PORT ANGELES — For the better part of the decade, Clallam County has controlled its spending and saved up for a rainy day.
Having $11.5 million in the piggy bank is paying off now.
Facing a projected $2 million loss in interest and sales tax revenues, Commissioners Mike Doherty and Mike Chapman on Tuesday approved a 2010 budget that spends $1,884,970 in reserves and cuts about a dozen employees, to balance a $32.7 million general fund.
That leaves more than $9.6 million in reserves for 2011, when the Elwha River dam removal project is expected to jump-start the local economy.
That $308 million project — the largest dam removal project in the nation — will take both the Elwha and Glines Canyon dams and is expected to bring hundreds of jobs to the North Olympic Peninsula.
“We’ve recommend using that $1.9 million dollars worth of rainy day fund to get us though to better times,” said County Administrator Jim Jones, who prepared the budget along with budget director Kay Stevens.
“We’re very hopeful that by the 2011 budget we’ll be in a stable atmosphere, and by 2012 start returning a little money to the general fund.”
Cutting staff
Clallam County is cutting the equivalent of 12.6 full-time employees, mostly through attrition. Two grant-funded positions — one in Juvenile Services and one in Health and Human Services Environmental Health — are being eliminated.
The county’s elected and appointed department heads have worked with Jones to slash spending without cutting services to citizens.
Jones had recommended cutting staff by what would amount to 12 furlough days for each of the 400 employees in the county work force. Instead, it was decided to cut the 12.6 full-time employees.
“Out of that came basically the decision to go back to 2008 levels of staffing,” Jones said.
Salaries and benefits account for $22.9 million in county expenses.
In the first of two public hearings at Clallam County Courthouse, Lyn Muench of Port Angeles urged the board to retain the position being eliminated in Environmental Health for on-site septic system inspection training and other septic matters.
The employee who held that position took another job in the same department after a resignation occurred last week.
“The expertise is still in the department, so if they could come up with some revenue, they could get right back to doing the same work,” Commissioner Mike Chapman told Muench.
The county will not add new positions next year unless unexpected revenue comes from grants, permits and fees.
“There was no fat in any of these departments that took these personnel cuts,” Jones said.
“That is really the primary reason I think it would be a mistake to pick one [position] and restore it back. … This was not easy for anybody. We just had to do it to make our targets.”
No public comment was taken in the second budget hearing.
Chapman closed the first hearing by thanking staff that made tough decisions.
“Nobody has said, ‘I don’t need that position,'” Chapman said.
“The workload is still there. The department heads have done their job to offer up cuts to meet Jim’s framework.”
Revenue shortfall
Clallam County’s budget deficit mirrors its revenue shortfall.
Comparing 2008 with the 2010 projections, Clallam County stands to lose $1,951,722 in interest and sales tax revenue.
The combined sales tax and interest revenues were $7.5 million in 2008 compared to a projected $5.5 million in 2010.
“It’s anticipated to stay low for much of next year,” Jones said.
Jones cited a new state law that requires a bank that takes public funds to hold a 100 percent reserve.
That, in turn, may deter small local banks from taking public money.
Before the commissioners adopted a budget, they first passed resolutions declaring substantial needs in the general purpose and road fund property tax levies.
Since the rate of inflation is less than 1 percent, they adopted a 1 percent increase, the maximum permitted by state law.
The county stands to generate as much as $20 million in work for local contractors through federal economic money funneled through capital projects and road funds.
Clallam County’s total budget, including grants, special revenues, capital projects, debt service and enterprise funds, is nearly $89 million.
The revised budget includes late changes, such as an $85,000 grant to the Port of Port Angeles that the commissioners approved on Nov. 24. The money will come from the county’s Opportunity Fund to upgrade the publicly owned facility on Marine Drive where Peninsula Plywood will open early next year.
Clallam County’s final budget can be viewed online at www.clallam.net.
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Reporter Rob Ollikainen can be reached at 360-417-3537 or at rob.ollikainen@peninsuladailynews.com.