Tuesday, August 26, 1997
Commissioners Struggle with Tax Rate
By BETH HALLMARK Staff Writer
Holding the line on the county's tax rate over the past few
years has left Taylor County commissioners in a bind, wondering
how to avoid a tax increase without risking the county's finances.
After making a few last-minute cuts to the county's proposed
1997-98 budget on Monday, commissioners began hammering out the
tax rate needed to pay for almost $20 million in expenses.
Without a tax increase, the county's projected revenue falls
short of expenditures by $1.65 million. In years past, commissioners
have relied on money left over from the year before and dipped
into the county's fund balance to cover such budget shortfalls.
This year, however, the fund balance is precariously low and
the amount of money expected to be left over from the year before
is only $200,000.
But to keep the tax rate for maintenance and operations below
the rollback rate of 41.93 cents per $100 valuation - the rate
voters can petition to change - commissioners would have to pull
money from the $3.1 million fund balance tied up in investments.
Commissioners discussed cashing in $525,000 worth of investments
next year in order to set the tax rate at 41.88 cents, 2.07 cents
more than the current rate, but below the rollback rate.
But Precinct 4 Commissioner Neil Fry warned against such a
move, saying it would drop the county's reserves well below the
amount recommended to maintain operations.
"Every year we've taken a shovel and dug us a hole,"
Fry said. "If we go into the fund balance this year we just
dug ourselves into a deeper hole.
"We're not using good, prudent judgement by cutting our
reserves to where we'll have to borrow money just to cover our
checks," Fry said.
Market value adjustments put the county's fund balance at $2.3
million. Financial advisors recommend that the county have more
than two months operating expenses in the fund balance. If commissioners
spent half a million to ease the tax rate, the county would have
only about a month and a half of operating expenses on hand, Fry
said.
Keeping the tax rate below the rollback rate would look good
to the public, he added, but it would not solve the problem.
"We're going to have to go over the rollback to do that,"
he said.
However, commissioners will be able to apply $1 million in
interest earned on jail bond proceeds to reduce the tax rate for
debt service from 7.37 cents to 4 cents, offsetting some of the
overall tax increase.
Commissioners did not reach any final decisions on tax rate
figures at their meeting Monday. They are scheduled to set a proposed
budget and tax rate today. A public hearing on the proposals will
be held next Tuesday.
Commissioners may then hear from some of the groups cut out
of next year's budget. Before delving into tax rate calculations
on Monday, commissioners decided to cut some budget requests they
had tentatively approved at earlier sessions.
By a 3-2 vote, commissioners cut a $34,000 allocation to the
Abilene Cultural Affairs Council and a $15,300 request from the
Boys and Girls Club. Although all of the commissioners voiced
support for the programs, the majority decided against the funding
because of budget concerns.
"It is disappointing," said Bob Milstead, chair of
the Cultural Affairs Council. "I'm afraid it's going to have
a grave impact on the support of the arts in our community."
Commissioner Neil Fry and County Judge Lee Hamilton voted against
the cuts.
The county has allocated funds to the council for the past
five years. This was the first year that the Boys and Girls Club
requested money from the county.
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Abilene Reporter-News / Texnews / E.W. Scripps Publications
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