GRAND RAPIDS — Indications are that Kent County will be changing its fiscal year.
Currently the county’s fiscal year is the calendar year. But because a number of county departments depend on revenues from the state, the county will soon consider matching its fiscal year to that of the state’s, which runs from October through September.
In a memo to members of the county’s Fiscal and Physical Resources Committee, Kent County Administrator and Controller Daryl Delabbio suggested that the county prepare a 12-month calendar-year budget for 2005, but follow it with a nine-month budget for 2006, which would cover January through September.
Then the 2007 budget year would start on Oct. 1, 2006, and run through Sept. 30, 2007, which would put the county’s fiscal year in step with Lansing.
“I believe it makes sense to work toward moving the county’s fiscal year to mirror the state’s fiscal year,” wrote Delabbio in his memo.
Delabbio also reported that a survey of department heads revealed those departments that rely on state funding favored changing the fiscal year, while those not dependent on revenue from Lansing were either neutral or opposed to the change.
“While the state of Kent County remains healthy, we have been challenged during the past 18 months by Michigan’s financial shortfalls. State revenues account for about 30 percent of the county’s total budgeted revenues, and during the past 18 months we have seen declining revenues from the state,” said Kent County Chairman David Morren in his recent State of the County address.
“From what we have all seen from the reports coming from Lansing, this will not change over the next 12 to 18 months,” added Morren.
The Fiscal and Physical Resources Committee agreed to limit increasing expenditures from the general fund to 2 percent for the next fiscal year, to require that each department use zero-based budgeting on all line items, and to place a moratorium on new positions that would be funded through the general fund.
A forecast for the 2005 general fund shows a deficit of just under $10.4 million.
Kent County Fiscal Services Director Robert White filed a preliminary report on the 2003 fiscal year late last month. In that report, White said revenue to the operating fund should total about $134 million.
If it does, White said that figure would be 4 percent higher than the previous year, despite the county getting 5.4 percent fewer revenue-sharing dollars from the state during the year. White estimated that operating fund expenses should total about $132 million and leave the account with a positive balance from $1.5 million to $2 million.
“But it will be difficult to maintain that balance in 2004,” said White.
Delabbio said he would come back to the committee with a formal recommendation to change the county’s fiscal year in the near future. Commissioners would have to approve such a change.