Kootenai County finance director outlines multimillion‑dollar shortfall as FY27 budget process begins

Kootenai County commissioners opened the FY27 budget deliberations on June 1 as Finance Director Brandy presented a preliminary budget showing multimillion‑dollar deficits under a range of tax scenarios.

Brandy said a 3% property tax increase would still leave about a $5.6 million shortfall, a 2% increase about $6.2 million, a 1% increase about $6.9 million and no increase about $7.6 million. She said those figures are preliminary and will be refined after statutory deadlines for valuation and roll submissions in June and July.

The presentation laid out the county’s main revenue drivers, including state sales tax and revenue‑sharing receipts, and noted a projected decline in one category of liquor revenue that Brandy attributed in part to House Bill 167, which diverts some liquor receipts away from counties. She also described planned interfund transfers and the use of restricted fund balances for non‑tax supported services such as E911 and solid waste.

On the expenditure side, Brandy said total loaded personnel costs are about $96 million, including roughly $2.5 million in overtime. She reported about $7 million in budgeted pay for open positions, with 40 positions open longer than 100 days; the departments with the largest vacancies are the jail (18), E911 (10), patrol (7) and the prosecutor’s office (7). New position requests total roughly $1 million across 12 requests, with the prosecutor and sheriff accounting for the largest shares.

Health‑benefit costs are another driver: Brandy said FY27 health plan costs are budgeted to rise by $2.8 million, with an anticipated stop‑loss reimbursement of about $1.2 million and a one‑month cushion of $340,000 included in the projection. She described budgeting for gross claims and noting the risk that stop‑loss reimbursements could lag into the next fiscal year.

Brandy recommended using a portion of investment income for ongoing costs — $2 million of the county’s $5.5 million budgeted interest — and reserving the remainder for one‑time capital projects. She also outlined $9.5 million in new capital requests, about $5.1 million of them for general government, and noted that many contract increases (including an $80,000 digital evidence management system) drive higher operating costs.

During public comment before the presentation, resident Ron Hartman urged a zero‑based budgeting approach, argued that contracts and user fees should be fully borne by the entities receiving services, and suggested a $2 transit fare to capture rider revenue. "The county commissioners are to represent the entire county," Hartman said, adding that if factual support for line items isn’t provided, those line items should not be approved.

Commissioners asked Brandy to provide a high‑level allocation showing each elected official’s FY26 share of the county budget so department presentations can be framed against realistic 0%, 1% and 3% tax scenarios. Brandy said she would email budget summaries and prepare a high‑level analysis for the board ahead of the next round of presentations.

The board scheduled seven deliberation sessions aimed at balancing the budget by July 28, with a preliminary balanced budget to be presented July 30, a budget hearing on Aug. 26 and adoption scheduled for Aug. 27.