During a public hearing Thursday evening, Bulloch County Manager Tom Couch acknowledged that the county government’s proposed fiscal year 2024-2025 budget is projected to use $2 million in accumulated fund balance, but he also indicated that a 1.4-mill rollback in the general property tax rate is possible.

That rollback would not be intended to reduce the county’s property tax revenue but could offset inflation in property values and produce a “neutral” amount of revenue, at the least same as last year’s. However, the separate fire fund millage rates are intended to remain unchanged. Two factors that remained unsettled as of the May 30 budget hearing were the final digest of taxable property values as determined by the Board of Tax Assessors and its staff, and the size of a surplus that will remain when the current budget closes June 30, after last year’s big tax increase.

“The general ad valorem tax rate will not be recommended tonight,” Couch said. “It’s a little premature, and it’s a little early. However, the team is willing to report that we’re confident that we can project perhaps a range that will be neutral or favorable to the county property taxpayers once the appeals are complete. The Board of Tax Assessors is still going through an appeals process, and there may be adjustments.”

By “the team,” Couch meant the budget review team, consisting of himself, county Chief Financial Officer Kristie King, Assistant County Manager Cindy Steinmann, Human Resources Director Cindy Mallett, and other members of the finance staff. The final tax digest probably won’t be delivered until after the budget is adopted, he said. The new fiscal year will begin July 1, and the commissioners are slated to vote June 18 to adopt the budget.

“But we feel we have enough statistical tolerance within the projected ranges that we’re looking at, but to speak today based on the latest that the Board of Tax Assessors has given us, our neutral rate would stand at 11.444 mills, dropping from 12.85 mills,” Couch said, standing at the public microphone to face the commissioners.

He suggested there may also be an effort to improve on that rollback.

“There’s a concept in public-sector economics called revenue-neutral tax rates,” Couch said. “While we’ve achieved that with that 11.444 (mills), we’d like to make it a little more attractive.”

He also cautioned that the “neutral rate” would be figured on all property on average and aimed only at countering the effects of inflation in real estate prices, not for improvements or additions to specific properties.

After his spoken presentation, Couch went back to sit at the dais with the commissioners, facing the audience of citizens. Six of the seven commissioners were there, including Chairman Roy Thompson, who lost his re-election bid for a third term as chairman in the May 21 Republican primary. The absent commissioner was Curt Deal, who also lost his re-election bid in the primary. But both Thompson and Deal are expected to remain on the board through December.

$2 million gap

The sole purpose of the May 30 called meeting was to serve as the public hearing on the budget. With a little over $64.7 million in projected spending and $62.7 million in projected revenue, the tentatively proposed general fund budget shows, in effect, a deficit in same-year revenue.

But that doesn’t mean there will be an actual shortfall. Instead, the staff budget team proposes dipping into the accumulated general-fund balance for that $2 million difference.

“That $1.9 million, or $2 million, is going to come from reserves,” Couch said.

With real growth in the digest from construction, other revenues and spending from the balance, this budget is expected to fund 22 full-time and one half-time added employee positions, 16 of which are in public safety departments, namely the Sheriff’s Office, jail and Emergency Medical Service. A 3% across-the-board raise for county employees is proposed, along with a merit-pay opportunity for up to 2% additional based on job performance.

Another 12 positions, for firefighters, and their equipment would be funded in the separate rural fire fund budget, which has its own millage rate. In fact, the general fund, with the almost $65 million in projected spending, is just one of the county’s budget funds, but it is the one that receives property tax revenue directly.

The fire fund, funds for federal grant money, those for T-SPLOST and SPLOST sales tax revenues for capital spending and other special funds, together with the general fund, bring the total of the county’s budgets to roughly $156 million.

Ted Redman, the first of a half dozen citizens to speak during the hearing, asked whether the county has remained in budget in the current year and for the actual spending and revenue reports to be made part of the public budgeting information. Couch noted that the Finance Department gives the commissioners monthly financial statements, which are public information.

Expecting a surplus

He and King then also revealed that, following the calendar year 2023 tax hike, some surplus revenue is expected to remain after the June 30 close of the current fiscal year.

“We think that as the fiscal year finishes out on June 30, we are likely to have some type of surplus,” Couch said. “But we are waiting, again, on some late, year-end adjustments … especially on the insurance side, whether it’s employee health insurance, liability insurance, workman’s comp insurance. We’re also waiting on some information regarding our employee retirement plan.”

Couch and commissioners referred to the general fund balance as a “rainy day fund,” which brought criticism from some of the citizens who spoke, such as Bill Emley, that the county should not be using this for planned deficit spending.

However, Couch noted that the accounting guideline for maintaining a reserve is to keep money equal to at least 25% of projected spending on hand. Asked after the meeting, King confirmed that with some expected surplus in the current year, county staff members hope to maintain at least a 25% reserve after covering the $2 million difference between fiscal 2025 projected revenue and spending, and a rollback.

Before last August’s increase, the county’s general property tax rate was 11.35 mills. With a rollback to 11.444, the tax would still be considerably higher than in 2022 because of inflation in assessments.

Some of the same citizens who have been speaking against that increase for a year continued to criticize the county’s budgeting and spending practices at last Thursday’s hearing.

“This is not a budget; this is a cashflow statement,” said Cassandra Mikell, who questioned the removal of a depreciation expense line for Splash in the Boro Waterpark and the overall handling of its finances.