County has to tackle repeating budget shortfall
Every year in recent years, as the Alpena County Board of Commissioners begins work on closing their annual budget and starting the next year’s spending plan, commissioners face a major gap between revenue and expenses that could force the county to dig deeply into its cash savings to cover the difference.
For the budget that ends Dec. 31, commissioners have to figure out how to close a $1.1 million gap, according to a recent story by News staff writer Steve Schulwitz. Current projections show the budget that begins Jan. 1 $1.7 million in the red.
Fortunately, the budget picture usually improves by year’s end. In 2020, for example, commissioners originally expected to use $984,000 from savings to balance their budget. By year’s end, however, the county had $769,000 more revenue than originally planned, but only about $148,000 more in expenses, meaning the county had to pull about half as much from savings as originally feared. Still, the county had to use $464,000 from savings that year, or about 9% of the balance. That kind of withdrawal is not sustainable.
So, county commissioners and new County Administrator Mary Catherine Hannah have to start making some tough choices.
Between 2017 and 2020, county general fund spending rose nearly 12%, while general fund income rose only about 7%, according to audits. Those numbers have to fall more in line.
And, while county voters have been generous over the years, many are still struggling from the economic headwinds caused by the coronavirus pandemic, so commissioners shouldn’t expect voters to remain so giving.
That means tax hikes can’t be counted on, and cuts have to be part of the plan.
(THE ALPENA NEWS)