Legal document…approved expenditures…statement of revenue…expenses and fund balances
While these somewhat clinical descriptions of the county budget are certainly valid, the budget document embodies much more to commissioners courts and the constituents they serve. The facts and figures in the Texas county budget often epitomize a way of life…or at least an intended way of life, if budget planners have their say. For example, consider the following defining phrases used in a recent training session on the county budget:
v A plan of action for the fiscal year
v A policy statement by the commissioners court
v A vision statement for the county
As part of the upcoming budget process, Burnet County elected officials and department heads met in late February to discuss the state of the county, departmental updates, legislative issues, and cost-saving ideas, said Burnet County Judge Donna Klaeger.
“We evaluated Burnet County’s mission statement and agreed on changes,” she explained, resulting in the following:
The mission of Burnet County is to maintain overall efficient and financial management of county resources and provide services desired by the people of Burnet County and mandated by state and federal law. We are here to serve…
County government is a unit of the State of Texas, and the structures and duties of county government are set forth in the Texas Constitution. County government responsibilities are mandated by law and must be funded by the county budget. These mandated services include:
Process and maintain voter registration
Maintain and construct county roads and bridges
Provide for public safety
Maintain and operate the court system including provision for indigent legal defense
Provide medical care for indigent county citizens
Facilitate the issuance and recording of public documents
Process motor vehicle registration and title transfers
Collect and remit state motor vehicle taxes
Provide local support for state agencies such as Texas Department of Mental Health and Mental Retardation, Department of Public Safety, Texas Parks & Wildlife, and the Alcoholic Beverage Commission
Counties also strive to provide discretionary services, often called “quality-of-life services,” such as community centers, health departments and libraries.
No Crystal Ball
When it comes to budgeting the discretionary or quality-of-life items, Burnet County is asking its constituency to help prioritize “services desired by the people,” as referenced in the new mission statement. This process is especially important in light of statewide budgetary woes that will no doubt trickle down to the county level.
As of press time, the 82nd Session of the Texas Legislature was completing its 11th week, with lawmakers predicting a $27 billion budget shortfall. The months of February and March saw county officials journeying to Austin to testify before committees on behalf of counties, addressing cuts that would drain local coffers and directly impact county services.
The Legislature is set to adjourn on May 30, with special sessions a strong possibility. Regardless, Texas counties have no choice but to launch their budget process without knowing exactly what will be coming down the pike.
So what’s a county to do?
“I don't foresee changing the (budget) process we go through,” said Houston County Judge Lonnie Hunt, “but we will certainly proceed with great caution. We have already tightened our belt over the last few years, so our budget is pretty lean right now.
“But I will challenge every elected official and department head to think outside the box and look for opportunities to operate even more efficiently,” Hunt continued. As part of this challenge, Hunt developed and distributed a County Judge’s Report detailing proposed state budget cuts and how they will directly impact Houston County.
For example, the state has proposed the elimination of assistance to counties to prosecute capital murder cases.
“The cost of prosecuting a high-profile capital murder case could bankrupt a small county like ours,” Hunt reported. “And remember, if the defendant is indigent, we have to pay the cost of the defense, too. Currently, the state helps cover these extraordinary expenses, but this funding would be eliminated. Pray that we don’t have any more capital murder cases in the future.”
While Houston County was disseminating the judge’s report, Burnet County was distributing a survey with a cover letter from Klaeger, which included the following:
As a Burnet County citizen, your participation in our county government, the government “closest to the people,” is vital to our continued success. We depend on you to help mold the future of our county…
For the good of the community, Burnet County has historically funded programs that are non-mandated by the Legislature. These programs will be under review for potential funding cuts in the 2011-2012 budgets. IF there has to be funding cuts, citizen input will assist in making these difficult decisions.
This survey was e-mailed to the county’s distribution lists, including those who receive the commissioners court agenda, posted on the county website, and was placed in other public locations such as libraries.
“We are getting it to as many folks as we can who live in our county,” said Jeanne Emerson, Burnet County Commissioners Court coordinator. The survey prompts taxpayers to indicate their top five funding priorities. Burnet County officials will use the survey results to help them decide which programs to prioritize in the budget process.
