EDITORIAL: Barrow facing tough choices

The initial numbers show a projected budget shortfall of up to $7 million for next year out of a budget of $29 million. The only way to prevent such a calamity is for the county to either raise revenues or cut expenses.

We vote to cut expenses.

On the revenue side, the county has been hit by lower sales taxes and the potential for a smaller tax digest. The drop in income comes on the heels of several years of explosive revenue growth when the county saw income jump each year by a significant amount.

There’s not much direct control county leaders have over revenues, other than to raise property taxes. But doing that in the middle of this economic downturn is ill-advised. Many individuals and small businesses are having a tough time hanging on as it is; hiking taxes could push some over the edge, increasing the already high foreclosure rate. Indeed, to close the projected budget gap, Barrow County would have to raise its millage rate by an untenable 50 percent.

The real problem for the Barrow County government is that its expenses have been climbing faster than income. During the boom years, county leaders took on a variety of projects, building a slew of new facilities. Now the bills for all that government largess are coming due, along with much higher operating costs for the new facilities.

The hard truth is that the county cannot raise taxes to dig itself out of its financial hole. To do that could trigger depopulation as people exodus their foreclosed home and create a movement of investment capital as people seek a more tax-friendly area to live or open businesses.

The only solution is for the county to cut expenses. And since it cannot cut its bonded debt without ruining the county’s credit rating, the only other place the cuts can come from is staffing. That, of course, is the most painful area to make cuts. Every layoff or cut in benefits affects people directly.

But in reality, the county’s bounty during the boom years led it to put in place some pay and benefits that are out of proportion to the community as a whole. For example, the county’s health insurance covers 100 percent for individuals and 70 percent for families. Few other local businesses offer such generous health benefits. Many businesses pay only part of the employee’s cost and none for other family members.

Times are tough and some very difficult decisions will soon have to be made by Barrow County leaders.

A failure to make those tough choices now could have catastrophic consequences for the county for years to come.