Cowlitz County commissioners weigh deep cuts as 2027 shortfall looms
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Summary
Facing a projected shortfall in 2027, Cowlitz County commissioners discussed across-the-board reductions, a potential one-year budget and deferring a $1 million capital transfer to protect reserves; commissioners warned personnel will likely be affected and options are limited.
COWLITZ COUNTY — Commissioners opened a budget workshop Tuesday to consider proposed reductions to the 2026 budget and strategies to prevent a projected 2027 deficit that finance staff said would require roughly $8 million in additional cuts or new revenues.
Cathy Funk Baxter, the county finance director, presented models showing how a set of proposed reductions would affect the general fund and the county’s reserves. Finance staff excluded internal service billings and mandatory transfers from the cuts and warned that many of the recommended reductions would fall on personnel lines because other departmental budgets cannot absorb deep cuts.
The discussion focused on how much of the county’s reserves commissioners are willing to accept. One commissioner said a reserve level of roughly 6.2 (from about $19 million down to the figure under discussion) was unacceptable and that they would not approve a budget that left the county at that level. Baxter said the county’s projected 2026 ending fund balance is a little over $6 million and that without further cuts or revenue, 2027 is not balanced.
Commissioners discussed two near-term options: adopt a one-year budget instead of the standard biennial budget to buy time for deeper analysis and create a task force to develop implementable cost-savings, or implement steeper, immediate reductions to hit a two-month reserve target. Baxter offered a possible one-time deferral of a $1 million capital improvement transfer as a tangible option to raise reserves roughly one point (from about 6.6 to 7.6), noting the trade-off would be deferring maintenance projects.
The finance director highlighted major cost drivers that limit discretionary choices: rising insurance assessments (finance estimated an increase that grew from an initial $500,000 estimate to nearly $800,000 after a recent assessment) and a new correctional-services contract the county said will increase costs by about $1 million. Commissioners and department leaders also noted personnel and contract costs remain the largest ongoing expenses and that tax receipts have been relatively flat.
The board directed staff to consult legal about whether the board can amend the county finance policy to adopt a one-year budget and asked for materials to be ready in time for a public hearing scheduled next week. Once posted, departments will be able to review the agenda and the revised budget proposals.
The workshop adjourned with commissioners agreeing to continue negotiations and to review a short list of suggested reductions and revenue options before the formal public hearing.