COTTAGE GROVE – Dane County Executive Kathleen Falk hosted an economic forum on Dane County’s 2010 budget Monday, fielding questions and comments on how to navigate the budget through a formidable economic climate.
Falk characterized the recession as “serious but not permanent” and said a number of factors will allow Dane County to capitalize on opportunities after the recession.
Some of these factors include outside financial assessors’ views of Dane County during a recession that has driven the budget deficit higher.
“Their assessment is that our financial integrity is sound but the recession is at fault,” Falk said.
Attendee Micah Zielke, a financial director for a manufacturing company, urged caution regarding economic forecasts because the recession has changed the economy in a more permanent way.
“When the economy turns around, it won’t return to pre-recession levels,” Zielke said. “That type of economy was not sustainable.”
Zielke said he wanted a “truly balanced budget,” and the budget should be evaluated on a need-versus-want basis, with some unnecessary services possibly needing to be cut.
Falk said the county faces an increase in the cost to operate the county workforce.
“As we start next year’s budget, things don’t stay the same,” Falk said. “The cost to [maintain] 2,500 employees goes up without anyone getting a penny more in salary. We have a built-in $6 million increase in next year’s budget without anyone getting any more salary.”
Dane County has a projected $11 million budget deficit, higher than originally thought. In May, the deficit was projected at around $8 million, according to Falk spokesperson Joshua Wescott.
“I have to find another round of cuts and decreases next year because these normal sales tax revenues that would support this increase are not there this year,” Falk said.
In order to curb the economic problem, Falk initiated a number of practices to reduce the effect of the deficit.
For example, Dane County employees took a pay furlough in an attempt to bridge the budget shortfall.
However, Wescott said sales tax revenue was considerably down from what was projected for this year, which was conservatively estimated as a 1 percent increase from last year. The sales tax for the last reported month, June 2009, was down 25 percent from June 2008.
This decrease in sales tax is the main driver in the budget deficit.
However, Wescott said these are only projections and there is now a way to have a definitive grasp on what the future numbers will be.
“In addition to raising revenue lines, there will have to be sound fiscal management decisions,” Wescott said.
One example of an additional revenue source, Falk said, is the sale of methane gas produced by landfills, generating electricity from it and selling it to Madison Gas and Electric, which would add an extra $1 million in revenue.
Another example of additional funds relates to the county’s prison system, according to Falk.
Twelve years ago, the county had a growing prison population and additional costs from deputies’ overtime. Now, the county has a lower jail population and a decrease in worker overtime due to more efficient management and renting out prison space to the state; the savings have added millions to county revenue.
Wescott also said the Dane County Treasury Department is communicating with people who are years behind on property taxes in order to come to solutions and collect back revenue for the county.
The county has to continue to work for creative solutions and rely on the ingenuity of county staff, with minimal impact on the services people rely on, Wescott said.
