County freezes hiring; Slow tax revenues force cutbacks

Special to the River Cities Business Journal

MOHAVE COUNTY - Due to a downturn in revenues, Mohave County Manager Ron Walker implemented a temporary hiring freeze on open positions within the county as of Oct. 23.

“Due to significant negative trends in the year-to-date General Fund revenues when compared to prior year actual and compared to current year budget, I have decided that it is necessary to impose a temporary, regulated hiring freeze on all non-essential positions which are General Fund supported,” Walker wrote in a memo to county department heads Tuesday, Oct. 23. “Non-essential positions will be defined initially as those that are not directly involved in providing services which impact life, safety and health.”

Sheriff's deputies, jail guards and Department of Public Health nurses will not be subject to the freeze.

“There are four major reasons for this action,” Mohave County Finance Director John Timko said. “Three involve revenue coming in less than anticipated in the budget and one involves an expenditure category that is tracking higher than anticipated.

“We budgeted a modest increase of $1.4 million for our portion of state shared sales tax,” Timko said. “The first two months of this fiscal year have shown an increase of $40,000. That would trend to around a $1.3 million shortfall to our budget. Lower sales tax revenues are the reasons the three cities have also implemented expenditure restrictions. Our second category, our share of vehicle license tax dollars, is also impacted by the general slowdown in the economy. We had budgeted a $500,000 increase in that category. It's not happening and we are looking at a $500,000 shortfall there. The third area is directly tied to the slowdown in construction - the projected revenues in the Planning and Zoning Department and building inspections. That is trending to a $1.7 to $1.8 million under budget performance.

“The combination of those three issues is complicated by one area of expenditures,” he said. “That is the amount of money we are forced to spend to provide defense attorneys. The demand there is driven by the increases of population and therefore the increases in crime.”

When the Public Defender's and Legal Defender's offices are maxed out on cases, or have a conflict of interest and cannot defend someone, the overflow has to go to outside attorneys who cost more than county lawyers.

“Based on the first two months of actual costs, we are forecasting our contract attorney costs to be about $1 million above what was budgeted for the year,” Timko said. “These four issues combined, we have close to a $4.6 million negative impact to our General Fund's bottom line. A hiring freeze, impacting approximately 50 positions at this time can offset that problem (cost). We will monitor this situation weekly and adjust accordingly.”

“This is necessary to prevent the possibility of more drastic measures in the future,” Walker said.

“I hope this will only be a short-term inconvenience. We will continue to take advantage of all prudent cost-controlling opportunities. The bottom line is, we will not spend more than we have.”