.
The board voted 5-3 — with Bates, Rivers and Schoolcraft opposing — to put the budget plan to a public hearing at the supervisors’ June 13 meeting at 6 p.m. at the school board’s meeting room on Lake Street.
After discussing proposed budget cuts, the board made real cuts for the current year’s fourth quarter. Hatfield said the county faced a $950,000 revenue shortfall from a combination of shrinking tax revenues despite a tax increase approved last year and a delay in mailing out tax tickets while the board debated next year’s seven-cent property tax hike.
County Treasurer Delores Wilson told supervisors that declining tax revenues stemmed from a declining coal industry and other businesses, even as collection rates are approaching 98 percent. She said the current year’s revenue shortfall could reach $1.14 million.
Hatfield recommended the cuts include: $99,500 to the county administrator’s office, $55,400 to the commonwealth’s attorney’s office, $60,600 to the circuit court clerk’s office, $93,300 to the courthouse, $130,000 for the social services department and $400,000 to the school system.
Hatfield said he had discussed the cut with School Superintendent Greg Mullins and that he had expected around $600,000 in cuts. With Rivers opposing, the board voted 7-1 for the cuts.