Budget Committee approves $2 billion balanced budget, closing $20.5 million general fund gap and preserving mandated county services

The Washington County Budget Committee approved a $2 billion total budget for fiscal year 2025-26 after a public hearing on May 20. The approved budget filled a $20.5 million funding gap in the county’s general fund, an area of the budget supported primarily by property taxes.

This is the fifth year in a row that Washington County has experienced a general fund gap between projected revenues and expenditures. Over that same five-year period, Washington County has experienced the most population growth among the three counties that comprise the Portland metropolitan area, an indicator of the community’s growing demand for services.

The Board of County Commissioners will consider adopting the approved budget after a public hearing on June 17.

“It is very hard for us to step back from service delivery,” said Board of County Commissioners Chair Kathryn Harrington. “We on the board have tried to ensure that we have provided guidance for the hard decisions.”

“Our future continues to be uncertain,” continued Harrington. “We don’t know what our state Legislature will do. We also have no idea what’s going to happen at the federal level. But nonetheless, we are going to continue to be brave together and figure out how we can develop valued services for the community that we know and love here in Washington County.”

Achieving general fund balance

The county’s $333.7 million general fund, which gives policymakers broad spending flexibility when compared to other funds within the budget, has historically supported a variety of county services, sometimes beyond levels required by law. On the other hand, Oregon’s restricted framework for generating property taxes – the general fund’s primary revenue source – puts Washington County at a disadvantage relative to its regional peers.

A forecast of the county’s general fund revenues and expenditures in late 2024 revealed an imbalance of $20.5 million. Estimated expenditures included anticipated cost increases, such as health care insurance costs, growing retirement costs, higher costs of materials and so forth. Using this projected base budget as a starting place, county departments and offices submitted a range of general fund reduction scenarios at 10%, 13% and 17%. Budget officials then applied budget guidance from the Board of County Commissioners when deciding how to bring the general fund and other parts of the proposed budget into balance.

The total budget approved by the Budget Committee has been decreased by $104.3 million or 5% when compared with the current-year’s budget as it has been modified. The general fund was increased by $5.3 million or 2%.

The largest impacts from general fund budget reductions in the approved budget include the following, listed in order of size:

• General fund transfers - A $12 million reduction is made in general fund transfers that have historically funded the Major Streets Transportation Improvement Program (MSTIP, experiencing a general fund cut of $8.7 million) and Washington County Cooperative Library Services (WCCLS, with a cut of $3.9 million). In the years just prior to constitutional changes to Oregon’s property tax system, Washington County voters had approved property tax levies supporting these two areas of service. Changes to Oregon’s property tax system led to the tax rates for these two prior levies being merged with the county’s now permanent property tax rate. For many years following that change, the Board of County Commissioners had approved general fund transfers to MSTIP and WCCLS proportionate to what these original levies raised.
• Public Safety and Justice – A $7.1 million general fund reduction across this portfolio of services. General fund support for this functional area was approved to grow by $2.4 million or 2% overall when compared with the current, modified budget for FY 2024-25. Reductions were largely made to vacant patrol and jail deputy positions within the Sheriff’s Office (representing $4.1 million), housing subsidies for people under supervision and 4.7 full-time equivalent vacant positions in the Community Corrections Department ($1.2 million), a new approach to providing juvenile detention services through a contract with Marion County as well as two reduced positions ($998,385) and 19 full-time equivalent positions in the Child Support Division of the District Attorney’s Office ($561,939), a non-mandated service that the Oregon Department of Justice has agreed can be merged with its Child Support Program.
• Housing, Health and Human Services – A $3.3 million general fund reduction was made, with overall general fund growth in this functional area of $301,283 or 3% when compared with the modified budget for the current budget year of FY 2024-25. Most of the general fund reductions in the approved budget were made in the Department of Health and Human Services, largely through five eliminated Public Health Division positions including vacant public health nurse positions that will reduce programming in the Nurse Family Partnerships program ($2.4 million), two positions within the Animal Services Division ($349,960) resulting in a reduction in Saturday hours of operation, a reduction of 1.25 positions serving veterans ($179,530) which may increase wait time and benefit delays and a shift in personnel and contracted services for Behavioral Health ($247,587).
• General Government – A $2.8 million general fund reduction was made to this functional area. Overall, this functional area was approved to grow by $1.6 million or 7% when compared with the modified budget for FY 2024-25. General fund reductions in the approved budget were primarily experienced in the County Administrative Office and the newly named Office of Access and Opportunity ($840,098). These cuts included the elimination of the Sustainability Office and positions such as an assistant county administrator, a program coordinator and a program specialist. Reductions were also made in the Facilities Division by eliminating five positions ($768,260) and bringing previously contracted services in-house. The approved budget eliminates three positions in Information Technology Services ($239,124). Other savings to the general fund in the approved budget were made by eliminating one or fewer full-time equivalent positions in each of the following: the County Auditor’s Office, County Counsel, Emergency Management, Elections Division and Human Resources.
• Land Use and Transportation – A $294,538 general fund reduction was made in the approved budget in this functional area. Overall this functional area decreased by $25,172 or 1% when compared with the modified budget for FY 2024-25. General fund reductions were experienced across services provided by Community Planning, land use code compliance provided by Development Review/Current Planning and plan review provided by Survey Development Review; service levels are expected to be primarily maintained by replacing reduced general fund support with revenue derived from fees.
• Culture, Education and Recreation – Outside of the general fund transfer to library services mentioned earlier, a general fund reduction totals $80,926 for this functional area. Overall general fund growth for this area in the approved budget was $18,060 or 3% when compared with the modified budget for FY 2024-25. General fund reductions included a $63,026 reduction in Parks Services through adjusting three seasonal recreation positions and a $17,900 reduction in the Agricultural Extension Services that reduced administrative services provided by OSU Extension.

