Montgomery County cuts $11M, will distribute $92M in stimulus

Montgomery County commission President Judy Dodge and county Administrator Michael Colbert. CORNELIUS FROLIK / STAFF
Montgomery County commission President Judy Dodge and county Administrator Michael Colbert. CORNELIUS FROLIK / STAFF

A month after approving nearly $18 million in budget cuts, Montgomery County commissioners on Tuesday authorized about $11 million in additional cost reductions.

The cuts, which will occur over multiple phases, are meant to address a general fund budget shortfall caused by declining revenue due to the coronavirus lockdown, largely in sales taxes.

The county has no plans to layoff or furlough employees, though it has implemented a hiring freeze that is expected to save millions of dollars, officials said.

The county is reducing its 2020 general fund budget by about 16% due to COVID-19.

“The idea here is to get as much pressure off the general fund as possible,” said Montgomery County Administrator Michael Colbert.

At the same time, the county also has received $92 million in federal stimulus money that it plans to use for small business support, workforce training, housing assistance and reimbursement of coronavirus-related expenses.

The county has created a new temporary department to manage and distribute stimulus funds to the community, including local businesses.

“This funding will be critical to help our community recover from this pandemic and will be used to support families and small businesses who are struggling to get by, as well as some educational and agricultural services,” said Montgomery County Board of Commissioners President Judy Dodge.

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Consumer spending nosedived after the state’s stay-at-home order led to the closure of many businesses, resulting in a dramatic decrease in sales tax revenue for Montgomery County.

Montgomery County commissioners made sizable general fund cuts in April, and on Tuesday, they approved three additional rounds of reductions through the end of the year.

The first new phase of budget adjustments takes place in June and eliminates the fall economic development grant program (a $1.25 million savings), freezes capital spending ($1 million savings) and makes other changes.

The next phase in July and August includes reducing professional services costs by $1.5 million, maintenance services by $600,000 and communications and rentals by a combined $300,000.

The last phase includes a $1.6 million workers’ compensation rebate and interfund capital transfer of $3.1 million.

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The county isn’t planning layoffs or furloughs because employees are its most valuable asset, said Montgomery County Commissioner Caroyln Rice.

“Without our employees, we can’t fulfill our mission,” she said. “You are a top priority for us, because through you, we are able to serve this community.”

The county predicts it will lose about more than $2 million per month in sales tax revenue between June and December, and that doesn’t count reductions in casino, gas and lodgings taxes, said Colbert, county administrator.

The April cuts saved the general fund about 10%, and the new rounds of cuts will save about 16%, Colbert said.

“In some areas, this will bring us back to 2019 budgetary levels,” he said.

Many of the cuts are to internal expenses, but the county also has shelved capital projects like the construction of a new municipal court in Trotwood, Colbert said.

The county also is scaling back planned investments in court security at the downtown Dayton courthouse, which included converting the Perry Street entrance into the main entry point, officials said.

“We are proactive in taking these steps so we can be fiscally responsible with our county’s overall operating budget and our fund budget,” commission President Dodge said. “I also want our citizens and businesses know we are still working to serve you and our operations will remain strong and focused to help our community recover.”

The cuts come at a time when Montgomery County has been awarded about $200 million in federal Coronavirus Aid, Relief, and Economic Security (CARES) Act funding, with about $92 million already deposited into its bank accounts, county officials said.

While the money cannot be used to plug holes in the county’s, it can reimburse coronavirus-related expenses, like personal protective equipment, a body scanner for the coroner and cases of hand sanitizer, he said.

“We can’t use stimulus money for lost revenue,” Colbert said.

But the county is creating a business grant program that may be similar to Hamilton County's, which provides forgivable loans up to $10,000 with no interest for companies with 50 or fewer employees.

In the near future, local businesses will be able to apply for funding online at the Business Solutions Center.

“We have a large chunk of money that we want to get out to the community,” Colbert said. “We are going to have a very robust program for our small business that we think will make a huge impact on the community.”

The small business grant program will take a few weeks to launch and county officials are still determining eligibility criteria, distribution amounts and other details.

County commissioners on Tuesday established a new office of CARES Act, which will oversee the allocation of funds through early next year.

The Dayton metro area is home to about 15,270 business with fewer than 50 employees, according to an analysis of Census data by Construction Coverage. But that includes multiple counties, not just Montgomery County.

The county also will provide millions of dollars for workforce training programs and housing assistance for rent, mortgage and utility payments, officials said.

The pandemic has had a huge impact on the community, but the CARES Act funds and the establishment of the new office ensures the county can make meaningful investments that benefit large numbers of people, Rice said.

“And $92 million sounds like a lot, but the need is so great that we could actually use a lot more than that,” she said. “But we are so grateful.”

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