Dickens County “is already about as lean as you can get,” said County Judge Lesa Arnold. “The past two years’ budgets have been challenging due to the devaluation of oil and gas minerals. To add the possibility of more unfunded mandates creates an even greater challenge.
“I think all we can do is provide services to our citizens and take an even sharper pencil to the rest,” Arnold concluded.
Dickens County will launch the budget process in May, when Arnold will distribute budget worksheets to all departments and elected officials. She will then translate the returned worksheets into a spreadsheet and gather her team together “to consider department requests and where cuts can be made.”
In light of the economic climate, both statewide and countywide, Brooks County has implemented hiring and spending freezes, said Brooks County Judge Raul Ramirez. As in Dickens County, the loss in mineral values has presented a budgetary challenge.
“Historically, Brooks County continues to lose values, and our taxpayers are burdened with tax increases,” the judge explained.
As budget season approaches, Ramirez said his county has started looking at avenues to increase revenues and reduce expenses in all departments.
In fact, seeking additional revenue sources was a key element of a recent training session on the county budget facilitated by Hunt, along with Tom Green County Judge Mike Brown and Ector County Judge Susan Redford. The trio presented The Budget Process: Step by Step at the V.G. Young Institute of County Government annual conference in mid-February.
One example of a potential revenue source is the Sales Tax on Telecommunications Services as described in Tax Code Section 323.208. Telecommunication services are subject to state sales tax but are exempt from county sales tax, the judges explained. However, any county that has adopted a county sales tax may repeal the exemption provided for telecommunication services under Section 323.208 and subject these services to the local county sales tax. The judges reminded officials that a county cannot adopt a county sales tax if the combined rate of local sales taxes would exceed 2 percent in any part of the county. As of press time, 33 counties had imposed this sales tax.
Officials also discussed the County Assistance District Sales Tax, as described in Local Government Code Chapter 387. All Texas counties may seek voter approval to create a county assistance district (CAD) and adopt a local sales tax if the total combined rate of all local sales and use taxes would not exceed 2 percent at any location within the district. The permissible rates for the district sales tax are one-eighth, one-fourth, three-eighths, or one-half of one percent. The revenue must be dedicated to certain functions specified in the government code.
The judges’ budget panel also detailed other funding sources including:
v Records Management Funds
v JP Court Technology Fund
v County & District Court Technology Fund
v Family Protection Fund
v Community Development Fund
In addition, the judges echoed the sentiments of the County Judges and Commissioners Association of Texas (CJCAT), calling upon the Texas Legislature to provide for additional revenue sources for Texas counties. In fact, the CJCAT passed a resolution at its state conference in October 2010 dedicated specifically to additional revenue sources as follows:
County Local Option Revenue Sources
WHEREAS, county revenue sources are extremely limited; and
WHEREAS, under current statutes, counties are forced to rely upon property taxes to fund necessary services; and
WHEREAS, county taxpayers should have the option to adopt a local sales tax, a local severance tax, a local motor fuel tax, an increase in local vehicle registration fees, and other revenue sources to reduce property taxes;
NOW, THEREFORE, BE IT RESOLVED, that the County Judges and Commissioners Association of Texas requests that the Legislature amend the tax statutes to allow the adoption of a county local option sales tax, a local option severance tax, a local option motor fuel tax, an increase in local vehicle registration fees, and other revenue sources for the reduction of property taxes without imposing any additional revenue caps.
A ‘Must Have’ – The Budget Calendar
Developing the county budget is difficult enough, especially during a pronounced economic downturn. This can only be made easier by the publication and internal distribution of a budget calendar.
“This is the most helpful tool in effective budgeting,” Redford emphasized.
The calendar not only defines the process in logical and sequential steps, but also improves accountability and cooperation and keeps key participants informed throughout the process.
“Become the budget expert for your county,” Hunt asserted. “County budgets are voluminous and complicated documents. Don't be afraid to ask questions of your auditor or anyone else so that you understand your budget.”
To view the presentation, The Budget Process: Step by Step, go to http://vgyoung.tamu.edu/files/jud41_996.pdf. To read the County Progress article on additional revenue sources for county government, go to countyprogress.com, In This Issue, Archive, September 2010. H – By Julie Anderson