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Wed, Oct. 16

County faces different kind of budget with new jail district

PRESCOTT – With its new jail district, the Yavapai County government faces a different kind of budget next year.

For one thing, supervisors plan to keep their promise to drop the county's property tax rate by 10 cents on every $100 of assessed valuation. They made the promise to voters last year if voters approved the jail district, which draws on a sales tax.

Starting July 1 – the same day the county's next budget year begins – people who buy goods (except groceries) in the county will pay a quarter-cent sales tax for the 20-year jail district.

The district will support new and expanded jails, plus pay for future maintenance and operations. The tax will bring in $4 million its first year, county officials estimate.

Without the district, supervisors predicted they would have to raise the property tax by 10 cents to build jails for a burgeoning inmate population.

With the new jail district sales tax, the county will rely even more on revenues from sales taxes, a revenue source that is much more volatile than a property tax.

The county already has state-shared sales tax money totaling an estimated $16.7 million next year, plus a half-cent sales tax for major road improvements, estimated to produce $10 million next year (one-fifth goes to the general fund, the rest to road projects).

All that sales tax money adds up to $30.7 million in next year's estimated $124.4 million budget.

That's enough of the pie that County Administrator Jim Holst wants the Board of Supervisors to help him come up with a contingency plan in case the economy slows down, Holst said Tuesday after the supervisors conducted their first round of year 2000-2001 budget hearings with department heads.

Holst's administrative aide, Brenda Peterson, is working on some pie charts to show the supervisors how the county's reliance on sales tax has increased.

The sales tax revenues are showing healthy annual increases these days, reflecting Yavapai County's growing economy. If the county faces a recession and sales tax revenues drop dramatically, what would it do? One option would be to put building projects on hold immediately, Holst said.

Some governments that rely heavily on sales tax revenues bolster their contingency budget. The county's contingency budget is $1 million, and it usually dips into that budget throughout the year to pay for unexpected needs.

For example, right now supervisors are considering using a half-million dollars from this year's contingency budget to pay for aerial mapping of the entire county during this watershed year of the new millennium and new U.S. Census.

The county already is moving forward on building projects the new jail district will pay for. Holst hopes the county will award an architectural contract within two weeks for the Camp Verde jail expansion, a project that will cost approximately $20 million.

Construction should begin within nine months, Holst estimated. The county plans to double the jail's bed space to 480 beds, and add space for juveniles the courts are trying as adults, so the county won't have to house them in Phoenix.

Departments in the general fund should have approximately $1 million available in next year's budget for what the county calls "program changes," which include new employees and new equipment. Those departments are seeking 31 new employees, including 3.5 in the Sheriff's Office and seven in the Management Information Systems Department.

Departments outside the general fund also are seeking new employees, including 18.5 the sheriff wants for the jails.

Holst already has tentatively set aside the following amounts in the general fund: $4.5 million for building projects, $1.8 million for the new county fairgrounds, $1.2 million for the 10-cent property tax reduction, $1 million for employee salary increases and adjustments, $500,000 for major road projects, and $4.9 million for jail operations "maintenance of effort" money the county must contribute outside of the jail district sales tax since it already was spending that much before the sales tax took effect.

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