Months after county officials began voicing concerns about Barrow County’s financial situation, the only thing for certain is that the picture keeps changing.
Last November, county officials said the budget for the current fiscal year could be off by as much as $1.96 million.
Then with the subsequent double-digit drops in sales tax revenues, that number climbed to between $2.5 - $2.7 million.
Based on that projection, the board of commissioners last week slashed county employees’ pay as well as departmental budgets. Together, the austerity measures are expected to shave about $1.8 million from the FY2009 budget.
But Tuesday night, Barrow CFO Beth Horacek said the budget gap could be as low as $1 million or as high as $2.7 million.
The size of the gap can’t be predicted with certainty because the county doesn’t control the flow of two major sources of revenue, property taxes and sales taxes.
Horacek said the shortfall in revenues from real and personal property taxes could range from $800,000 to $1.6 million. The shortfall in local option sales taxes could range from $1-$1.7 million.
Revenue shortfalls from all sources are projected to total $3-$4.7 million, she said.
However, spending in the first quarter also trended downward. By the end of December, expenditures were $500,000 under budget. Horacek said she thinks spending will be $3 million less than budgeted, leaving a net shortfall of $1-$2.7 million.
The austerity measures imposed Jan. 20 should take care of most – or all – of that gap, said BOC Chairman Danny Yearwood.
“The things we implemented, I think, will take care of this,” he said. “We’re pulling at straws here…”
Other commissioners Tuesday night asked questions primarily about the size of the county’s reserves. Horacek said the county currently has more than $12.9 million in cash on hand, plus another $2.7 million in certificates of deposit.
However, by the end of the fiscal year Sept. 30, it is likely the county would have only enough cash reserves to cover two months of expenses, she said.
She said the board has had an informal policy of setting aside enough reserves for three months of expenses. She asked the commissioners to provide direction to the staff on that issue.
Horacek said in the coming weeks she plans to analyze the impact of the cost-reduction measures the board approved last week. She also will provide monthly financial updates at board meetings.