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County finance projects modest revenue growth but flags state assessment cost shift and lower grant totals
Summary
Finance staff reported updated FY2018 revenue estimates and recommended 4% growth for income tax receipts; commissioners were briefed on a state-driven shift that will move assessment-office charges to county expense lines and on reduced grant revenues in the packet.
County finance staff reported FY2018 revenue updates at the Feb. 28 work session, citing the state constant-yield letter and updated assessable base figures. The county’s assessable base increased modestly for the recommended budget and staff recommended a 4 percent growth assumption for income tax revenue based on recent multi-year averages and recent collection patterns.
Gilmore explained one major procedural change: the county will treat part of the State Department of Assessment and Taxation (SDAT) activity as an expense in the county budget rather than a direct reduction of property-tax revenue; staff said the FY2018 presentation shows the assessment-related charge as an expense line. The package noted the state is proposing counties take a larger share of assessment-office costs: staff said the county estimate for FY2018 reflects a proposed 70 percent county share (up from a 50 percent assumption), with a possible further increase in later years. Commissioners expressed concern that state mandates are shifting operational costs to counties.
Staff also told the board that grant-funded revenues included in the FY2018 packet were lower than in the prior approved budget because some grants moved to the health department and other adjustments reduced total grant revenue included in the general fund package; packet grant totals fell from roughly $15.0 million (approved FY2017) to an $8.4 million request for FY2018 in the materials, largely because several grants were moved out of the general-fund presentation.
On property tax rate setting, Gilmore presented the certified constant-yield tax rate and the board discussed adopting a rate that would produce the same yield versus increasing to cover new requests. Commissioners deferred a final tax-rate decision pending the board’s revenue/expenditure trade-offs and public hearing schedule.
Ending: Staff will return with updated revenue projections and an updated debt/encumbrance breakout for bond-funded projects; commissioners asked for continued monitoring of state cost-shift proposals affecting assessment-office funding.
