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Second Travis revenue projection still down

Wednesday, July 1, 2009 by Austin Monitor

On Tuesday Travis County Commissioners heard the second budget revenue projections from the County Auditor, and the situation has not improved much since the initial estimates, only going up $826,000. However it still represents a decrease of $3.76 million from this year’s revenue.


County Auditor Susan Spataro told the court she is “not seeing anything out there that would convince you that revenues are going to go up.” However, the key date is July 25 when the final tax rolls are certified. The county has seen a record number of appraisal appeals this year, and the outcome of the final decisions on those appeals could move the revenue projections.


Currently, the court is working with a three percent increase over the effective tax rate, to 42.32 cents. The auditor is currently projecting revenues of $448 million with a beginning balance of $54.8 million.


The revenue is broken into two components, Maintenance and Operations (M&O) and Interest and Sinking, which covers long term debt like bonds. The M&O and I&S rates are combined to get the total rate. Spataro said the M&O portion 35.31 cents, a 3 percent above current M&O rate.


The second revenue projections also include a breakout of funds other than the general fund. The county is taking a big loss with low interest rates combined with a decline in fines and auto registration. Spataro’s chief assistant Blaine Keith pointed out to commissioners that in 2005, the Legislature moved the county portion of motor vehicle sales tax to the general fund with 10 percent of that sum leaving roads and bridges for the general fund each year. “That’s great for the general fund, but that means another 10 percent goes out of the road and bridge fund,” said Keith. The road and bridge fund is expected to have a $6.5 million shortfall in revenue with total resources of just over $18 million, a 26.5 percent decrease from this year. Because of lower interest rates and a lower fund balance, the county dropped the FY 2009 estimate of pooled interest from $6.2 million to $3.45 million for next year.


In a memo to the court, Spataro said, “Let me stress that these numbers will change as we go through the budget process, driven by decisions by the Court and by new information. We are being conservative in our estimating and will increase our estimates only when we have sufficient data to justify raising our numbers.”


Spataro also noted, “a number of contracts are not included because we have not had verification that they will continue next year; some of these are certified mid-year, others… will be included in later estimates as we go through the budget process. Their not being included yet makes [some] departments’ revenues look unusually low at this early point in the budget process.” She said these expenditures and revenues will have to move “in tandem” as the budget office adds the expense portion, “at the point that we receive notice that funding is available for FY 2010.”


The third revenue estimate is due July 22 and will include the risk management and assurance funds. The preliminary budget will get to the commissioners on July 27 and the fourth revenue projections will be released at the beginning of September.


Commissioners took action on another item later in the day, which would have the court curtailing a more extensive budgeting process. Leroy Nellis told the court in the past there’s been five days worth of budget hearings, “based on what Rodney and I have observed there’s not a whole lot of interest on the court to go above the three percent over the effective tax rate and as such we didn’t see in that economic environment that possibly there would be that much benefit to spending the time in budget hearings.”


They also recommended that markup, when commissioners dissect the budget line-by-line, become a one or two day affair rather than a two or three day ordeal. Commissioners agreed, and markup will take place in two sessions on September 9.

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