Manager's eUpdate for 09/22/09

I am pleased to provide you with highlights of some of our recent activities that reflect the County Commission's strategic priorities for our region. As always, I welcome your comments either by email (ksimon@washoecounty.us) or phone (775-328-2000). If you do not wish to receive this update by email, please let Community Relations Director Kathy Carter know at kcarter@washoecounty.us. Thank you.

Katy Simon
Washoe County Manager

Partly because of significantly reduced local government budgets and the continuing threat of the Legislature redirecting revenues, Washoe County continues to look at functions which can be consolidated, integrated, or shared with other government entities. In addition to the possible long-term economic benefits, the motivation to do so is to continue to provide a higher level of service to the citizens we serve. The 2009 Legislature, in fact, mandated that the local governments in Washoe and Clark counties study the consolidation of public safety, public works, and `general government` and report back to them.

At this time, the Shared Services Subcommittee of elected officials has given direction to staff to develop a request-for-qualifications/request-for-proposals (RFQ/RFP) for consulting assistance to assess the feasibility of consolidating Purchasing, Technology Services (long-term), and specific functions of Human Resources. The consulting assistance is necessary because we`ve lost so much staff that we just don`t have the capacity to do this work ourselves, and the elected officials want to make sure that the public knows that the analysis has been done independently. We expect the process of developing the RFP to take approximately one month, at which time it will go back to any entities that wish to participate to review, approve and share in funding. We expect the actual analysis to take 3-6 months. The media has reported that such an effort could cost as much as $250,000; in fact, any costs would be shared with the participating jurisdictions and only done if there is a likely outcome of long-term savings or better public service.

Separately, the Legislature gave direction to study the possible consolidation of water utilities in Washoe County. Our Department of Water Resources (DWR) and the Truckee Meadows Water Authority (TMWA, the area`s largest water purveyor) are pursuing ways that they too can consolidate or share services that would allow
better management of of our community`s water, infrastructure and financial resources if we operate the water systems as one utility rather than two. As of now, DWR is expected to continue to be responsible for providing wastewater, reclaimed water and remediation. As with the above potential mergers, all will be presented in public meetings before the County Commission for discussion and final approval before any final action is taken.

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Many employees and citizens frequently ask me how our budget situation is now after the tough budget reduction process. I tell them that the process was indeed hard on our entire organization, having to cut almost 20% out of the overall budget (many departments more than that), and reduce our workforce by 500 positions, and our employees have been really challenged to meet the needs of the public we serve. But we recognize that it`s also difficult for our neighbors and family members and the thousands of residents throughout the County that depend on us.

As you probably know, about 75% of our total $300+ million General Fund budget comes from consolidated tax revenues (primarily sales taxes) and property tax revenues. Both of these revenue sources have steadily declined over the past several years as a result of our country`s and our region`s economic crisis. To date, the consolidated tax revenues have declined in 33 of the last 36 months.

The good news--what there is of it--is that Washoe County forecasted the beginning of this economic downturn as early as four years ago, and took corrective action long ago to reduce the budget by holding positions vacant, cutting discretionary expenditures, and using savings to balance the budget. And so far, our projections for this year are continuing to hold as well. Even though bleak, the budget is tracking right on what we expected and planned for. Property tax revenues are down about 2.8%, and consolidated taxes are tracking to be down overall about 10%. These are the numbers that we budgeted for, and because we planned around these scenarios, we are presently ok. Many folks were critical of the depth of cuts we made, but it has turned out to be a wise choice.

As a result, at this time, we don`t anticipate having to make further reductions in this year`s budget unless there are significant unplanned events, such as a Special Legislative Session that could divert even more of our revenues to the State or mandate new expenditurreres for us.

It`s important to realize that while the news on the national economy continues to cautiously improve, with the Federal Reserve Chairman recently declaring that `the recession is over`, most economists say that it will take one to two more years before state and local governments recover, because property values will take some time to catch up, and we have seen increased demand for services that will continue to hit our budgets hard. Nevada in particular, because of our State`s reliance on gaming and new construction, is expected to see a delay in recovering. It`s too soon to tell for certain what will happen in 2010-2011, despite what may be reported.

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IN THIS ISSUE:

Improve Regional Collaboration

Improve Government Efficiency and Financial Stability