The Campbell County Fiscal Court presented its 2023-2024 fiscal year budget of $56.85 million Wednesday, noting an increase in department operating expenses for a second year due to inflation.
This was the first reading of the budget; therefore, it was not voted on. The budget will be voted on for adoption at a future meeting before the new fiscal year begins on July 1. Laura Lewis, Campbell County finance director, gave the budget presentation.
Here are some of the budget highlights:
Fiscal 2023 budget vs. fiscal 2023 projection
- Revenues are projected to be about $644,000 or 1% higher than budgeted.
- Expenditures are projected to be $9.8 million or 19% less than budgeted.
- Expenditure differences are mostly caused by timing differences due to the cash basis of accounting, supply chain delivery delays, and projects that either carry over to the next year or cost less than estimated.
Fiscal 2023 budget vs. fiscal 2024 proposed budget
- Revenue in fiscal 2024 is projected to grow by 7% based on historical data and current-year trends and assessments.
- Expenditures are budgeted to also increase by 7% based on current market conditions and inflation, current year trends, and capital planning.
- The result is a projected 7% decrease in the ending fund balance for the fiscal year 2024. The deficit is overcome each year by the collection of additional revenue and lower expenses due to timing delays, pricing, or assessments, according to Lewis.
Revenue fiscal year 2024
Real property tax and payroll tax collections combined are 50% of the fiscal court’s annual revenue collection. These are two of approximately 90 revenue sources.
- The fiscal court is projected to net $12.518 million (27% of revenue) in payroll taxes and $12.10 million (26% of revenue) in real property taxes.
- The fiscal court has limited control over increasing revenue due to statutory restrictions, according to Lewis. Revenue generation from property tax is limited to 4% while operating expenditures are expected to increase 7%.
- Other revenue sources come from things like the jail, state road funding, and insurance license fee, among others.
Expenditures fiscal year 2024
Personnel costs and benefits are the largest expense.
- Employee wages are $14.857 million (26% of expenditures), and employee benefits are $7.298 million (13% of expenditures).
- Other expenditures come from contracted services, TANK contributions, and debt service, among others.
- Current market conditions increased medical costs, and regional labor market conditions are considered in the cost-of-living adjustment scenarios.
- Decreased pension contribution rates by the state for hazardous and nonhazardous employees are expected to partially offset increased salary costs in the fiscal year 2024.
- No new staffing requests are included in the fiscal year 2024 budget.
Capital projects carried over to fiscal year 2024 budget
Capital projects help to maintain county infrastructure and provide departments with equipment to perform services. Capital costs are offset with grant funding when possible, according to Lewis.
- Road projects- bridge replacement and equipment purchase: $2.496 million
- Jail and commissary projects: $219,000
- Vehicles and equipment delayed due to supply chain issues: $429,000
- Water fill station project: $110,000
Expenses are budgeted from historical trends for typical operations. This has been impacted by inflation and supply chain issues, according to Lewis.
- Capital projects proposed for the fiscal year 2024 are $3.35 million – $2.6 million for roads and bridges and $750,000 for equipment replacement and planning.
Jail funding is impacted by the early release due to the pandemic and staffing levels, according to Lewis.
- Most expenditures are fixed costs of operations and are not impacted by population.
- Non-personnel expenditures like meals and medical services are 63% of the detention center’s overall budget.
- Medical contract, non-routine medical services, and meals: $2.7 million
- Statutory requirements and pass-through funding (federal funding that is awarded to an organization, which then distributes the funds) are 40% of the county expenditure budget, which is $22.664 million, leaving 60% for county operations or $34.185 million.
Future financial considerations
- Long-term impacts of current market conditions regionally, such as inflation and competitive wages
- Supply chain disruptions
- Impact of ARPA funding timing differences on the financial statements—utilizing federal funds for long-term community benefit.
- Maintaining cash flow and a reserve of 35% of operating expenditures
When the 2023-2024 budget is adopted by the fiscal court, it can be viewed here, along with past year’s budgets.