Revenues keep falling in county's 2010 budget

Whitman County Treasurer Robert Lothspeich lowered his 2010 revenue projections from Whitman County investments this week after the state’s Local Government Investment Pool again lowered earning rates.

Interest off investments were originally slated to generate near $500,000 next year, but continually falling interest rates have whittled that down.

Lothspeich said Tuesday he is expecting interest will generate $200,000 in 2010.

“It’s a pretty drastic drop from where we were just a couple of years ago,” said Lothspeich.

The Federal Reserve has repeatedly slashed interest rates during the current recession to spur commercial lending.

In 2007, when interest rates were near five percent, the county earned just shy of $1.5 million in interest off investments. Through October of this year, the county has received $260,362 from interest revenue.

The drop in projected interest earnings compounds the county’s projected deficit in the 2010 budget, increasing it from around $270,000 to almost $400,000.

County commissioners will hold two hearings on the 2010 budget next month, one Dec. 7 and one Dec. 21.

Another hit to interest revenue is expected to come, as the state tries to balance a multi-billion dollar deficit.

The county is planning to pave a portion of Almota Road early next spring to finish a state-funded rebuilding project.

Public Works Director Mark Storey told the Gazette Tuesday that state transportation officials informed him the state will wait until next August to repay costs of the repaving.

“We’re getting hit every time we turn a corner,” said County Commissioner Greg Partch.

The state’s fiscal year ends in June, and a delayed repayment will take the nearly $1 million cost off the books for this year.

State budget officials announced late last week that the state is staring at a $2.6 billion shortfall in revenues for this fiscal year.

Storey said paving costs will be taken out of the nearly $3 million of reserves held in the county road fund. He explained the reserve is kept in case it is needed to fix road damage caused by a major disaster.

The county’s road fund is kept separate from the county’s general operating fund and derives from a separate road levy.

Partch said interest off that reserve fund, however, does go into the county’s general fund.

That means, at four-tenths of a point of interest, the county current expense fund would be down almost $4,000 in interest revenue for every month that money is not invested.