Archuleta County Finance Director Diane Sorensen presented the county’s First Quarter Financial Report during a June 4 special meeting of the Board of County Commissioners, showing a county that is both earning less and spending less than in prior years.
As Sorensen noted, the county was aware that revenues would decline due to a lower property tax assessment that equates to lower revenues, with Commissioner Clifford Lucero adding that county staff and officials began working on the 2012 budget in 2010 in anticipation of the reduced revenue.
The following information is for the first three months of 2012 and is taken from Sorensen’s presentation.
Through the first quarter of 2012, the county’s revenue feeding into the General Fund sat at 23.8 percent of the 2012 budget.
Revenues for the fund as a whole were $2,548,062 at the end of the first quarter, with $10,717,234 budgeted for the year’s revenues.
Revenues to the fund decreased by $271,400 (9.6 percent) over the same period in 2011, with the most significant decrease coming from a 15.6-percent decrease in property tax revenues ($340,000) — an expected decline due to lower assessed valuations in 2011.
Administration fees were at the expected 25 percent of the year’s budget and are the largest increase over 2011 in dollars ($63,131). The increase is the result of the county implementing a cost allocation plan for the county to claim indirect costs such as charges against grants, contracts, awards, as well as for internal funds.
Charges for services sat at 22 percent of the budget through the first quarter — an increase of 51.3 percent over 2011 ($23,457). The increase is the result of increased Treasurer charges for services, fees on tax lien sales, administrative fees, redemption fees and more.
Permits and fees were at 14.5 percent of the 2012 budget and have increased by $12,122 over 2011 due to an increase in building permits.
Expenditures in the fund sat at $1,849,999 at the end of the quarter — 16.6 percent of the 2012 budgeted amount of $11,130,595 and a 2.9 percent increase over 2011.
The largest increase in expenditures falls under the category of salaries and benefits due to there being six pay periods in the first quarter of 2012 versus five pay periods in the same quarter in 2011.
The largest decrease is found in the category of “Purchased Professional Services” with an amount of $126,000. This category includes such things as $83,000 due to the District Attorney’s first-quarter costs that had not been recorded, about $33,000 for the IT infrastructure upgrade in 2011 and a $10,500 decrease in medical services for inmates.
Road and Bridge Fund
Road and Bridge revenues through the first quarter of 2012 were at 14 percent ($755,547) of the 2012 budget ($5,391,580).
The revenues sitting at 14 percent is partially due to the county’s receipt of sales tax revenues two months in arrears.
Revenues to the fund decreased by $398,841 versus 2011, mostly due to the decline of $366,623 in property tax revenues (property tax revenues are split between the General Fund and the Road and Bridge Fund).
Expenditures in the fund ended the first quarter at 11 percent and decreased $457,007 (37.8 percent) from the same period in 2011.
Much of the decrease is due to the refinancing of Road Capital Improvement Debt early in 2012 (see related article), with the first payment made in the second quarter instead of the first quarter.
Another significant decrease came in Capital Outlay, with the purchase of truck accessories made in the first quarter of 2011 and no capital equipment purchases made in the first quarter of 2012.
The most significant increase in expenditures comes from interfund costs, which include fleet and fuel charges.
Salaries and benefits also increased due to the additional pay period in the quarter.
Solid Waste Fund
The Solid Waste Fund is a businesslike fund in the county, where revenues are derived from user fees.
Through the first quarter, revenues in the fund totaled $92,533 or 17.6 percent of the year’s budget. This is a decrease of $12,000 from 2011 and is the result of two large commercial customers decreasing their landfill usage during the first quarter.
Expenses within the fund are at 29.8 percent of budget, at $198,872. This is an increase of almost $81,000 over 2011. Most of that increase falls under interfund costs to the Fleet Fund for repairs and an engine rebuild on the landfill compactor.
Salaries and benefits also increased due to the additional pay period.
The Fleet Fund receives revenues through user fees from other county departments and agencies on a cost reimbursement basis.
Revenues through the first quarter sat at 27.8 percent — an increase of $217,618 from 2011. That increase is largely due to the increase of expenditures of repairs and maintenance in other county funds.
Expenses for the fund ended the quarter at 22.8 percent of the budget and $82,937 over the same period in 2011, largely due to the county’s aging equipment and subsequent maintenance costs.
“I think we’re managing our funds better,” Sorensen said, noting one internal control that has been implemented is a comparison of all payables (bills and such) to the budget line items before release of the funds.
Lucero praised Sorensen’s suggestion to refinance the county’s debt, which is set to make a notable difference to county coffers (see related article).
“You have really done a good job with the finances,” Lucero told Sorensen.
But that doesn’t mean the county is ready to take it easy, according to the commissioners.
“We have to tighten up our belts as much as we can,” Lucero said, adding that county staff and officials have already begun looking at 2014’s financials in anticipation of another decline in assessed valuations, as well as a possible end to the Payment in Lieu of Taxes funding (Congress has yet to decide on the matter), the combination of which could mean a cut of $1 million to the county.
“That’s jobs,” Lucero said.
Commissioner Michael Whiting also suggested the county create a formal plan for capital asset replacement (the BoCC approved more than $350,000 in equipment purchases for Road and Bridge at the same meeting, which was reported in last week’s SUN) to help the county lessen maintenance costs of its aging equipment.
Just over a week after Sorensen’s presentation, the county’s independent auditor presented the county’s 2011 audit. For information on that audit, see related article.