City, county interest rates

Both Washington County and the city of Marietta have seen the interest rates on their investments take dramatic dips in recent years.

Along with reductions in revenues for both county and city, both governmental entities have had to sharpen their pencils and readjust their budgets for 2013.

As part of recent budget hearings held by the Washington County commissioners, county treasurer Dorothy Peppel reported to the commissioners Thursday on interest rates on the county's investments.

Peppel reported that county investments earned $391,400.97 in interest in 2012, with an interest rate of 1.15 percent.

Currently, the balance in Washington County's interest-earning account is "about $32 or $33 million," said county treasurer Dorothy Peppel.

The average monthly interest earned for 2012 has been between $30,000 and $35,000, she added.

According to Peppel, the balance in the account is lower than it will be in February and March 2013.

"The balance will be higher and we'll earn more interest because we'll have more money in the bank from (revenues) including real estate taxes and taxes on manufactured homes," she said.

Interest earned during fiscal year 2011 was $832,528.30, with a contracted interest rate of 4.36 percent for the first four months of that year.

"Let's be fair about it," said Washington County Auditor Bill McFarland. "Interest income was a significant revenue contributor to the county until (interest) rates fell so dramatically."

Interest rates are just one component of the county's revenues. Others include sales tax, the biggest revenue; property tax and local government funds.

"There are quite a bit of pieces to the pie to fit this whole thing together," McFarland said.

Washington County Commissioner Tim Irvine was in agreement.

"The money that goes into the general fund comes from several sources. Maybe interest is down, maybe another revenue item is up," he said.

Irvine said he is certain the county will have carryover monies from the general fund from 2012 into 2013.

"We want to see what our final revenues are for this year, and also our final expenses, so we have a clear picture of what kind of carryover (there will be) into the new year," he said.

Interest rates on the city of Marietta's investments also dropped from 2011 to 2012, said councilman Tom Vukovic, D-4th Ward.

In October 2012, the amount in interest in the city's general fund from January to the end of October was $43,991.13, Vukovic said.

In the same month last year, interest was $77,624.23, or a drop of approximately 43 percent from October 2011 to October 2012.

In 2006, the averaged interest rate for all of the city's investments was 4.32 percent, said city treasurer Valerie Hess. For 2011, that rate was 1.2 percent, and for 2012, the rate dropped to 0.3 to 0.4 percent.

"The highest year for interest (for the city of Marietta) was in 2000. It averaged 6.53 percent," Hess said.

The city of Marietta has $5.5 million invested in a money market account earning 0.3 percent interest this year, he added.

Another $5 million is in a CD with a 0.4 percent interest rate.

For 2012 to 2013, the city of Marietta is "expecting to have $1.94 million in carryover money from the city's general fund," said Vukovic.

The goal for the end of 2013 is to have $1.2 million in carryover monies going into 2014, he added.

"We're going to spend $700,000 more in 2013 than we take in," Vukovic said.

Because of decreases in interest and revenues for the city of Marietta, "We've shuffled a lot of money around the last few years," he added.

Just as with a family's budget, "If you're short in one area, you have to take money from somewhere else," said Vukovic.

Vukovic said he doesn't see any changes regarding city staffing or services for 2013.

"We should be able to make it through next year," he added. "It just means we're not going to be able to expand services."