Washoe officials predict more budget cuts in 2010-11

Washoe County expects to cut spending in the 2010-11 budget after making severe cuts in the current year.
And it could take more than a decade for county property taxes to return to pre-recession levels because of state property tax limits, officials said.
With home values cut in half, Assistant County Manager David Childs said property taxes are expected to decline significantly in 2010-11 starting in July. But as property values eventually increase, he said property taxes will be slow to recoup because of a 3 percent cap on residential property taxes paid each year.
"So, the county could see a significant decline in property tax revenues that could take over a decade before revenues recover to anything near pre-recession levels," Childs said.
Childs was cited in a report by the International City/County Management Association about how communities are dealing with the recession. Washoe County was among five governments profiled in the report.
"We are hopeful that aggressive cuts made in 2009-10 will minimize the need for draconian cuts in 2010-11. However, it is expected that there will be more cutting that needs to be done."
Loss of property taxes
The county work force shrunk by 500 employees to about 2,690 employees. Since July, 100 workers were laid off and 150 retired early. Raises were eliminated over two years, and workers have agreed to take a 2.5 percent pay cut for most of 2009.
County parks have lost half of their budget, and county libraries are in a similar situation.
Budget Manager Darin Conforti said it's too early to talk about budget cuts for next year, but it is one of several scenarios under study. Without some growth in sales taxes, he expects that the budget will have to be trimmed.
"The harder one is what's going on with sales taxes," he said. "We have had such a sustained decline."
For 2009-10, property taxes are 47.7 percent of revenues, budgeted at $205.7 million. That's up from $196.6 million in the last fiscal year.
Retail sales, cigarette and alcohol taxes and the county's share of motor vehicle registration fees have been in decline for 33 of the past 36 months, including double-digit declines during the past 13 months. They comprise about a third of the county's revenues.
Conforti said county finance officials met with county Assessor Josh Wilson and Treasurer Bill Berrum last week to get earlier estimates for property taxes for next year.
Lower property values and countywide sales taxes also would affect budgets for Reno and Sparks.
Wilson cut residential values 15 percent countywide for the current fiscal year to reflect the tumble in housing prices. Based on initial reappraisals, he said Monday that residential values could be cut another 15 percent for the next fiscal year in July 2010.
Of 171,500 parcels in the county, Wilson said almost half are vacant. New construction is not subject to the tax limits, and commercial properties are under an 8 percent cap. It's too early to speculate on those values, he said.