Budgets on local, state level shift to meet COVID-19 challenges

By Zach Hagadone and Lyndsie Kiebert
Reader Staff

Nearly four months after the state of Idaho began responding in earnest to the global COVID-19 pandemic, Sandpoint City Administrator Jennifer Stapleton provided some additional detail on how the virus and the response to it have affected the state and local economies.

Speaking to the Sandpoint City Council on July 1, Stapleton noted that the state’s fiscal year closed June 30 with a balanced budget — as is mandated by the Idaho Constitution. Gem State budget writers are projecting a revenue surplus of between $100 million and $150 million over what was anticipated; however, Stapleton said that the city should expect declines in revenue sharing amounts going into the next fiscal year beyond what was anticipated in the previous budget writing cycle.

A graph showing confirmed and probable COVID-19 cases in Idaho. Courtesy Idaho Dept. of Health and Welfare.

Consistent with long-term sales tax trending, local revenue from receipts exceeded the budget by $3.2 million by the close of FY 2020. Also encouraging to city budget managers, as of June 30, the 1% voter-approved local option tax was trending “at or above budget,” Stapleton said.

Yet, while LOT revenue remains robust — necessary for funding the ongoing resurfacing and upgrade work at War Memorial Field — the resort city tax has taken a big hit as visitors stay away from town on coronavirus concerns.

The RCT, a 7% tax on hotel-motel occupancy and other temporary lodging of 30 days or less, is down 21%, amounting to a decline of about $40,000 into municipal coffers. According to Stapleton, that’s thereabouts of 60% of what the city collects from June through September. 

“We’ll continue to have to watch that very closely,” she said.

Resort city tax revenue goes to support public safety services, including police, fire and community resource officers.

To support those vital service sectors, the city is drawing on a set-aside pot of funding totaling nearly $300,000 from the CARES Act COVID-19 response bill passed through Congress in the spring. Stapleton said Sandpoint has incurred about $30,000 in expenses as of July 1 related to public safety — primarily to fund the purchase of personal protective equipment and sanitation supplies for first responders, as well as signage meant to inform citizens of public health guidance on public properties.

What’s more, city staff is recommending to the council that a second round of funding be allocated through the Bonner County Economic Development Corporation — a first round of financial support having already been mostly disbursed.

As the spring and summer have been dominated by COVID-19 closures and restrictions, and with the virus and its attendant responses uncertain in the coming seasons, Stapleton said the big question is “how we’re going to weather this COVID-19 pandemic as we go into the fall and winter months.” 

“We will be recommending an additional $40,000 to the program to support businesses and their needs in the fall and winter months,” she said. 

Moving forward, city staff is recommending additional monies for public safety, including hazard pay for first responders, if needed, as well as funding for overtime, sanitization, cleaning and supply needs. While Stapleton admitted it’s hard to plan accurately as cases continue to spike both in the Panhandle Health District and state as a whole, the city should budget for a further $61,600 in public safety dollars.

The city has also already applied to participate in the state’s property tax relief program for the next fiscal year.

“That will provide much needed property tax relief for our citizens,” Stapleton said.

Among the big-ticket budget items likely to come before the council is a line item calling for $188,000 to pay for online technology improvements, in case City Hall needs to make accommodations for public involvement and participation in meetings, as well as the ability for city government to function remotely. 

Because the city building was never designed with pandemic conditions in mind, Stapleton nodded to the frequent overflow crowds at recent City Council meetings as reason to invest in improvements including monitors in the lobby outside the council chambers. 

Still, “we are hearing from community members that many of them do not want to participate electronically,” Stapleton said. 

The city transitioned away from its prior streaming platform to a Zoom-enabled process, which is accessible — including archived meetings — on the city of Sandpoint YouTube channel, accessible here: sandpointidaho.gov/your-government/meeting-agendas.

Bonner County commissioners have also moved to allocate more funding to technology improvements. At its regular Tuesday meeting, the board voted unanimously to pull $48,000 from the 2019 General Fund Statutory Reserve Budget to pay for “the addition of a new county employee” and “the need to install new technology for meeting streaming stemming from the COVID-19 pandemic.”

Commissioner Dan McDonald said the new employee is an information systems manager — responsible for working with the county’s Enterprise Resource Planning system, which allows departments to better collaborate with shared information. McDonald described the job as a “hybrid IT position that also has the ability to work between numerous departments to find communication and efficiency solutions.”

In the capitol, Idaho Gov. Brad Little announced that state agencies would need to cut their budgets by 5% in fiscal year 2021, resulting in a $200 million decrease across the board. Boise State Public Radio reports that total state revenues could drop between $349 million and $585 million, according to Paul Headlee, director of the Legislature’s budget division.

Meanwhile, the public safety realities of the pandemic continue to grow more severe. Idaho logged 430 new confirmed and probable cases of COVID-19 on July 8, bringing the statewide total to 8,969. The state also reported four new virus-related deaths, bringing that total to 98. Bonner County had 44 cases as of July 8 according to the Panhandle Health District, 26 of which were active. 

In a “position statement” released July 8, PHD officials wrote that in response to the rising COVID-19 numbers in North Idaho, the health district “strongly endorses community-wide masking, social (physical) distancing, and repeated proper hand hygiene (properly wash hands, use hand sanitizer, keep hands away from face).”

Little will hold a press conference July 9 at noon (Mountain Time) to address whether Idaho will be able to leave Stage 4 of the Idaho Rebounds economic reopening plan and transition to a more local approach to pandemic restrictions determined by cities and health districts. The governor will also share the Idaho State Board of Education’s plans for possibly reopening the state’s K-12 schools in the fall at the Thursday press conference.

Access a live stream of the event at idahoptv.org.