Finance Manager Exercises Caution Re: Revenue Increases
Geauga County’s permanent appropriations for 2024 showed an increase in projected revenue by almost $2.5 million, said Budget and Finance Manager Adrian Gorton.
Geauga County’s permanent appropriations for 2024 showed an increase in projected revenue by almost $2.5 million, said Budget and Finance Manager Adrian Gorton.
“The (Geauga County Budget Commission) meetings with all the departments were very helpful this year,” Gorton said in an interview Dec. 6.
Gorton said $1.5 million of the increased revenue is related to consumer activity.
“This money is not guaranteed. A case in point is the property transfer tax. This was increased $500,000 for 2023 and right now, we will probably not even reach last year’s number,” Gorton said. “The reason being is that the housing market has cooled off considerably. Housing consumers are not willing to take out high-interest rate mortgages and inflation has made houses more expensive.”
Sales and casino taxes are also not guaranteed money, Gorton said.
“If we have a serious recession and people begin moving money away from taxable commodities or recreational gambling, then we may begin to struggle in these areas just like with the (PTT) tax. The problem here is the sales tax is almost 50% of our revenue,” Gorton said. “Small hits to that income stream could have a big impact. We will be watching the revenue throughout the year, gauging its performance. Thankfully, we still have a decent balance that is not committed to anything, yet, so, a reduction in revenue, as long as it is a moderate one, can be accommodated.”
Staffing issues have also been a challenge for several years, Gorton noted.
“After the pandemic, there were so many good paying jobs available that government postings took a back seat to the private sector, which was trying to attract people back into the workforce,” he said. “We lost some good employees, we were getting less applicants and the expectations were increasing among those that were applying. Back in the spring, the commissioners took action to stabilize our roster by providing increases to the county’s wage scales over the next three years.”
The wage scales increase by 5%, with 3% increases in 2024 and 2025, he added.
“Because the commissioners asked departments not to budget any wage increases in 2023, this meant that year over year, despite the 2023 increases being covered in the current year, we were preparing for an 8% increase in the budgets for payroll accounts next year to accommodate both the 2023 and 2024 increases,” Gorton said. “This will not be an issue again as we begin to budget for 2025.”
Gorton said he believes the county is doing well overall with no significant shortfalls.
“Specifically, in regards to the county’s general fund, we have currently exceeded the overall budget for revenue and with the exception of the transfer tax, should be able to surpass the budgets for sales tax, the state reimbursement for real estate and the local government tax revenue accounts,” Gorton said. “Expenses also remain in check with a comfortable 15% buffer between the budget and actual expenses.”
Gorton said the budget process for 2025 will be starting a bit earlier next year.
“I am looking forward to bringing some of the elected officials and departments into chambers during regular meetings to submit and explain their budgets,” he said. “We should hopefully have more public attendance and participation then what we normally do.”
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Public safety leads all groups for general fund operating expenses at 39%, according to Geauga County Budget and Finance Manager Adrian Gorton’s 2024 permanent appropriations presentation at the Dec. 5 county commissioners regular meeting.
