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The county’s budget woes

Don’t look now, but Harris County is running really low on cash.

The $154 million reserve fund Harris County started its fiscal year with is expected to be nearly gone by March as it gets spent to cover shortfalls in property tax collections.

Budget projections released Tuesday show the county entering the fiscal year that begins March 1 with a $5.7 million cash balance on a $1.36 billion budget — a cushion of less than 1 percent. Historically, the county has ended its fiscal year with a cash balance of 15 percent or more.

The situation is dire enough that Precinct 4 Commissioner Jerry Eversole warned that a day of reckoning is on the horizon that may make a tax increase necessary. As Eversole explained it, voters approved tax increases to pay for the construction of civil, criminal and juvenile courthouses. But Commissioners Court, flush with property tax money a decade ago, decided instead to cover the debt payments with its existing property tax collections. In fact, commissioners cut the tax rate four years ago.

Eversole called voting for that tax cut “the worst thing I ever did.”

“You’re absolutely wasting time if you think we can maintain this budget without a tax increase,” he said. “If we can get through 2011, we damn sure aren’t going to get through 2012. So somewhere along the line either this (budget) has to be cut or we’ve got to talk about a tax increase.”

Is the county not required to maintain a minimum cash reserve? If I’ve understood previous coverage, the city and Metro have some kind of requirement imposed on them. Regardless, surely it’s prudent for them to keep a few more bucks on hand than that. Commissioner Eversole is right, this is not sustainable, and as the state will find out next year, you cannot make this work on cuts alone.

I’ve been saying all along that the 2007 property tax rate cut, which was worth $12 a year to someone with a house valued at $161,000 but which has cost the county $25 million in revenue annually, was irresponsible. County Budget Director Dick Raycraft opposed it, too. It’s the main point of disagreement I have with County Judge Ed Emmett. I’m sure the county can find cuts to make up for that lost revenue, but what will the real cost of those cuts be? Among other things, the hiring freeze that the county is under means that the Sheriff’s office is forced to spend millions on overtime. Judge Emmett recognizes that this is more expensive than actually hiring enough employees to do the job, and that’s before you consider the cost of dealing with the lawsuit that was filed by the deputies’ union. Yet Garcia’s request to hire more employees, as well as requests by DA Pat Lykos and County Attorney Vince Ryan, were turned down. Steve Radack can posture and bloviate all he wants about conducting studies and privatizing the jails, but in the end the numbers are what they are.

Finally, there’s been an endless supply of critics of the city’s finances and Metro’s finances in recent years, but they never seem to have anything to say about the county. I’m looking at you, Bill King, and your perch on the Chron’s op-ed pages, but I’ll be happy to hear from anyone who’s wrung his or her hands about entities other than the county.

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2 Comments

  1. [...] Where’s Harris County going to find the money to pay for that? You can blame the city of Houston for this if you’d like, but the same question applies. Right now, at every level of government, we don’t have the money to pay for the things we want. It’s easy to talk about cuts, but stuff like this is the consequence. Until we come to grips with the fact that what we have is a revenue issue, and we become willing to do something serious about it, problems like this will never go away. [...]

  2. [...] you suppose that if it were the city of Houston instead of Harris County that had been forced to take this action that we’d be hearing about it from all of the [...]

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