Many areas are feeling the sting of the national economic downturn and Delaware County is no exception, county commissioner Todd Hanks said at the Jan. 29 commission meeting.

Many areas are feeling the sting of the national economic downturn and Delaware County is no exception, county commissioner Todd Hanks said at the Jan. 29 commission meeting.

Earlier that day, Hanks and commission president Tommy Thompson attended a meeting of the county's investment committee. They learned that interest revenue is lower than projected because interest rates are half what they were at this time last year, Hanks said.

In January 2008, when the interest rate was 4.5 percent, the county received $494,600 in interest income, he said. As of Jan. 29, 2009, when the interest rate was 0.5 percent, the county had received $272,960.

"It's going to be a rough year," Hanks told his fellow commissioners. "The good news, gentlemen, is it can't go much lower."

The news could have been worse, Thompson said, if not for the fact that some of the rates on the county's investments are locked in until June.

Hanks told ThisWeek interest income isn't the only revenue producer that is down compared to last year.

Sales tax collections are down nearly 4 percent, to $2.86-million in January 2009 compared with $2.978-million in January 2008, he said. Transfer fees (the fees that occur when property changes hands) also are down.

The change in revenue is enough to lead the county's budget commission to reconvene March 2 to update revenue projections for this year, he said. Normally, that group meets once a year, prior to budget hearings, to determine what revenues will be available for the coming year.

As the former county auditor, Hanks was a member of the budget commission that set the projected revenues for 2009.

Anticipating a continuing downturn in the economy, the commission was conservative in its estimates and reduced projections by $1-million in anticipation of a continued downturn, he said.

Now it appears that the estimates weren't conservative enough, and the budget commission will meet to set a new and, most likely, lower revenue figure for the commissioners to work with as they re-evaluate the county's budget, Hanks said.

The county already is dipping into reserves because the previous commissioners approved a $53.5-million budget that exceeded expected 2009 revenues by nearly $6-million.

The shortfall is coming out of cash reserves, leaving a reserve balance of about $2.5-million at the beginning of 2010.

"We had a budget that wasn't balanced," county administrator Dave Cannon said. "If we don't meet those (revenue) projections, then we need to start looking at other options."

"We need to look at all the budgets out of duty to our constituents," Thompson said.

While the previous commissioners avoided any layoffs or cut in services by passing the unbalanced budget, they left the door open for the next commissioners to make changes if the downturn continued.

Former commissioner Kris Jordan voted against the budget and said it wasn't fair to put that responsibility on their successors.

The budget commission -- which consists of the county auditor, prosecutor and recorder -- chose to wait until March 2 to meet to give the new county auditor, who will be named on Feb. 18, time to settle in, Hanks said.