‘Freeze’ a worst-case scenario for budget deficit
Published 8:23 am Sunday, November 11, 2012
By Richard Meek
The Daily News
Washington Parish Councilman Ken Wheat expressed concern about the budget deficit facing the parish but is optimistic a solution can be reached before Dec. 31.
The parish’s general fund is projected to have a $250,000 deficit by the end of the year, finance director Donna Alonzo said. State law prohibits any parish from ending the year with a deficit in the general fund, which serves as each parish’s operating account.
“Am I thinking it can’t be done?” Wheat, chairman of the Finance Committee, said. “No, I don’t think that. For the first time I see a lot of people (from sub agencies the parish is mandated by state law to support) willing to work with us because we are willing to do what is right and that is to want to fix old problems.”
Wheat called his “worst case scenario” freezing expenditures for all agencies for the month of December.
“Will it get down to a freeze for at least one month? I don’t know that,” Wheat said. “I don’t expect that to happen.
“We’re working on some things. We just hope these things will play out.”
The public will have its first look at a number of proposals that would ostensibly not only solve this year’s crisis but also offer a preview of 2013 during three separate meetings Monday. The finance committee will meet at 5 p.m. in the conference room of the parish government office to discuss solutions to satisfy the budget shortfall and discuss the hiring of a financial auditor for 2013.
At 5:30 p.m. the committee will adjourn and council members will reconvene in the council chambers at the courthouse to discuss a proposal asking voters to approve rededicating the portion of the existing sales tax that is currently used to pay off a debt service from 2002.
Following adjournment, the parish council will hold its regular meeting at 6 p.m. During that meeting is when members are expected to approve the rededication proposal as well as a proposed .33 percent increase in the sales tax so each proposition can be sent to the state bond commission for approval and be placed on the April 6, 2013 ballot.
Alonzo said the sales tax, if passed, should generate about $1.4 million annually.
“(The proposals) don’t do anything for high profile projects the public really expects out of parish government,” Wheat said. “It does involve an important side of government that most people don’t realize government has anything to do with, and that is criminal justice and public concerns that affect a lot of people.”
Wheat called the sales tax proposal a fair formula that takes everybody’s concerns into consideration.
“It is the fairest proposal anyone could have come up with considering all of the limitations we have,” he said. “I think it’s a fantastic result of a lot of the hard work that went into this.
“We’ve talked to a lot of people and I think we have found something that addresses all of that.”
The rededication is a bit more complicated and multi-faceted. Currently the parish has an annual debt service of $1 million from a loan in 2002 that was used for road improvements. The loan is being paid from a one-cent sales tax increase approved at that time.
However, that loan will be paid off this year, freeing up $1 million but money from that specific tax is mandated for the road department, officials said. That and the 10 mills dedicated to road improvement will keep that department self-sustaining, according to parish sources.
However, paying off the loan should free up $175,000 annually that has been funneled into the road department out of the general sales tax fund. Voters will likely be asked to rededicate that money to pay the parish’s mandated expenses for sub agencies, including funding the criminal justice system, clerk of court, assessor and the sheriff’s office.
Under the current structure, .67 percent from every sales tax dollar collected is dedicated to the Choctaw Landfill for maintenance, expenses and capital improvements. After those monthly expenses are met 15 percent of the remainder goes to Franklinton; Angie and Varnado each receive 1 percent and the parish receives the rest.
Alonzo said 15 percent of what the parish receives is currently being funneled into the road department.
“Do we really need that (after paying off the debt service),” Alonzo said. “We are rededicating the 15 percent to the criminal justice and public safety (the sub agencies the parish must fund).”
Additionally, Wheat said Franklinton has agreed to lower its share to 12 percent, which will generate an extra $25,000 that Alonzo said will be used for future construction at the landfill. Parish President Richard Thomas said a new cell may be needed at the landfill in the next two years as the parish continues to grow.
“I admire Franklinton officials for what they are doing.” Wheat said. “They understand the importance of the courthouse to Franklinton.”
If approved by voters, the parish should start receiving the increased sales tax revenue in August.