Beaufort News

Expected budget cuts are 'going to hurt,' county council learns at annual retreat

Beaufort County Council spent Friday afternoon batting around budget-balancing ideas, considering everything from tax hikes to furloughs to privatizing ambulance service to renting space in public libraries to national coffee chains.

The budget brainstorming came during day two of council's three-day annual retreat.

Council members spent much of the first day discussing looming financial challenges -- a combination of state funding cuts, declining property values and a looming reassessment that Chairman Weston Newton described Thursday as "a sobering reality."

Already, council and staff have trimmed the 2011 budget from $104 million to $99.5 million.

Councilman Steve Baer said he has done preliminary work with the projected budget for fiscal 2012 and has seen how difficult further cuts will be.

"I think our goal is about $97.5 million or thereabout," Baer said. "That's going to hurt. There's going to be a lot of screaming around this table."

Budget woes will likely increase once property values are reassessed in 2012. The fair market value of the county's property tax base has fallen from about $45 billion in 2007 to about $37 billion today.

IS PRIVATIZING THE ANSWER?

Long-term, the biggest cost-saving idea discussed Friday might be privatization of some county services.

Newton said the EMS system costs about $7.5 million annually and generates about $2 million in revenue. The county could save by contracting that service to a private company, he said.

"I'm not advocating it," Newton said. "I'm just simply acknowledging that there are some places that do it. And based on simple math, for us, it's (about) $5 million."

He said any such contract would specify base requirements, such as a minimum response time.

Members suggested solid waste and recycling, libraries and airports as other potential targets for privatization.

Councilman Rick Caporale, who served on the Beaufort County Board of Education before joining County Council, pointed to the Board of Education's private contracts for busing and food service as examples.

"The school board did that 15 years ago," he said. "It was extremely controversial. But we did it, and it did save money."

LABOR COSTS

Eight county workers were laid off in October, and officials have said more personnel cuts are a possibility.

Beaufort County employs about 1,200 full- and part-time workers. Labor costs are 60 to 70 percent of its budget, county administrator Gary Kubic has said.

Councilman Gerald Dawson said he would prefer a 10- to 15-percent salary cut for all county employees to layoffs.

But that approach raised other concerns.

"When you start doing things like that, your best people -- who have the ability to change, to find a job -- those are the people you're going to lose," Councilman Jerry Stewart said. "And you're going to end up having to pay to retrain people; you're going to have less efficiency."

Councilman Stu Rodman suggested the county might be able to find volunteer help in some cases.

"We've got a tremendous number of retirees in this community," Rodman said. "I think about the libraries. I'm sure there's a lot of volunteers, but maybe there's a way to do more."

FEE AND TAX HIKES?

Council also discussed ideas for raising revenue.

"There are areas where fees -- reasonable fees on premium services --could be used to help out the budget," Baer said.

A tax increase might be an option, as well, some members said.

"We also, I think, have to look at the other side: Should our residents be paying a little more for the services they expect?" Stewart asked. "I'm not saying I'd vote for it, but I think we have to put it on the table."

If taxes did increase, Councilwoman Laura Von Harten said, it would be easier for residents to swallow if those hikes are tagged to specific projects and implemented incrementally.

"I'd rather raise it a little bit each year than get to 2013 and have to really bump it up," she said.

Councilman Brian Flewelling disagreed, saying taxpayers would likely accept a tax hike -- but only as a last resort.

"If we can't justify every dollar that we tax them, then I'd rather leave it in their pocket," he said.

"If we can demonstrate to them that it's absolutely necessary, and that we've done everything we can to cut our costs and keep them to an absolute minimum, and that we're doing only those things we're supposed to do, people will pay for that service."

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