Rainy day fund has Holmes government in good shape
While the days of Holmes County government officials uniting like this with no protection are currently gone, the Holmes County commissioners’ foresight to create a strong rainy day fund is currently paying dividends.
Hurry up and wait.
That is pretty much all the Holmes County commissioners can do right now as area businesses continue to slowly open back up to the public following a lengthy time of being closed due to the coronavirus issues.
Like many of Ohio’s 88 counties and states across the nation, the Holmes County commissioners are eagerly pushing Gov. Mike DeWine to put up the open sign on Ohio and welcome back in the tourism industry that is so critical to the county’s economy.
For the commissioners, that process has been slow to happen, especially because Holmes County is so reliant on the tourism industry driven by small-business activity.
Three months into the COVID-19 pandemic, the commissioners have seen plenty of hurting people in the county, just as has been the case nationwide.
Commissioner Joe Miller said while Holmes County has not been immune to the disease and its many results, he expects the entrepreneurial spirit of the county to overcome and eventually rebound.
That said, he also recognizes the hardships being created now won’t be solved overnight.
“Our sales tax was right around $8 million last year, and that is a big part of our revenue,” Miller said. “The thing is we are three months behind on what we get back. Fortunately we have a lot of solid companies here that have a lot of retained earnings, but we also have new companies that don’t have that. It all depends on how strong (the economy) comes back.”
The government is in the same boat as the business world.
Miller said last year the average income from sales tax was around $750,000 per month, a number that is now three times that amount.
He said while the county is fine now, there is no guideline as to what will take place down the road when the absence of the sales tax begins to catch up to the budget. It also will affect how the county is able to dole out bed tax grants, which help nonprofit organizations and county entities grow and prosper.
“We are fine for this year. But if that number drops drastically, who knows?” Miller said.
Over the past number of years, the commissioners have been putting as much funding as possible into a rainy day fund, and that fund has allowed the county to maintain all of its government activities without cutting any positions.
Commissioner Rob Ault said because the county has been frugal and been able to create a large rainy day fund, it has been able to sustain all activity during the time of social distancing that has seen many businesses deemed nonessential and closed for many weeks.
“Financially the county is in good shape, and we will be in good shape because of what we did in the past,” Ault said. “It took us 11 years to get to where we are today, and there are a lot of counties that are hurting right now.”
Miller said over the years they have had people question the idea of such a large rainy day fund when the money could be put to use for the immediate time. Miller said the fund was created for just such times as these.
“It’s called a rainy day fund, and it is raining now,” Miller said.
With the 2020 budget in place, the commissioners won’t have to worry for the remainder of the year, but the long-term effects of COVID-19 have yet to be seen.
Miller said when 2020 is over, he expects the sales tax to be well below the norm, meaning they may have to take a hard look at the 2021 budget.
“I hope I am dead wrong, but the sales tax will probably be way down from what it should be,” Miller said.
That belief is why the commissioners feel it is critical to get county businesses back up and running as soon as possible while maintaining safety precautions as much as possible.
“I worry about the small businesses,” Ault said. “Right now it is a waiting game. We may not know the results and the impact immediately, but it is important to get back to business.”