Russell Springs

This past Tuesday, Russell County Fiscal Court held a special called meeting to deal with a few loose ends and discuss this year’s budget deficits as well as expected deficits next year unless action is taken.

The Department for Local Government (DLG) sent representatives to the meeting to hold a budget workshop, to discuss with the court options they hold in balancing the budget. The gist of which came down to three options, ultimately; 1) cut unmandated services or other expenses not required by law, 2) raise revenue, 3) a combination of the two.

State Local Finance Officer/Debt Officer Junior Wright was joined by Local Government Advisor Matthew Frohlich and Staff Attorney Andrew Hartley. Wright began by briefly outlining the duties and responsibilities of his office as it applies to the state’s counties before addressing our particular needs and problems.

“Let me first say, you all are not in this situation by yourself,” Wright said, pointing out that for the last five to 10 years difficulties occurring at a national level are filtering to the state and county levels.

Currently, the county faces a projected budget deficit of $191,000. Frohlich offered a more pessimistic projection, saying that after his office checked the numbers; “190,000 shortfall end of the year is accurate. I would even say, in most instances, opening a new jail costs, a lot of times, tend to be more than what you expect, especially early on. That could be a low estimate.” Frohlich said, also pointing out that in December the county faces a $280,000 bond. “So there are a lot of financial concerns that need to be addressed.”

It will take some time to see what impact operation of the jail will have on the county’s finances, but without the jail, the county would have been paying out over $40,000 a month to Casey County and related expenses, it was pointed out.

Stating that the new budget must be approved by July 1 and that it must be balanced, Hartley said, “If a county does not have a balanced budget then it effectively cannot operate. And the state has seen it appropriate to essentially appoint the state and local finance officer, which is Junior Wright, to oversee the process any time a county would get to that point.”

The process could eventually lead to initiation of legal action to force the county to balance the budget, the refusal of, or the inability to, has actually led to members of the court being incarcerated in other counties. Hartley did point out that events occurred under “extraordinary circumstances” and that he would not expect that it would occur here, but the court needed to know “where it could ultimately end up, if it came to a stalemate.”

Judge Executive Gary Robertson and members of the court asked questions and for clarification on a number of issues.

It was determined that cutting all services, whether essential or not, that are not mandated would likely still not raise the revenue needed.

Those services the county enjoys are the volunteer fire department, 911 services, sheriff’s office (which raises much of its own revenue), road crews and more, as well as expenses such as insurance for public employees elected or otherwise and registration fees for training and travel expenses, equipment needs for services among others.

Raising revenue means raising taxes. Three taxes discussed were property, occupational and insurance.

Wright pointed out that the county’s property tax of 6.7 percent was one of the absolute lowest in the state, with only one or two counties having a lower rate, and that the occupational tax of .25 percent is exceptionally low as well.

The county does not collect an insurance premium but that is also a way counties have helped balance their budgets.