Cumberland County is expected to increase general fund expenditures about $1.8 million in 2018 under the calendar year budget approved Monday by the county commissioners.
The county will not be changing its tax rate, however, as it begins to draw down on a surplus in its general operating fund that should keep taxes level for some time even as costs gradually increase.
The county is projected to have just over $30 million in unassigned cash in its general fund by the end of 2017, of which just under $1 million will be drawn down by the end of 2018, according to projections from the county’s’ finance office.
The 2018 general fund budget allows for expenses of $84.3 million and revenue of $79.3 million, although these numbers include cash flows assigned from previous budgets, according to county Finance Director Dana Best.
Actual 2018 expenses and revenue are projected around $81.1 million and $80.2 million, respectively, showing a deficit of $958,508 to be drawn from fund balance, although that number will certainly change with actual experience through the year.
This will still leave the county with enough cash on hand to operate for 127 days at zero revenue, according to projections. A fund balance of at least 100 days’ expenses is necessary to cover cash flow needs throughout a given year, as major revenues and expenses come at different times.
The general fund budget covers county functions that are primarily funded through local tax revenues, mainly the county’s property tax, which accounts for 66 percent of general fund revenue. Property rates are 23.61 cents per $100 of assessed real estate value, which includes the general tax rate as well as the 1.66 cent library tax set-aside.
The county also maintains other funds that are supported largely by state allocations — mostly human services departments — and are run on a fiscal year basis.
Including the 2018 portion of these budgets, the county’s total 2018 budget is about $266 million, of which about 20 percent is property-tax funded and 35 percent of is allocated by state or federal agencies.
The 2018 general fund also includes roughly $1 million in salary increases, a 3.55 percent increase in county employees’ pay over 2017. This includes any new positions or increased hours as well as any salary hikes that are part of the county’s recently enacted pay-for-performance system, which pegs raises to employee evaluations.
Although the county’s fund balance provides a cushion, the county faces the long-term issue of expenses increasing at a slightly higher rate than revenue.
The county is expected to close out 2017 with revenue up 5.88 percent over 2016, but expenses up 9.43 percent, according to projections from Best’s office.
Although some of this imbalance is attributable to day-to-day costs, much of it is due to capital expense increases. The county nearly tripled capital outlay from the general fund in 2017 to $2.8 million, versus less than $1 million in 2016.
Those expenditures are expected to increase even more in 2018 and beyond, as the county continues to work on major initiatives including telecommunications infrastructure, specifically the overhaul of the public safety radio network.
Renovations to the county courthouse to facilitate the arrival of a seventh Court of Common Pleas judge are also a general fund expense. The state is expected to expand the county’s judiciary in 2020.