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Cheshire County officials warn of budget strain as ProShare and fund-balance uncertainty grows
Summary
At a Feb. 19 meeting the Cheshire County Board of Commissioners and county staff warned that uncertain ProShare payments, growing use of fund balance and rising costs are creating budget pressure that could affect tax rates and credit ratings in coming years.
Cheshire County commissioners and county staff said Wednesday that uncertainty around state ProShare (revenue-sharing) payments, growing use of fund balance and rising personnel and capital costs are creating significant budget pressure that could affect taxes and the county's long-term financial position.
County Administrator (unnamed) and other staff told the Cheshire County Board of Commissioners at their Feb. 19 meeting that the county has increased use of fund balance in the current budget and faces uncertainty over future ProShare reconciliations from the state.
Why it matters: county leaders said the combination of one-time federal relief in prior years and unpredictable state revenue reconciliations could force future tax increases or reduce the county's ability to respond to new costs. Officials also said the county's credit rating and borrowing costs could be affected if fund balance continues to decline.
County staff said the current budget includes an increased withdrawal from fund balance approaching $6,000,000 and that $1.8 million of ProShare was used in 2024 to offset taxes raised for 2025. Commissioners and staff said the county has allocated about $4,050,000 in ProShare in recent planning, but they emphasized that the state's final reconciliation could reduce amounts previously advanced to the county.
The county's budget discussion touched on multiple drivers of the pressure: rising salary and wage costs, upcoming capital needs such as a sheriff's department security-system replacement estimated at $650,000, and the end of one-time federal pandemic relief (ARPA) that county leaders said had previously allowed investments not otherwise affordable.
Cheryl, a county finance official who spoke during the meeting, told commissioners, "Our audit will be starting next Monday, and it will be going on for 2 weeks," underscoring the near-term review of the county's financial statements. Commissioners and staff said Moody's or other bond-rating reviews could focus on the amount of fund balance used to offset taxes and that a sustained drawdown would raise borrowing costs.
Commissioners and staff discussed outreach to the county delegation and towns to "educate" local elected officials about the limits of county finances so those officials are prepared when the budget hearings occur. The county administrator said repeated, incremental adjustments to tax rates may be preferable to relying on one-time fund-balance draws.
The board agreed to continue line-by-line budget review in coming weeks and flagged 2026 as a year that could require difficult choices depending on final ProShare receipts and other revenue changes.
Ending: Commissioners scheduled further budget work in upcoming meetings and asked department heads to identify the most vulnerable programs and potential alternative funding strategies so the board can consider options before final votes on the 2026 budget.
