Faced with decreasing revenue and a worsening economy, the Pierce County Council voted yesterday to reduce the county’s 2008 budget expenditures by $3.6 million.
Councilmembers warned last year that the budget would have to be cut by May 1 if conditions didn’t improve. The situation became more problematic when the Federal Reserve began to cut interest rates, leading to an $800,000 revenue loss for Pierce County for every quarter-point reduction.
“We’ve kept a close eye on the regional economic projections,” said Councilmember Roger Bush (District 3), prime sponsor of the proposal (2008-9s). “Making these reductions now is the prudent thing to do.”
The savings will come primarily from reductions in payments to departments providing services to other county departments, as well as the use of reserve funds in the county’s $286.5 million General Fund, which pays for most county services through sales and property taxes and fees.
“We’ve been proactive during the last few years in building up fund balances for just such an occasion,” Bush said. “The public will not notice any change in service.”
To prepare for the possibility of further declines in County revenue in the coming year, the Council also asked the Executive and other county elected officials to report back to the Council by May 1 on how they would handle an additional 1 to 3 percent reduction in budgets, if needed.