Thursday, August 19, 2010
Board mulls local/state budgets
By SUE WATSON
Consultant Gary Anderson and the Marshall County Board of Supervisors considered local and state financial outlooks during a recent meeting.
Anderson said the basic concern of state lawmakers is money – how to balance budgets short- and long-term.
At the year’s closeout on June 30 and in July, state tax revenues came in at $6.7 million over projections for the year which was somewhat of a surprise, Anderson said. Individual and corporate income tax collections are what brought the projections up, he said.
“When business is down, businesses don’t have expenses to offset tax,” he explained.
Sales tax collections at the cash register were down $4.5 million for the month of July, he said.
“So, retail business is still lagging behind in Mississippi,” Anderson said. “This is not a trend; just one month.”
Of concern is how the state budgets have been built on federal economic stimulus dollars and one-time money that will not be available for balancing the state budget in year 2012 – which is expected to contain a budget deficit of $400-$500 million, Anderson said.
“Gov. Barbour has put agencies on notice about spending for the first six months,” he said. “September is when the Legislature invites all agencies to make budget presentations and the budget office will craft a budget for November/December to get ready for the next session (2011). There was a lot of hot air blowing at the Neshoba County Fair (about budgets).”
Supervisors were interested in what Anderson had to say because the counties and municipal governments will have to make up any budget cuts the state makes to programs in education, tag rebates, etc.
Any state cuts in local funding will have to be managed by the careful hands of local boards - the county and municipal boards, the boards of education, as examples.
Zinn asked if a bill is in the works to try to get more taxes from casinos to offset the downturn in other sales tax and income tax revenues at the state.
“Do you think that is something that might fly?” he asked Anderson.
Anderson said several groups are looking at how to fund gaps in the state budget, one of which is a group looking at how casinos pay tax.
“I think it will be difficult to raise taxes in an election year,” he said.
He added that the Mississippi Development Authority wants to keep a good business climate in the state.
“If you are raising taxes on casinos, that might indicate the business climate is eroding,” he said.
“Would you say casinos are living up to their agreements?” Zinn asked.
“I would say they are,” Anderson said.
He had not looked at the tax sheet for casinos, he said.
Supervisor Ronnie Joe Bennett asked, “What about our schools for next year?”
Anderson said lawmakers will try to avoid cutting education’s budget until the last minute. But the $400 million-$500 million tax hole for 2012 will likely impact the state school system budget, he said.
Bennett said throwing these costs that used to be paid by the state back on counties is like a tax increase to local governments, despite the governor’s remarks that he would not raise taxes.
Supervisor Keith Taylor said he appreciates the county school board not raising taxes this year.
“The school will be short next year and puts more back on the counties,” said Bennett.
Taylor said if the state department of education takes a hit in its budget, the county will have to make up the lost monies.
Anderson said school districts took a budget cut statewide this year and some Medicare services at the department of corrections were cut.
“I heard the penal system’s budget went up,” Bennett said.
Anderson reviewed the budget since 2005, the year Hurricane Katrina wiped out the Gulf Coast counties.
“We relied upon Katrina money to meet our budget several years and the last two years upon stimulus money,” he said. “Sooner or later when all these balls disappear, you are back to where you were. Some reserve funds are hit. There is $290 million left in the Rainy Day Fund.”
Chancery clerk Chuck Thomas said he has noticed that the State Department of Mental Health has been required to have closing plans in place by the end of August.
Anderson said mental health has been targeted for cutbacks more than any other agency for making budget cuts. Services in Oxford, Batesville, and Tupelo are threatened, he said, as well as Whitfield and a unit in Picayune.
“They want to go to community-based services,” he said. “There is a lot of back and forth on mental health, cutting to the very core of these community-based services.”
Thomas said waits for beds in state facilities have increased from four to five weeks to eight to 10 weeks for males. The inpatient services are important to families and waiting in jail is unfair to the mentally ill as jails are not equipped to help them while they wait.
“If they are not properly medicated, it creates a volatile situation at home and in the community,” Anderson said.
Thomas said a day-time monitoring program for patients is needed to dispense medicines to the mentally ill who are not confined to an institution. Some patients are not taking their medication, he said.
“You have priorities staring the budget in the face,” said Anderson. “More than likely, a lot of budgets will be trimmed down even more.”
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