May 22nd, 2020
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Preparations Underway to Address Fiscal Impacts of COVID-19 Pandemic
Today, Monroe County Executive Adam Bello unveiled proactive actions to close the County's projected budget deficit as a result of revenue shortfalls from the COVID-19 pandemic and the shuttered regional economy. Adjusted downward from an original estimated deficit of between $68 million and $122 million, County Executive Bello updated the expected deficit to be between $46 million and $85 million and announced that his administration has identified a number of areas of potential savings and cost reductions to address the gap.
"For the last several months, my top priority has been the health, safety and wellbeing of our community. But with that has come an incredible financial burden that even the most prepared could not have predicted," said County Executive Adam Bello. "The COVID-19 pandemic has not only put a strain on our hospital systems, healthcare facilities and medical professionals, it has effectively brought our regional economy to a halt. This means unprecedented losses in projected sales tax revenue, hotel/motel tax revenue and state aid, among other variables. I have directed my administration to look at areas of potential savings, cost reductions and increased efficiencies to ensure Monroe County taxpayers will not be further financially burdened during these challenging economic times."
County Executive Bello has identified over $47 million in initial potential savings should federal funding not become available to help offset this year's revenue losses and budget gap. Many of these cost cutting measures and spending reductions have already been implemented, including:
- A temporary non-essential hiring freeze and an essential hiring delay for over 400 vacant positions, creating a projected $19.5 million in savings;
- Midyear budget reductions by all Monroe County departments, which would equate to $12.6 million in savings;
- Cash capital savings of $10 million;
- Existing budget reserves of $1 million;
- Solid Waste subsidy from the General Fund of $2 million; and
- Monroe Community Hospital subsidy from the General Fund of $2.5 million;
Last week, the first financial indications of the economic fallout of COVID-19 – April sales tax receipts – became available and showed a 25% drop year over year. This resulted in the county finance department adjusting the projected loss in sales tax revenue to be between $12.8 million and $22.5 million. Coupled with unchanged projections for losses in hotel/motel tax revenue, fee revenue, and state aid, the county has updated its projected deficit to be between $46 million and $85 million. Bello noted that these projections will continue to be adjusted as more data becomes available and that the county stands ready to identify further areas of savings should the situation worsen.
"Unfortunately, we still do not know the full extent of the impacts that the COVID-19 pandemic has had on our local economy, and we might not know that for many more months. While I remain hopeful that Monroe County and other local governments and school districts will receive federal assistance to offset unprecedented revenue shortfalls, the reality is that counting on those funds would be irresponsible. Monroe County is taking decisive action and making tough choices to minimize costs and overcome these budget hurdles so we can continue to provide our residents with the essential services they need," concluded Bello.
