Larimer County budget staff present $87 million 2024 surplus, warn of structural shortfall without savings or new revenue

Budget staff for Larimer County told the Board of County Commissioners on March 26 that unaudited 2024 figures show a countywide net surplus of about $87 million but that most of the money reflects capital and timing delays that will be carried forward into 2025.

The forecast and carryover presentation from Matthew Bohunan, budget team lead, and Alex Jordan, budget analyst, explained the mechanics and effects of the formal carryover process. Bohunan said the county must amend the adopted budget to move unspent 2024 funds into 2025, noting: "if there's any unspent funds from the prior year that need to roll over for expenses in the next year, we have to do a formal carryover process." The presentation showed $8.3 million of revenue above budget against $79 million in underspent expenses across funds, producing the $87 million net surplus.

Why it matters: Commissioners were cautioned that the headline surplus does not mean discretionary funds are available. Many large projects — notably landfill closure and the new North Landfill and transfer station — are budgeted in 2024 but expected to be constructed and paid in 2025–26. Bohunan said these capital projects “are tens of millions of dollars,” and the carryover process will rebudget them. The projected reserves picture also depends on state revenues, sales tax performance and policy choices the commission makes.

Budget details and drivers Budget staff said the general fund posted about $4.4 million in unanticipated revenue, largely from clerk and recorder recording fees and higher-than-expected election fees, plus nearly $1 million in opioid settlement funds and roughly $1.3 million from interest earnings. On the expense side, personnel and operating underspending across departments contributed to the $79 million total in underspent expenses countywide. Alex Jordan summarized the state economic forecast included in staff materials and noted that the Legislative Economic Office has increased recession risk: interest rates remain elevated and sales-tax growth faces trade-policy uncertainty.

Human services and state risk The presenters flagged a material shortfall in the county’s human services revenue picture. Bohunan and County Manager Lorenda Volker explained that roughly $3.8 million of a human services revenue shortfall is tied to a previously-expected statewide allocation that did not materialize. Volker said the shortfall “did not come out of general fund” but from human services reserves, and that the department is considering program-level changes, staffing adjustments and guidance from the state to address sustainability. Commissioners noted the state long bill and a possible increase in CCAP funding under consideration in the legislature; Commissioner John Kefalas and others asked staff to continue analysis as the long bill is finalized.

Ten‑year reserves and structural gap Staff presented a 10‑year general fund reserves forecast showing current reserves above $75 million, including a disaster contingency set-aside. Under staff assumptions — flat assessed values for the next reappraisal, a projected decline in sales tax in 2026, $4 million of new state-related service costs, and expected department cost savings of $6 million by 2027 — the county would run a structural deficit until tax increment financing (TIF) districts (Timnath and Centerris) expire and redirect revenues back to the county. County Manager Lorenda Volker emphasized these projections are scenario-based: “this picture shows you isn't what will happen. It's what could happen using the assumptions that were listed.”

Next steps and commission direction Staff asked commissioners for direction on new general-fund carryover requests and said the county manager is authorized under county budget policy to approve existing project carryovers and restricted funds. Commissioners asked for further analysis of specific items that affect services — notably human services and the assessor permit backlog — and directed staff to continue identifying the $6 million in targeted savings by 2027 while monitoring the state long bill and other external risks.

Ending Staff said final 2024 figures are unaudited and will be reconciled; the carryover package presented to the commission will be reflected in the adopted 2025 budget amendments where appropriate. Commissioners and staff agreed to continue work on program and revenue options and prioritized follow-up briefings on human services and the state long bill.