NORRISTOWN - The delayed sale of the Parkhouse Geriatric Facility and a winter of heavy snowfall are to blame for a projected deficit of about $1.5 million by year's end, according to Montgomery County officials.
The county is projected to end 2014 with about $381 million in revenues and more than $382 million in expenditures, according to a report released by the county commissioners on Aug. 7. Building sales gave the county an unbudgeted boost of $4.9 million in revenues, but personnel and building management costs added an additional $6.5 million in expenditures.
One of the unexpected expenditures was the Parkhouse Geriatric Facility in Upper Providence. The sale was anticipated to close at the end of 2013, but Parkhouse stayed under the county's control until March of this year. Parkhouse cost the county nearly $2 million to $4 million per year while the county controlled the facility, according to the report, and operating it from January to March of this year cost $1.1 million. The commissioners passed the budget in December thinking the facility would be sold by the end of 2013.
Despite a deficit from operating Parkhouse until March 6, the county expects to realize $4.3 million in revenue from the facility. The report states this amount is consistent with previous years. An additional $600,000 comes from revenue generated by county government.
The unexpected series of winter storms also cost the county. Of the $900,000 spent on cleanup, total personnel costs - largely in overtime and comp time - are more than $800,000. A 'significant number' of employees in corrections and emergency communications continued to work and received overtime while the rest of the county shut down because of the inclement weather.
The office of the Recorder of Deeds is projected to end the year with a revenue decline of $763,505 due to a 16.7 percent decrease in homes sold in the first two quarters of 2014.
'Quarterly reports present opportunities for the county to identify unexpected divergences from the budget and revise the year-end outlook. The county is then able to make to make mid-year adjustments with the goal of achieving a balanced budget by year-end as contemplated in the adopted 2014 budget,' the report states.
The county will realize $16.5 million from the sale of Parkhouse and the Human Services Center by year's end. This will reportedly bring the county's fund balance to $38.9 million by the end of the year, which is a $15 million increase from the end of 2013. The ending fund balance is equal to 10.2 percent of revenue for 2014, according to the report.
On June 30, the county transferred $877,099 to the pension fund. The county is required to make four quarterly payments to the Annual Required Contribution. This will be the second consecutive year the county will be able to make these required payments. Last year was the first time since 2007 that the county had been able to make the payments, according to Controller Stewart Greenleaf Jr.