Hoping no budget impasse imminent
June 30 – the last day of the state’s fiscal year – is about seven weeks away, but a group that represents Pennsylvania counties calculated that taxpayers in each county were on the hook for $12 million during the recent budget impasse and demanded that the squeeze not occur again.
Counties continued to provide services for residents despite not receiving money owed to them from the state until the fiscal year was more than half over.
In a news release from the County Commissioners Association of Pennsylvania, Washington County Commissioner Harlan Shober, CCAP first vice president, said, “Other contingency plans such as reducing services and staff, delaying or completely stopping provider payments, or in extreme cases, shutting down some county operations to the bare necessities, become more and more likely the longer an impasse goes on. Clearly our residents are the ones paying the ultimate price of delays in state funding for these much-needed services.”
As a top priority this year, counties are asking the General Assembly to approve an appropriately funded 2016-17 state budget, on a timely basis, that recognizes the importance of the services counties provide so that counties and those they serve are not forced to bear the costs and burden of another impasse.
One of the last areas to receive funding was the Penn State Extension for 4-H and agriculture-related programs after those affected converged on the Capitol to press for a resolution when Penn State University’s president said it was on the verge of having no money to advance.
Locally, officials estimate Washington County lost $6,000 to $7,000 worth of interest as it used reserve funds to pay bills that would have been otherwise been covered by allocations in the state budget.
Some vendors and service providers found their payments were delayed, but have since been made whole.
“All in all, I think we came through it pretty well,” said Washington County Finance Director Roger Metcalfe. “There were some minor challenges, but for the most part, we got the payments out.”
Should a second budget impasse occur this year, Washington County won’t have quite the cash reserves that allowed it to stay afloat amid the 2015-16 budget impasse. Although the county has begun receiving its first revenue from natural gas being extracted from beneath Mingo Creek County Park, the price of both natural gas and petroleum products dropped significantly last year.
Records kept by the Washington County Finance Department show revenue from natural gas extraction in the fourth quarter of 2014 totaled $1,175,771, while a year later it had dropped more than 50 percent to $546,169, reflecting market conditions.
Greene County used Act 13 impact fee money and a $4 million tax anticipation loan, taken out late last year, to help fund its human services department. Chief Clerk Jeff Marshall said human services paid back most of the loan in early January after the budget was finally passed and signed, but is keeping some money out just in case there is another impasse.
“We’re just monitoring the situation and hoping it doesn’t happen again,” he said.
He said the short-term loan cost the county only “a few thousand dollars” because of the low interest rates.
Greene County commissioners Chairman Blair Zimmerman said they’re fortunate to have the Act 13 money, unlike school districts or some counties in the state, but county officials are still watching Harrisburg with a wary eye.
“It really concerns me. It concerned me last time,” Zimmerman said. “Obviously we don’t know where our Act 13 money will be.”
Money for some projects might need to be diverted to human services or other programs if it appears the governor and legislative Republicans cannot agree again on a deal.
“We’re just going to have to be very good stewards of our funds,” Zimmerman said. “I think we’re OK with what we’re doing right now, but with the demands on human services and (Children and Youth Services) from the state and what they cost, we might have to dip into our reserves again if it keeps going.”
Doug Hill, executive director of CCAP, said he also sees danger in what he perceives as under-funding.
“Without appropriate funding from the state and federal government, counties will be faced with the difficult choice to either curtail vital services for the commonwealth’s most vulnerable citizens or increase local property taxes, something no one wants to happen,” Hill said in a news release.
Counties deliver services to children and youth, and in areas including mental health, intellectual disabilities and combatting drug and alcohol abuse, as well as environmental matters, courts, prisons, elections, tax assessments, community and economic development and emergency management.
Greene County Bureau Chief Mike Jones contributed to this report.