Wayne County projecting at least $152 million deficit due to COVID-19

With small businesses already feeling the financial pinch, governments are starting to release predictions for their annual budgets over the next fiscal year. The outlook is grim.

Wayne County Executive Warren Evans said the county is projecting at least a $152 million deficit for the 2019-2020 fiscal year. That minimum estimation amounts to at least 20% of the county's projected revenue.

“Our main focus remains fighting the coronavirus spread as a public health matter. However, the county’s long-term health requires proactively planning for budget shortfalls created by this pandemic,” said Evans.

In an effort to balance the budget, county officials aren't taking any options off the table. Along with tapping a rainy day fund and renegotiating existing leases, it's possible the municipality's workforce could be reduced. 

“Every option is on the table and under consideration,” said Assistant County Executive Khalil Rahal, who presented the revised forecast to Wayne County Commissioners. “We must take immediate and difficult steps to balance our budget, and we will."

That framework for Wayne County's recovery plan includes:

  • Tapping funds from the accumulated budget surplus/Rainy Day Fund and possibly the Delinquent Tax Revolving Fund;
  • Deferring capital expenditures and renegotiating existing leases
  • Workforce reductions are a possibility though no current reductions have been identified

Evans said the county has managed to "put our financial house back in order" over the last five years. But, considering the economic collapse that COVID-19 has wrought on the state and country, many governments will be filing similar reports.

RELATED: City of Detroit's COVID-19 budget triage plan of layoffs, pay cuts come into focus

That includes the city of Detroit, which is now up against a $348 million deficit. After registering surpluses following decades of financial downturn, the city is now tapping its resources to offset $300 million of that deficit. The rest will come from temporary layoffs and a shuttering of the city's blight program.

While Wayne County accounts for 18% of Michigan's population, it's home to almost half of the state's COVID-19 cases and deaths