Less than three full months into the budget for Fiscal Year 2016–2017, the Letcher County Fiscal Court is facing a $1.3 million shortfall and the necessity of taking drastic action.
At this week’s September meeting, Judge/Executive Jim Ward announced the budget deficit and told the court it is unlikely it could “cut their way out if it.” Ward told the court that the Jail Fund and the Local Government Economic Assistance (LGEA) fund will both be running a deficit by November, and that by March all but Senior Citizens and the Road and Bridge Funds will be “in the red.” He added that only cuts in Senior Citizens and the consolidation of all the centers into one located at the Letcher County Recreation Center had saved it from a similar fate.
Ward said he cannot rule out any particular course of action, and said the court will meet next week and he will be happy to take suggestions on how to address the issue. He said the county has already reduced its workforce by 53 employees from 2012 and the court needs new ideas. Fifth District Magistrate Wayne Fleming asked what else the court can do, since it is already moving workers between departments now to address worker shortages. Ward said the court has some major decisions to make.
Judge Ward told the court that coal severance revenues have dried up to the point that they are barely there, and tax receipts from natural gas are almost gone as well. He said the mineral tax receipts that had averaged around $500,000 in the high production years have been reduced to about $80,000 per quarter. He added that one big problem is with state prisoners in the jail. Ward said that while prisoners can receive credit as “time served” on sentences for the time they spend in the county jail waiting to go to trial, the state only takes the responsibility of paying for them after they are sentenced. He added that the jail is also down by three employees.
In a related matter, the court also voted in a split vote to refuse to return about $42,000 of an excess fee payment made by the Letcher County Sheriff ’s Department. Deputy LaShawna Frazier, who is the department’s financial officer, told the court the payment would not be a loan, but it would be extremely helpful in keeping the department afloat until county tax revenues come in. In past years the court has returned the excess fees and allowed them to pass through as a way of reconciling the books, but in a threeto three vote the court voted to keep the money.
Fourth District Magistrate Keith Adams led the opposition to returning the money and was adamant that the court refuse Frazier’s request. Magistrate Fleming and Second District Magistrate Terry Adams both spoke in favor of returning the funds to the sheriff ’s department, and Fleming, Terry Adams, and First District Magistrate Bobby Howard voted in favor of the matter, while Keith Adams, Third District Magistrate Woody Holbrook, and Judge Ward voted no. Ward said that it is not his intention to harm the sheriff ’s department, but alluded to the budget shortfall, which was the next matter on the agenda, as his reason to keep the money.
The entire amount of the excess fees for 2014 amounted to $44,077.81, but Deputy Frazier told the court the department would need $573.27 to close out the 2012 unmined mineral taxes and $1,165 to close out fees for 2013.
In other business, the court also set its own property tax rates and accepted the tax rates of special taxing districts in the county. Judge Ward told the court that its only course of action could be to vote to certify that it had received the tax rates from the districts and that by law, it has no power to modify them or to reject the rates. However, Magistrates Terry Adams and Wayne Fleming both questioned the representatives of the taxing districts concerning carryover funds and Adams told several that Letcher County residents are having a difficult time making ends meet and the special district taxes add to their burden. Adams voted no on certifying that the tax rates have been received on the Letcher County Conservation District, the Letcher County Public Library Board, Letcher County Public Schools, and Jenkins Independent Schools. Fleming voted to accept the report of all the districts. Special District and county tax rates per $100 are:
• Letcher County: 13.7 cents per $100 for real, and personal property and motor vehicles. This was the state recommended compensating rate and the court voted unanimously to accept it.
• Letcher County Soil Conservation District: $.016 for all the compensating rate.
• Letcher County Board of Health: $.08 across the board for all taxes. The same rate as last year.
• Letcher County Public Library District: Real property $.11, personal property, $.1405, and motor vehicle, $.0532.
• Letcher County Cooperative Extension District, real property $.07, personal property $.1099, and motor vehicle $.03. These are the same rates as last year.
• Jenkins Independent Schools: real and personal property $.833 per $100, and $.69 per $100 for motor vehicles. Jenkins Schools accepted the compensating rate, set by the state to keep revenue at the same level it was last year.
• Letcher County Public Schools: real and personal property $.634, motor vehicle, $.496, the state-recommended compensating rate.
In response to Terry Adams’s and Fleming’s questions about carryover, several of the the representatives told the court that while the tax rates are set soon after the fiscal year begins, they will have to operate without tax receipts for up to six months and the carryover is budgeted to pay salaries, building maintenance expenses, and other necessary payments throughout the year. Both Library Director Alita Vogel and Letcher County Schools Superintendent Tony Sergeant also said their respective organizations have several buildings to maintain and Sergeant said that maintenance costs on the schools are high.
In other court business:
• Letcher County Tourism Commission Chairman David Narramore and County Treasurer Phillip Hampton, who is a member of the Mountain Heritage Festival Committee, reminded the court that the festival is now underway. Narramore presented the court with a pre-parade program as well.
• The court voted unanimously to accept Pepsi Coal Bottling’s bid to supply drinks to the Letcher County Recreation Center.
• The court voted unanimously to declare September as “Child Cancer Awareness Month”.
• The court accepted a memorandum of understanding with the Kentucky State Police to approve an interlocal agreement for KSP to provide 911 service to the county. The agreement is unchanged from last year.
• The court voted to accept a resolution approving a lease for financing two new Mack trucks.
• The court heard the first reading of ordinances setting speed limits on Kelly Drive and Flower Road.
• The court voted to approve resolutions naming the following roads for U.S. military veterans: The road at Thorn Drive at Gordon in honor of Specialist 4 Tommy Thornsberry, U.S. Army, and the road at Mesa Drive at Blackey in honor of Private First Class Curtis Halcomb, U.S. Army, European, Africa, Middle Eastern Theater. Halcomb was the recipient of three Bronze Stars.
Bank balances for county agencies as of September 9:
• General Fund $182,014.99
• Road and Bridge Fund $957,305.47
• Jail Fund $124,330.47
• LGEA Fund $180,550.52
• Senior Citizens Fund $117,111.31
• Forestry Fund $ 16,507.66
• Letcher County Public Courthouse Depreciation Reserve $185,797.49
• Letcher County Public Courthouse Debt Service