In light of the anticipated downslide in property tax and severance tax revenue, La Plata County is tightening its belt for the 2017 budget, reducing both personnel costs and operational expenses.
Staff members asked the county commissioners to “aggressively pursue” imposing a use tax, marijuana excise tax and impact fees next year.
“As revenue decreases, so must operating expenditures to live within our means,” county Finance Director Diane Sorensen said, noting that no staff cuts are expected. “We worked with our departments, and we reduced operating expenditures.”
County revenue is expected to fall by 13.6 percent, or $10.8 million, from 2016. Next year’s total revenue is estimated at $69 million, with an ending fund balance of $67.1 million.
Property tax revenue has fallen by $3.4 million, while severance tax has taken a $932,000 hit – a 70 percent decrease from $1.3 million to a mere $400,000.
In 2017, intergovernmental revenue will replace property tax as the biggest revenue source, accounting for 24.2 percent of county income. Sales tax will contribute 22.8 percent and property tax will fall to third at 22.5 percent.
Sales tax revenue has not surpassed property tax in 11 years.
A look at property tax incomes over the past decade chronicles the rise, climax and drastic decline of oil and gas production in La Plata County. Revenue sat at about $25 million from 2007 to 2009, climbing to $29.5 million in 2010.
The figure stabilized at about $20 million for the next three years, then dropped to $15.6 million in 2014. That’s what county staff members are predicting for 2017, and revenue will fall an additional $1.4 million in 2018.
“Obviously, the decline in revenue is significant and we’re stepping up to try to meet that challenge,” assistant county manager Joanne Spina said.
She said staff worked with all county departments to see where they could cut waste, save time and increase efficiency.
A total of $78.3 is expected to be available for expenditures next year, which includes reserves, and reflects a 25 percent decrease compared with 2016.
Part of the decrease stems from one-time and capital expenditures that included the county’s purchase of 10 Burnett Court and a remodel of the County Courthouse. Leases in the Courthouse will bump up revenue for the county moving forward.
Costs for salaries and wages also shrank; it will decrease by 2.9 percent, or about $678,000 – a byproduct of no new positions, merit raises, changes in wages or promotions, coupled with filling vacated positions at lower pay.
County officials insist the future of the road and bridge department is riding heavily on a mill levy proposal that will go to voters in November. If voters say “no” a second time, as they did in 2015, road and bridge projects will likely reach a standstill.
The county has budgeted several caA public hearing on the proposed budget is scheduled for 6 p.m. Oct. 18 at the La Plata County Administration Building, 1101 East Second Ave.
Commissioners will move to adopt the budget no later than Dec. 15.