General fund could go bust by 2013

If Hernando County continues using reserves and doesn't find any other ways to bring in revenue, the general fund could run out of money by 2013.

That was the dire warning Tuesday from County Administrator David Hamilton, who is spending this week meeting with community and business leaders and department officials to prepare for next Tuesday's first of two budget hearings.

Hamilton said even once this current budget is put to bed, Hernando County will face the next fiscal year some $5 million to $7 million in the hole.

Budget Director George Zoettlein concurred that the county has to start spending only what it takes in.
"We have to stop using one-time revenues to balance our budget operations," Zoettlein said.

County commissioners have only three weeks left to balance the 2011 budget and reduce a general fund budget deficit hole that, as of Tuesday, stands at $281,851.

Work will start immediately on the 2011 budget which Zoettlein confirmed will start off with a $7 million shortfall.

"If we don't find a way to do away with that shortfall, then by fiscal year 2013 we will run out of money," Zoettlein said.

But he doesn't foresee that happening if the county finds a way "to balance our budgets properly."

Hamilton said cascading property values and declining revenues will bankrupt the general fund in two years unless creative steps are taken now.

Hamilton said that is the reason why he introduced his government reorganization plan, which consolidates the number of leadership team divisions in Hernando County from the current nine to six.

That plan was met with skepticism from several members of the public at last week's commission meeting, including concerns about the makeup of certain departments under team leaders.

For example, after meeting with business and chamber of commerce officials Tuesday, Hamilton said the economic development department - which he had grouped under the auspices of Director of Community Development Jean Rags - may be reassigned to another team.

Hamilton declined to be more specific.

If the county is going to deal with that huge deficit and avoid depleting the general fund in two years, the county must be more creative with the way it manages its employees and resources, Hamilton said.

To that end, Hamilton has proposed major changes to the county's tourism development department.

In his reorganization plan, Hamilton wants to take the $90,778 salary compensation package used to pay retiring Tourism Director Sue Rupe and use it to partially fund recreation specialist Ruby Turner's position (who makes $43,700) as well as the salary of Economic Development Supervisor Valerie Pianta, who makes some $62,000 annually.

Pianta would take over Rupe's position as tourism director when the latter retires in November.

Turner would receive half her salary from the tourism department and half from the general fund, he said.

The county's legal office is reviewing whether such moves are permissible under state law, which has specific allowable uses for tourism department funding.

Hamilton said he believes economic development and tourism should be more closely linked in the future because their missions are similar.

"We're not trying to raid tourism to fund economic development," Hamilton said.

Instead, he said he hopes to retain valuable employees and make both departments stronger.

In addition, Hamilton wants to take the beleaguered Little Rock Cannery off the general fund dole, call it a "tourist attraction" and have it funded through tourism department.

Rupe doubts the administrator can do such a thing.

Under state law, tourism departments are to use its money for the sole purpose of promoting tourism and attracting people to the area.

Rupe said funding non-tourism-related positions is a no-no. And calling the cannery a tourist attraction won't fly either, she said.

Weeki Wachee Springs and Boyett's Grove are tourism attractions but the TDC is not allowed to use its money to help run those entities, she said.

As a one-time move, Hamilton is also proposing taking $100,000 out of the TDC budget to help offset the general fund cost of maintaining local parks and fields.

Rupe said the TDC agrees that would be an allowable use of department money and her board voted 6-0 in May to support such a move.

But that idea has still to be approved by the full county commission board.

The county tacks on a 3 percent bed tax on people who stay in local hotels, motels, mobile home parks, recreational vehicle parks, campgrounds and any other sleeping accommodations rented for a period six months or less.

The TDC is entirely funded by that bed tax. No general fund revenue goes into that department.

In 2009, the county collected $342,022 from the tax, down from $369,859 in 2008.

County Commissioner John Druzbick said the county legal office continues to look into the legality of Hamilton's tourism options and he should know more about the plan after he meets Thursday with Hamilton.

A fuller discussion on these budget moves is scheduled for Sept. 14, the first of two budget hearings.