News Photo by Steve Schulwitz Cindy Cebula, Alpena County chief deputy treasurer, left, and county Treasurer Kim Ludlow look over a budget on Friday at the Alpena County Courthouse. On Tuesday, the Alpena County Board of Commissioners’ Finance Committee will propose cuts the county could implement if a proposed property tax increase fails in November.

ALPENA — On Tuesday, Alpena County residents will learn how steep budget cuts may be if voters again reject a proposed property tax increase.

The county board’s Finance Committee will meet at 9:30 a.m. Tuesday in the Howard Male Conference Room in the county’s annex building, 719 W. Chisholm St., Alpena.

County officials are expected to lay out all of the potential cuts at that meeting. At past meetings, commissioners have said the deficit is so large that cuts to jobs will most likely be included in the package of cuts.

The Finance Committee can only recommend cuts. The full board would have to sign off on them.

The county will in the Nov. 5 election ask voters to approve a 0.7051-mill tax increase that would raise about $800,000 a year for the county and cost the owner of a $100,000 house about $35 a year.

The proposal failed in August by a vote of 4,070 to 3,882, but county commissioners decided to retry the proposal to try to avoid severe cuts to the county budget that could include laying off police and other county employees.

The county is staring at a budget shortfall of more than $1 million and its cash savings are dwindling, making large cuts before the end of the year necessary if the tax hike doesn’t pass, county officials said.

Over the last decade, current and former county commissioners have moved money around to avoid cuts. The county board has utilized money from the county’s budget stabilization fund and much of the $5.5 million the county received via the federal American Rescue Plan Act during the COVID-19 pandemic.

Those pots of money are now gone or dangerously low and won’t be available to help bail the county out much longer.

Finance Committee Chairman Burt Francisco said the proposed cuts will be steep out of necessity.

He said the issue is quite simple: Voters can choose to continue receiving services the county provides now by approving the tax hike, or they can force commissioners to cut into the deficit by removing funding for some of those services.

“It’s unavoidable now,” Francisco said. “If the millage passes, services will continue as they do now. If it fails, then we have to cut about $1 million. I just want people to understand where we are right now and what’s at stake.”

The various departments in the county have been forced to make cuts for years now, leaving few areas where department heads can further reduce expenses without laying off staff, which in some departments is already running thin.

Last week, Alpena County Sheriff Erik Smith told The News that his office is dangerously close to having to stop 24-hour road patrol because of the low number of deputies on staff. He said that, if he is forced to let go of more, he’ll have to make severe changes to the way police patrol the county.

“If I lose any more — which it is pretty certain we will because of cuts — we just won’t have the manpower to do it,” the sheriff said.

Francisco said it wasn’t long ago county residents paid taxes well below what their homes were worth. During the Great Recession and the adjoining housing market crash in 2008 and 2009, property values plummeted and people’s property tax bills were often about half of what they were prior.

That seriously cut into the county tax revenue stream and forced county officials to adjust.

Francisco said that loss of revenue helped set the stage for today’s deficit.

As property values began to increase again, the county slowly began to see its funding return, but, by then, the budget was already behind the eightball.

Then the so-called “Headlee rollback” came into play.

A section of state law known as “the Headlee amendment” says that, if the tax base of a local unit of government is broadened, the tax rate levied on that base must be proportionally reduced so property tax revenues increase no more than the rate of inflation. In simple terms, if taxable values go up, then the millage rate generally must be reduced, according to the state House Fiscal Agency.

The county lost property tax revenue because of the Headlee rollback as property values increased faster than inflation after the recession.

The tax increase proposed on the Nov. 5 ballot would allow the county to override the Headlee amendment and recapture tax revenue it loses because of the Headlee rollback. County officials call their proposal a “Headlee rollup.”

What happens next is up to the voters, Francisco said.

He said trying to kick the can down the road isn’t a solution, and, although none of the commissioners want to make the painful cuts, all of them are ready to do so.

“Bad news doesn’t get better with time, and the only way to maintain the services and staffing is to have the millage pass,” he said.

Steve Schulwitz can be reached at 989-358-5689 or sschulwitz@thealpenanews.com. Follow him on Twitter @ss_alpenanews.com.

IF YOU GO

* WHAT: Alpena County Board of Commissioners Finance Committee meeting

* WHEN: 9:30 a.m. Tuesday

* WHERE: County annex building, 719 W. Chisholm St., Alpena

* INFO: County officials are expected to lay out potential cuts to the county budget should a proposed tax increase fail in November. For more information, call the county at 989-354-9500.