Less than two months after closing a $31 million mid-year budget gap, Cobb County faces more budget problems -- a $15 million deficit in the next fiscal year.
Projections for the 2012 budget, which begins in October, are the latest numbers for the county, which, like most in metro Atlanta, has been hurt by declining tax revenues.
“If you don’t address the $15 million deficit, it would compound to $30 million by [fiscal 2013]," said Jim Pehrson, the county’s finance director. “We would have to address the deficit with recurring and not one-time fixes. Dealing with it in one-time fixes will lead to the deficit carrying over to the next year.”
To close the 2011 budget gap, the county implemented five employee furlough days for the remaining five months of the fiscal year, along with a collective 10-percent cut and other reductions. Commissioners have opposed a tax increase.
The county's top official is optimistic about the budget.
"I think the digest decline will be less than anticipated for 2011, and maybe for 2012 as well," said Commission Chairman Tim Lee, who has long warned of a bleak budget outlook. "We're also not having as many [property tax] appeals as we thought. I can't put my finger on it. It's just feeling a little better."
Lee and other county officials traveled to New York last week to meet with the credit-rating agencies about the county's financial outlook and maintaining its triple-A bond rating.
The largest portion of the county’s tax digest -- a value of real and personal property in the county, used by city and county officials to estimate revenues and determine budgets, and due out in June 30 -- has an estimated decline of about 6.85 percent, according to county officials. That's better than expected, but likely to continue through 2013 as the economy rebounds.
The wild card for the county's budget, Pehrson said, is property tax appeals and their impact on tax revenues. Appeals have been filed on just 3,000 of the 14,000 commercial properties that received a tax notice, and there are 2,000 residential appeals out of 230,000 parcels, said Phil Hogsed, Cobb’s chief appraiser. The deadline for residential appeals is June 20.
In advance of the 2012 budget discussions, county officials have enlisted the help of a group of local residents and business people to provide guidance and recommendations in finding savings. A presentation for the citizens oversight committee is expected June 28. A dollar-for-dollar list of specific cuts the county can implement to reach the $15 million deficit amount, which is not the committee’s charge, is not expected said Brett McClung, a CPA and committee chairman.
Recommendations are likely on human resource and personnel issues such as employee compensation and benefits, in vacation, comp time and overtime. In a previous committee meeting in April, members were surprised that the county enabled employees to accumulate 480 hours of annual leave time, a perk viewed by some as liberal compared to private-sector policies.
The committee has received 285 email suggestions for county savings from residents and employees. A daylong oversight committee meeting on June 15 to analyze the recommendations before the commission presentation is closed to the public.
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