Instead of visions of sugarplums dancing in their heads, the St. Mary’s County Commissioners this week had dollar signs bouncing around up there. And they received an early Christmas present this year, but they have been warned it may turn into a lump of coal.
The commissioners heard two presentations this week from Chief Financial Officer Elaine Kramer, the first on revenue and expense projections for the next fiscal year and the second was the release of the audit for the 2011 fiscal year. The big news out of the two presentations is that the county has almost $12 million in undesignated reserve funds they didn’t anticipate.
The $11.9 million comes from local income taxes that the state has disbursed to the county based on actual collections from previous fiscal years and a higher-than-anticipated percentage of distribution from the state. St. Mary’s County was recently cited for having the highest per capita income in the nation, fueled by the high income workers who live here and work on base.
The cautionary tale in the story, according to Kramer, is that the income tax collections seem to her to be higher than they should be. Next year at this time the state could come back and say, oops we made a mistake, a give the county a lower amount. Or not! The county won’t know until then. “It may be ours,” Kramer said. Such are the perils, she said, of predicting budget revenues.
But for now, the county has a total fund balance of more than $30 million, of which more than $12 million is carried over from prior years. Of the total reserve, $11.8 million is designated to cover the bond rating agencies’ requirement of a five-percent reserve.
The size of the reserve, nevertheless, could work against the county when they preach austerity to the agencies they fund, such as the Board of Education and sheriff’s office.
But the fiscal conservatism is well placed, according to Kramer, because of the uncertainty of the state’s numbers, but also because of some potential factors not under the county’s control, including the possibility the state may shift some or all of the costs of teacher pensions back to the counties.
At a budget workshop Monday Kramer, reported that property tax revenues continue to be essentially flat, which some commissioners noted was a good thing considering that many jurisdictions are experiencing declining property tax revenues due to declining property values. “This flat rate is going to be maintained for a long time,” observed Commissioner Lawrence Jarboe (R: 3rd).
The more than 100-page audit for the last fiscal was released to the commissioners on Tuesday but the county refused to release a copy to the Bay Net for review and reporting. The full audit is expected to be on the county’s web site at some time in the future.
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