New Year Brings New Budget Deliberations

Each year around this time two Clarke County Supervisor’s gather with County Administrator David Ash, Joint Administrative Service Director Tom Judge and accountant Annette Gilley to begin the mind-numbing and vision-blurring task of pouring over the County’s chart of accounts as budget season begins.

Clarke County’s FY13 budget deliberations kicked off on Tuesday night.

Supervisor Michael Hobert (Berryville) and John Staelin (Millwood) are the County’s “numbers guys” when it comes to the behind-the-scenes heavy-lifting needed to set the County’s baseline financial position for the coming fiscal year. The budget role requires the analytical skill of a hedge fund manager, the number-crunching capability of a certified public accountant and the crystal ball of a gypsy fortune teller.

Even though the annual budget crunching sessions are public meetings members of the public rarely attend – save a couple of reporters from local newspapers hoping to get a quick quote on what the coming fiscal year may bring. (Quick Quote – “Board of Supervisors Chairman Michael Hobert said on Tuesday that Clarke County is looking at an essential flat-line budget for FY13 over FY12.”)

But even though the public doesn’t make the budget workshops, out of deference to the ideals of openness and transparency the meetings are scheduled for late afternoon and run into early evening so that working citizens at least have the option of attending.

Of course, the late afternoon-early evening schedule means that Hobert, Staelin and the three County budget experts will miss yet another evening meal with their own families while serving the larger Clarke County family.

Still the budget deadlines wait for no man – or woman as the case may be.

While the final budget outcome, which won’t be known for several months, is unpredictable from year-to-year due to the prevailing political winds in Richmond, the County’s budget development process plays out in much the same way each year.

On Tuesday night JAS director Tom Judge led the financial review with a line-by-line look at each account that generates revenue for the County’s general fund. Months of JAS staff analytical work is boiled down into three detailed spreadsheets that range from topics like “Dangerous Dog Registration” – no revenue projected for the FY 13 budget – to Current Taxes on Personal Property – projected to fall $6,646 from $3,031,369 in FY12 to $3,024,723 in FY13.

The list of accounts goes on for three pages but Judge offers an in-depth explanation of each account to the Supervisors.

As Judge steps through each line item, Hobert and Staelin ask questions and offer opinions on things that may impact the account in the coming year. In cases where the number projected by Judge’s budgeting efforts seems reasonable the Supervisors move on to the next item. But in many cases Hobert and Staelin also rely on their own understanding of County and State financial trends to adjust the budgetary projections.

In some cases, the adjustments recommended by the two men are based on solid facts – like knowing that the County is going to see increased costs for County employees do to changes in local funding responsibility to keep the beleaguered Virginia Retirement System afloat. In other cases, the men “guess-imate” based on years of experience with the County’s finances.

For example, local sales tax revenue was projected to be $783K in FY12. But after conferring with the group, both Hobert and Staelin agree that the local economy is showing some signs of fiscal improvement  and decide to set the local tax revenue estimate for FY13 at $800K.

Placing the higher local tax figure in the budget means that if their guess is wrong there may be a shortage of money for County services in others areas, something that could irritate voters and that both men hope to avoid.

After each painstaking decision is labored over and reviewed, accountant Annette Gilley records the change on the master budget spreadsheet. Slowly, but surely, the County’s financial future for the coming year begins to evolve with each numerical adjustment.

At the end of the meeting Gilley’s spreadsheet holds the first high-level estimate for Clarke County’s proposed FY13  budget – $24,640,283.

But the $24M budget number that emerged last night is nothing more than the first result from what will be a long and complex process.

In a way, the revenue side of the budget may be the easiest part of the process for Hobert and Staelin. While estimating the correct revenue amounts that will eventually fill the County’s accounts takes some skill, state and local tax codes mean that there is no uncertainty that some level of funding will eventually arrive. The harder task, deciding how to divide the money between the many needs and wants that will be presented by Clarke County citizen’s during the future budget sessions is, predictably, another matter.

On January 31st  five organizations will present budget requests to the Supervisors; The Clarke County Sheriff’s Department, Soil and Water Conservation, Department of Social Services, Shenandoah Area Agency on Aging and the CHEERS School Family.

The Clarke County Public Schools are scheduled to present their budget request to the Board of Supervisors in early March.