Alpena County projects $1.2M budget shortfall
ALPENA — The Alpena County Board of Commissioners made few, if any, cuts when crafting its 2022 budget and it appears it will lead to about a $1.2 million deficit at the end of next fiscal year.
That is before dollar amounts for new union contracts are plugged in and increased costs for energy and other operational items, should inflation continue to climb, Alpena County Treasurer Kim Ludlow said.
Negotiations with the unions are ongoing, so the new expenses are not yet set, Ludlow said.
“That $1.2 million deficit is without any of our contracts being ratified,” she said. “I’m sure that is going to bump that up. With the daily cost of operations, there just isn’t a lot of room to cut. Things are getting more expensive and I have no idea where they are going to come up with the money.”
The projected shortfall comes after the county utilized nearly $800,000 from the $5.5 million it received from the American Rescue Plan Act to help reduce the budget shortfall projected for the end of the year. The projected shortfall now stands to be about $570,000 at year’s end, Ludlow said.
The commissioners voted Tuesday to put the 2022 budget on display and it is expected it will be adopted late next month.
Ludlow said the 2022 budget, which runs from Jan. 1 to Dec. 31, has revenues of about $9.6 million and expenses of about $10.9 million. Ludlow said the county may be able to claim lost revenue due to the COVID-19 pandemic and again dip into the federal stimulus it received, but at this point, that is unknown.
For the last several years, the board of commissioners has chosen to utilize its savings to run a budget shortfall, and not have a balanced budget, but often is able to trim the deficit by the end of the fiscal year, a little in the red or black.
Ludlow said the county’s unrestricted savings, which can be used for anything, would drop from a little over $3 million to $1.8 million if it uses its savings to make up for the budget shortfall next year. The county also has about $567,000 in savings that are earmarked for emergency needs like roof replacement, but it can use the money any way the commissioners choose with a simple two-thirds vote of the board.
The Board of Commissioners also voted Tuesday to give bonuses to non-union employees who didn’t receive raises like the union employees the last several years. Each employee not in a union will receive $1 for every hour worked. For an employee who worked a full 40 hours each week of the year, that would equate to a $2,080 check.
The total amount to pay the employees is just a touch under $70,000.
Ludlow said the money will come from the American Rescue Plan funds and not have a direct impact on the general fund budget.
The county is still in the process of determining how else to spend the stimulus money from the federal government. It has until the end of 2024 to do so.