NEW BUSINESS
Presentation Of Proposed 2019 Archuleta County Operating Budget
Per CRS 29-1-105, the County Budget Officer is required to submit to the governing body a proposed budget outlining expenditures and revenues of the various spending agencies for the upcoming budget year.
Larry Walton
Finance Director
The October 9 special meeting of the Archuleta Board of County Commissioners was convened to meet a legal requirement: the approval of a proposed Archuleta County Budget for 2019. Following approval, the budget would be made available to the public, for their review and comments.
This, in fact, happened. The budget was approved by the two commissioners in attendance — Michael Whiting and Ronnie Maez. And Finance Director Larry Walton’s Powerpoint slides and the 188 pages of “Budget Detail” were posted to the County website later that same day.
But before the meeting came to its successful conclusion, we experienced a bit of a Love Fest among the two commissioners and their staff, patting themselves on their respective backs for the amazing work everyone has done to keep the County out of bankruptcy. Some of our reader will recall a dark period in the County’s history — back in 2007 through 2010 — when the County Finance Department had made such a horrible mess of things, it looked like the state government might step in, any day, and take over the County’s operations.
Here’s Commissioner Michael Whiting, at the October 9 meeting, talking about the nearly $9 million that the BOCC has managed to sock away into savings accounts since 2007:
“Before 2011, the two Reserve Funds that we currently enjoy didn’t exist. In 2011 and 2014, we created the policies that created those Reserve Funds… It’s important to know that the reserves we do have are the result of extreme austerity on the part of the staff and the Finance Department killing it for us every year…
“The reason we have the reserves we have to work with at all is because of a team effort — staff, BOCC, et cetera — that got us here. Otherwise we’d be upside down like we were in 2010… So we should all be proud of the work and the sacrifice… we’re talking about 20-plus staff being cut in that same period.
“Stacking up reserves during the worst economic downturn in a lot of our lifetimes is a remarkable accomplishment for an organization. It was a turn-around, and everyone who was involved should be proud of that.”
As Commissioner Whiting notes, the period between 2008 and 2014 — when the County government was “stacking up reserves” — was indeed a time of great economic stress for families and businesses.
But it was actually a time of financial extravagance for our County government, as we noted in Part One.
Between 2004 and 2007, the County had property tax revenues of around $4 million per year, as we showed in this graph taken from Archuleta County’s 2012 Budget document:
In 2006, the BOCC convinced the voters to “de-Bruce” the County’s property taxes, thus removing the constitutional TABOR controls on tax increases, and the County’s property tax revenues nearly doubled, hitting $7.7 million in 2010 — the year Commissioner Whiting was elected to office. As the result of Ballot Measure 1A, approved by the voters in 2006, plus a governmental delay in the way property tax valuations are calculated, the County has been flush with property taxes ever since. Yes, those revenues have dropped slightly since 2012, as Finance Director Walton noted in his October 9 presentation, but they have remained well above $4 million.
County sales tax collections have also been on a fairly relentless upward track since 2007, increasing from $3.3 million in 2007 to a projected $5.2 million in 2019. Not quite double, but close enough.
Commissioner Whiting, in praising the staff and BOCC for their efforts in socking away nearly $9 million into savings accounts during a period of record tax collections, seems to have forgotten the important part played by the taxpayers, who provided all that money.
But maybe it’s actually more than $9 million? I looked through the 188 pages of budget detail provided by Mr. Walton last week, but was unable to locate anything called “The Unassigned Fund Balance.” We’ve heard that particular fund discussed on occasion, however, during the planning of the Ballot Measure 1A tax increase proposal. And we heard it mentioned again on October 9.
First, here’s a clipping from the approved “Budget Detail” for 2019:
In 2017, the BOCC created a brand new savings account called the “Justice System Capital Fund” and started stashing money in it. As we see above, the commissioners plan to have $2.1 million in that savings account by the end of 2018, and $3.5 million in the account by the end of 2019.
Where did all this money come from?
Commissioner Whiting:
“One of the questions I have. We’ll have $3.5 million in the Justice System Capital Fund, that came largely out of the Unassigned Fund Balance, right? What’s left in that unallocated fund, once we’ve transferred over the $3.5 million?”
Finance Director Larry Walton:
“In the Unassigned Fund balance? There would be about $3 million in that Unassigned Fund balance.”
It might therefore appear that the BOCC will have, by next year, five substantial savings accounts. Even if Ballot Measure 1A fails at the polls.
1. The TABOR reserve, required by state law.
2. The Unassigned Fund Balance, $3 million
3. The Strategic Reserve, $3.3 million
4. The Working Capital Reserve, $2.5 million
5. The Justice System Capital Fund, $3.5 million
Commissioner Ronnie Maez commented on the draft 2019 budget prior to the approval vote last week, and praised the work of the Finance Department.
“I appreciate everything, especially the conservativism that you’ve shown in the preparation of this budget, and anticipating the failure of the ballot measure. But I hope we’re successful, because we may [otherwise] end up building a facility that’s less than what we’re needing right now, and we’ll still be outsourcing prisoners.
“And I appreciate that anticipation, especially seeing that number increasing the number of housing inmates on there. We always want to be progressful in our own government. We want to be moving forward. But the less personnel that we have… We’ve already ready have complaints about the process of things going, the time it takes for building inspections, the time it takes for building permits to get processed, and everything there. That all helps by increasing personnel.
“This failure [of the ballot measure] will be a long-term effect on everybody in Archuleta County. Not just the County government itself. It’s going to impact all the citizens of Archuleta County.
“So, stating that, I commend you on the job you’ve done.”