Steamboat Springs As the Routt County Board of Commissioners prepares to consider a proposed 2012 budget of $44 million, most residents can expect to pay less in county property taxes when bills arrive in January 2012.
The drop in property taxes is driven by a 21 percent decline in the county’s overall property valuation (down $300.8 million to $1.1 billion), County Finance Director Dan Strnad said Wednesday. But the decline in any property taxpayer’s bill will vary across the county. Stagecoach, for example, saw 60 to 70 percent decreases in the value of homes.
“North and South Routt seemed to take the biggest hits in valuation, with Hayden not far behind,” Strnad said.
Any individual taxpayer’s overall tax bill also takes into account the different tax districts whose boundaries encompass their property — school districts and towns, for example.
County property tax revenues from all sources is anticipated to decrease $487,000 to $16.866 million, but a large part of that is attributable a projected $885,000 hit that will be absorbed by voter-approved property taxes for the Purchase of Development Rights program, the Museum and Heritage Fund and Horizons Specialized Services. Those tax collections, handled by the county, are pegged to specific mill levies and not subject to the Taxpayer’s Bill of Rights (TABOR). As a result, their revenues rise and fall in direct proportion to property valuations.
The drop in the voter-approved funds will be offset by an increase in the county’s base property tax revenue, which funds basic services like road and bridge maintenance, law enforcement, communications and personnel costs. It is expected to increase by 4 percent or $494,000 under TABOR. The amendment to the state constitution permits the county a 4 percent increase in revenues that is the combination of 3.35 percent for inflation and 0.64 percent from new construction. The county also can apply mill levy credits under TABOR that it has accrued from spending less than it was entitled to in previous years.
Strnad said the county found a lot more room in its budget this year thanks to an unexpected 7 percent increase in revenues on its one point of sales tax against a budgeted decline of 5 percent. The county collects general sales tax as well as a 1 percent building use tax and a 1 percent auto use tax.
“Sales tax is 11 percent of the overall budget. It’s one of the two major sources of revenues that go to fund operations,” Strnad said. “(Tourism research shows visitation) was up slightly, but the people who came were spending more for whatever reason. When you combine the increase in base property taxes and sales taxes you have almost $900,000.”
This year’s county budget, yet to be approved by county commissioners, anticipates expending $300,000 in reserves from a fund pegged for future equipment purchases and Road and Bridge Department projects. That’s far less than the $4.1 million in reserves the county spent last year when it had to absorb an unexpected 33 percent increase in health insurance premiums as well as pay for six new heavy road graders.
The health insurance costs are in much firmer control this year, Strnad said, under the county’s partial self-insured plan. Claims for 2011 have been substantially lower than in 2010, Strnad said.
As it did in 2011, Strnad said the county will defer its asphalt overlay program for roads and instead use the less expensive chip-and-seal process for extending their life. However, the chip-and-seal budget has dropped for 2012 by more than $571,000, or 55 percent of 2011’s budget, as the Road and Bridge Department anticipates treating 12.5 miles of road versus 22 miles last year.
Personnel expenses, the biggest part of the county budget, are proposed to increase $287,000 to $19.3 million in 2012 in spite of the fact that county employees continue to work for salaries that are 5 percent less than what they were in 2009.
The Assessor’s Office is approved to hire a full-time commercial appraiser whose salary of $56,370 is expected to be offset by contract fees previously paid to complete that work.
The Information Systems Department will add a help desk position at a salary of $54,800 that will support the ongoing implementation of computer-aided emergency dispatch and records management systems. And the Sheriff’s Office adds half a full-time employee at $20,735 for a records technician.
Strnad said county employees took a 10 percent pay cut in 2009, which was reduced to 5 percent in 2010. That cut will remain in the 2012 budget.
A recently completed salary survey of compensation for county workers in nearby resort communities concluded that wages and salaries for Routt County employees are on average 10 percent below other local governments. The individual differences ranged from zero to 24 percent.
The cost to bring Routt’s salaries in line is about $1.5 million, Strnad said, but the survey also determined that Routt employee contributions to its health care plan of 4 percent for single coverage and 3 percent for family coverage are less than the typical 15 percent in other counties. He calculates the discrepancy in the benefits contributions would offset about half of the $1.5 million in wages.
The county commissioners have said they will continue to study the survey but have not budgeted for increasing salaries.
“We really can’t afford it right now,” Strnad said. His 20-year projection intended to help the commissioners answer the question “Can we sustain what we have, and are we living within our means?” suggests that if the county implemented 100 percent of its pavement plan and upgraded compensation to meet the survey, it could burn through its reserves and become insolvent by 2021, he said. That prediction makes assumptions that the revenue side of the county’s budget won’t improve dramatically in that time.
“Looking out 20 years, we’re sustainable, but we’re still going to need to do overlays in there, and in order to retain quality people, you’re going to need to pay them somewhere along the line,” Strnad said.
— To reach Tom Ross, call (970) 871-4205 or email tross@SteamboatThursday.com
2012 proposed Routt County budget