Commission Declares Budget Gap Closed

The Gwinnett County Board of Commissioners is declaring success after approving two recommendations that will close the county’s $18 million budget deficit for 2011.

Over the past two months, commissioners have approved of the original shortfall. Today, commissioners approved two items that will generate an additional $1.66 million in revenue and establish a new budget stabilization reserve within the general fund. The county will be able to draw up to $3 million from this fund.

According to a county press release, the additional $1.66 million in revenue will be comprised primarily of new judicial fees. These fees, made possible by the passage of HB 1055 in 2010, will result in a $1.15 million increase in fee income through the Clerk of Court and an additional $250,000 from the Gwinnett County Probate. The remaining revenue increase is a result of stronger than expected returns on investments.

County officials describe the budget stabilization reserve as a “special, temporary fund established to soften the economic impact and preserve the County’s organizational capacity to provide services.” The reserve will be funded with excess county revenues from 2010.  According to numbers provided by the county, revenues exceeded expenditures and planned use of fund balance by approximately $9 million last year. Receipts exceeded projections while expenditures were lower than anticipated. The county will be able to use the reserve to draw up to $3 million each year for the next three years.

Gwinnett County chief financial officer Aaron Bovos said local governments throughout the country are using budget stabilization reserves to deal with budget shortfalls. In a press release issued March 15, Bovos added the Engage Gwinnett citizens review process had recommended using reserve funds to mitigate the effects of revenue reductions.

“I’d like to thank County staff for the job they've done of helping us close our $18 million budget deficit for 2011,” said Commission Vice Chair Shirley Lasseter in a released statement. “A lot of hard work and difficult decisions went into this process. And while we have good reason to celebrate today, 2012 and the years beyond may be even more difficult. I’m proud that Gwinnett County has worked to increase productivity, reduce expenses and enhance revenues since the economic downturn began nearly three years ago. However, I also recognize that we must continue this process to meet our financial challenges that lie ahead.”

Other recent measures taken by the county to close the $18 million budget gap include:

•   for county workers to help eliminate the county's budget deficit. According to officials, converting Independence Day, Labor Day, the Friday after Thanksgiving and Christmas Eve to unpaid furlough days will save about $2.8 million.
• Reducing contributions to its Risk Management and Workers Compensation funds and its Fleet/Equipment Capital Project Fund.
• Eliminating seven vacant positions, the ad budget for vacant positions, and cutting part-time salaries in the police department.
• Paying off a 2002 general obligation bond and redirecting the .23 mill tax levy that had been servicing that debt toward general operations.
• The commission voted Feb. 22 to require all vacant jobs be held open for a minimum of 90 days. The commission’s action, which extends a general hiring freeze that has been in place since August 2008, is expected to save the county at least $2.2 million this year.
• The county will also receive an additional .
• Another $300,000 in revenue was generated by right-of-way sales to the Georgia Department of Transportation for a Highway 316 project.