With the painful cuts behind them, Island County Commissioners are poised to raise the property tax levy by 5.8 percent, using their “banked levy rate” as a way around the voter-imposed 1 percent limit on such tax increases.

The move will provide the county $318,372 in additional revenue in its 2003 current expense fund. Had the commissioners opted to stay within the 1 percent limitation, they could only have increased tax revenue by $55,514.

The “banked levy rate” is a figure derived from how much the commissioners could have raised taxes in the past, but didn’t. Before voters imposed the 1 percent limit, elected officials could raise taxes up to 6 percent without a vote of the people.

The proposal is the subject of a budget hearing set for 9:50 a.m. Monday in Coupeville. Also on the agenda is a motion to raise the road tax by 1 percent, which will provide another $57,027 for that fund.

When the budget is formally adopted at the same meeting, it will complete a budgeting process that dates back to last February. Having gone through an equally grueling budget process for 2002, the commissioners wanted to get ready early for 2003. Last year, they dipped into the county’s reserve fund for over $700,000 to make ends meet.

Last August, the commissioners announced a number of job and program cuts, the most controversial of which involved 5-percent cuts to senior services and 4-H programs.

Mike Shelton, chairman of the board of commissioners, said this week that all the “banked levy” will be used up if the 2003 budget proposal is adopted.

“That’s all there is available,” he said.

Had the commissioners eschewed the banked levy option for next year’s budget, even more employee cuts would have to be made, “seven or eight more people,” Shelton said.

Those people who will be laid off were notified in August.

“We didn’t want to be passing out layoff notices at Christmas,” Shelton said. The offices of assessor, auditor, juvenile court, prosecutor and sheriff all lost one full-time employee, and a number of other part-time positions were eliminated, among other measures to reduce expenses.

The tax increase, if adopted, will allow the commissioners to retain a small reserve fund of about $500,000.

The outlook for 2004 appears even worse, according to Shelton. The reserve fund will be minimal and the banked levy option will be gone. Taxes can be raised only 1 percent, which will bring in about $60,000, and new construction adds about $120,000 annually to county coffers. So the county will have only about $180,000 in new revenue.

That won’t last long, Shelton said. This year, for example, the county was dinged for $325,000 in additional health insurance costs, and giving employees even a 1 percent cost of living increase costs $120,000. Other costs, of course, continue to escalate.

“There’s not a lot of ways to cut the pie any more, other than to truly cut back services,” Shelton said.

The state has its own budget woes and Shelton doesn’t expect the counties to receive much help from the Legislature, which convenes in January. Counties may be given more local option taxing authority, but even that would require a vote of the people.

“I can read the election returns as well as anyone else,” Shelton said. “New taxes are not an option right now.”