County to seek tax hike

Faced with a revenue shortfall of about a half-million dollars, San Juan County commissioners last week decided to ask voters for help rather than cut a dozen jobs from the county payroll.

In a split decision, the commission agreed to ask voters to cover the anticipated shortfall through an increase in property taxes. If approved, county officials expect the proposed increase to add about 10 cents per $100,000 of assessed property value in 2004.

Without the added revenue, county officials estimate that 8-12 jobs will need to be eliminated to balance the budget next year and cover an anticipated shortfall of at least $400,000. A slowdown in local spending, reduced support from the state, and a state voter-imposed limitation that prevents property taxes from increasing without a vote of the people are largely to blame for the shortfall, according to county officials.

Commissioners John Evans and Rhea Miller agreed to put the proposed tax increase before the voters this November. Commissioner Darcie Nielsen, who opposed the move, worries that lack of a detailed plan, insufficient time to orchestrate a campaign, and potential conflict with competing taxing districts that may also seek a tax increase could doom the effort. It will cost roughly $3,300 to put the proposal on the ballot.

“We should have been out there already if that’s what we intended to do,” said Nielsen, noting the amount and duration of the proposed tax hike, which could potentially span several years, has yet to be clearly defined.

Because of Initiative 747, which Washington voters approved in 2001, government agencies are limited to a 1-percent annual increase in property taxes unless voters agree to lift the so-called “levy lid”. Before I-747, the limit was 6 percent. To avoid cuts during the past several years, the commission shifted money from roads and tapped “banked” dollars -- previously unlevied property taxes -- to supplement the general fund.

Evans said there’s little fat to trim off county programs and few opportunities exist for new revenue from fees, which have been boosted during the past three years. He said a hike in property taxes, though modest, is both regrettable and necessary to maintain essential services the county provides, like public health programs, emergency services, and law enforcement at “status quo.” County government accounts for only 18 percent of the annual property tax bill, and the increase will supplement only the general fund, he added.

“I think it’s a situation that if everyone helps a little bit, we’ll be alright,” Commissioner John Evans said. “I’d prefer not to have to ask voters for more, but the only other option at this stage would be to cut programs and lose about a dozen people. My feeling is we’re not over-staffed.”

Commissioners are expected to finalizes details of the proposal during the next several weeks, following meetings with the county auditor. The Prosecuting Attorney’s office will then craft the ballot measure that appears on the ballot. Evans expects the proposal to be outlined and on display at the county fair, where commissioners will also be available to discuss it with the public and make their case.

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