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Context Needed on Budget Talks

It’s been interesting this week — and, if you just read the headlines, perhaps somewhat concerning — to see some of the revenue decreases being projected for local governmental bodies in the 2025-26 fiscal year.

Consider:

– Marshall County Schools, a projected $50 million drop in revenue;

– Marshall County Commission, a projected $16 million decrease in revenue;

– Ohio County Schools, a projected $7 million decrease in revenue;

– Ohio County Commission, about $2 million less in revenue.

That’s $75 million less those four governmental bodies have to spend on schools, public safety, etc. in the coming fiscal year. On its face, that’s an alarming amount.

Context is necessary, though. There’s much more to consider in these specific situations — namely that each of these entities has seen a rapid increase in their fiscal budgets over the past decade.

Let’s start with Marshall County Schools. For the current fiscal year, that system has a budget of $204 million. Included in that amount is $50 million of your tax dollars that has been collected and placed into a reserve fund. Just a decade ago, in FY 2016, the school system’s budget was $64.7 million. That’s a 215% increase in a decade.

The Marshall County Commission this current fiscal year has a budget of $52.4 million. In FY 2016, the budget was $21 million. That’s an increase of 149.5%.

Ohio County Schools has seen similar yet smaller increases. The current fiscal year budget is about $90 million. In fiscal 2016, it was $56.7 million. That’s about a 59% increase.

For the Ohio County Commission, the current fiscal budget is about $37.1 million, which includes $11 million placed in a budget stabilization fund. In FY 2016, the budget was $24.4 million. That’s a 52% increase.

When you add all those increases together over the past decade, these four entities have collectively seen their budgets increase by $212.4 million. Even with budgets decreasing by $75 million for the coming fiscal year, that’s still an overall increase in a decade of $137.4 million!

Are the declines a sign of things to come for our county governments? Perhaps. The growth, in many ways, has been fueled by increasing property values and the natural gas industry. That’s allowed county governments and school systems to correctly lower their levy rate to reduce the burden to taxpayers as much as possible.

But the state recently changed the way it values minerals. That is part of the revenue decline. Personal property taxes now also, if they’re paid on schedule, are being refunded to taxpayers. The state has promised to keep counties whole, but with numbers such as these, for how long?

School systems and county governments have simply followed the rules and benefited from increased tax collections. There’s nothing wrong with that. However, they should be upfront that the declines being seen now follow years of massive budgetary increases. That would be transparency.

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