Recent headlines read of record stock market gains and the lowest unemployment levels in years. As these things are happening, Cobb County’s tax digest is the highest ever. Yet Cobb County Commission Chairman Mike Boyce is saying the county doesn’t have the money it needs to pay for the facilities and services it provides and needs to raise taxes to meet its commitments. Together, these things raise the question: How can it be that Cobb, one of the economic engines of the region, is staring at a $30 million shortfall?
In 2009, decreases in the county’s tax digest prompted then-Chairman Sam Olens to discontinue the annual contribution to the county’s “rainy-day fund” – the fund used to meet capital maintenance needs. Following Olens’ departure, new Chairman Tim Lee continued to withhold the annual contribution. The absence of rainy-day funds forced the Board of Commissioners to load the 2011 SPLOST with capital projects, such as extensive work in the parks.
Fast forward to 2015. When the list of proposed projects for a 2016 SPLOST referendum was completed, I voted against putting it on the ballot. I felt it was filled with “wants” and not “needs.” I also felt that many of these “wants” were going to increase county spending.
On a positive note, the county’s original 2017 budget proposal included two special reserve funds. One of the funds addressed anticipated revenue reductions that would take place as the Title Ad Valorem Tax (TAVT) matures. The other would address economic development contingencies. In addition to these two funds, the Board also set aside $10.5 million in anticipation of the first-year costs of a pay-and-class study for county employees. Unfortunately, due to a last-minute millage reduction pushed through by Lee, the Board adopted what was termed a “structurally balanced” budget.
Lee was defeated in his 2016 re-election bid by Boyce. In his first six months, Chairman Boyce got the pay-and-class pay scales approved and convinced the Board to issue the bonds (approved by the voters back in 2009) to purchase land for parks. As the Board prepared to set the millage and adopt the 2018 budget, the chairman proposed a .13 mil tax increase. The increase, which would generate approximately $4 million to be used for the park bond, elicited strong opposition from citizens. It was ultimately rejected on a 3-2 vote of the Board.
Prior to my vote against the proposed increase, I explained that the Board needs to get a handle on the county’s spending before considering any tax increases. From staff presentations, it was clear to me that the previous budgets had ignored basic maintenance requirements even as spending increased. The staff presentations made it clear that previous leadership had kept the Board in the dark for too long.
The rejection of the tax increase and the adoption of the provisions of the pay-and-class study caused the board to use one-time monies – much of which had been set aside by the previously – to balance the budget. Approximately half of the TAVT reserve fund, all of the $10.5 million and half of the economic development contingency were used.
At the Board’s annual retreat in October, the commissioners were asked to categorize all county services as mandated, essential, or desired. Then, after receiving potential cuts from staff, were asked to create a balanced budget with a beginning shortfall of $55 million. This number included the vehicle replacement needs.
I and one other commissioner were successful in dealing with the $55 million gap by using a combination on of service/program cuts, fee increases and in my case a .5 mil tax increase. The .5 mil increase raises approximately $14 million. When I began my first term in 2009 I expressed concern that most program fees only collected fifty cents for every dollar spent. In late 2017, the Board approved a revised fee scale that brings most fees closer to market rates and closes the gap between program costs and fee income.
There are some who claim the budget shortfall is due to costs related to the Braves project. I reject this notion. Costs associated with the Braves project were funded bonds or by SPLOST money. The $10 million infrastructure payment was part of the original funding formula.
Boyce has reportedly said that, to keep Cobb as a “five star county,” the Board must find a way to continue funding existing programs and bring back many that were discontinued. This seems to suggest the need for a millage increase. I cannot support any increase in the millage without cuts in services that are not mandated or essential to county operations.
The first step is to take the list of mandated, essential, and desired services agreed to by the commissioners to the public to confirm that everyone is on the same page. Next would be to fund the mandated, then move to the essential. When money runs out, those are the services that the county will continue to provide. If the essential list is not completely funded then, and only then would I consider a tax increase.