Wallowa County auditor presents 2026 draft budget showing $5.9 million shortfall

On Sept. 9, 2025, the Wallowa County Board of Commissioners received the county auditor’s draft budget for fiscal 2026. County Auditor Karen Martin told the commissioners she had balanced the formal budget document for reporting purposes but that, as submitted, departmental spending requests exceed projected revenues by about $5.9 million.

The draft, Martin said, shows department revenue estimates of roughly $23,000,134 and expenditure requests of about $29,064,000, producing the approximately $5.9 million gap. “I am here today to present to you the request for the 2026 budget for Wallowa County,” Martin said when she opened her presentation. She also provided the board a summary cover sheet and the usual multi-year reports that show beginning fund balances, revenues, expenditures and ending fund balances for each fund.

Martin and the commissioners discussed how those totals compare with recent years. Martin told the board that historically the county has closed some of these gaps because departments do not spend their entire budgets; she said typical year-end shortfalls carried forward have ranged from about $1 million to $3 million, and last year’s final shortfall was roughly $3.5 million. She said retirement contribution rates dropped midyear this year, which has reduced some costs, and she noted several miscellaneous fund balances that the board may want to consider when shaping the final budget.

Commissioners asked for clarification on how the $5.9 million figure should be interpreted. Martin described it as the difference between offices’ submitted expenditure requests and the county’s revenue estimate and confirmed the county’s fiscal year runs Jan. 1–Dec. 31. She also said the $31,000 figure shown for the 2025 current expense balance is based on receipts through August and cautioned that year-end results can change because invoices and some revenues come in late in the year.

Officials flagged several program- and agency-level pressures that will affect budgeting choices. Martin said licensing mailings (Department of Licensing operations) have seen postage charges rise sharply; the licensing unit had about $15,000 in postage through July, more than the auditor’s entire budgeted postage line for the year. She also noted state-imposed requirements — for example increased DOL audit and reporting obligations and more intensive election audits by the State Auditor’s Office — that require staff time and carry costs the county must absorb.

Commissioners raised a separate, longer-term revenue concern tied to tax increment financing (TIF) adopted by local cities and development authorities. One commissioner explained that recent and planned TIF districts by the Port, the city of Walla Walla and the city of College Place will divert a portion of new tax revenues to those entities for development projects, reducing the portion of new growth that flows to the county’s property tax base. The commissioner said that while TIF can stimulate development, it also transfers much of the near-term revenue gains away from county operations and could force the county to consider raising taxes or cutting services.

Martin and commissioners discussed next steps. Martin has exported the detailed three‑year history and monthly reports into a shared folder for staff and will provide department-level percentage comparisons before budget hearings. A commissioner said he will request a board workshop to “game plan” county responses to changing revenue prospects; Martin confirmed the board’s budget review meetings typically begin in October.

No formal budget action was taken at the Sept. 9 meeting; the board received the draft and asked staff to continue analysis ahead of the formal budget hearings. The board approved a revised agenda at the start of the meeting and later adjourned by unanimous voice votes.