BROOKSVILLE — It wasn't quite the year of the ax, but cuts to local government budgets ran bone deep in 2011.
The continued free-fall in property tax revenue prompted the Hernando County Commission to further shrink government. For the School Board, less tax revenue was compounded by cuts to state education funding and the loss of federal stimulus money. The city of Brooksville also had a sizable shortfall to bridge.
Even as they put 2011-12 budgets to bed, however, officials had already begun to fear that next year would bring more pain.
Considering the trend in property values, it's a safe bet. A very rough estimate based on data from the first half of the year indicates a potential 5 percent decrease in the value of property across Hernando, said John Emerson, chief deputy in the Hernando County Property Appraiser's Office.
"You think of the combination of foreclosures and short sales and sinkholes," Emerson said, "and that indicates we're still going to have property values going down."
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Until this year, the County Commission and staff had managed to keep county services fairly stable by shuffling expenses out of the strapped general fund and into other funding sources, spending millions in reserves and using attrition to trim payroll expenses. By the start of budget discussions early in the year, however, commissioners faced a multimillion-dollar shortfall and no more reserves to help offset the revenue hit.
The commission faced daunting choices, such as layoffs, cuts to employee benefits, park closures, the shuttering of the Little Rock Cannery and the possible elimination of mosquito control. Commissioners indicated early in the process that they would not consider the politically unpalatable option of raising taxes.
Since board-controlled departments made most of the cuts in previous years, the county's leadership team decided that constitutional officers should be given goals to trim budgets to a greater degree than in the past.
Most of the officers met those goals, and the others came close. The county and the constitutional officers got some help from the state Legislature in the form of a new law that requires public employees to pay 3 percent of their salary each year toward their own retirement.
The county negotiated deals with outside groups, including athletic leagues and interested parents, to help pay for and maintain some parks. The commission opted to maintain passive parks with money from the county's sensitive lands fund. That fund was also tapped to keep mosquito control services alive for this fiscal year and next.
Voters will decide in November whether to continue the sensitive lands fund and whether to establish a new tax to pay for mosquito control.
The Little Rock Cannery was saved when a nonprofit group affiliated with Access Healthcare — Auro Community Cannery — stepped up to lease the facility, run it as a cannery and provide training programs there.
The commission hoped to find more savings by asking staff to take furlough days, sacrifice a couple of paid holidays and deal with cuts to health insurance benefits. Those were negotiable items in union contracts, however, and members of Teamsters Local 79 and the county firefighters union rejected the concessions. Negotiations will continue early next year after auditors look at the county's books.
Commissioners eliminated several positions in county government. Some of those employees were able to find other jobs with the county.
In the end, the cuts still weren't quite enough, so commissioners agreed to a slight increase in the tax rate, but only by the amount that taxpayers saved by the elimination of the Southwest Florida Water Management District's basin boards.
The commission also agreed that, once all other funds are expended late in the budget year, officials will formally ask the board's permission to dip into the budget stabilization fund to pay the bills. Commissioners are reluctant to spend those dollars because they must be repaid within two years.
Anticipating several months without a county administrator to lead cost-cutting efforts, the commission earlier this month formed a team led by chief procurement officer Russell Wetherington to focus on the 2012-13 budget.
"You always plan for the worst and hope for the best," Commissioner Dave Russell said. "We're going to get to work early to make sure we preserve as much as we possibly can while living within our means."
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At the start of the city of Brooksville's budget process, City Manager Jennene Norman-Vacha warned City Council members that three years of staff cuts, limiting capital improvements and minimizing operating costs had left the city with few options to bridge its projected $404,000 shortfall in revenue.
Achieving immediate reductions without further jeopardizing services or raising property taxes required surgery-like delicacy. Over several weeks, city staffers and council members came up with several ideas to shave additional expenses for 2011-12.
The elimination of two administrative staff positions and a restructuring of the city's contract with the Hogan Law Firm cut the deficit by about $200,000.
Perhaps the largest single savings not related to personnel reductions came with the lease of the Quarry Golf Course, which for years has operated at a deficit. Bob Carson agreed to take over operations at the course for a minimum of five years, which would decrease the city's annual expenditures by $73,388.
However, some of the cuts were controversial, including the elimination of a $7,000 annual fee waiver fund for special events such as parades, art festivals and other outdoor events requiring street closures. From now on, organizers of such events will have to pay those expenses themselves.
While the final budget looked good on paper and kept the tax rate the same, the city had to once again forgo critical infrastructure needs. Capital improvements such as road, sidewalk and utility projects were put on the back burner. Additionally, the city made only a modest contribution to its reserve fund.
One bright spot for Brooksville's future financial picture could be something that has worked before: red-light cameras. The resumption of the camera program in March could mean additional thousands for the city's coffers. However, the projected $1.1 million the city could earn as host for a private company's high-tech venture is purely speculative.
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To bridge what at one point was an estimated $11 million shortfall, the Henando School Board did what previous boards refused to do: cut bus service for students who live within 2 miles of school.
The move saved about $800,000, affected some 2,400 students and prompted plenty of complaints from parents who had to scramble to find other ways to get their children to school. For hundreds of students, that meant walking, and many grumbled about it.
The board also approved fees to participate in sports and other activities, dipped into the general fund reserve and sent non-reappointment letters to more than 100 first-year teachers. That was after school principals and district office administrators cut 10 percent of their staffing allocations at superintendent Bryan Blavatt's direction.
The local teachers union made some concessions, agreeing to give up a half-year's worth of the automatic raise built into its contract and, if student enrollment numbers came in significantly under projections and the budget forecast for next year looked grim enough, two paid holidays. That helped the district to bring back all 114 of the teachers given non-reappointment notices and place them in full-time teaching positions.
Hernando's K-12 enrollment came in about 50 students shy of projections. Union representatives and district officials are slated to meet next month to discuss the two paid holidays.
The district was able to close the last portion of its 2011-12 budget gap with help from unspent funds for fuel and vacant positions.
At the same time funding dropped off, the district was able to meet stricter class size mandates and avoid potentially hefty fines from the state, though that required the hiring of long-term substitutes.
The school tax rate, largely set by the state, increased by about $9, for a $125,000 home with a $25,0000 homestead exemption.
Gov. Rick Scott, after signing a budget that cut education funding by about 8 percent, now says he wants to increase funding by $1 billion for 2012-13.
Blavatt is skeptical.
"The bottom line is, how are they going to distribute the money and what difference is it going to make?" he said. "We're still going to be 20 percent behind what we were five years ago."
Tony Marrero can be reached at (352) 848-1431 or firstname.lastname@example.org.