Faced with a projected budget deficit of almost $550,000 for the fiscal year 2010-2011, which begins July 1, the Budget Committee of the Cannon County Commission decided to eliminate a pay raise for county employees Monday night.
It had been hoped at the beginning of the budget process that a three percent pay raise would be possible for county workers, who have not received an increase the last two years.
The cost of the three percent raise would have been about $136,000.
"We are looking at spending $546,000 more that we are taking in and you can't do that for long," Budget Committee Chairman Mark Barker said at the beginning of Monday's meeting.
Even without the pay raise, the county is looking at taking close to $400,000 from its reserves to fund next year's budget.
That would leave a reserve fund balance of about $600,000 at the end of the 2010-2011 fiscal year, down from $1,012,341 this year.
"If things continue to go as they are we will be out of money by next May," committee member Bill Jennings commented.
County Executive Mike Gannon said the state recommends maintaining a fund balance of three month's operating expenses, whereas he is comfortable with one of $900,000 at a minimum.
Barker pointed out that although county employees will likely not receive a raise, they will still be receiving an increase in their retirement compensation. The recommendations of the budget committee are subject to the approval of the full county commission, which will meet on July 17 to vote on the proposed budget.
"It (not getting a raise) beats getting laid off," Barker said, noting that several area counties have had to either make drastic budget cuts or terminate workers to balance their budgets this year.
Prior to deciding to eliminate the proposed pay raise, the committee once again went line by line through the budget requests of each county department and agency, something they have done several times at previous meetings. When they were finished Barker estimated they had managed to trim between 15 to 20 thousand dollars.
The committee will meet again Friday at 5 p.m. at the courthouse for what it hopes will be the last time prior to presenting the budget to the full commission July 17. They will work on the budgets proposals for schools and solid waste, which are also projected to run a deficit for 2010-2011.