WashCo approves $1.6B budget, though larger work remains
Washington County approved a $1.6 billion budget for next fiscal year on Tuesday, June 21, though the larger work of overhauling the county government's financial priorities is only just beginning.
County officials had to balance the budget to address a $30 million shortfall identified earlier this year, with requested expenses for various county departments outpacing revenues.
While the next fiscal year's budget is balanced — as required by state law — officials said that they will be taking a magnifying glass to the county's financial systems to try to avoid future spending shortfalls.
"The context for putting this proposed budget together for this year has been enormously challenging for a number of reasons," said county administrator Tanya Ange, "due to both issues unique to our current situation, and long-building structural issues."
One of the longstanding issues Ange highlighted relates to Oregon's property tax system, which places firm limits on how much county and city governments can increase property tax rates each year. Ange said this puts fast-growing counties like Washington County in a tight spot, as the population greatly increases but the tax base does not.
Ange also noted that the county has benefited from federal pandemic aid, most recently in the form of $116 million in American Rescue Plan Act funds.
However, Ange said that "over-reliance on one-time revenue can have the effect of masking structural problems in the county's fiscal approach."
She noted that it has been years since the county board studied the amount of general fund money that's gone toward certain county functions. The general fund dollars that go toward transportation improvements and library services, for instance, account for 17% of the total general fund. They've stayed at about that same level for years.
All these historic budget priorities are further strained by new county policies, which have significant costs.
This is the first year in which Washington County has applied what officials call a "budget equity tool," which has affected spending across all county departments to address equity and diversity.
An additional $25.5 million was requested across all county departments for next year, related to culturally specific programs and services, new training for staff, and things like interpretation services or accommodations for people with disabilities.
This spending, as well as other key functions of the county like police patrols and mental health services, was not cut to make room in the budget. Instead, the county has tightened its belt on capital improvements projects — prioritizing an update of the county's IT systems over other projects that can be put off without sacrificing operations or community needs.
"(These investments) are so we can continue to provide various strategic programs to serve our community so that we are a stronger, more sustainable and nimble county government in service to our community here in Washington County," said Chair Kathryn Harrington.
Harrington was elected in 2018, and she has been critical of past boards' approach to governing Washington County. She also said prior boards often balanced their budgets by not making needed updates to county equipment and processes.
This budget, Harrington said, still prioritizes the most necessary of these investments while still presenting a more trimmed-down budget than what was initially requested by county departments.
That's not to say resolving a $30 million shortfall is painless.
Under the approved budget, Washington County has placed a hiring freeze on vacant or new positions requested by most county departments.
This year, officials also chose not to fulfill a $4 million annual request for affordable housing construction, although Harrington and other county leaders have continually identified affordable housing as a top priority. They say it is already being handled through Metro's 2018 affordable housing bond and other revenue sources.
Commissioners agreed that it will take an unflinching look at how the county does business to avoid similar shortfalls in the future.
"You were dealt a hand that's been building for several years," Commissioner Roy Rogers, who has served on the board since 1985, said to Ange. "I want to thank you for honestly looking at it and understanding that there's only so long you can kick the can down the road."
Rogers added, "The next year and a half is going to be a very interesting period for this board … it's going to be a big issue."
The five county commissioners adopted the 2022-23 fiscal year budget unanimously.
The next fiscal year begins on July 1.
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