Collin County is in an enviable position for two reasons: First, we have the lowest total county tax rate in the state—the lowest of all 254 counties. Second, our county is holding onto surplus tax dollars, sitting in investments.
Those two statements are a testament to the phenomenal growth that we have experienced for many years now.
At the same time, our tremendous surplus poses a conundrum for the Commissioners Court. Rating agencies, who determine our AAA credit rating, don’t like for surplus to be spent on expenses, but on major, one-time expenses. So how can we make the best use of the surplus in the most responsible way?
Just How Big is the Surplus?
The annual report we just received dramatically understates the obvious, “the County is in excellent shape to endure a future economic downturn.”
The surplus funds controlled by the Commissioners Court, those not legally reserved for a specific use, are more than $200,000,000. Two hundred and five million dollars to be exact. That’s enough to run everyday expenses for more than a full year.
But that’s not all…
Some funds budgeted in major functional areas have not been spent. The largest unspent amount is in the major contingency fund, but others include public safety expenditures (under budget by more than a million dollars), public facilities (by almost a million and a half dollars), among others.
What Can We Do with Our Surplus?
Since we need to keep, at most, about $65 million in reserve to maintain our AAA credit rating, that leaves us with approximately $140 million to spend on major capital outlays today.
Highway funding is one possible answer to our conundrum. We have no other major capital outlays planned for the foreseeable future, and it’s hard to deny that transportation is the county’s greatest funding need right now.
Since the surplus is a result of our economic growth, it seems like a fitting solution to two problems at once: the problem of what to do with the surplus and the problem of funding major highways. After all, it was the same fast growth that gave us each of these challenges.
You might be wondering—even with the lowest tax rate in the state—why we continue to collect surplus tax dollars. That’s a good question, and it’s one we’ll need to ask and answer during our upcoming budget discussions.