Finances strong now, but future uncertain
So far, the Jackson County government has avoided the kind of massive financial squeeze that has hit many other local governments. Part of that is due to fairly good management of the county’s money. On a department-by-department basis, the county has pared expenses and as reported last week, managed to add over $900,000 to its reserve funds in 2009.
But part of the county’s financial success has also been due to a massive growth in revenues in recent years.
In the year 2000, the county’s tax income was $23 million; last year it was $37.8 million, a 61 percent increase over the decade. Of those dollars, in 2000 just $7.2 million was generated by property taxes. That tripled over the years and in 2009, property taxes accounted for $23.9 million of the county’s revenue.
That means that in 2000, property taxes were 42 percent of the county’s tax income while last year it was 57 percent.
That was due to growth in the county that added to the county’s tax digest. From 2000 to 2009, the county’s tax digest grew a whopping 140 percent. Most of that was due to residential projects that tripled in value during the last decade, but also due to more commercial and business development.
So while the county has managed its money well overall, part of that financial success was due to a windfall of more revenues.
Now, however, there are some dark clouds gathering that could dramatically change the county’s financial picture.
First is an anticipated drop in the county tax digest. During the boom years, property values were inflated because of all the speculation.
Now, those values have fallen and the county is finally starting to make adjustments (funny how they were so quick to hike property values, but have been dragging their feet to lower them.) And while new growth will offset that some, this year officials expect the tax digest to actually go down for the first time in decades.
Second, the recession has hit sales tax revenues hard. The county last year was down $1.2 million in sales taxes from its peak, a 19 percent decline.
Finally, the biggest problem the county faces is its long-term debt. Starting with the new courthouse, the county’s debt has exploded in the last decade. At the end of 2009, the county had debt of over $131 million. To put it in perspective, the county’s 2009 audit said that debt amounted to over seven percent of personal income and over $2,100 per capita in the county (and that doesn’t count city or school system debt.)
Making that even worse is that local taxpayers didn’t approve most of that debt, yet are obligated to pay it.
Officials hope voters will approve a SPLOST renewal in November and that those funds can be used to pay some of that debt; but approval of SPLOST is not assured given the misuse of those dollars in the past and the likelihood that not all of that money will be used for debt reduction.
The bottom line is this: The county has so far weathered a tough financial storm, but if the economy stays stagnant and revenues continue to fall while debt obligations continue to climb, a major crisis will follow. And if the SPLOST vote fails, county leaders will be forced to do major cost cutting, perhaps having to curtail services, or have a major property tax hike.
Jackson County is better off than many of its peers across the nation, but the really tough part is just now hitting.
In the year 2000, the county’s tax income was $23 million; last year it was $37.8 million, a 61 percent increase over the decade. Of those dollars, in 2000 just $7.2 million was generated by property taxes. That tripled over the years and in 2009, property taxes accounted for $23.9 million of the county’s revenue.
That means that in 2000, property taxes were 42 percent of the county’s tax income while last year it was 57 percent.
That was due to growth in the county that added to the county’s tax digest. From 2000 to 2009, the county’s tax digest grew a whopping 140 percent. Most of that was due to residential projects that tripled in value during the last decade, but also due to more commercial and business development.
So while the county has managed its money well overall, part of that financial success was due to a windfall of more revenues.
Now, however, there are some dark clouds gathering that could dramatically change the county’s financial picture.
First is an anticipated drop in the county tax digest. During the boom years, property values were inflated because of all the speculation.
Now, those values have fallen and the county is finally starting to make adjustments (funny how they were so quick to hike property values, but have been dragging their feet to lower them.) And while new growth will offset that some, this year officials expect the tax digest to actually go down for the first time in decades.
Second, the recession has hit sales tax revenues hard. The county last year was down $1.2 million in sales taxes from its peak, a 19 percent decline.
Finally, the biggest problem the county faces is its long-term debt. Starting with the new courthouse, the county’s debt has exploded in the last decade. At the end of 2009, the county had debt of over $131 million. To put it in perspective, the county’s 2009 audit said that debt amounted to over seven percent of personal income and over $2,100 per capita in the county (and that doesn’t count city or school system debt.)
Making that even worse is that local taxpayers didn’t approve most of that debt, yet are obligated to pay it.
Officials hope voters will approve a SPLOST renewal in November and that those funds can be used to pay some of that debt; but approval of SPLOST is not assured given the misuse of those dollars in the past and the likelihood that not all of that money will be used for debt reduction.
The bottom line is this: The county has so far weathered a tough financial storm, but if the economy stays stagnant and revenues continue to fall while debt obligations continue to climb, a major crisis will follow. And if the SPLOST vote fails, county leaders will be forced to do major cost cutting, perhaps having to curtail services, or have a major property tax hike.
Jackson County is better off than many of its peers across the nation, but the really tough part is just now hitting.
Defined tags for this entry: editorial
It can't be too bad because if you go to the landfill there building and I see new tractors cutting the sides of the road etc.
100% debt reduction or a NO vote from me.