“We had hard discussions, we had good discussions, I learned a lot, but I honestly feel that we all came to this passionately about doing the right thing for the community that we serve,” added County Commissioner Pame Treece, referring to the members of the Budget Committee. “I’m sorry that we are dealing with such a difficult time. I am grateful to deal with difficult issues with good people, so thank you.”

Investments in employees and systems
Several initiatives meant to continue efforts to modernize and re-align the organization’s financial framework for long-term financial and operational stability were also approved. These investments include:

• Providing the 6% “PERS Pickup” to all Washington County employees not already receiving the Pickup using projected cost-of-living adjustments over a multi-year period with budgeted general fund resources covering the remainder. Washington County has provided the PERS Pickup for deputies in the Sheriff’s Office who are members of the Washington County Police Officers’ Association through their negotiated collective bargaining agreement. All other County employees have been paying their 6% contribution through payroll deductions.
• Replacing a 23-year-old business management tool, also called an enterprise resource planning tool, supporting payroll, human resources, procurement, accounting and financial reporting. The initial cost estimate for the project is $19.7 million, of which the approved budget funded using $11 million in federal pandemic response and recovery dollars that have already been received. The balance of $8.7 million would come from a combination of Strategic Investment Program (SIP) funds from large-scale economic development projects and related Gain Share revenue shared with the state.

Other capital investments

Through a new, comprehensive capital improvement plan (CIP), Washington County has begun identifying projects to improve the organization’s infrastructure, technology, facilities and major pieces of equipment. This best practice for local governments enables prioritization and alignment with available resources over a five-year window.

In addition to the enterprise resource planning tool already mentioned, key projects include:

• Continued improvements to 24-hour facilities within the public safety and justice system, including the Washington County Jail/Law Enforcement Center with an estimated total project cost of $57.4 million. Additional critical facilities receiving maintenance and systems replacements include HVAC replacements for the Justice Services Building ($5.8 million) and Community Corrections Center ($2 million). Federal pandemic recovery and SIP funds are largely supporting these projects.
• The Center for Addiction Triage, Treatment and Treatment (CATT) with a total estimated cost of $59.7 million. Funding comes from more than a dozen sources, including Behavioral Health funds, Measure 110 grant funds, opioid settlement funds and grants from health care partners including CareOregon, Providence Health Plan, Trillium Health Plan and Yamhill CCO.
• Information Technology improvements such as deployment of Windows 11 and the replacement of aging equipment that the approved budget funded through SIP-related Gain Share revenue, departmental resources or carry-forward dollars.
• Transportation improvements through MSTIP are still receiving funding, despite the reduced amount of general fund transfer. Under board policy, the transferred amount must grow in proportion with countywide assessed value growth (assumed to be 4.25% in this budget). The board has also authorized sale of $150 million in bonds to ensure timely completion of remaining projects.

Special funds facing challenges
The total proposed budget, including both general fund and special fund amounts, decreased by $104.3 million in the approved budget, representing a 5% reduction when compared to the 2024-25 modified budget. This change is largely explained by declines in intergovernmental revenue coming to the Metro Supportive Housing Services program (a $76.4 million reduction in total resources).

Next steps
Members of the public are invited to give testimony during a public hearing on June 17 as the Washington County Board of Commissioners considers adopting the approved budget. The public can attend the meeting in person at the Charles D. Cameron Public Services Building, Auditorium, 155 N. First Avenue in Hillsboro. Alternatively, the public can join the meeting by Zoom. Information about signing up for testimony and other guidance can be found at the board’s meeting portal at: https://washingtoncounty.civicweb.net/Portal/MeetingTypeList.aspx

The meeting will also be livestreamed from the County’s YouTube channel.

Washington County is a leading-edge, mission-focused organization that successfully serves the community now and in the years ahead. We are a human-centered organization that integrates equity into decision-making and supports the health, effectiveness, creativity and talents of our employees as public servants and the residents whom we serve. The organization is supported by a budget of $2.1 billion and is staffed by 2,442 full-time equivalent employees serving a diverse and growing population of 611,389 on the western side of the Portland metropolitan area. More information about Washington County can be found at washingtoncountyor.gov.