Rain clouds let loose on Gila County supervisors as they passed their survival mode tentative budget of $91 million, buffered by $800,000 in rainy day funds, and a possible $5 million loan.
The budget offered no room for raises, did not keep pace with inflation, and was prefaced with dire predictions that state legislators would meet in January to revise the state budget county supervisors said was not fiscally sound.
The effects of an altered state budget on the county's finances are not yet known.
"It could affect us," said Supervisor Tommie Martin. "One-quarter of our income comes from state-shared sales tax and all of that is vulnerable to the state dipping into it."
The proposed fiscal year 2008-2009 budget includes a $1.1 million general fund increase from last year, but extra costs include nearly $1.6 million in mandated increases such as health care premiums and retirement. Overall, the budget increased by about $8 million.
The state of Arizona, to balance their budget, is requiring $725,000 from Gila County. Though the county's tax rate decreased, the amount of property tax collected will increase by 4 percent since assessed valuations increased. A property owner with a $100,000 home can expect to pay $392, up from $376.56. The increase will net nearly $793,000 countywide.
To help fill the breadbox, the county is contemplating borrowing $5 million from the Greater Arizona Development Authority.
Deputy County Manager John Nelson said, "it's probably the cheapest way to borrow."
"I'm not very optimistic, in fact I'm pessimistic about the future," Nelson told the supervisors at a Monday morning meeting. "I think we're going to name this (budget) ‘Survive.'"
Relief is likely far away.
"Gila County is in this economy for probably the next year and a half," Nelson said. He added that Arizona typically lags behind national economic pick-ups and slowdowns.
To help save their way to a balanced budget, the county will likely institute a hiring freeze -- except for critical positions such as law enforcement should a position become vacant -- and delay purchasing equipment save for the absolutely essential items.
"Throughout this coming fiscal year, we must focus on reducing our reliance on reserves that took so long to set aside," the budget narrative reads, in regards to the rainy day funds.
General government costs were slashed $10,000 and the public works budget dropped $300,000 from the $18 million budgeted last year.
Not every department is facing cuts. The library district could receive roughly an extra $129,000, up to $1.2 million. County officials said that sour economics translate to an increased need for public services.
Law enforcement is slated to receive an extra $1.1 million, up to $12.6 million. "Unfortunately this increase, a lot of it was for increases in retirement and health insurance. It did not put more officers on the street," Nelson said.
According to the budget narrative, the supervisors directed county staff to put budgetary emphasis on law enforcement.
The final budget will be adopted on Aug. 4 after the 10 a.m. truth in taxation hearing regarding the tax increase.