Mesa County proposed budget extends hiring freeze, leans on creativity

Brandon Leuallen, The Business Times 

Mesa County is proposing a preservation-minded fiscal year 2026 budget that keeps the hiring freeze in place, trims department requests and still returns $2 million to taxpayers through a TABOR refund.

During the Oct. 7 Board of County Commissioners Administrative Public Hearing, Budget Manager Diane Dziewatkoski told commissioners the draft follows months of revenue forecasting. The budget process began in April and May with preliminary revenue forecasting, and the final adoption is scheduled for Dec. 9 after late-November assessed values and insurance quotes arrive.

“We’ll be back here on December 9 to certify mill levies and adopt the final budget,” she said.

County Administrator Todd Hollenbeck said the plan “really focuses on people, infrastructure, and stewardship” and stays cautious, because sales tax growth is flat, and state and federal revenues are uncertain.

“We are proposing to keep the (hiring) freeze through 2026,” Hollenbeck said. “We’re still projecting some flat revenues.”

He added the hiring freeze allows the county to work closely with the departments regarding core services, while protecting continuity of operations and public safety.

Tight conditions also spur new ideas, as Hollenbeck said, “When times get a little bit tougher, that pressure is put on you, and it’s amazing the innovation that comes out.”

The big numbers at a glance

The General Fund is proposed at about $90.5 million in revenues and about $98.6 million in expenditures, with a planned draw on fund balance sized to preserve healthy reserves, according to the FY26 budget summary presented Oct. 7.

Dziewatkoski said property tax is currently modeled at roughly 3.5 percent. She said sales tax, which makes up roughly 30 percent of total county revenue, is trending at about 1.5 percent growth over last year, while many departments expect lower intergovernmental revenues such as grants.

Capital spending reflects the timing of multiyear projects. The capital plan shows about $46.6 million in FY26 revenues and $57.3 million in FY26 appropriations, with several 2025 projects rolling into 2026. Dziewatkoski said that over six years, almost $268 million is planned across the program, with transportation and public works comprising more than half of that total.

Tight belt, targeted investments

Dziewatkoski said departments were asked to build to a 10 percent reduction target, and the county budget assumes a continued hiring freeze that can be relaxed midyear if reserves or needs allow.

“We are defunding a number of positions through that hiring freeze,” she said. “Those savings are partially offset by inflation and contracts.”

She noted placeholders were set for a 10 percent increase in health insurance and a 10 percent increase in other insurance until final quotes arrive later in November. Looking back at early drafts, she said, “When I put the base budget together for 2026, we had over a $14 million deficit. Combined savings plus increases got us down to an $8 million deficit.”

Employees remain a priority even in a tight year, as Hollenbeck said the proposal includes about $3.5 million for the workforce to move employees one step on the pay plan. 

Creative moves to make it through the tight budget

Road and Bridge is shifting its maintenance mix to stretch dollars.

“They’re looking at preventive maintenance reallocation where they’re reducing our gravel by 30 percent, so they can double down on crack-seal work, as well as applying 50 percent more asphalt within each of our districts,” Hollenbeck said.

He said a dedicated preservation crew funded by the Highway Users Tax Fund would add three positions to run sweepers, a vactor truck, and stay ahead on culverts and bridge care to extend asset life.

“We’re keeping good roads in good shape,” he said, while acknowledging preventive maintenance is not a permanent fix.

Grants are helping fill gaps.

“Public Works is seeing some great success in revenues on getting grants,” Hollenbeck said, citing about $7 million that will support roughly $27 million in road and bridge projects next year while the $1 million annual surface-treatment program continues.

Facilities is planning approximately $3 million in HVAC upgrades and about $2 million in asset preservation, and design work for the Justice Center expansion continues into 2026, according to the capital schedules.

Unfunded mandates and volatile aid

State finances and shifting aid are pressuring the county’s plan. Dziewatkoski said departments are budgeting lower federal and state grants for 2026 and noted the state’s retention of severance tax removes about $1 million that typically supports the General Fund.

To show the cumulative impact, the county has provided estimated annual costs of unfunded or underfunded state mandates that total $8,341,861.54 across departments.

The figures include $50,000 for the Assessor’s Office, $149,786.10 for the Clerk and Recorder’s Office, $325,000 for Community Development, $3,527,905 for the District Attorney’s Office, $15,000 for Facilities and Parks, $751,000 for Human Services, $1,250,000 for Information Technology, $200,000 for Public Works, and $2,073,170.44 for the Sheriff’s Office.

“Local government is doing more with less,” Hollenbeck said. “I’m proud of the innovation and the teamwork.”

How the TABOR refund will work

The county plans to credit $2 million back to taxpayers on 2024 excess collections.

“Two million will be refunded through property tax credits,” Dziewatkoski said.

Rather than paper checks, she said the refund will appear as credits on tax bills, because average amounts would be small, and issuing checks carries processing costs.

Where the money goes

Public safety and justice remain among the largest operating lines, with the Sheriff’s Office and the District Attorney’s Office leading General Fund appropriations at about $40.7 million and about $7.14 million, respectively, according to the FY26 schedules.

Roads and infrastructure funding is split between the Road and Bridge operating fund and a suite of capital projects supported by competitive grants and the capital sales tax, including $46.6 million budgeted into the capital program and $57.3 million in appropriations for 2026.

“Health and Human Services and Public Health continue to rely heavily on intergovernmental dollars that departments expect to tighten in 2026,” Dziewatkoski said.

She added the county expects to start 2026 with about $19.9 million in General Fund reserves after this year’s cash-saving measures, and the hiring freeze and supplemental tools give commissioners flexibility to adjust if conditions change.