It wasn't pretty, but Erie County ended the scorched-earth year of 2005 with a small surplus -- at least $10 million, according to early indications -- which County Executive Joel A. Giambra says signals a turning point in the government's slow rebound.
"While we are not doing cartwheels, we are optimistic about the future," Giambra said Wednesday, crediting the glimmer of a surplus to effective management. "It appears we are breaking the trend of budgets with deficits."
Officials had to make drastic changes last year, possibly the stormiest in the county's recent history. They laid off 1,500 full- and part-time employees and raised the sales tax a quarter of a percentage point.
Without the sales tax increase, the county again would have ended the year with a deficit, which it would have had to cover with reserve funds. But by late last year, the deficit from 2004 had consumed all the county's reserves.
Giambra and Kenneth Vetter, his budget director, said leaving many jobs vacant saved about $7 million last year. Sales tax revenue exceeded estimates by about $1 million; about $800,000 was saved in supplies; and Medicaid costs fell short of projections, possibly by $4 million.
Giambra figures the surplus could reach $15 million, but the actual number will not be known until outside auditors finish their work in a few months. Whatever the total, he said he wants it held in reserve next year to help persuade credit-rating agencies to raise the county's ranking.
"My goal is to get credit upgrades before I leave office," said Giambra, whose current term will conclude at the end of next year.
A $10 million surplus represents only 1 percent of the county's almost $1 billion budget for last year. And officials still must find more than $50 million in savings this year to avoid another tax increase for next year.
With the July 1 sales tax increase and another half a percentage point boost this year, the rate in Erie County is 8.75 percent, second-highest in the state behind the 9.5 percent in Oneida County.
In his own report Wednesday, Comptroller Mark Poloncarz showed that budget officials never would have reached last year's sales tax estimates had the tax not gone to 8.25 percent from 8 percent July 1. Instead, revenue would have fallen $13.35 million below forecasts, he said.
"This is why the monthly budget-monitoring reports are so crucial," Poloncarz said, urging Giambra's budget staff to provide them regularly, as the Legislature insists.
Giambra disclosed the $10 million surplus in a monitoring report delivered Wednesday to the Legislature.