A mid-year budget report reveals Clallam County should finish 2014 with about $100,000 more than expected.

But county officials are curbing their enthusiasm, recognizing several of those unanticipated revenue sources are likely “one-time in nature and cannot be county upon in the future,” according to an executive summary prepared by county administrator Jim Jones.

Further, county commissioner Jim McEntire said several county offices are needing additional staff in light of the county shedding 42 staff positions since 2007.

Jones presented county commissioners with the mid-year budget summary in mid-July, detailing a slight increase in general fund revenues — $32.84 million to $32.74 million, three-tenths of 1 percent — against what officials projected for 2014. Sources of increased revenue include, among others, a refund for capital murder trial expenditures, a greater-than-projected retail sales tax revenues and timber sales.

The boost in revenue from sales taxes is likely because of money spent on the major road construction project on U.S. Highway 101 between Sequim and Port Angeles, Jones said.

As general budgeting philosophy, Jones said, it is best to “save one-time revenue for one-time expenses or simply save it.” Though the mid-year budget review executive summary suggests improved revenue figures, Jones warns county officials to proceed with caution given the revenues are potentially one-time sources.

“We’re not out of financial difficulties just yet,” McEntire said.

Staffing situations

After two years of concessions that saw some county employees working 40 hours per week, county commissioners opted to return to a standard 37.5-hour work week in 2014 for nearly all Fair Labor Standards Act-covered employees and lowered the Exempt Salary schedule to better reflect what the county can afford.

“I can see clouds out on the horizon,” McEntire said. “There are still serious needs for additional staff.”

Areas in need of staffing, he said, include the county prosecutor’s, treasurer’s and assessor’s and Director of Community Development’s offices, according to the Clallam County Administrator’s final 2014 recommended budget submitted at the end of 2013. Since 2007 county revenue has basically been “flat,” Jones said.

Despite little to no increase in revenues, the county’s expenditures continue to increase at an annual rate of about 2.5 to 3 percent because of inflation.

Since then, more than 40 full-time-equivalent employees have been cut from the county’s staff. The continual lack of staffing causes a strain for the county, Jones said, but other than trimming expenses, the only other realistic option to balance revenue with increasing expenditures is through increased taxes. That scenario, Jones said, is unlikely.

“We’ve been living within our means and doing the best we can,” Jones said. “The only way to balance the lack of revenue with increasing expenditures is cut expenses.”

Given Gov. Jay Inslee’s warning to “prepare for an up to 15 percent decrease in state sponsored revenues,” Jones already is preparing the board for the potential impacts the state’s budget may have on the 2015 Clallam County budget. However, the actual impacts won’t be known until after the state Legislature has approved the budget near the end of April, he said.

Because the state and Clallam County operate on different fiscal year schedules, county officials “(can) only guess what might happen,” Jones said.

‘Not conducive for economic growth’

McEntire recently hosted a town hall meeting and presented a handful of Clallam County statistics in graph form. Comparing and contrasting the Clallam County population demographics, the county population is increasing while the “working age” and “school age” population within the county is decreasing — reflecting a service based economy.

Statistically, McEntire said, it appears it is getting “increasingly harder for the working-age population to make it here and that is not conducive for economic growth.”

McEntire suggested the county “focus like hell on the economy” to generate more revenue.

“Government can’t create an economy, but it can either stifle it or encourage it,” McEntire said. “There’s a constant balance when it comes to taxation.”

Reach Alana Linderoth at alinderoth@sequimgazette.com.