GALLIPOLIS — Gallia Commissioners advised county departments Thursday during their regular meeting in the Gallia Courthouse that with ongoing issues with the COVID-19 outbreak sales tax and financial resources may likely be stretched thin in the coming year and to plan accordingly.
“Our message is that this is going to have an impact and we need people to start thinking about it and really start tightening belts now,” said Commissioner David Smith.
Commissioners voiced concern with what they expect as a coming drop in sales tax to the county as Ohio and many parts of the nation have closed businesses. Commissioners said that around 65 percent of the county’s budget is made of county employee salaries.
“There are a lot of unknowns right now,” said Smith. “There is going to be an impact and it’s going to be negative. We don’t know how big and it’s going to be determined by circumstances beyond our control. There has been some talk at the federal level about helping local government. I don’t know if that’s going to happen or not.”
Ohio Governor Mike DeWine weeks ago directed Ohio agencies to cut their planned budgets by as much as 20 percent because of predicted drops in anticipated revenue.
“It’s easier to stretch your cuts over nine months than it is in a few months,” said Gallia Commissioner Harold Montgomery.
“Our best guidance at this time is if you don’t have to buy it, please don’t buy it,” said Commissioner Brent Saunders.
What follows is a letter obtained by Ohio Valley Publishing and addressed to county department heads signed by the commissioners:
The Gallia County Board of Commissioners has been vigilantly watching the revenue streams for the county general fund as we know the business restrictions imposed by the COVID-19 pandemic will inevitably have an impact.
Gallia County’s general fund has several revenue sources such as sales tax revenue, casino tax revenue and investment income that will be directly affected. These 3 revenue sources were 47.3% ($5,011,856.14) of our total 2019 general fund revenue. There are many other revenue sources that could be affected indirectly such as property tax and various fees collected by the county for services should the business restrictions continue for very long.
Gallia County has been discussing this with other counties, the County Commissioners Association of Ohio and the State of Ohio. By using these resources, we have found that most counties are anticipating a loss or revenue for county general funds ranging from 10% to 25%. With sales tax, casino tax and investment income revenues being almost 50% of our total general fund revenue for 2019, we anticipate we could lose between 15% ($752,000) to 25% ($1,253,000) from these sources alone in 2020.
Our biggest concern is our county employees and the services they provide to our community. In order to do our best to protect the job security for all current county employees, we are implementing a hiring freeze (except for mission critical or required positions) and a wage/salary freeze (unless contractual) for all offices and departments under our hiring authority and we ask for the cooperation of other elected officials within our 2020 general fund budget (except for emergency or mission/time critical expenditures) until further notice and we ask for the cooperation of other elected officials and departments to do the same.
We are not reducing general fund appropriations at this time, but we seek the help of each elected official and department head to minimize spending any way you can. Our sales tax revenues come to us 2 months after collected, meaning the sales tax revenue we received in March 2020 is for the month of January 2020. We have asked the State of Ohio to provide us with sales tax collection information much earlier than the current 2 month lag time, so that we can know sooner how to plan for our short and long-term financial future.
Our best guidance to each office/department at this time is “if you don’t have to buy it, please don’t buy it” and you should be reviewing your 2020 general fund budgets for reduction strategies ranging from 5, 10 and 15%.
We will keep you informed as we gather further information regarding the financial impacts to county revenues from the COVID-19 pandemic…
Dean Wright is a staff writer for Ohio Valley Publishing and can be reached at 740-446-2342.