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Dutchess County financial picture shows some improvement

Gasoline prices dictate consumer behavior, which during the summer months sometimes means the difference between a vacation and a “staycation.” The high cost of gasoline and home heating oil is also causing government leaders to think differently about our budgets via sales tax revenues. This month county leaders received a report on the close-out of 2010 finances, which were largely affected by higher-than-expected sales tax revenues. These favorable revenue reports, after many years of dismal reports, allowed us to move forward with consensus on projects requiring both spending and borrowing.After two years of revenue shortfalls and unanticipated expenditures for state mandates, 2010 was a year of conservative budgeting. We saw layoffs, department consolidations and program eliminations to keep our spending in check with anticipated revenue shortfalls that did not come. Instead, 2010 ended with total revenues of $436.7 million and total expenditures of $427.8 million for a positive difference of $8.9 million. As a result, we did not have to use the $12.6 million in general fund balance that was in the 2010 budget.Sales tax growth is approximately 8 percent higher than last year at this time. If sales tax growth continues at the current rate, we could realize an additional $5 million over the 2011 budget estimate.Despite optimistic revenue reports, the expense side is still worrisome. There was a $5.9 million increase in state mandated costs and a $5.2 million increase in employee benefits primarily for state pension and health insurance.The biggest 2010 expense was economic assistance to the poor administered by the Department of Social Services (31.7 percent), including $40.3 million for Medicaid. In this tough economy, social service clients have increased more than 57 percent since 2007. Food stamps are up 97 percent from December 2007. Medicaid is up 40 percent. Safety Net is up 22 percent. Temporary Assistance is up 39 percent. The county has little control over these state-mandated programs.General government support was the second highest expense (14.9 percent) followed by health (13.9 percent), but which together do not equal the cost of social services. Public safety came in fourth at 12.8 percent, followed by employee benefits (11.7 percent), including $38.3 million for employee health insurance and pension costs. Contrast these with the cost of debt service for issued bonds at 3.4 percent.Recognizing a profitable year grounded in prudent budgeting and perhaps a possible turn in the economy, in July the county Legislature moved forward with several long-standing needs including projects that heretofore had been placed on hold due to the sluggish economy. We passed bonds that together total more than $10 million dollars spread out over the life of the bonds. These include the construction of a new medical examiner’s office, upgrades to our county parks (which are seeing continued public use by those on staycations), highway vehicle purchases, energy upgrades and highway and bridge repairs. The Legislature scrutinized each bond, oversaw lengthy and vigorous debate but in the end passed each, many unanimously and all with bipartisan support.In this climate there is no pride in government spending or borrowing. However, there is some contentment to be had in recognizing when to move progress forward.Michael Kelsey represents Amenia, Washington, Stanford, Pleasant Valley and Millbrook in the County Legislature. Write him at KelseyESQ@yahoo.com.

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Provided

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