Washington County, nestled in Downeast Maine, is grappling with a severe budget crisis that could significantly impact its services and the financial stability of its residents. County officials are urgently seeking voter approval for an $11 million general obligation bond to address the deficit, which stems from accounting errors dating back to 2020. The situation highlights the economic vulnerabilities of Maine’s poorest county and raises concerns about the future of essential services.
This crisis underscores the critical importance of sound financial management and oversight in local government. The outcome of the upcoming referendum will have far-reaching consequences for Washington County, potentially affecting everything from law enforcement to emergency management. Understanding the root causes of the deficit and the proposed solution is crucial for residents as they prepare to make a pivotal decision at the polls.
This article delves into the details of the budget crisis, exploring the accounting errors that led to the shortfall, the implications for county services, and the arguments for and against the proposed bond. By providing a comprehensive overview, we aim to equip FYM News readers with the knowledge necessary to understand the complexities of this critical issue facing Washington County.
Accounting Errors and the $11 Million Shortfall
The current budget crisis in Washington County can be traced back to 2020, with the implementation of a standard accounting policy approved by the County Commission in 2019. This policy involved using surplus funds from the previous year to reduce the tax burden in the new year. However, according to county documentation, this carry-over method failed to account for overspent line items and under-collected revenues, creating a flawed financial foundation.
State Senator Marianne Moore (R) Washington County, stated, “We were behind an audit, across the state everyone’s dealing with that.” This lack of timely auditing further exacerbated the problem, as the true financial state of the county remained obscured. The carry-over policy was eventually discontinued with the creation of the 2025 county budget, but the damage had already been done.
The Washington County Sheriff’s Office clarified that the county had attempted to hire an external Certified Public Accountant (CPA) to conduct annual financial audits. Unfortunately, they were unable to secure a CPA for the years 2020 through 2024. Consequently, the unaudited books presented a misleading picture of significant annual surpluses, which were then used to justify reduced taxation.
Further complicating matters, Washington County received $6.1 million in American Rescue Plan Act (ARPA) funds in 2021 and 2022. These funds, while intended to provide relief, were used to address cash flow issues. According to county documents, the ARPA funds were transferred to the general fund to maintain cash flow until Tax Anticipation Notes (TAN) could be established each February.
The Unraveling: Discovery and Consequences of the Accounting Errors
Once a CPA was finally hired and completed an audit, the accounting errors came to light. The audit revealed that the previously reported surplus funds were, in reality, non-existent. As a result, towns within Washington County had been underbilled since 2020. With all surplus funding depleted, the county now faces a substantial deficit.
Despite the severity of the financial crisis, the Washington County Sheriff’s Office has stated that there is no evidence of theft, embezzlement, or malicious intent. They emphasized that none of the county’s employees or department heads contributed to the crisis. This clarification aims to reassure residents that the issue stems from unintentional accounting errors rather than deliberate misconduct.
Adding to the complexity, the Washington County Sheriff’s Office building project was funded by ARPA funds. However, the county now acknowledges that the funding essentially came from the 2025 TAN. This financial maneuver has further strained the county’s resources, leaving it struggling to meet its obligations.
The county’s financial situation is dire. It is unable to repay the 2025 TAN of $7,612,174. When combined with the unaudited back deficit of $2,623,733 and the projected 2025 cash shortfall of $700,000, the county’s budget team determined that a general obligation bond of $11 million is necessary to stabilize its finances.
The $11 Million Bond: A Lifeline or a Burden?
The proposed $11 million general obligation bond is at the heart of Washington County’s plan to address its budget crisis. The county estimates that the projected interest on the bond, at a rate of 6%, would amount to $3,654,706.26 over the life of the loan. However, county officials hope to reduce this amount by paying off the loan early.
The Washington County Sheriff’s Office is strongly advocating for voter approval of the bond in the upcoming November 4th referendum. They argue that the bond is essential to ensure the continuity of county services, including law enforcement, the jail, dispatch services, the district attorney’s office, the treasurer’s office, and emergency management.
In a social media post, the Sheriff’s Office warned that if the bond does not pass, the consequences could be severe. “If the bond does not pass, nobody can say for sure what the result will be, but suffice it to say that County services will be drastically affected if not completely shut down,” they stated.
The Washington County Commissioners held a public hearing on September 11th to discuss the budget and the referendum question. This meeting provided an opportunity for residents to voice their concerns and ask questions about the proposed bond.
Impact on the Community: Services at Risk
Washington County is Maine’s third-least populous county, with approximately 31,000 residents. It also faces the challenge of having the highest poverty rate and the lowest per capita income in the state. The budget crisis and the potential failure of the bond referendum could exacerbate these existing economic vulnerabilities.
The potential disruption or shutdown of county services would disproportionately affect the county’s most vulnerable residents. Access to law enforcement, emergency services, and social services could be compromised, further straining an already fragile community.
State Senator Marianne Moore acknowledged the concerns of her constituents, stating, “I have heard a lot of ruckus and a lot of rumors going around that they are angry that we’ve gotten to this point it’s gonna cost us more money. We’ve already raised their taxes. The unorganized territories have already raised taxes, so here we are paying more for the county and we’re going to have to borrow money.”
The outcome of the November referendum will determine the future of Washington County and its ability to provide essential services to its residents. The decision rests in the hands of the voters, who must weigh the potential risks and benefits of the proposed bond.
Conclusion: A County at a Crossroads
Washington County stands at a critical juncture. The $11 million budget deficit, stemming from years of accounting errors and exacerbated by the complexities of fund management, threatens to destabilize the county’s essential services and deepen the economic challenges faced by its residents. The proposed bond referendum presents a difficult choice for voters, weighing the immediate financial burden against the potential for long-term stability and the preservation of crucial community resources.
The crisis in Washington County serves as a stark reminder of the importance of diligent financial oversight and the potential consequences of accounting errors in local government. The need for transparency, accountability, and sound fiscal management has never been more apparent. As the November 4th referendum approaches, residents must carefully consider the facts, weigh the potential outcomes, and make a decision that will shape the future of their community.
Ultimately, the story of Washington County is a testament to the resilience and determination of its people. Despite facing significant economic challenges, the community is coming together to address this crisis and chart a path toward a more sustainable future. The outcome of the referendum will not only determine the fate of county services but also reflect the values and priorities of the residents who call Washington County home.
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