Disaster spills over into Schoharie County budget

PHOTOGRAPHER: Edward Munger Jr.

Schoharie County would cut its workforce by 30 positions under a 2012 budget proposal reflecting the devastation wrought by August flooding.

County budget officer Paul Brady on Thursday said the $59.7 million tentative budget calls for a tax levy increase of 7.1 percent. The hard-hit county will likely seek to override the state’s newly imposed 2 percent property tax increase cap.

The tax levy would increase from the current $17.89 million to $19.16 million under the plan.

Brady said the tentative budget would take $1 million from the county’s fund balance — its reserve of funds unspent in previous budget years — to help reduce the tax hike. The county had roughly $7.5 million in its fund balance before the flood but has spent about $5 million of it since.

Using $1 million from the fund balance would leave only about $1.5 million for unforeseen expenses, but Brady said the fund should be boosted next year by flood reimbursements by the federal government and insurers.

Assuming there are no changes by the county Board of Supervisors or its Finance Committee, tax rates on property in the various towns would increase from 2.3 percent in Summit to 8.89 percent in Fulton. The rates vary by how close a town’s assessments are to actual market value.

Compared with this year’s budget of roughly $64 million, spending would go down by 7 percent.

“Revenue is going down, that’s really what is driving a lot of the difficulties that we’re having with the budget,” Brady said.

One of the biggest impacts to the 2012 budget is the loss of the county’s jail, one of dozens of buildings put out of commission by the disaster. Last year alone, the county drew in about $900,000 in revenue from boarding prisoners for other municipalities.

Now, the county’s prisoners are all at the Albany County jail and Schoharie County not only isn’t receiving boarding revenue, it’s paying. Also, the county’s roughly 30 correction staff members have remained on the payroll, kept busy by transporting prisoners from Albany County to court appointments and by working guard duty in flood-damaged areas.

It’s unclear yet if the county will repair or replace the jail, so the county can’t count on any inmate boarding revenue for 2012.

“For us, that’s been a pretty significant revenue generator,” Brady said.

Other revenue losses include the fact that the county can’t hold a property foreclosure sale this year — all the documents and data that go into that function were wiped out at the County Office Building on Main Street in Schoharie on Aug. 28.

Meanwhile, without even considering that hundreds of buildings no longer exist, the county’s total property value for 2012 is projected to go down by 1.5 percent, the second decline in as many years.

As an ironic result of state law, owners of houses that no longer exist will be taxed on those buildings in 2012 for the amount they were worth in March 2011. New values won’t be set until March 2012, which would then impact the 2013 tax bills.

The tentative budget proposes to eliminate 12 positions that are currently vacant and 18 full-time jobs that are currently occupied. The job cuts would affect the local office of the state Department of Motor Vehicles, the county Safety Office, Public Health, Transportation, Economic Development and Planning and Social Services departments, the Old Stone Fort and the Youth Bureau. But the bulk of the cuts, Brady said, will hit the Sheriff’s Department, which operates the jail.

The tentative budget doesn’t reflect disaster-related expenses. Brady said the county intends to borrow $10 million through a Bond Anticipation Note and deposit that money into a reserve account for repairs or rebuilding.

Interest payments on the bond next year will mark the first time in years Schoharie County will have to include a budget line for debt service, because the county has long been debt-free.

“I give a lot of credit to the Board of Supervisors, I give a lot of credit to [county Treasurer] Bill Cherry. We were very much operating on a principle of ‘pay as you go,’ ” Brady said.

The tentative budget will now go under review by the county board’s Finance Committee before going to the full board for final approval on or about Nov. 28.