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County finances in the red

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Officials say deficit serious but manageable

By Lisa King

The bad news is that the county government is experiencing a budget deficit.

The good news is that it's nothing they can't handle.

At least, according to Shelby County Deputy Judge Executive Rusty Newton, who said that the exact amount of the shortfall has yet to be determined.

"We have to examine that issue in a finance committee meeting that we are having next week,” he said. "We won't have those numbers until then, because it will depend upon the deficit of occupational taxes.”

Newton said the shortage has happened because the occupational taxes that the county receives from payroll revenue has been reduced because many people in the county have either been laid off or have lost their jobs through plant closures like Martinrea Heaving Stamping and Leggett & Platt.

The latter, founded in 1901, will close its doors at its Simpsonville plant in January, after being at that location for more than 50 years. All of the company's 240 employees will lose their jobs.

At least two auto p

Martinrea, a stamping facility that produces sheet-metal for car doors and fenders for the Ford Explorer, has already made several cuts to the its workforce and is rumored to be near closing.

Johnson Controls, which manufactures seats for GM, has also had to make cuts as demand has decreased.

If those companies were to close, Shelby County would lose close to 9 percent of its current industrial jobs.

Paula Web, Shelby County treasurer, said that most of the county's revenue comes from the occupational license fees and from real estate taxes.

"Those are our two large ones,” she said. "We estimated in the revenues that we would bring in $2,450,000 from occupational license fees this year.”

Webb said that though the occupation taxes will be less than the county had counted on, she estimates that the real estate tax will be close to what the county had hoped to receive. She explained that the real estate tax, which is collected by the sheriff's office, is received in two annual payments.

"So far, he has given me $1,483,244, which is 59 percent of what we thought we would receive,” she said. "So we still have $1,016,755 outstanding. But we have another payment coming, and I would anticipate that we'll get most of that, because normally, you'll have the residents who will pay to get the 2 percent discount.”

Webb is referring to the discount that residents will receive if they pay their property tax bill by Nov. 1.

In contrast to the county's shortfall, the city's finances seem to be in better shape, according to Mayor Tom Hardesty.

"We're in the fifth month of our 08-09 budget, and we seem to be in the black, so, so far, so good,” he said. "We watch our spending, always have, always will, as long as I'm mayor.”

He added that he will be keeping a close eye on the county government's finances, however.

"We monitor closely what happens with the county, because usually whatever affects them affects us.”

Newton said that though it's not to be taken lightly, he doesn't expect the shortfall to plunge the county into a financial crisis.

"It is serious, however, we will get through it,” he said.

He added that the county has experienced budget deficits before, though "not of this magnitude,” and has always come out on top.

"We will look at all our options, and will also be looking very closely at all our departments and their individual budgets,” he said. "We will probably have to shift some funds from some departments to others.”

He added that no government employee should be in fear of losing their job.

"We don't anticipate any layoffs, because if we had to reduce our staff, that would affect the services that we offer to residents.”