Washington County Board Gets a First Look at the 2012 Budget

The Washington County Board of Commissioners got its first glance at the 2012 budget outlook during a workshop Tuesday morning.

The 2012 budget comes on the heels of more than $7.2 million in reductions to state aid over the past three years, while at the same time more residents are turning to the county for services in hard economic times.

The county potentially faces more state aid reductions in 2012.

Washington County receives about $23.7 million from the state of Minnesota that could potentially be at risk over the next couple of years as the Legislature addresses the state budget deficit, Deputy County Administrator Molly O’Rourke said.

State aid has already been reduced in the overall county program aid, as well as in block grants that pay for social service programs, child support collection services, medical transportation grants and community corrections programs.

Possible reductions—yet to be determined by the Legislature—include additional cuts to county program aid and community services grants, as well as aid that goes to fund state highways, community corrections and local public health programs.

“As the state has reduced state aid and continued to add mandates to the county, we have had to fund them through property tax dollars,” O’Rourke said. “From 2002-2011, we have had to raise the property tax portion that funds our budget by 7 percent because state aid is not keeping up.”

The state’s county program aid per capita was $43.02 in 2000, O'Rourke said. In 2010, that number fell to $42.60 after being adjusted for inflation.

So the 2012 budget will be crafted amid continued economic uncertainty and uncertain state funding levels, while the county attempts to maintain its service quality.

In preparing its 2012 budget, the county is building on its fiscal accomplishments of a low tax rate and a low per capita spending and property tax.

In 2010, Washington County had the lowest operating cost per capita in the seven-county metropolitan area, and the second-lowest property tax per capita, O’Rourke said. The number of county employees has fallen from 1,113 in 2009 to its current staff level of 1,068, which is the second lowest in the seven-county metropolitan area.

But at the same time, O’Rourke said, food-support cases that the county processes have more than tripled since 2004—and health-care cases have grown from 6,500 to almost 8,000 between January 2008 and January 2010.

It is expected that there will continue to be a high demand for safety net services by county residents.

“The county is the first place people turn for help during a recession,” O’Rourke said.

The county board’s reaction to the presentation was split.

“It’s tough economic times. The federal government is broke, the state government is broke, but I can’t see under any circumstances raising property taxes on people,” District 2 Commissioner Bill Pulkrabek said. “I’m not going to vote to raise the rates, so I’m thinking zero (property tax levy increase) or below.”

Gov. Mark Dayton originally had a $39 billion budget and in a month’s time “even he has reduced it to $37 billion, which is a 4 percent decrease,” Pulkrabek added. “If he can do it, I don’t see why we can’t do negative 3 (percent).”

District 4 Commissioner Autumn Lehrke agreed.

“I would like to see a negative number if possible to show people we are responsible,” she said.

But Vice Chair Dennis Hegberg and Chair Gary Kriesel disagreed with Pulkrabek’s comparison of state to county budgets.

“I don’t agree with comparing Washington County to the state of Minnesota,” Kriesel said. “Minnesota is not the second lowest tax rate in the country. Stuff—like sewage—tends to roll down hill. I would support what it takes to maintain core and essential services.”

When comparing county to state government, Hegberg said, “We have to remember the state budget still went up 2 percent, because their revenues went up.”

The state has different revenue sources, he said.

“I’m waiting to see what the state Legislature is going to do to us, because I don’t think they’re done yet,” Hegberg said. “I’m not going to say we are going to go down in the negative, because I don’t think that’s possible. That’s the reality. The revenue from the state is going up and their budget is based on inflation.”

Woodbury Commissioner Lisa Weik said she would like to see what a zero increase in property tax levy would look like.

“If we are going to stay at zero or go into negative levy, does that mean cutting into (state) mandates?” she said. “That’s the first thing we need to know, because if I’m going to be wearing an electronic ankle bracelet to go into a negative levy, I need to balance that against my future.”

Workshops are used to give board members background information. No action was taken.

The board will continue to review the budget during the summer, with public hearings in the fall and final adoption in December.