Harris County reviews FY2027 budget, flags health‑insurance pressure and small cost‑cutting measures

Chair Susan Andrews opened the May 5 work session for the FY2027 proposed budget and turned the presentation over to County Manager Clark Harrell and the county CFO.

Harrell told commissioners the proposed general fund budget is $38,893,538 and currently shows a shortfall of about $406,476 against estimated revenues. He said the primary upward pressure is health‑insurance costs, which initially appeared to be up about 25 percent year‑over‑year but, after broker negotiations, staff hopes can be reduced to roughly 15 percent. Harrell said the presentation was high level and that department heads have reduced many requests compared with last year.

Elizabeth, the county CFO, distributed financials through April and said the county is at about 74 percent of both budgeted revenues and expenses. She told the board roughly $10,000,000 of budgeted expenses remain unspent and the proposed budget assumes using about $8,500,000 of reserves; if the budget plays out as currently constructed, the county would draw down those budgeted reserves. She also estimated roughly $3.4 million of additional revenue in late spring and noted five upcoming payrolls that together total about $1 million each.

Commissioners pressed staff on options. Several members said moving straight from prior multi‑year raises (recently 3 percent) to zero would undercut employees; one commissioner proposed an intermediate 1.5–2 percent approach. Finance staff and the county manager cautioned that giving larger raises risks being absorbed by rising insurance costs and could force deeper cuts elsewhere or greater reserve use. The proposed budget as presented includes a 1 percent longevity payment and a 1 percent cost‑of‑living adjustment.

The board also discussed program‑level reductions, including a proposed one‑day‑a‑week community center closure to save about $36,000–$38,000 annually and proposals to stop funding second seasonal recreation officials; commissioners and recreation volunteers pushed to reallocate modest savings toward field maintenance, training and certifications for staff, and to consider targeted investment that could enable tournament‑grade fields and generate revenue.

On capital spending, staff said general‑fund capital purchases are limited in the proposed plan and that most capital will be paid from SPLOST and other special funds. Commissioners asked staff to prepare options on whether to seek a local option sales tax (FLOST or LOST variant) if state action enables placing a referendum on the November ballot.

The county manager asked commissioners to review the budget book once finalized and to bring questions to staff in the coming weeks. The board did not take a final vote at the session; staff said a second reading and public hearings will follow the budget work calendar.