Increased revenues and declining expenditures in the 2013 fiscal year have brought some stability back to the Hall County budget, but officials warn it’s too early to tell if the good news will last.
“We’re still very, very cautious in how we go about our business,” said County Administrator Randy Knighton. “We still have to maintain fiscal discipline and remember the measures we had to take to get us to this point.”
That’s the takeaway from an audit report presented to the board of commissioners last week, which revealed that revenues improved nearly 5 percent during the last fiscal year, which ended June 30, thanks in large part to the sale of the Hall County Jail to the city of Gainesville.
That transaction brought in $7.2 million and helped boost the county’s fund balance to $22.7 million, a fund balance increase of $7.8 million year over year. But charges for services came in under budget by $3.7 million as a result of losing the detention center lease.
Overall, general fund revenues were $5.2 million higher than budgeted, topping $93 million for the 2013 fiscal year. And while expenditures increased 2 percent, they came in at $3.4 million below expectations, falling to less than $85.4 million.
“The actual savings was just where departments didn’t spend everything they were budgeted,” Finance Director Vickie Neikirk said.
Property tax revenues also got a lift last year despite the millage rate remaining unchanged, helping to bring in about $2.6 million more in total tax revenue than anticipated.
Moreover, the county collected about $27 million in special purpose local option sales tax revenue last year, spending more than $25 million of that revenue on road projects and upgrades to the Hall County Government Center.
The improving budget has allowed the county to roll back a number of austerity measures set in place to tackle slowing revenues and budget shortfalls that topped $11 million as recently as 2011.
Furloughs were scrapped in 2012, and some retirement contributions were reinstated.
And in December, bonuses were paid to county employees for the first time in years after merit increases had been sidelined to shore up the budget.
“While we’ve seen our expenditures go down and our revenues go up, we’ve started to see some of these other austerity cuts take a U-turn,” county spokeswoman Katie Crumley said.
County officials, however, said the positive trend lines could just as easily nosedive in the coming 2015 fiscal year if they do not continue to budget carefully.
The improved revenues and fund balance will, therefore, not likely result in new hiring. About 100 layoffs were made in the summer of 2011.
“We’ve still been able to meet the needs of citizens with our current staffing levels,” Knighton said.
Certain capital expenses related to public safety services that have been put off for a few years are likely to get a fresh look, though, according to county officials.
But maintaining a healthy fund balance is critical, officials said.
After dropping to a “dangerously low level” south of $7 million a few years ago, the fund balance must now be reserved for “rainy day” expenses, Commissioner Craig Lutz said.
He’s concerned that sales tax revenues are not performing as well this year and expressed concern that property tax revenues won’t make up the difference.
“We’re not out of the woods yet,” Lutz said. But “hopefully we’ve hit the bottom.”
Commissioner Scott Gibbs said it’s important for the county to have about 90 days of operating expenses available in the bank to cover emergency spending.
For example, the county had to dip into its fund balance reserve when flooding washed out roads last summer, resulting in more than $1 million in damage.
“We have just gotten our reserves back up to where we feel comfortable,” Gibbs said. “So I don’t think you’ll see a lot of extra spending” in the coming fiscal year. “We’ve still got to see some stability."